On March 31, 2021, in
United States ex rel. Felten v. William Beaumont Hospital, No. 20-1002, 2021 WL 1204981 (6th Cir. Mar. 31, 2021), the U.S. Court of Appeals for the Sixth Circuit held that the False Claims Act’s (FCA) anti-retaliation provision protects former employees alleging post-termination retaliation. The decision creates a split with the Tenth Circuit, which held in 2018 in Potts v. Center for Excellence in Higher Education, Inc., 908 F.3d 610 (10th Cir. 2018), that former employees are excluded from the scope of the FCA’s anti-retaliation provision. While current employees are undoubtedly protected under the provision,
Felten ultimately leaves the question of whether former employees may recover for post-termination retaliation under the FCA unsettled across all circuits.
On March 31, 2021, the Sixth Circuit addressed an issue of first impression in the circuit, holding that the False Claims Act’s (“FCA”) whistleblower protection provisions protect.
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On March 31, 2021, the Sixth Circuit addressed an issue of first impression in the circuit, holding that the False Claims Act’s (“FCA”) whistleblower protection provisions protect former employees from post-employment retaliation.
Background
Plaintiff was employed as a doctor at a Michigan hospital. He filed a qui tam action against the hospital alleging that it was paying kickbacks to various physicians and physicians’ groups in exchange for patient referrals. Plaintiff also claimed that the hospital terminated his employment and then maligned him in retaliation for his reports of illegal conduct, thus undermining his employment applications to numerous other institutions.
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Can an employer be held liable under the False Claims Act (“FCA”) for retaliation if it takes some adverse action against a
former employee? Until recently, only one federal appellate court had addressed the issue, holding that the FCA does
not cover post-employment retaliation.[1] However, on April 1, 2021, the Sixth Circuit reached the opposite conclusion in
United States ex rel. Felten v. William Beaumont Hospital, creating a circuit split and different rules for employers in different jurisdictions.
Background
In 2010, David Felten filed an action on behalf of the United States and the State of Michigan against his employer, William Beaumont Hospital, alleging that it had violated the FCA and a comparable Michigan law by paying physicians for referrals of Medicare, Medicaid, and TRICARE patients. Felten also asserted a retaliation claim against Beaumont based on actions it had allegedly taken against him be