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January 23, 2018

Bill to Combat ‘Litigation Tourism’ Advances in West Virginia

The Wall Street Journal reports that whistleblower lawyers may have found a new angle to pursue False Claims Act (FCA) lawsuits: customs and import cases. 

Last year, the U.S. Supreme Court declined to hear an appeal of a 2016 Third Circuit ruling that broadened the scope of the FCA. That case, which is now being reconsidered in district court, alleged that a pipe company failed to mark imported goods with the country of origin, which allowed the company to escape paying duties. Two weeks ago, The U.S. Department of Justice (DOJ) announced a $2.3 million settlement in a FCA case against another company that failed to label imported goods. 

Recent changes in enforcement may force the whistleblower bar to look for new opportunities to file cases. Last week, a leaked DOJ memo asked attorneys to dismiss “meritless” or “parasitic” FCA cases. Customs and import cases could provide them with that new revenue stream.

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