Whistleblower Rewards
Congress decided to give whistleblowers a share of the recoveries that result from qui tam lawsuits to encourage people to step forward and take the risks involved in reporting fraud. The amount that the relator can receive most often ranges from 15% to 30%, depending on whether the government intervenes in the case and the extent to which the relator substantially contributes to the prosecution of the action.
If the government intervenes in the action, a successful relator will receive between 15% and 25% of the amount recovered by the government. The percentage is usually negotiated with the government at the conclusion of a successful case and will depend on the relator’s substantial contribution to the litigation. If the percentage cannot be agreed upon by negotiation, the court will be asked to decide the matter.
"The extent to which the relator substantially contributes to the prosecution of the action will affect the amount of the reward."
If the government declines to join the case and the relator proceeds against the defendant anyway, the relator is entitled to at least 25 percent but not more than 30 percent of the money the government recovers.
There are circumstances in which a relator may receive less than 15% of the amount recovered by the government. If the relator’s suit is one that is found to be premised on public disclosures or the relator is found to be someone who “planned or initiated” thefraud, a relator could receive less than the 15% minimum provided by the Act. If
a relator is convicted of a crime arising from the fraud scheme, the relator will not receive any share of the proceeds received by the government.
In deciding whether to pursue your potential claim, you should be aware of some general guidelines that have evolved in evaluating qui tam cases. The False Claim Act provides for penalties of three times the amount of the government’s losses plus fines of $5,500 to $11,000 for each false claim.
However, the government often agrees to settle a good case by accepting two to three times the amount of losses suffered by the government and agreeing to forego the fines. You should be aware of this possibility since your reward will be based upon the amount recovered by the government. Though a relator does have the right to object to an unreasonable settlement, courts are generally reluctant to upset a government settlement except in the most egregious circumstances.
The Department of Justice contends that the average relator share is approximately 17% depending upon the factors referred to above.
