elections
Georgia Taxpayer Protection False
Claims Act: The Peach State Gets Tough
on Fraud against the Government
[email protected]
By Theresa A. Vitello
Levy, Phillips & Konigsberg, LLP
szinns@lpklaw.
Sharon J. Zinns
Levy, Phillips & Konigsberg, LLP
G
eorgia’s Taxpayer Protection False Claims Act
became effective on July 1, 2012. Georgia’s newest
whistleblower law is not its first, but it is its most
expansive. While an earlier Georgia law only protected
government employee whistleblowers and, another, just
pertained to Medicaid Fraud, the latest law allows any person
with first-hand knowledge of fraud against the government
occurring within the State’s counties, municipalities, school
districts, hospital authorities, transit system (MARTA) and any
political subdivisions, to be rewarded for coming forward with
information which leads to the recovery of taxpayer dollars.
The new law largely mirrors the Federal False Claims Act
which dates back to the Civil War. To date, the Department
of Justice has recovered over $30 billion under the
Federal False Claims Act with the assistance of credible
whistleblowers, who receive 15-25% of the government’s
recovery in an intervened case.
The Georgia Taxpayer Protection False Claims Act contains
the same liability and damage provisions as the federal
act. False claims presented to the government for payment
must be submitted knowingly. However, knowing conduct
also includes actions taken in deliberate ignorance or in
reckless disregard of the truth or falsity of the information.
Damages may be trebled and civil penalties of not less
than $5,500 and not more than $11,000 for each false or
fraudulent claim may be imposed on fraudsters. Unique to
Georgia’s Act, if the individual or company committing the
fraud cooperates fully with the government and, did not have
actual knowledge of the fraud, the damages may only be
doubled. The whistleblower’s attorney’s fees and expenses
are also recoverable, if the case is successful.
Like the Federal False Claims Act, once the case is filed, it is
placed under seal for sixty days to allow the government to
conduct an investigation without the defendant’s knowledge.
This sixty day time period may be extended with the consent
of the court. Should the government decide to intervene
in the case, it assumes control of the litigation, and the
whistleblower, known as a relator, becomes a participant in
the government’s case.
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THE ATLANTA LAWYER
November 2012
Should the government decline the case, the relator has
the opportunity to continue to prosecute the case with his
or her whistleblower attorney. The government still retains
the option to intervene in the case at any time. Should the
relator in a non-intervened case be successful, he or she
will receive 25-30% of the total recovery.
Some other important features of Georgia’s Taxpayer
Protection False Claims Act include:
• A requirement that a private person wishing to file an
action obtain the written consent of the Attorney General.
See O.C.G.A. § 23-3-122(b)(1).
• An anti-retaliation provision, which provides for job
reinstatement, two times the amount of back pay, interest
on the back pay, and compensation for any special
damages including litigation costs and attorney’s fees.
See O.C.G.A. § 23-2-122(l)(1)-(2). The retaliation action
must be brought within three years of the retaliatory
activity. Id. at § 23-2-122(l)(3).
• A relaxed pleading standard for fraud which explicitly
does not require the relator to identify specific claims
that result from the fraudulent conduct, but only facts,
that if proven true, would create a “reasonable indication”
that the Act was violated. See O.C.G.A. § 23-3-123(c).
As with the Federal False Claims Act, the person who comes
forward first and with the best information gets the opportunity
to be rewarded. Commonly, what an attorney may see
as a retaliation or breach of contract case may also be a
false claims act case. So, the next time you come across
an employment, contract or healthcare case, think about
whether you can achieve better results for your client by also
filing a claim under the Georgia Taxpayer Protection Act. ■
The Official News Publication of the Atlanta Bar Association