Supreme Court tightens scope of False Claims Act

The decision could hamper physician whistle-blowers but help doctors targeted in weak fraud cases, experts said. By Amy Lynn Sorrel, AMNews staff. July 28, 2008

The June opinion stemmed from a conflict in the lower courts over whether those who do not bill the government directly, but go through another entity that contracts with the U.S., can be held liable under the False Claims Act for fraudulently obtained funds.

The high court unanimously said yes, but with some limitations.

Justices clarified that the plaintiffs must show that the defendants intended to defraud the U.S. and not another entity, and that the alleged false statement was relevant to the government's decision to pay the claim.