When current or former employees or clients blow the whistle on alleged corporate wrongdoing, it can create the potential for significant legal liability. It can even create the possibility of criminal charges being filed.

Here are five keys to success in beating these whistleblower allegations.

1. Challenge the Qui Tam Filing, Including the Technicalities

In many cases involving federal government funding, the whistleblower pursues a qui tam claim against the company, alleging that the corporation’s fraud or misconduct earned it taxpayer money. Qui tam claims are favorites for whistleblowers because the individual stands to receive up to 30 percent of what is recovered and, should the government decide to intervene in their case, they may not even have to pursue it on their own.

Qui tam lawsuits, however, are notoriously tricky to file. There are nuanced procedures that have to be strictly followed, and many qui tam plaintiffs do not use attorneys who are experienced in this unique field of law. Challenging the technicalities on the filing can get it dismissed, or can convince the government not to intervene in a case that has been so poorly put together.

2. Be Aggressive But Tactful with the Whistleblower

One of the biggest keys to winning in a whistleblower complaint situation is to manage the whistleblower appropriately.

Generally, companies will not know the whistleblower’s identity until a formal complaint has been filed and discovery is underway. Once the whistleblower’s identity is known, though, it should be one of the focuses of the defense strategy. The informant should almost always be deposed, and the true motive of his or her actions should be uncovered.

In many cases, the whistleblower is acting out of self-interest. They are often accusing the company of wrongdoing because they:

• Stand to gain, financially, from blowing the whistle and recovering part of the proceeds of the case
• Hold a grudge against the company
• Were recently terminated and want to exact revenge
• Are worried that they are about to get demoted, transferred, or terminated and want to make use of whistleblower protection against retaliation to delay things

If it becomes clear that one of these motives is in play, they should be a central component of the defense strategy and should be brought up whenever possible, especially if the evidence of wrongdoing is flimsy or incomplete.

However, if the whistleblower’s motives are largely in the public interest and he or she has a credible persona, aggressively attacking their intentions can backfire. Not only do these attacks miss the substance of the claim; but they can also make the company look bad.

As Dr. Nick Oberheiden, founding partner of the whistleblower defense law firm Oberheiden P.C., says, “The attitude that the defendant company takes towards the whistleblower needs to be appropriate and consistent throughout the case. Taking the wrong approach can make the case much more difficult to defend.”

3. Keep the Government from Intervening

In many whistleblower cases, the government has the option of intervening on the whistleblower’s behalf and prosecuting the case. Preventing this intervention from happening is possibly the most important key to success.

Just look at the numbers. According to the Civil Division of the Department of Justice (DOJ), in 2021 qui tam cases collected:

• $1,186,717,879 (over $1.1 billion) in cases where the Division intervened
• $479,009,230 (less than $480 million) in cases where the Division declined to intervene

The difference is even more striking given how the government only intervenes in about a quarter of the qui tam allegations that they review.

The reasons for the difference are not surprising, though. The government brings far more resources into the federal investigation than the whistleblower can have access to. Additionally, government intervention generally only happens if the law enforcement agency thinks that the case is strong – it will tend to decline to intervene in flimsy or weak cases.

Convincing the government to decline, then, is a key part of a whistleblower defense strategy. It isolates the whistleblower and serves as a strong indication that their case is a long shot.

4. Keep Public Relations and the Company’s Brand in Mind

Something that many companies overlook during a whistleblower claim is their brand as a business. While the legal liability at stake in the whistleblower’s case can be significant, so too can the negative perception that the company can get if it responds to the claim in a way that the public deems inappropriate.

This can happen if the company aggressively attacks a credible whistleblower that has the empathy of the public, refuses to change its ways while the case is pending, or settles the claim in a way that admits to guilt or wrongdoing.

Unfortunately, the long-term fallout that a whistleblower’s case will have on the business’ brand and reputation are difficult to predict. The experience that a whistleblower attorney has accumulated from prior cases can serve as an important resource for businesses that recognize the need to think about the future of their company while dealing with the whistleblower case.

5. Do Not Retaliate Against the Whistleblower

Finally, companies should refrain from retaliating against the whistleblower for two reasons.

First, whistleblowers are generally protected from whistleblower retaliation claims by the law under which they are alleging misconduct. For example, the False Claims Act (31 U.S.C. § 3730(h)) forbids employers from discharging, demoting, suspending, threatening, harassing, or otherwise discriminating against employees, contractors, or other agents who blow the whistle on them under the False Claims Act. Employers who do so face significant consequences, including:

• Reinstating the worker with the same seniority status
• Paying twice the amount of back pay that the worker would have earned
• Paying interest on the back pay
• Covering special damages that were suffered as a result of the adverse employment action, including the whistleblower’s court costs and attorneys’ fees

Second, retaliating against a whistleblower makes it seem as if the company is guilty of the wrongdoing being alleged. Not only can retaliating against the worker create a new legal case with the potential to go to trial, but it can also make it more difficult to defend against the current one. It will also hurt the company’s reputation if the case gets any media attention.