Under the False Claims Act, prior public disclosure of the allegations or transactions in a federal “report, hearing, audit or investigation” may preclude filing a qui tam lawsuit. On May 16, 2011, in Schindler Elevator Corp. v. United States ex rel. Kirk, No. 10-181 (May 16, 2011), the United States Supreme Court issued an unprecedented opinion holding that a response to a Freedom of Information Act request, even one filed by a whistleblower looking for corroborative evidence of fraud to present to the United States, is a federal “report” potentially barring jurisdiction over the action.
Although the public disclosure/original source rules were further amended in 2009, the federal “report” language applies to both versions of the statute. Accordingly, under the Supreme Curt’s interpretation, any response to a FOIA request, even one obtained from someone other than the whistleblower could, potentially, bar the action unless the whistleblower can show she qualifies as an “original source.”
Relator Daniel Kirk had worked for Petitioner Schindler Elevator Corporation (Schindler) for twenty-five years and alleged that Schindler had falsely certified its compliance with the Vietnam Era Veterans' Readjustment Assistance Act of 1972 (VEVRAA), which requires contractors to report information concerning its employment of veterans to the U.S. Department of Labor (DOL). He also alleged that Schindler failed to file certain required VETS-100 reports and included false information in VETS-100 reports.
As part of his investigation, Kirk’s wife submitted three FOIA requests to DOL including all VETS-100 reports filed by Schindler for the years 1998-2006. DOL sent copies of ninety-nine VETS-100 reports that Schindler filed, and a FOIA response informing her it could not locate Schindler's VETS-100 reports for 1998, 1999, 2000, 2002, or 2003. Kirk used this information to support its allegations.
In holding that a response to a FOIA request is a governmental “report,” the Supreme Court held that such a response falls within the ordinary meaning of the word “report” because it is “something that gives information,” “a notification,” and an “official or formal statement of facts.” The Supreme Court also held that any records produced with the FOIA response are also part of the “report” and may be used to support a public disclosure defense.
The Supreme Court thus held that the three written FOIA responses in this case, along with the accompanying records produced to Mrs. Kirk, are reports within the meaning of the public disclosure bar. The Court remanded for a determination whether the Kirk’s suit is “based upon . . . allegations or transactions” disclosed in those reports. If so, Relator Kirk will need to demonstrate on remand that he is an original source to proceed with his claims.
For whistleblowers, this case means that one should likely not use FOIA before bringing one’s claims to an experienced qui tam lawyer to discuss and perhaps first bring to the government before looking for corroborating evidence.