False Claims Act 2023 – Already a Litigation Minefield but Now With a Cyber Security Overlay

Claims brought under the False Claims Act continue to result in billions of dollars in recoveries to the United States at the expense of corporate defendants. The Department of Justice reported over $5.6 billion in judgments and settlements for the fiscal year of 2021. While billions of these settlements arose from healthcare industry cases, any company that makes claims for payment of federal funds is at risk for claims or investigations under the FCA. In addition, DOJ may seek to reach private equity investors and other actors said to be "substantially involved" in alleged wrongdoing. Layered on top of this minefield of exposure, the current administration has launched a “Civil Cyber-Fraud Initiative” through which the Department of Justice will use FCA to target cybersecurity-related false claims. Companies that falsely claim satisfactory levels of information security preparedness while submitting claims for contract payments can face FCA litigation when a threat actor exposes a network vulnerability. Given the significant damages and penalties associated with the FCA, strong compliance programs are essential with particular emphasis on information security practices and protocols. This panel, comprised of current DOJ officials, in-house counsel, and private practitioners, will focus on current trends in FCA litigation, highlight recent decisions of importance, and will provide practical strategies companies can employ to avoid being the target of these suits.