4th Circ. Leaves 'Excessive' FCA Fines Up In The Air

Law360, New York (January 9, 2014, 8:58 PM EST) -- Government contractors and health care companies had hoped the Fourth Circuit would support the elimination of a $24 million statutory penalty in a False Claims Act case with no established damages, but the appeals court's reinstatement of the fine instead leaves defendants wondering when exactly high FCA penalties become too punitive to stand.

The FCA allows the government and relators to pursue treble damages based on the harm to the government, as well as $5,500 to $11,000 in civil penalties per violation of the law. Many courts, including the Fourth Circuit, have interpreted the civil penalty as being triggered once for...

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