The U.S. Department of Justice Civil Division (Department) issued a Memo dated January 10, 2018 (Granston Memo), directing Department of Justice attorneys to more seriously consider dismissing False Claims Act (FCA) cases filed by whistleblowers. The Granston Memo enumerated several factors that prosecutors should consider when evaluating dismissal of qui tam actions. As the number of qui tam actions filed under the False Claims Act has substantially increased, the Granston Memo is an important tool in response to the strained government resources needed to evaluate, participate, and/or monitor these cases.
Although the seven factors laid out by the U.S. Attorney’s Office assist in making a decision on whether or not to seek dismissal, the Memo clearly indicates that the list is not exhaustive. The following factors were enumerated:
- Curbing Meritless Qui Tams – Simply put, if the qui tam is defective or factually lacking in merit or is frivolous;
- Preventing Parasitic or Opportunistic Qui Tam Actions – If the action duplicates a preexisting government investigation (and otherwise adds no useful value to the investigation);
- Preventing Interference with Agency Policies and Programs – If the Department determines that the action threatens to interfere with an agency’s policies or the administration of its programs;
- Controlling Litigation Brought on Behalf of the United States – When necessary to protect the Department’s litigation prerogatives;
- Safeguarding Classified Information and National Security Interests – In cases involving intelligence agencies or military procurement contracts, if needed to safeguard classified information;
- Preserving Government Resources – If the government’s costs are likely to exceed expected gain; and
- Addressing Egregious Procedural Errors – If the action otherwise frustrates the government’s efforts to conduct an investigation.
In addition, according to the Department, dismissal is not “all or none,” but rather partial dismissal may be appropriate in some cases. The Granston Memo also provides that Department attorneys should also consult any affected agency to discuss whether dismissal is warranted under the factors set forth in the Memo.
If the government declines to prosecute, defense counsel could advocate for the dismissal of the case based on these factors. While there is some debate over whether the Granston Memo will in practice result in more dismissals of qui tam actions, it provides defense counsel with Department guidance that could be incorporated in their presentation to the government, which could be particularly effective if Defense counsel were to quickly address these issues at or around the time of the government’s declination to intervene.