Chris Jozwiak appears on The Legal Journal
Dec 03, 2012
Baillon Thome Jowiak & Wanta LLP partner Christopher Jozwiak appeared on Business 1570's The Legal Journal broadcast show on December 1, 2012. Chris discussed a type of whistleblower law known as qui tam actions. Qui tam whistleblower actions allow an individual to file a lawsuit on behalf of him or herself and on behalf of the federal or state government. Qui tam actions seek to recover money from a company or person who has committed fraud against the government. Baillon Thome Jozwiak & Wanta LLP represents invidiuals in whistleblower actions and Mr. Jozwaik has has represented whistleblowers in federal court seeking to stop government fraud.
An audio download of the broadcast is avaialble at the bottom of this post.
Ross: Welcome back to the Legal Journal on Business 1570, online Business 1570.com. I want to throw out the phone number if you want to comment today, 651-289-4477. The text line, 651-243-0391 as well. Welcome back. Hopefully your Saturday morning is off to a good start. Now in studio here for the second half of the program I am joined by Chris Jozwiak, he is with Baillon and Thome, Jozwiak and Wanta, more online at BaillonThome.com. That is B-a-i-l-l-o-n T-h-o-m-e.com. Chris, it's good to see you.
Chris: Good morning. Thank you for having me.
Ross: I think the firm name is very recognizable to our listeners because I think the other three names on that list, I think, they’ve all been in studio so far so it's good to finally meet the fourth member of that team name there.
Chris: Thank you very much.
Ross: It's good to see you. Thanks for coming in this morning. Today on the show talking about a lot of different things in the second half of the show. Specifically and you're going to have to correct me if I'm wrong here because we've talked about this on the show before, but I know there's a couple different ways to pronounce it, Qui Tam lawsuits. Did I get that right or is there a better way to pronounce that?
Chris: No, there's a couple different ways out there. Some people say Que Tom, Qui Tam and every kind of permutation in between, but essentially Qui Tam cases are at their heart whistleblower cases and it all falls under either state or federal False Claims Act.
Ross: Before we get into the crux of the matter, dive deep into the issues; I want to give you a chance to just talk a little bit about your background and a little bit about the firm as well, if you don’t mind.
Chris: I grew up in small town Wisconsin and came here for undergrad and then stayed on for law school at the University of Minnesota and have been here ever since. We are a firm, Baillon, Thome, Jozwiak & Wanta is a specialized practice. We exclusively practice employment and consumer law on behalf of individuals.
Ross: On behalf of individuals. So not necessarily the employer, we're talking about the employee.
Ross: Awesome, let's hop into Qui Tam because it's very interesting. We've talked about it before on the show, but I said it the last time. This is not something you talk about once and you're done with it. We could spend multiple shows on this for weeks and weeks at a time. Can you just give me, in general, what is Qui Tam? Does it involve federal government, state and local as well. I know you kind of touched on that, that there's different aspects to it, but let's talk a little bit about the general background of Qui Tam, if you don’t mind.
Chris: It's a really interesting area of law. It's complex. It's not familiar to most people. It's not familiar to most lawyers. Big picture, Qui Tam is a Latin phrase that roughly translates to, “He who sues on behalf of the king as well as for himself” and that really goes to the heart of what is at stake in these lawsuits is an individual who is usually a whistleblower and is bringing a claim in conjunction with the government to recoup government funds because of a fraud scheme.
Ross: You just took the words right out of my mouth. Basically, in general terms, we're talking about somebody maybe they work with a contractor, I don't know, maybe the contractor’s billing the government for False Claims of money spent or they only spent $30,000, but they’ve billed $50,000. That would essentially, in layman terms, that’s kind of what we're talking about.
Chris: Yes, to give you two easy examples in some of the most common industries where this happens, one health care. A medical clinic that’s billing Medicare for services that were never provided to the patient. Another one in the defense industry, a defense contractor who is providing defective parts to the Army and holding them out as up to spec.
Ross: Chris Jozwiak joins us this morning. He is with Jozwiak, he's with Baillon, Thome, Jozwiak and Wanta. I'd better get that right. You can learn more online at ballionthome.com. That’s b-a-i-l-l-o-n-t-h-o-m-e.com discussing Qui Tom, Qui Tam lawsuits today. You did mention a little bit on the False Claims Act. Again, that’s something else that we have talked about on this show before, but why don’t you talk about the False Claims Act, I guess, just specifically what is the False Claims Act?
Chris: The federal Qui Tam law is a part of the False Claims Act. It's actually an old law that was originally enacted in 1863 at the request of President, then, Abraham Lincoln and it was an effort to combat profiteering by Union Army suppliers. It was designed to fight against defense procurement fraud by providing any private citizen with the right to file a civil action against anyone who submitted a false claim for the payment to the United States government.
Ross: Chris, how often do you deal with this? Are these fairly common? Is this something that does happen a lot? Do you deal with this a lot on a daily basis or a weekly basis?
Chris: It's interesting. It's a really specialized area of practice, so most firms unless they practice exclusively in Qui Tam law, maybe have a few of the cases, but its labor intensive, it's a lot of work, it's a lot of time and they're not that common. It's not like most people in their employment come across government fraud schemes that are big enough that the government’s interested in prosecuting them and it really has grown though in the last few years. In 1986, the act was amended and that really, after those amendments, we saw such an increase in both US attorneys who were interested in this area and private attorneys who were interested in developing those cases and that mainly came because of The Cold War. As US defense spending increased, there were a lot of highly publicized fraud cases involving defense industry contractors and basically Congress looked at how can we make the old FCA, the False Claims Act, work to fight that.
Ross: Relevant to today. Is that the theory on why you’ve seen an uptake in these recently? Is that the law or the statute, so to speak, was amended more to apply to today or is there may be more to it that that?
Chris: Yes, there were some parts of it, I think in 1943 that had changed and really restricted the ability to bring those suits and then after the ’86 amendments, it really opened up this area of the law and the essential components of the modern False Claims Act really changed then in 1986 and so both dollars in terms of federal dollars got allocated to having US attorneys who could prosecute these claims and there was also an interest in going after and curbing that fraud.
Ross: The voice you're hearing this morning is Chris Jozwiak. He is with Baillon, Thome, Jozwiak and Wanta. More online at ballionthome.com. You're listening to The Legal Journal on Business 1570 with you for about another 20 minutes or so this morning. Chris, what do you need to prove to establish a claim under the False Claims Act, the FCA, what do you need? Is there a standard bar of evidence or stuff that you need on your side? That’s sounds like a terrible term, but I think you know what I'm trying to say. Is there a standard you have to meet or is it different for each case?
Chris: It does get kind of specific depending on the type of case, but at its most basic, there are three essential elements. One, a claim must be presented to the government by the defendant or the defendant must cause a third party to submit a claim, two, the claim must be made knowingly by that defendant and three, the claim must be false or fraudulent.
What is a claim? A claim is virtually all demands or requests that cause the disbursement of federal funds whether that demand or request is on the government directly or indirectly.
Ross: You mentioned also knowingly and false and fraudulent. The term “knowingly” to me is a little generic, but by defined by law, is it a little more narrow? Is there a little bit more of a background there?
Chris: Yes, in any area of law you see terms like this fought, fought and fought over, but yes, knowingly is defined under the statute as one’s actual knowledge of the false information, two; acts in deliberate ignorance of the truth or falsity of the information or three; acts in reckless disregard of that and the key here with respect to the False Claims Act is that you don’t have to prove there was a specific intent to defraud the government. In any type of law, intent is always going to be a fought after area where you're trying … what level of intent do you have to show in order to prove your claim.
Ross: Has the False Claims Act, in general, has that been effective? Has it worked?
Chris: Yes, it's actually quite impressive. The numbers really bore that out. According to the Justice Department, total recovery in the False Claims Act from 2009 to 2011 alone exceeded 7.3 billion and that’s an amount that’s greater than any other two year period in US history. We're really seeing the growth of that prosecution and it be very effective.
Ross: Chris, in a weird way to me these lawsuits really jump out because if you're telling me the government knowingly was able to recoup $7.3 billion that they technically lost, right? There's probably more out there, but to me, what that makes me think about is, we're all losing in the end, aren’t we? A citizen, so to speak, is losing if the government’s out money, they're going to find more ways to get that money which in general is going to come back on all the taxpayers, right? The less fraud that’s being done is better for all.
Chris: Exactly. I think it's a great kind of equalizer regardless of how you feel about size of government, taxes.
Ross: Who's running the government.
Chris: Everyone kind of agrees that individuals and companies should not profit off fraudulent claims which take taxpayer dollars away.
Ross: It's probably important as well, Chris, to define what is a whistleblower and specifically maybe why they get that term. If we can talk about that a little bit, it you don’t mind. What is a whistleblower?
Chris: A whistleblower in its simplest sense in someone who reports an illegal act and most often those are employees. They don’t have to be, but most often that’s the context we see them in and usually after that happens, all as you can imagine, is not always well at work and people face retaliation for reporting the suspected illegality and whistleblowers have protection in a number of ways. State whistleblower laws, the False Claims Act that we've been discussing and anti-retaliation provisions in a variety of laws like OSHA under the IRS, but essentially they all focus on the same goal, not punishing someone for standing up for what is right in a situation where illegal conduct is occurring.
Ross: I'm going to jump around on you a little bit Chris, but I want to stick with the whistleblower and the process of a whistleblower, are they protected in any way if, say, they go to the government or they call, maybe they pick up the phone and they call you. They contact Baillon, Thome. Again, more at baillonthome.com. B-a-i-l-l-o-n-t-h-o-m-e.com. Are they protected? Could they face retaliation? How does that work and, so to speak, could somebody be let go once the company finds out, “Boy, you know John Johnson, or employee Tommy Thompson, whatever, went to a lawyer, went to a government.” Can they let you go based on that?
Chris: It really depends on the type of situation, the industry they're in, what kind of illegality they're reporting. While not all whistleblowers are Qui Tam whistleblowers which the Qui Tam law calls them relaters. All relaters are whistleblowers. Here in Minnesota if someone calls me and says, “Hey, this is what's going on. I reported this illegal action at work and this is what's happening to me by my employer afterwards.” That person has different types of protection depending on the facts of what's going on. The most common way a Minnesota employee has protection is the Minnesota Whistleblower Act. That doesn’t necessarily involve anything to do with Qui Tam law, but the Minnesota Whistleblower Act protects an employee when an employee has in good faith reported a suspected violation of federal or state law or they’ve refused to perform an act that they believe violates the law.
Ross: Qui Tam specifically is for the government being wronged, right? There might be a lot of people listening that think their place of employment might be scamming somebody, so to speak, but if it's not the government, that’s not covered under Qui Tam, correct?
Chris: Yes, Qui Tam only refers to and only deals with government fraud and so that can happen under the Minnesota False Claims Act, which is brand new, only a couple years old and also federal False Claims Act which has been around, which we discussed, for a long time.
Ross: If you can Chris, why don’t you walk us a little bit through the litigation process? How does that work? How does that start? Where does one even begin?
Chris: If we have a typical whistleblower case, just Minnesota Whistleblower Act, for example, it's going to be a little bit more what you think of as litigation. The client’s going to come to me, we're going to assess the case, going to figure out if they have a claim, then move forward. We basically are going to contact the employer, see if there's an interest in trying to resolve something prior to litigation. If not, the litigation follows a pretty standard suit. We file a complaint. They provide an answer. We do discovery which is an exchange of information. There are depositions. There's motion practice and then you either proceed to trial or settle the case.
With respect to Qui Tam, it's real different. You start out, you assess a case and then you reach out to either the State Attorney General’s office or the US Attorney’s office depending on if you are bringing a federal or state claim and then it's really different than standard litigation because essentially at the heart of Qui Tam law, you're working with and alongside the federal government in prosecuting that claim.
Ross: Let's walk back to the beginning. At the very start, Chris, is it as simple as just basically calling you up or calling up Baillon Thome and saying, “I think this is happening” or “Maybe I have some proof that this is happening.” Is that the very first step of the process, just picking up a phone and maybe even calling you and saying, “What do we do here? Do I even have a case?” Is that the first step you take or is there something even before that?
Chris: I think you're exactly right. Usually if you think either you're experiencing retaliation for reporting something illegal or if you are experiencing this fraud scheme that you know is a pretty big deal at work and it's scaring you and you don’t know if you're involved in criminal activity or you don’t exactly know what's going on, call an employment lawyer or a Qui Tam lawyer if that’s the facts that are going on and get advice even for a current employee and I talk to people everyday who maybe they don’t exactly know what's going on and we help them do that and maybe they just make a report to their HR person or someone else at their company to fix the situation and a lot of those people never call me back because companies do the right thing, fix the situation and people don’t experience retaliation, but it doesn’t always go that way.
Ross: Is there a statute of limitations as well on this? Do you know that off the top of your head? Say you did work for a company two years ago and maybe you're hearing the program today and you go, “Well, you know what? I never thought of it at the time, but I think such and such was doing this maybe illegally.” Are they still within their right to call you up and say, “Hey, I think I know about this,” or do they have to be employed there at the time or is there a certain amount of days or years where they have to basically call you up and say, “Hey, we should look into this.”
Chris: Yes, and there is a statute of limitations, like almost any law, if it's a regular whistleblower case under the Minnesota Whistleblower Act, there's going to be a two year statute of limitations. If it's a Qui Tam case, then it's a much different answer. It differs according to whether it's a state specific Qui Tam law or a federal one, but in Minnesota the Minnesota False Claims Act statute of limitation provision mirrors exactly the federal so I can give you one answer and that is that a Qui Tam relater and the government must file a False Claims Act claim within six years of the False Claims Act violation regardless who's initiating it.
Ross: That would be your timeframe right there.
Ross: The website baillonthome.com, b-a-i-l-l-o-n-t-h-o-m-e.com. This morning we're talking about Qui Tam lawsuits here for the final about nine minutes of the show. Again, you're listening to The Legal Journal on Business 1570. I'm Ross Brindle in studio. Here in the second half of the show we've been joined by Chris Jozwiak with Baillon, Thome, Jozwiak and Wanta. Chris, I know I think most people are going to report wrongdoing just because they simply think that it's wrong. I think most people are still good natured, but for the most people that do that, are they entitled to any type of commission or payout if you guys go to court so to speak and you find out, “Boy, there was wrongdoing here. They owe the government,” let's just say it's even a small number, it seems less small, but let's just go with a million dollars. I'm sure there are ones that are much more than that. Would somebody be entitled to a part of that million dollars if that went all the way to court and it turned out that company was wronging the government?
Chris: Yes, the way it works is after you talk with the government and everyone agrees you're going to move forward, there's a kind of a more procedural and probably not that interesting process for how that happens.
Ross: We want the interesting stuff.
Chris: If it is moving forward and the government’s interested and you're prosecuting the case, at some point maybe there's a settlement. Some of these go to trial, some of them settle. It all depends on how they go, but yes, the relater is due a certain share of that and that’s what motivates them to come forward because usually it's not a fun experience for a whistleblower to report their employer for defrauding the government of millions and millions of dollars and usually they're out of work, they lose wages and go through a lot of psychological …
Ross: It can take a long time too, correct?
Chris: Yes, it can take a long time and you see pretty horrific things. People losing their homes and their families breaking up and people going through divorces because it is a pretty sad and difficult process for most people when they go through retaliation after blowing the whistle.
Ross: What if the agency, the government chooses not to intervene. They say, “Well, maybe there could be something here, we're just choosing not to” or maybe they don’t think it's worth it for them, maybe those would be the reasons. I don't know what the reasons would be, but let's say they choose not to get involved. Can a relater or can a whistleblower still move forward? Is that possible or do they need the government’s help?
Chris: Yes, after the initial process the government can decide if they want to move forward, if they need more time to investigate, if they want to intervene and prosecute it or if they're going to decline. If they decline and they're not interested, the relater is permitted to prosecute the False Claims Act claim alone with a private attorney and essentially the government still retains an interest in an ability to intervene later if the case develops in such a way where they believe they do have that interest, but the person can go forward with a private attorney and prosecute that claim.
Ross: Chris, I think it's probably important to note, if we can, we have just about five minutes left, but in what ways does the Minnesota False Claims Act and the federal False Claims Act, if there is such a thing, the FCA, how do they differ? Are they the same, but also are they different?
Chris: They're very similar. They are different in scope and procedure and enforcement and those differences probably aren’t going to be something you want to hear much about.
Ross: That’s the boring stuff?
Chris: A little bit, but in one very real way I can illustrate it is if you only have a claim, a Minnesota employee has a claim where the only dollars at stake that are being defrauded are Minnesota dollars. There's no federal funding at stake. Then you're only going to move forward with a Minnesota False Claims Act case.
Ross: Okay, as long as it didn’t touch the federal government. If it was only the Minnesota government, you play by the Minnesota rules so to speak.
Ross: Chris, we have just about three minutes left so I think I'll make this the final question that I have because I think this might be one of the most important parts that we've talked about in this entire segment. What type of attorney should I hire, so to speak, if I think, say the company that I work for is defrauding the government, what type of attorney should I hire and again, if you don’t mind, kind of walk us through the process of how it all starts and where you go from maybe step one on.
Chris: It's important for anyone, especially an employee experiencing retaliation in the workplace to contact an employment lawyer. Even if all you do is get appropriate advice and figure out your rights and you don’t do anything with it, then at least you know where you stand.
Ross: At least you took the proper steps to see, A; is there something wrong here and if there is, at least you know your recourse.
Chris: Exactly and like I said earlier, some people I never hear from again. They fix the problem internally or either they decide they don’t have anything that would necessarily be discrimination or retaliation or anything like that, but when things don’t go well.
Ross: Which does happen obviously. There's plenty of Qui Tam lawsuits that do take place.
Chris: Exactly and if that whistleblower is terminated or even if they're not terminated, they're a current employee and they can't live with being a part of this fraud scheme, then they should talk to a Qui Tam lawyer and figure out exactly what's going on. It's very complicated stuff and figuring that out on your own would be quite difficult and it's a really specialized area of practice. Most attorney like I said earlier, don’t even know what Qui Tam means and the law in general is becoming more and more specialized and you don’t usually if you have a specific issue want to see a generalist. I have no business talking to anyone about a family law issue they have or a bankruptcy. I wouldn’t even know to say and I refer those people to the right attorneys.
Ross: Very important to make sure you find somebody, I don't know specialized is the right term, but you want to find somebody who deals with, works with and focuses on these types of cases.
Chris: Yes, it's really important to research the type of case you potentially have, talk with an attorney and it's really key that you do your homework on that firm and that attorney’s background, qualifications, experience and reputation in the industry and a lot of people, we'll get referrals all the time from other attorneys and other practices because someone goes to them with an employment issue, like the med mal attorneys you had on earlier today. They wouldn’t take an employment case. They would say, “Hey, call Chris.”
Ross: It's not their forte, so to speak. In 20 seconds or less, tell me a little bit about Baillon, Thome, Jozwiak and Wanta. If you could just give me a ten, 15 second answer.
Chris: We are, like I said earlier, are a specialized practice. We only represent individuals in employment and consumer law cases. For the employment that means discrimination, retaliation and whistleblower cases. Whistleblower really gets at the heart of what we're talking about today. Qui Tam is kind of a subset of that and intersects with whistleblower law.
Ross: Chris, I appreciate your time so much. Thank you this morning. We appreciate it.
Chris: Thank you.
Ross: That’s Chris Jozwiak with Baillon, Thome, Jozwiak and Wanta. Learn more baillonthome.com. That is b-a-i-l-l-o-n-t-h-o-m-e.com, baillonthome.com. You hear the music, that means it's time for us to go. We're back next Saturday with The Legal Journal on Business 1570. Have a great Saturday.
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