In the latest issue of The Wright Toolbox:
ASBCA Makes Headway
By Don Walsh
The Armed Services Board of Contract Appeals (ASBCA) released its annual report describing its case activity for FY 2018 on Oct. 10, 2018. It presented some mindful statistics for contractors wishing to pursue claims with the DOD.
- Of the 139 cases decided on the merits, the Board found merit in 69%.
- Demonstrating the success of the Board’s promoted ADR process, of the 420 cases dismissed, the vast majority were dismissed only after the parties reached an amicable settlement and there were 21 resolved utilizing the Board’s ADR process.
- Although the ASBCA started the year with 970 pending appeals, its total pending appeals decreased to 901 pending appeals which is considered the lowest level since Oct. 1, 2013.
- Contractors also requested expedited or accelerated appeals under Rule 12 for 20 appeals in FY18.
- Not surprising, the majority of cases still originate from contracts with the Army Corps of Engineers. USACE has the highest percentage of active appeals at 30.4 percent. The following table illustrates the breakdown of cases per agency:
Agency FY17 FY18
Army 138 75
Navy 77 93
Air Force 48 61
Corps of Eng. 161 127
DLA & DCMA 92 89
Other Agencies 8 20
- Out of 559 cases disposed of in FY18, including 129 decisions determined on the merits, only nine appeals were docketed with the Federal Circuit.
The process of pursuing claims from the government can be influenced by where you file. Your decision can be influenced by how you wish to handle discovery, the use of alternative methods of dispute resolution as well as the success of various issues before the various Board of Contract Appeals. Reach out to WCS’ Government Contracts group to discuss the relative merits before you make an election.
DOJ Issues False Claims Act Report For Fiscal Year 2018
On December 21, 2018, the Department of Justice (“DOJ”) issued its report for Fiscal Year 2018 on False Claims Act Recoveries. The DOJ announced that it obtained more than $2.8 billion in settlements and judgments from civil cases involving fraud and false claims against the government during 2018. The total recovered amount has been falling for the past few years. In 2017 total recoveries were $3.7 billion and in 2016 total recoveries were $4.7 billion. The False Claims Act was originally enacted during the Civil War to protect against rampant fraud perpetrated against the United States military. The Department of Justice stated that it “has placed a high priority on rooting out and pursuing those who cheat government programs for their own gain.” Of the $2.8 billion in settlements and judgments recovered in 2018, $2.5 billion involved the health care industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organizations, laboratories, and physicians. This is the ninth consecutive year that civil health care fraud settlements and judgments have exceeded $2 billion.
The False Claims Act permits private individuals to assert False Claims Act claims in qui tam suits as “relators” or whistleblowers. Typically, the whistleblower actions comprise a substantial percentage of the False Claims Act cases that are filed each year. In 2018, whistleblowers filed 645 qui tam suits and recovered over $2.1 billion. The government paid out $301 million to the individuals who exposed fraud and false claims by filing these whistleblower actions. The threat of FCA exposure is always present and can come from multiple sources including disgruntled current or former employees, customers or vendors or “professional” whistleblowers who target certain industries and review publicly available information to generate claims. Compliance audits and operational reviews are important in protecting against FCA claims. Contact us to learn how to protect yourself from FCA exposure.
To browse past issues, visit The Wright Toolbox page.