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Key Differences Between State and Federal Whistleblowing Laws

Books and gavel

Whistleblowers are individuals who report illegal or fraudulent activity that is being carried out by an employer, an organization, or government. If an individual is employed by the organization they are making a complaint against, their employer may try to retaliate against them, but there are state and federal laws to protect whistleblowers.

Deciding whether to bring a state or federal whistleblowing complaint has implications for the success of a case and the award you may be entitled to—as much as 25 to 30% of the recovered funds. So it helps to know the difference between state and federal whistleblowing laws.

State False Claims Law—a whistleblower complaint falls under state False Claims Law when it involves damage or harm that has cost a particular state money. These are the facts about state False Claims complaints:

  • The penalties for violating the state False Claims Act include possible imprisonment, in addition to fines of $5,000 to $10,000 per claim.
  • The four states that have prosecuted fraud most aggressively—New York, Texas, Florida, and California—averaged $200 million each in recovered funds in 2010 alone.
  • Financial incentives for states to pass False Claims Law modeled on the federal False Claims Act has caused a significant increase in activity in state legislatures since the incentives were passed by Congress in 2005. The number of states enacting their own False Claims laws are expected to continue to grow.
  • Both federal and state False Claims Acts have laws that protect whistleblowers from being discriminated against, harassed, demoted, or fired for reporting suspected fraud.

Federal False Claims Law— a federal whistleblower complaint involves nationwide fraud or illegal activity. Here are the facts about federal False Claims complaints:

  • The penalties for violating the federal False Claims Act can total three times the amount of the claim, plus fines of $5,500 to $11,000 per claim.
  • 2017 saw the second highest amount ever for qui tam “whistleblower” recovered funds, with almost $426 million coming from lawsuits where federal government declined to get involved.
  • The federal Anti-Kickback Statute prohibits “the exchange of (or offer to exchange) anything of value, in an effort to induce (or reward) the referral” of federal health care program business. Violations are punishable with fines of up to $25,000, felony conviction and imprisonment of up to five years, or both, and may even result in exclusion from participation in Federal Healthcare Programs.
  • Keep in mind that the federal False Claims Act (FCA) does allow you to sue for damages under state and federal whistleblowing laws at the same time. So, for instance, if you file a complaint that involves damage to both the United States government as well as the state of Mississippi, you can file the entire case in Federal Court and, if successful, collect for damages to both those governments.

Choosing to File Under State or Federal Whistleblowing Laws

Where you choose to file a whistleblower complaint can determine whether you have a state or federal False Claims case. In fact, one of the most important decisions when making a whistleblower complaint is deciding the jurisdiction in which to file your claim. This may sound simple, but it is not.

An FCA lawsuit can be filed in any jurisdiction in which any of the defendants “can be found, resides, transacts business, or in which any [false claim] occurred”. This means there are a number of districts in which a claim can be filed, but the deciding factor should always be to file a claim in the venue that is most favorable for pursuing a case. Sound daunting? Finding out which can be the most favourable is best done by a professional.

A trustworthy and reliable law firm will be familiar with both federal False Claims Act case requirements and with the case requirements of fraud against the state of Mississippi.

A Specialist Law Firm Knows State and Federal Whistleblowing Laws

The False Claims Act is a complicated area of law that needs knowledgeable lawyers who have a reputation for successfully pursuing whistleblower lawsuits. These lawyers understand the intricacies of False Claims Act law and will know whether to file your case under state or federal whistleblowing laws for the best chance of success. At Coxwell & Associates, FCA attorney, Chuck Mullins, is licensed to practice in Mississippi as well as DC and West Virginia and has seen many cases through to a successful conclusion.

Mississippi State False Claims Law

Currently, there are seven states that have a False Claims Act that does not include a qui tam provision—qui tam is a violation of the False Claims Act. Although whistleblowers in these states cannot file state FCA lawsuits, they are able to file using a Whistleblower Law and Complaint Form – a form which each State investigative body is required to develop for use by a whistleblower. Mississippi is one of these states, along with Arkansas, Kansas, Missouri, Nebraska, Oregon, and Utah. There is a provision in Mississippi, Arkansas, Missouri, and Nebraska for whistleblowers to bring cases of Medicaid fraud or fraud involving any state healthcare program.

A further 12 states (Alabama, Alaska, Arizona, Idaho, Kentucky, Maine, North Dakota, Ohio, Pennsylvania, South Carolina, South Dakota, and Vermont) have neither a False Claims Act nor a qui tam statute. These states rely on generic Medicaid anti-fraud statutes that make submitting false or fraudulent Medicaid claims a crime. Of course, whistleblowers in these states can still bring a federal False Claims Act case against individuals or businesses they believe are involved in fraudulent activity. Living in Mississippi, we are lucky to have the whistleblowing laws that we do.

Correct Reporting of Your Case Could Award You With a Percentage of the Recovered Funds

If you would like more information about how you as a whistleblower can be protected and rewarded, you can download our Essential Guidance On Qui Tam and Whistleblower Lawsuits. This helpful guide includes key terms, common types of Medicaid and Medicare fraud, negative consequences for whistleblowers, and a fraud checklist: if you suspect fraud, what do you do next?

Coxwell & Associates investigates FCA cases across the state of Mississippi. If you are an employee at a facility and have witnessed any type of fraudulent Medicare or Medicaid billing, please contact Chuck Mullins at Coxwell & Associates. Report your case correctly and you could be awarded 25 to 30% of the recovered funds. We will also look at any other type of government fraud cases across the state so please reach out to us for advice.

Disclaimer: This blog is intended for general information purposes only, and is not a substitute for legal advice. Anyone with a legal problem should consult a lawyer immediately.