KELLOGG BROWN & ROOT v. U.S. EX REL. CARTER
Benjamin Carter was a former employee of Kellogg Brown & Root (KBR), a contractor that the U.S. Government had employed to provide logistical services in Iraq during the U.S.’s military action there. In 2006, Carter filed a whistleblower suit against KBR for fraudulent billing practices under the Federal False Claims Act (FCA). Carter claimed that KBR had a standing policy of filling out fraudulent time sheets and thus overbilling the U.S. Government for services rendered in Iraq.
After Carter’s first complaint was dismissed for failure to plead fraud with particularity, he re-filed his complaint, and KBR moved to dismiss. KBR argued that the suit was barred by the FCA’s “first-to-file” requirement, which bars any additional FCA suit if a related one is already pending. Because another case involving KBR’s fraudulent billing practices was pending, the district court again dismissed Carter’s. In 2011, Carter once again filed his complaint, and KBR moved to dismiss this complaint on two grounds: it was filed after the FCA’s six-year statute of limitations had expired, and it still violated the “first-to-file” requirement on the basis of two additional related actions. The district court agreed with KBR and dismissed Carter’s suit with prejudice. The U.S Court of Appeals for the Fourth Circuit overruled the district court, and held that, since the two additional actions had since been dismissed, they no longer barred Carter’s suit. Additionally, the Court found that the Wartime Enforcement of Fraud Act, a statute which extends the statute of limitation of certain claims during times of war, could be applied to Carter’s civil whistleblowing suit.
(1) Does the FCA’s “first-to-file” requirement act as a “one-case-at-a-time” rule, allowing as many related claims to be filed as long as no prior claim is pending?
(2) Can the Wartime Enforcement of Fraud Act’s statute of limitations tolling provision be applied to civil claims brought by private citizens?