Supreme Court Hears Argument to Decide Whether Fraud Allegations in State Reports are Public Disclosures

On November 30, the US Supreme Court heard oral argument in Graham County Soil & Water Conservation District v. United States ex rel. Wilson, No. 08-304 (“Graham County II”), concerning the “public disclosure” provision in Section 3730(e)(4)(A) of the False Claims Act. The public disclosure provision and the “original source” provision of the False Claims Act is intended to define the statutory bar against copycat whistleblowers who merely repeat what they have read or heard in public arenas, without having first-hand information of such information. The issue in Graham County was whether fraud publicly disclosed in a state (as opposed to a federal) administrative investigation or audit report are “publicly disclosed” for purposes of the FCA. Counsel for the Relator and for the the Government (from the Solicitor General’s Office) urged the Court to restrict the term “administrative to federal sources because of a “likelihood” that Congress believed that federal authorities would focus upon strictly federal sources. At oral argument, it seemed that the Justices were of the opinion that the statutory language was far from clear, and that the legislative history on the specific phrase is non-existent. Therefore it may be that the issue will be decided upon policy grounds taking into account the purposes of the False Claims Act as intended by its drafters.

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