232 F. Supp. 3d 583
S.D.N.Y.2017Background
- DaSilva, a former EOTech quality-control engineer, made pre-filing disclosures to the government about defective weapon sights and later filed a sealed qui tam FCA complaint in April 2014.
- DaSilva was a fugitive (convicted in Michigan and fled to Brazil); his counsel eventually sought to dismiss the qui tam action without prejudice in August 2014, with the government's consent.
- Over a year later the government filed its own FCA suit against EOTech, L-3, and an individual, and settled that suit for $25.6 million the day after filing.
- DaSilva moved for a declaratory ruling that he is entitled to a relator’s share of the $25.6 million under 31 U.S.C. § 3730(c)(5) (the "alternate remedy" provision).
- The government argued that because DaSilva voluntarily dismissed his qui tam action, the government’s later suit was not an "alternate remedy" to a pending qui tam action and DaSilva therefore has no statutory entitlement.
- The court denied DaSilva’s motion, holding that a voluntary dismissal without prejudice leaves no qui tam action for the government to intervene in and § 3730(c)(5) therefore does not entitle DaSilva to a share.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a relator who voluntarily dismissed his qui tam action without prejudice can claim a share of government recovery under 31 U.S.C. § 3730(c)(5) (the "alternate remedy" provision). | DaSilva: the government’s subsequent suit and settlement were an "alternate remedy" to his earlier qui tam disclosures and suit, so he is entitled to a relator’s share. | Government: voluntary dismissal removed any pending qui tam action; thus its later suit was not an "alternate" to intervening in a relator’s action and § 3730(c)(5) does not apply. | Court: Held for the government. Voluntary dismissal leaves no action for the government to intervene in, so § 3730(c)(5) does not provide DaSilva a share. |
Key Cases Cited
- Webster v. United States, 217 F.3d 843 (4th Cir. 2000) (voluntary dismissal wipes the slate clean; relator who dismissed cannot claim continuing rights in later government-filed FCA suit)
- United States ex rel. Babalola v. Sharma, 746 F.3d 157 (5th Cir. 2014) (no alternate-remedy protection where no qui tam action pending at commencement of government proceeding)
- United States ex rel. Bledsoe v. Cmty. Health Sys., Inc., 342 F.3d 634 (6th Cir. 2003) (alternate remedy refers to government’s choice not to intervene in a relator’s qui tam action)
- United States ex rel. Barajas v. United States, 258 F.3d 1004 (9th Cir. 2001) (alternate remedy requires government to choose between intervening in qui tam or pursuing other remedies)
- United States ex rel. Polansky v. Pfizer, Inc., 822 F.3d 618 (2d Cir. 2016) (discussing FCA liability framework and qui tam structure)
- Oneida Indian Nation of N.Y. State v. Oneida Cty., 622 F.2d 624 (2d Cir. 1980) (voluntary dismissal leaves situation as if suit was never brought)