Under the False Claims Act, whistleblowers who uncover fraud against the government can file a civil action to recover damages. One important consideration when filing these actions is the heightened pleading standard in fraud cases.
Rule 9(b) of the Federal Rules of Civil Procedure requires that a complaint of fraud “state with particularity the circumstances constituting fraud.” Many federal courts have interpreted this as requiring the who, what, when, where, and how of the fraud.
Recently, the Fourth Circuit rendered an important decision outlining the specific requirements of Rule 9(b) as it applies to whistleblower suits under the False Claims Act. In United States ex rel. Grant v. United Airlines Inc., 912 F.3d 190 (4th Cir. 2018), the court stated that whistleblowers must “provide ‘some indicia of reliability’ to support the allegation that an actual false claim was presented to the government.” Id. at 194–95 (quoting United States ex rel. Nathan v. Takeda Pharm. N. Am., Inc., 707 F.3d 451, 457 (4th Cir. 2013)). This can be accomplished in two ways: (1) alleging the specific false claims submitted to the government or (2) alleging “a pattern of conduct that would ‘necessarily have led[ ] to submission of false claims’ to the government for payment.” Id. (quoting Nathan, 707 F.3d at 457).
This pleading requirement is critical to any whistleblower claim. If Rule 9(b) is not precisely followed, the entire complaint can be dismissed.