Hogan Lovells Publications | ADG Insights | 06 April 2017

Top False Claims Act developments in 2017 for ADG companies

The False Claims Act, 31 U.S.C. §§ 3729-3733, continues to pose unique liability risk for aerospace, defense, and government services (ADG) companies that directly or indirectly conduct business with the U.S. Government.

In 2016, the U.S. Department of Justice (DOJ) obtained more than US$4.7bn in settlements and judgments from civil cases involving alleged FCA violations and fraud committed against the Government. This represented roughly a 34 percent increase compared to amounts obtained in 2015. FCA lawsuits continue to be initiated often by whistleblowers under the statute’s qui tam provisions. Of the US$4.7bn obtained in 2016, US$2.9bn related to lawsuits filed by individual whistleblowers. The number of whistleblower-initiated qui tam lawsuits exploded to 702, or an average of 13.5 cases every week. Although the Health Care and Finance industries were most often the focal point of large FCA recoveries, the ADG industry continues to be a significant target for qui tam relators and Government enforcement authorities.

The following presents a discussion of the most significant FCA issues likely to impact the ADG industry in 2017.

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