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State-level False Claims Acts

The federal False Claims Act allows private litigants to file bounty-hunting actions against federal contractors for alleged overcharges, pocketing a share of the winnings if the actions succeed. It's developed into a prized cash cow for the emergent qui tam bar, which in turn eagerly urges states to adopt mini-False Claims Acts of their own. The Colorado Civil Justice League has been monitoring such a bill in Colorado, HB 1144, which as drafted would actually have gone significantly farther than the federal version of the law. ("CCJL Under the Dome", Feb. 2, currently on main page of CCJL site). Per the CCJL's fact sheet on the bill (PDF format), the drafted version would weaken defendants' due process protections compared with the federal law; eliminate specific intent to defraud for some violations; create a new claim for treble damages in cases of "inadvertent receipt" of funds with no intent to defraud; and allow copycats to collect bounties over alleged frauds already brought to light in another state. Following protests from the League, the bill's sponsor is said to have agreed to amend the bill so that it goes no farther than its federal equivalent. But what happens in states where the critics of this sort of thing are less well organized?

More on qui tam/False Claims Act litigation here.



Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.