St. Thomas Law Review

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Every year, fraudulent activity against the United States government costs taxpayers billions of dollars. The majority of these losses result from acts of fraud against federal health care programs like Medicare and Medicaid, and to a lesser extent, from matters involving contracts with the government for the purchase of goods and services. However, the United States Department of Justice (“DOJ”) fights back to regain lost taxpayer dollars by taking action under the False Claims Act (“FCA”), which imposes liability on such types of government fraud. Since 1986, actions taken by the DOJ resulted in the recovery of over $64 billion in settlements and judgments in cases involving fraud and false claims. In fiscal year 2020 alone, the DOJ recovered over $2.2 billion, and saw even more success in the prior year when it recovered over $3 billion. The DOJ does not achieve such victories and recover billions of dollars stolen from taxpayers all on its own—whistleblowers lead the charge and prove to be vital to the Department's success. Under the FCA, any private individual or whistleblower may sue other individuals and corporations for perpetrating fraud against the government. The role these private suits played in combating fraud compounded with every passing year, and in fact, the number of cases filed in a single year peaked in 2020. Often times, at the cost of great sacrifices, these suits are brought by brave employees against their employers on behalf of the government. To encourage employees to actually utilize this statute, the FCA contains an anti-retaliation provision that provides relief to employees when their employers retaliate against them for exposing fraudulent activity. Nonetheless, a pressing issue lies with whether the anti-retaliation provision’s protections extend to former employees. Since November 6, 2018, only the Tenth Circuit Court of Appeals addressed this issue in Potts v. Ctr. for Excellence in Higher Educ., Inc. The Tenth Circuit held the FCA’s anti-retaliation provision only extended protections to employees who were current employees at the time of retaliation. However, on March 31, 2021, the Sixth Circuit Court of Appeals reached an opposite conclusion in United States ex rel. Felten v. William Beaumont Hosp. when it held that the term “employee” under the FCA provided anti-retaliation protections to victims of post-employment retaliation. This Comment addresses the Sixth Circuit’s decision to interpret the term “employee” more broadly than the Tenth Circuit and the effect it has on FCA claims across the nation. Part II provides background on the history of the FCA, its anti-retaliation provision, and the legislative intent supporting the provision. Part II also explains how individuals who learn of fraudulent conduct can bring claims under the FCA, as well as the types of protections the FCA provides to whistleblowers. Further, Part II explains how the Tenth and Sixth Circuits reached opposite conclusions on whether the term “employee” under the FCA was broad enough to provide protections to former employees. Next, Part III addresses the United States Supreme Court’s analysis when it interpreted the term “employee” in the anti-retaliation provision of Title VII, which was the basis upon which the Sixth Circuit interpreted the term “employee” in its own analysis. Part III also explores how a narrow interpretation of the term “employee” undermines the purpose of the FCA when former employees are excluded from receiving the same protections. Finally, Part III illustrates how a narrow interpretation of the term “employee” perpetuates and exacerbates the gross injustices that result from employer retaliation. Part IV proposes a legislative and judicial solution to the circuit split. Congress should revisit the FCA, and make a statutory amendment that clarifies the definition of the term “employee” to include protections for former employees. Alternatively, if Congress is unable to reach a consensus to amend the FCA, the United States Supreme Court should grant certiorari on appeal and apply the same reasoning used when it held that an “employee” in Title VII’s anti-retaliation provision includes former employees—thus, the Supreme Court should similarly hold that the FCA’s anti-retaliation provision extends protection to former employees.