Grassley Moves to Stop Contractors From Holding U.S. ‘Hostage’

A bill from Sen. Chuck Grassley (R-Iowa) to amend the False Claims Act addresses his longtime frustration with government fraud lawsuits that get dismissed because contractors assert that agencies paid for products and services despite knowing about misconduct.

An FCA suit must allege “materiality,” meaning that a federal contractor’s actions would likely affect whether it got paid by a U.S. agency. Whether armed guards have adequate marksmanship skills, for example, is material to payment decisions under a security services contract.

A 2016 U.S. Supreme Court ruling, Universal Health Services, Inc. v. United States ex rel. Escobar, ...