In a qui tam (pronounced Kee-tam) action a private party (person or entity) brings an action by filing a lawsuit or claim on behalf of the government. The private party is called the relator and the government is the real plaintiff.
For example, under the federal False Claims Act a private party may bring a qui tam action against a party who has defrauded the federal government by submitting false claims for goods or services. See 31 U.S.C. §3279. If the lawsuit or claim is successful, the relator may receive up to 30% of the government’s recovery.
Because the relator is bringing the fraud to the attention of the federal government they are sometimes referred to as whistleblowers and the lawsuit or claim may be referred to as a whistleblower action.
Qui tam actions may originate in most any of the federal government’s departments, but two of the most common are the military (defense contractors selling goods and services to the U.S. government) and health care (Medicare and Medicaid services sold to the U.S. government). The Fraud Section of the United States Department of Justice generally investigates qui tam claims.
Most states also have a law known as the False Claims Act that that provides for qui tam or whistleblower actions brought on behalf of the state government. These laws vary from state to state and are usually located in a state’s statutes.
In Delaware, similar to the federal False Claims Act, there is a state-level statute that allows for qui tam actions, where a private party, known as a relator, can bring a lawsuit on behalf of the state government against individuals or entities that have defrauded the state. This is typically found in the Delaware Code. The relator, often referred to as a whistleblower, may be entitled to a portion of the recovered funds if the action is successful. The percentage of the government's recovery that the relator may receive varies and is determined by specific provisions within the Delaware False Claims Act. These actions can arise from various sectors, but are commonly associated with healthcare and defense contracting, where fraudulent claims for payment to the state government are made. The Delaware Department of Justice would typically be involved in the investigation and prosecution of such claims. It's important for relators to understand the specific requirements and procedures under Delaware law when considering a qui tam action.