Statement of Lisa Rickard, President of the U.S. Chamber Institute for Legal Reform, on today’s favorable reporting of the False Claims Act Corrections Act out of the U.S. House Judiciary Committee:

“The False Claims Act (FCA) has been an important and effective tool to protect the government against false claims on federally funded contracts and programs. Through a combination of government- and whistleblower-initiated lawsuits, the U.S. government has successfully recovered more than $20 billion in cases brought under the Act.

“However, the far-reaching expansion of the FCA sought by the trial lawyer lobby would have a disproportionate effect on small companies who will hesitate to compete for government contracts out of fear that one minor mistake could trip a lawsuit that costs them their business. In addition, the revisions would expand the FCA beyond simply those doing business with the government to include those doing business with any entity which receives government funds, creating whole new categories of targets for the plaintiffs’ bar, including scientists and artists, health clinics and homeless shelters, state and local governments, and universities and colleges.

“The False Claims Act Corrections Act would increase the federal government’s cost of contracts, discourage companies large and small from doing business with the government, and invite lawsuits against anyone participating in a government program. Once again, what is likely to be very lucrative for a handful of plaintiffs’ lawyers is bad for the rest of America.”

ILR seeks to promote civil justice reform through legislative, political, judicial, and educational activities at the national, state, and local levels. The U.S. Chamber of Commerce is the world’s largest business federation, representing more than 3 million businesses and organizations of every size, sector, and region.

---