Fraud Fighters Fear ‘Deathblow’ as Supreme Court Ruling Turns 2

Contractors must have been dismayed on June 16 two years ago when the Supreme Court gave the government and whistleblowers a shiny new fraud-fighting tool by green-lighting the implied certification theory of fraud under the False Claims Act.

Plaintiffs could now assert that contractors were liable if they concealed noncompliance with critical—material—contract requirements when seeking payment from the government.

But Justice Clarence Thomas‘s opinion did something else. It provided a road map that some defendants could use to take down false claims actions by arguing that no materiality existed, and thus no fraud occurred, if the government continued to...