Given the potential for retaliation from their employers and others, whistleblowers often understandably express concerns about protecting their identity when reporting potential wrongdoing. While whistleblowers file False Claims Act complaints under seal, which protects the whistleblowers' confidentiality for at least 60 days, it is very likely that, sooner or later, whistleblowers' identities will be made public. If the Government intervenes in a False Claims Act case, the seal will be lifted and the whistleblower's allegations will become publicly available. Similarly, if the Government declines to intervene in a False Claims Act case, and the whistleblower decides to continue to prosecute the case without Government involvement, the seal will be lifted, again making the whistleblowers' allegations public.
What if the Seal has not been Lifted on a Whistleblower Case?
But what if the Government declines to intervene in a False Claims Act case, and the whistleblower decides not to proceed with the case? Can the whistleblower dismiss the case while it is still under seal, and prevent his or her identity and allegations from becoming public? A few cases attempt to answer this difficult question.
- United States ex rel. Wenzel v. Pfizer, Inc., 2012 WL 3194481 (D. Mass. July 25, 2012)
In Wenzel, the court rejected a whistleblower's attempt to keep his case sealed through dismissal. There, the whistleblower alleged that Pfizer illegally marketed Zyvox for off-label uses. After the Government declined to intervene in the case, the whistleblower sought to voluntarily dismiss his complaint, and asked the court to keep his case under seal after the dismissal so that his identity would remain confidential. The Government objected to the whistleblower's request.
The court explained that there is a "general rule in favor of unsealing" False Claims Act cases after the Government conducts its initial investigation and decides whether to intervene. In the court's opinion, the 60-day time period that qui tam cases must remain sealed "reflects Congress' desire to have the seal lifted after the Government conducts its initial investigation and decides whether to intervene." United States ex rel. Herrera v. Bon Secours Cottage Health Servs., 665 F.Supp.2d 782, 784–85 (E.D. Mich. 2008); see also United States ex rel. Health Outcomes Techs. v. Hallmark Health Sys., Inc., 349 F.Supp.2d 170, 173 (D. Mass. 2004) (“the statute clearly contemplates that the complaint be unsealed once the government has acted with respect to intervention.”). The Wenzel court explained that the general rule, however, "is subject to the privacy rights of participants and third parties," and if, for example, "particularized evidence demonstrates that the unsealing of a qui tam complaint would threaten a litigant's personal privacy or safety, courts have the discretion to maintain a complaint under seal . . . and to unseal a complaint with redactions." Nonetheless, as the court in Wenzel recognized, most courts have held that "a relator's general fear of retaliation is insufficient to rebut the presumption of public access," in part because retaliation concerns are mitigated by the False Claims Act's anti-retaliation provision, 31 U.S.C. § 3730(b)(2).
Despite the whistleblower's concerns about having his credibility attacked, and being stigmatized and ostracized by the healthcare industry in which the whistleblower and his wife were still employed, the court found the whistleblower's concerns were merely "conjectural," and that he provided "no evidence of any specific threat of retaliation by any particular individual or company." Accordingly, the court held that the whistleblower failed to present privacy concerns sufficient to override the presumption in favor of unsealing the case to allow public access. Similarly, the court rejected the whistleblower's request to have only portions of the court record redacted to conceal his identity, because doing so would have kept a significant portion of the record sealed and would have prevented the possible application of the False Claims Act's public disclosure bar to future, similar suits against Pfizer.
- United States ex. rel. Brian Eberhard v. Angiodynamics, Inc., 2013 WL 2155327 (E.D. Tenn. May 17, 2013)
In Eberhard, the court addressed the question of whether to simultaneously dismiss and permanently seal a False Claims Act case. The United States government, which declined to intervene in the case, consented to the dismissal of the case while notifying the court that it opposed the relator's motion to keep the case under seal.
Brian Eberhard, the whistleblower, worked at Angiodynamics, a manufacturer and distributor of medical devices, for approximately two years as a sales consultant. In his complaint, Eberhard alleged Angiodynamics used product promotions, provided free "swap out" services (whereby customers would receive updated versions of medical devices for free), provided discounted prices, and hosted client dinners to generate business. Eberhard further alleged that the doctors and hospitals receiving these benefits would fail to report the discount prices or free "swap out" services when they billed federal and state payors for the products given to them by Angiodynamics, and thereby submitted false claims.
Eberhard, like many relators, feared retaliation due to the fact that he remained employed in the medical device industry, although he was no longer employed by Angiodynamics. Relying on a similar rationale as the court in Wenzel, the Eberhard court concluded that "a permanent seal would require the relator to overcome the strong presumption in favor of public access, that sealing of court records is not warranted absent the presence of a factor sufficient to outweigh the strong interest in public access, such as national security considerations, trade secrets, personal privacy interests, and personal safety concerns." (Internal quotations omitted.)
In Eberhard, the court found that the relator had not provided sufficient justification for a departure from "the well-grounded and strong presumption in favor of public access." For the court to justify the permanent sealing of a case, it would need evidence beyond a showing of possible or plausible economic harm. The court acknowledged it would be more inclined to depart from the precedent that clearly favors public access in situations "involving national security, trade secrets or personal safety." The court accordingly dismissed the case, and denied the relator's motions to permanently seal and/or redact the case.
How to Be an Anonymous Whistleblower
In short, situations in which courts are willing to keep sealed whistleblower cases and relator identities will be rare. It is worth mentioning there are a few additional methods through which relators seek to remain anonymous when blowing the whistle in an FCA case, although such methods are likely no more effective than attempts to keep cases sealed, discussed above, and create additional complications for the case. A relator could file as a “Jane Doe,” meaning his or her name would not appear on the complaint, the initial document filed in the case, but important identifiers like job title and time in the organization would likely still have to be disclosed. Moreover, the whistleblower's identity might be referenced or revealed in other case filings, and the redaction or other concealment of such information would be subject to the same standards discussed in the cases discussed above. Alternatively, Relators might create a corporation or LLC in whose name the whistleblower complaint might be filed to avoid disclosing their identity. But this process presents the same drawbacks as filing as a "Jane Doe," and might create additional obstacles because the corporate whistleblower would have a separate legal existence from the whistleblower.
Whistleblower Retaliation Protection
While whistleblower confidentiality in False Claims Act cases is rare, the Act does provide relators protection from retaliation by their employers and the broader industry in which they are employed when they report claims of fraud on the government. Understanding the options available to whistleblowers if they do face retaliation is essential. The False Claims Act includes an anti-retaliation provision that prevents an employer from suspending, firing, threatening, harassing, or discriminating against an employee who has reported or attempted to stop an employer from partaking in fraudulent activities.
For a whistleblower to successfully sue his or her employer for unlawful retaliation, the False Claims Act requires that the whistleblower show that he or she was (a) engaged in a "protected activity," (b) the whistleblower's employer engaged in retaliatory behaviors, and (c) that the retaliation occurred because of the whistleblower’s involvement in a "protected activity." So while whistleblowers typically cannot keep their identities confidential, they have legal remedies when disclosure results in unlawful reprisals.
Contact Whistleblower Attorneys Today
If you are aware of fraud against the government and have questions about how to proceed with an FCA case as a whistleblower, call Goldberg Kohn at 312-284-3258 or contact us online. We are always willing to provide you with a free, confidential consultation to discuss a potential case.