Kasowitz decision precludes use of the False Claims Act to usurp regulators’ role and collect bounties for never-adjudicated violations.

The United States Court of Appeals for the D.C. Circuit issued a decision in United States ex rel. Kasowitz v. BASF et al., No. 18-7123, on July 5, 2019, rejecting relator Kasowitz Benson Torres LLP’s (Kasowitz), two “novel” theories of False Claims Act (FCA) liability premised on defendants’ alleged reporting violations under the Toxic Substances Control Act (TSCA). It was “undisputed” that the Environmental Protection Agency (EPA), which administers TSCA, had never assessed penalties for the alleged violations. Accordingly, Kasowitz could not use the FCA as a vehicle to usurp EPA’s role and establish that defendants owed the penalties and further that defendants defrauded the government by failing to pay the penalties.