Supreme Court Finds That Courts Have Discretion to Fashion Remedy for Violations of False Claims Act Seal Provision: State Farm Fire & Casualty Co. v. U.S. ex rel. Rigsby

Dear Readers:

The Supreme Court today handed down its unanimous decision in State Farm Fire & Casualty Co. v. U.S. ex rel Rigsby et al, and affirmed the 5th Circuit's ruling that a relator's violation of the False Claims Act's "seal" provision, 33 U.S.C. § 3730(b)(2), does not require dismissal of the relator's qui tam complaint. I assume this ruling was widely anticipated since, as the Court pointed out, there is nothing in the False Claims Act's "text and structure" that requires dismissal of a relator's qui tam in the event a relator violates the seal. As to what sanction, including dismissal, may be appropriate for a violation of the seal, the Supreme Court left that to the "sound discretion of the district court." 

For those seeking further details about the Rigsby decision, I commend to you Ronald Mann's analysis of the Court's opinion found on SCOTUSblog: Opinion analysis: Justices reject automatic dismissal for seal violations in False Claims Act cases.

A. Brian Albritton
December 6, 2016