Summary
This D.C. Circuit opinion affirms the dismissal of a False Claims Act qui tam action alleging fraud in Federal Communications Commission wireless spectrum auctions. The court concluded that the relators' allegations were substantially the same as those publicly disclosed in a prior 2008 lawsuit, thereby triggering the statute's public disclosure bar. Furthermore, the court determined that the relators did not meet the stringent requirements for the original source exception, as their additional details did not materially add to the publicly known facts.
Topics
Practice areas
Questions Presented
- Whether the FCA public‑disclosure bar applies to the relators’ qui tam action
- Whether the relators qualify as original sources under the FCA’s original‑source exception
Holdings
- The public‑disclosure bar applies because the relators’ allegations are substantially the same as those disclosed in the 2008 qui tam action; the action must be dismissed.
- The relators are not original sources because they did not voluntarily disclose the information to the Government before the public disclosures and their additional information does not materially add to the prior disclosures.
Key quotations
“The public disclosure bar now operates as an affirmative defense.” (at 276)
“Relators do not qualify as an original source because their additional information does not materially add to the public disclosures.” (at 276)
Factual background
Relators alleged that U.S. Cellular used sham small‑business entities (Carroll, Barat, King Street) to obtain FCC bidding credits intended for genuine small businesses. The scheme was previously disclosed in a 2008 qui tam action. Relators presented new evidence of post‑licensing fraud, including a 2011 network sharing agreement, but the underlying fraud remained the same.
Procedural history
The district court dismissed the qui tam action under the FCA public disclosure bar because the allegations were substantially the same as those disclosed in a prior 2008 qui tam suit and the relators were not original sources. The appellants appealed.