If a whistleblower brings a False Claims Act (FCA) claim against a defendant, and the government forgoes intervening in the FCA case and instead chooses to pursue criminal prosecution and forfeiture proceedings, the Eleventh Circuit has found that the FCA whistleblower is barred from intervening and participating in the related criminal forfeiture proceedings. See United States v. Couch,  2018 WL 5019480 (11th Cir. Oct. 17, 2018).

Typically, when a private person brings an FCA claim against a defendant as a qui tam action, the government may choose to intervene and take over the action or pursue “any alternate remedy available.” 31 U.S.C. § 3730(c)(5).  If the government pursues  an “alternate remedy,” the FCA provides a qui tam relator the same rights “in such proceeding” as he or she would have had if his or her FCA case had continued.  Id.

In United States v. Crouch, the Eleventh Circuit addressed this provision of the FCA in a whistleblower FCA lawsuit filed by Lori Carver in August 2013 against her former employer, Physicians Pain Specialists of Alabama PC.  The government did not intervene in Carver’s FCA case, which is ongoing, but instead brought criminal charges based on charges which “partially overlapped with the allegations in Ms. Carver’s qui tam complaint.”  See United States v. Couch, 2018 WL 5019480, at 5 (11th Cir. Oct. 17, 2018).

The Eleventh Circuit held that an FCA whistleblower cannot intervene and participate in criminal forfeiture proceedings.  “In contrast to the precision of the forfeiture statutes, the alternate-remedy provision does not expressly provide a right of intervention in an ‘alternate proceeding,” the Eleventh Circuit found. “Neither does it define ‘alternate remedy’ to include criminal fraud prosecutions. The specific bar on intervention in the criminal forfeiture provisions controls our interpretation of the alternate-remedy provision’s general terms here.”  Id. at 11-12.

Notwithstanding Ms. Carver’s inability to intervene and participate in the criminal forfeiture proceeding, if she is successful in her FCA claim, she would be able to recover her relator’s share.

The case  United States v. Couch, 2018 WL 5019480 (11th Cir. Oct. 17, 2018) can be found here.