DOJ Issues New False Claims Act Guidance, Updates Justice Manual

by Andrew Murray | May 19th, 2019

On May 7, 2019, the Department of Justice’s Civil Division announced the release of formal guidance concerning DOJ’s process for awarding credits to cooperating defendants during False Claims Act investigations. Found at Section 4-4.112 of the Justice Manual, the formal policy identifies factors that DOJ attorneys are to consider when providing credits to cooperators. According to the DOJ Press Release:

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Under the policy, cooperation credit in False Claims Act cases may be earned by voluntarily disclosing misconduct unknown to the government, cooperating in an ongoing investigation, or undertaking remedial measures in response to a violation. Even if the government already has initiated an investigation, for example, a company may receive credit for making a voluntary self-disclosure of other misconduct outside the scope of the government’s existing investigation that is unknown to the government. Similarly, a company may earn credit by preserving relevant documents and information beyond existing business practices or legal requirements, identifying individuals who are aware of relevant information or conduct, and facilitating review and evaluation of data or information that requires access to special or proprietary technologies.

Under the policy, the Department of Justice will take into account corrective action that a company has taken in response to a False Claims Act violation. Such remedial measures may include undertaking a thorough analysis of the root cause of the misconduct, appropriately disciplining or replacing those responsible for the misconduct, accepting responsibility for the violation and implementing or improving compliance programs to prevent a recurrence.

Most frequently, cooperation credit will take the form of a reduction in the damages multiplier and civil penalties. If appropriate, the Department may also notify a relevant agency about the company’s voluntary disclosure, cooperation, or remediation so that the agency can take those actions into account in deciding how to apply administrative remedies. And the Department may publicly acknowledge the company’s cooperation.

The complete policy is available at the Department of Justice’s website.

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