Halunen & Associates

The Illinois Whistleblower Reward and Protection Act (WRPA) is modeled after the federal False Claims Act and provides relators with many of the same advantages. Like the False Claims Act, the WRPA allows private individuals (relators) to bring suit on behalf of the government, and in the name of the government, in order to recover a percentage of the damages recovered by the state or local government for themselves.

Who is Liable Under the WRPA?

Under the WRPA, a party is liable if they

1. knowingly present a false or fraudulent claim to an officer or employee of the State;

2. create, use, or cause to be used, a false record in order for a false or fraudulent claim to be paid or approved by the state;

3. conspire to defraud the state by enabling a false or fraudulent claim to be allowed or paid;

4. have possession, custody, or control of property or money used, or to be used, by the state and, intending to defraud the state or willfully to conceal the property, delivers, or causes to be delivered, less property than the amount for which the person receives a receipt;

5. authorized to create or deliver a document certifying receipt of property used, or to be used, by the state, and intending to defraud the state, creates or delivers the receipt without fully knowing whether or not the information contained on the receipt is true;

6. knowingly buy or receives public property from an officer or employee of the State who lawfully may not sell or promise property;

7. willfully create, use, or cause to be created or used, a false record or statement to conceal, avoid or decrease an obligation to pay or transmit money or property to the State.

FOUR COMMON TYPES OF WRPA CLAIMS

Over Charge/Poor Quality— a contractor charges the state for a high-grade (expensive) type of material but delivers a low-grade (less expensive) material for the price of the higher-grade. This type of claim also applies to doctors who bill Medicare or Medicaid for procedures they did not perform.

Bid-Rigging/False Representation— an agency/company/individual falsifies reports to the state in order to receive a higher payment for services performed.

False Compliance— an agency/company/individual submits a false or fraudulent claim stating compliance with environmental standards, nondiscrimination requirements, anti-kickback statutes, minority contracting, or other compliance issues entered under state contract.

Reverse False Claim — an agency/company/individual purchases a product from an agent of the state and submits false or fraudulent claims as to the amount of product actually acquired. Action can be taken against the purchaser if they are under a specific legal obligation to account for its purchases but submits false or fraudulent purchase reports.

AWARDS UNDER THE WRPA

The State — under the WRPA, each person submitting a false claim to the state liable for “a civil penalty of not less than $5,000 and not more than $10,000, plus three times the amount of damages which the State sustains because of the act” of the defendant. The WRPA also makes the defendant liable for the state’s and the relator’s “reasonable expenses…including reasonable attorneys’ fees and costs.” Unlike the federal FCA, defendants have no right to recover fees from the state under the WRPA. A defendant will only receive fees under the WRPA if a court finds that the government’s position was not “substantially justified”. Also, under the WRPA, relators are not permitted to recover fees from the state as well.

The Relator —to encourage relators to file suit, the WRPA grants relators a percentage of the state’s recovered awards. The relator’s award percentage directly correlates to the level of involvement by the state in filing and ultimately winning the suit. If the state intervenes in the relator’s suit, and if the suit is not based on publicly disclosed information, and the relator was not the conspirator behind the false or fraudulent claim, the WRPA awards the relator 15-25 percent of the state’s total award.

The chart below (cited from the Employment Termination handbook, III. Inst. For CLE, 2002) illustrates the variables the WRPA takes into consideration when awarding a percentage to the relator.

Circumstances Relator’s Share

State Does Not Intervene 25-30%

-Relator brings an action and recovers damages.

State Intervenes 15-25%

-Relator brings an action that is not in any way based on a public disclosure.

-Relator, who qualifies as an original source, brings an action that is based in a small way on a public disclosure, but the action is primarily based on other information.

-Relator, who qualifies as an original source, brings an action that is primarily based on public disclosure, and the relator is the source of the public disclosure.

< 10%

-Relator, who qualifies as an original source, brings an action that is primarily based on public disclosure, and the relator is not the source of the public disclosure.

State Intervention Immaterial Reduced Amount

-Relator planned and initiated the violation.

0%

-Relator, who does not qualify as an original source, brings an action based in any way on a public disclosure.

-Relator is criminally convicted for violation.

AWARDS FOR THOSE INVOLVED IN WRPA VIOLATION ? ? ? ?

The WRPA allows relators to recover awards (reduced) even if he/she were a participant in the false or fraudulent claim because it is the purpose of the WRPA to encourage whose with knowledge of a violation to come forward in order to seek recovery on behalf of the state. However, the WRPA does draw the line if the relator is convicted of criminal conduct that arises from his or her role in the false or fraudulent claims violation (in order to prohibit convicted criminals from receiving the benefits of their crime).

WHISTLEBLOWER PROTECTION UNDER THE WRPA

The WRPA provides protection for individuals who report false or fraudulent acts against the state from retaliation by his/her employer. The WRPA strictly prohibits an employer from adversely affecting the employee’s employment status. If an employer does in fact violate the WRPA by firing, demoting, harassing, (etc.) an employee, the employer may be liable for reinstatement, double back pay, attorneys’ fees, and other sanctions. In order for an employee to gain such retribution he or she must be able to present proof that these three steps were taken:

1. his/her activities were intended towards exposing fraud against the government;

2. the employer had knowledge of the employee’s actions to try and expose the false or fraudulent acts;

3. and the employer discriminated against him/her because of his/her actions.

A Complaint filed by a relator will remain under seal for 60 days.