Senator Grassley Questions Use of DOJ Memo

WASHINGTON – Senator Chuck Grassley (R-Iowa) is seeking details on the role of Justice Department (DOJ) guidance in government’s efforts to dismiss claims of fraud against taxpayers. The 2018 Granston memo issued by DOJ’s Commercial Litigation Branch outlines when DOJ can seek to dismiss fraud cases brought by whistleblowers on behalf of the government. Those cases have led to the recovery of more than $59 billion in taxpayer dollars lost to fraud since 1986.

“Congress gave whistleblowers the ability to proceed with claims on their own precisely for situations in which DOJ either would not or could not pursue the case. We know from experience that without whistleblowers, fraudsters multiply and bad behavior balloons,” Grassley said in a letter to Attorney General William Barr.

Grassley championed the 1986 update to the False Claims Act, which allows whistleblowers alleging fraud against the government to file qui tam suits on behalf of the government and share in any recoveries. In some cases, the government has chosen not to intervene on behalf of the whistleblower (often referred to as the relator, in the case), but is still a party to the case as the alleged victim of fraud. The new guidance allows for the government to seek a case’s dismissal for a number of vague reasons, including the preservation of government resources. Since the memo was issued, the government has used that rationale to pressure courts to dismiss cases—arguing that litigation would be too burdensome—without having first performed a sufficient cost-benefit analysis.

“The facts show that the False Claim Act is working. The qui tam provisions have reinvigorated an Act which had been mostly left for dead after the 1940s. In order for the law to continue working, DOJ must let the qui tam provision work the way it was intended and allow relators to proceed with litigation on their own,” Grassley wrote.

Grassley’s letter outlines a number of examples in which the government has moved to dismiss cases on grounds outlined in the memo without first conducting cost-benefit analyses or other evaluations of the merits of a case. In the letter to Barr, Grassley is seeking details on how the DOJ is using the memo and whether it is concerned that the memo will create perverse incentives for alleged fraudsters to engage in abusive litigation tactics to prompt a case’s dismissal.

Full text of Grassley’s letter to Barr follows:

Source: https://www.grassley.senate.gov/news/news-releases/grassley-questions-use-doj-memo-limit-recovery-tax-dollars-lost-fraud

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