On Monday, May 14, 2019, the Supreme Court issued a decision essentially expanding by four years the time available for private suits to be brought by relators under the False Claims Act (“FCA”), regardless of whether the Government decides to intervene. In Cochise Consultancy, Inc. v. United States ex rel. Hunt, No. 18-315, 2019 WL 2078086 (U.S. May 13, 2019), plaintiff-relator Billy Joe Hunt filed a complaint on November 27, 2013, alleging two defense contractors (collectively, “Cochise”) violated the FCA in 2006 and 2007 by submitting false claims for payment under a subcontract providing security services in Iraq. The United States declined to intervene, and Cochise moved to dismiss the complaint, arguing that the action was barred under the FCA’s statute of limitations clause, 31 U.S.C. § 3731.

As we explained when the Court granted certiorari, the FCA has two statute of limitations. Normally, a case must be brought within 6 years of “the date on which the violation of [the False Claims Act] is committed.” 31 U.S.C. § 3731(b)(1). The Act’s second statute of limitations provision allows for FCA cases to be brought “more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed.” 31 U.S.C. § 3731(b)(2).

Mr. Hunt alleged the violations at issue in this case occurred between January 2006 and “early 2007,” and claimed to have revealed the alleged fraud in an interview with FBI agents regarding an unrelated matter that occurred on November 30, 2010. Because the alleged violation occurred over six years prior to the claim being filed, Cochise moved to dismiss the case on statute of limitations grounds and argued that, because the Government had declined to intervene, the second prong of the statute of limitations did not apply. The district court agreed with Cochise but the Eleventh Circuit reversed and, in the process, created a three way circuit split.

The Supreme Court resolved this split this week by holding that the statute of limitations applies equally to suits initiated by the Government as well as by a relator. The appropriate time limit for Mr. Hunt’s claims was thus three years after the meeting in which Mr. Hunt disclosed his allegations to the Government, since it was at that time the facts first became known to the United States. The Supreme Court also clarified that “a private relator is not an ‘official of the United States’ in the ordinary sense of that phrase,” and that therefore the three-year statute of limitations did not start when Mr. Hunt gained knowledge of the facts underlying the violations.

This ruling carries possible negative implications for contractors as it expands the universe of potential cases subject to the second, and longer, of the FCA statutes of limitations. The Court’s decision allows for the possibility that a relator could inform an appropriate U.S. official of material facts relating to an alleged FCA violation after their own six-year statute of limitations has already tolled, so long as the action is brought within 10 years. This decision may also subject the government to additional, and earlier, requests for information regarding its knowledge of the alleged conduct, as such knowledge is now dispositive to both statute of limitations defenses as well as materiality defenses following Escobar.