§ 9-1.1-4 — § 9-1.1-4. Civil actions for false claims.

§ 9-1.1-4. Civil actions for false claims.

(a) Responsibilities of the attorney general and solicitor. The attorney general or solicitor diligently shall investigate a violation under §â€‚9-1.1-3. If under this section the attorney general or solicitor finds that a person has violated or is violating §â€‚9-1.1-3, the attorney general or solicitor may bring a civil action under this section against the person.

(b) Actions by private persons.(1) A person may bring a civil action for a violation of §â€‚9-1.1-3 for the person and for the state. The action shall be brought in the name of the state. The action may be dismissed only if the court and the attorney general give written consent to the dismissal and their reasons for consenting.

(2) A copy of the complaint and written disclosure of substantially all material evidence and information the person possesses shall be served on the state upon the attorney general. The complaint shall be filed in camera; shall remain under seal for at least sixty (60) days; and shall not be served on the defendant until the court so orders. The state may elect to intervene and proceed with the action within sixty (60) days after it receives both the complaint and the material evidence and information.

(3) The state may, for good cause shown, move the court for extensions of the time during which the complaint remains under seal under subsection (b)(2). Any motions may be supported by affidavits or other submissions in camera. The defendant shall not be required to respond to any complaint filed under this section until twenty (20) days after the complaint is unsealed and served upon the defendant.

(4) Before the expiration of the sixty-day (60) period or any extensions obtained under subsection (b)(3), the state shall:

(i) Proceed with the action, in which case the action shall be conducted by the state; or

(ii) Notify the court that it declines to take over the action, in which case the person bringing the action shall have the right to conduct the action.

(5) When a person brings an action under this subsection, no person other than the state may intervene or bring a related action based on the facts underlying the pending action.

(c) Rights of the parties to qui tam actions.(1) If the state proceeds with the action, it shall have the primary responsibility for prosecuting the action, and shall not be bound by an act of the person bringing the action. The person shall have the right to continue as a party to the action, subject to the limitations set forth in subsection (c)(2).

(2)(i) The state may dismiss the action notwithstanding the objections of the person initiating the action if the person has been notified by the state of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion.

(ii) The state may settle the action with the defendant notwithstanding the objections of the person initiating the action if the court determines, after a hearing, that the proposed settlement is fair, adequate, and reasonable under all the circumstances. Upon a showing of good cause, such hearing may be held in camera.

(iii) Upon a showing by the state that unrestricted participation during the course of the litigation by the person initiating the action would interfere with or unduly delay the state's prosecution of the case, or would be repetitious, irrelevant, or for purposes of harassment, the court may, in its discretion, impose limitations on the person's participation, such as:

(A) Limiting the number of witnesses the person may call;

(B) Limiting the length of the testimony of such witnesses;

(C) Limiting the person's cross-examination of witnesses; or

(D) Otherwise limiting the participation by the person in the litigation.

(iv) Upon a showing by the defendant that unrestricted participation during the course of the litigation by the person initiating the action would be for purposes of harassment or would cause the defendant undue burden or unnecessary expense, the court may limit the participation by the person in the litigation.

(3) If the state elects not to proceed with the action, the person who initiated the action shall have the right to conduct the action. If the state so requests, it shall be served with copies of all pleadings filed in the action and shall be supplied with copies of all deposition transcripts (at the state's expense). When a person proceeds with the action, the court, without limiting the status and rights of the person initiating the action, may nevertheless permit the state to intervene at a later date upon a showing of good cause.

(4) Whether or not the state proceeds with the action, upon a showing by the state that certain actions of discovery by the person initiating the action would interfere with the state's investigation or prosecution of a criminal or civil matter arising out of the same facts, the court may stay discovery for a period of not more than sixty (60) days. Such a showing shall be conducted in camera. The court may extend the sixty-day (60) period upon a further showing in camera that the state has pursued the criminal or civil investigation or proceedings with reasonable diligence and any proposed discovery in the civil action will interfere with the ongoing criminal or civil investigation or proceedings.

(5) Notwithstanding subsection (b), the state may elect to pursue its claim through any alternate remedy available to the state, including any administrative proceeding to determine a civil money penalty. If any alternate remedy is pursued in another proceeding, the person initiating the action shall have the same rights in that proceeding as the person would have had if the action had continued under this section. Any finding of fact or conclusion of law made in the other proceeding that has become final shall be conclusive on all parties to an action under this section. For purposes of the preceding sentence, a finding or conclusion is final if it has been finally determined on appeal to the appropriate court; if all time for filing an appeal with respect to the finding or conclusion has expired; or if the finding or conclusion is not subject to judicial review.

(d) Award to qui tam plaintiff.(1) If the state proceeds with an action brought by a person under this section, the person shall, subject to the second sentence of this paragraph, receive at least fifteen percent (15%) but not more than twenty-five percent (25%) of the proceeds of the action or settlement of the claim, depending upon the extent to which the person substantially contributed to the prosecution of the action. Where the action is one that the court finds to be based primarily on disclosures of specific information (other than information provided by the person bringing the action) relating to allegations or transactions in a criminal, civil, or administrative hearing, in a legislative, administrative, or auditor general's report, hearing, audit, or investigation, or from the news media, the court may award those sums as it considers appropriate, but in no case more than ten percent (10%) of the proceeds, taking into account the significance of the information and the role of the person bringing the action in advancing the case to litigation. Any payment to a person under the first or second sentence of subsection (d)(1) shall be made from the proceeds. The person shall also receive an amount for reasonable expenses that the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. The state shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred by the attorney general, including reasonable attorneys' fees and costs, and the amount received shall be deposited in the false claims act fund created under this chapter. All expenses, fees, and costs shall be awarded against the defendant.

(2) If the state does not proceed with an action under this section, the person bringing the action or settling the claim shall receive an amount the court decides is reasonable for collecting the civil penalty and damages. The amount shall be not less than twenty-five percent (25%) and not more than thirty percent (30%) of the proceeds of the action or settlement and shall be paid out of the proceeds. The person shall also receive an amount for reasonable expenses the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All expenses, fees, and costs shall be awarded against the defendant.

(3) Whether or not the state proceeds with the action, if the court finds that the action was brought by a person who planned and initiated the violation of §â€‚9-1.1-3 upon which the action was brought, then the court may, to the extent the court considers appropriate, reduce the share of the proceeds of the action the person would otherwise receive under subsection (d)(1) or (d)(2), taking into account the role of that person in advancing the case to litigation and any relevant circumstances pertaining to the violation. If the person bringing the action is convicted of criminal conduct arising from his or her role in the violation of §â€‚9-1.1-3, that person shall be dismissed from the civil action and shall not receive any share of the proceeds of the action. The dismissal shall not prejudice the right of the state to continue the action.

(4) If the state does not proceed with the action and the person bringing the action conducts the action, the court may award to the defendant its reasonable attorneys' fees and expenses if the defendant prevails in the action and the court finds that the claim of the person bringing the action was clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.

(e) Certain actions barred.(1) No court shall have jurisdiction over an action brought by a former or present member of the guard under this section (actions by private persons) against a member of the guard arising out of the person's service in the guard.

(2) No court shall have jurisdiction over an action brought pursuant to subsection (b) (actions by private persons) against the governor, lieutenant governor, the attorney general, members of the general assembly, a member of the judiciary, the treasurer, secretary of state, the auditor general, any director of a state agency, and any other individual appointed to office by the governor if the action is based on evidence or information known to the state when the action was brought.

(3) In no event may a person bring an action under subsection (b) that is based upon allegations or transactions which are the subject of a civil suit or an administrative civil money penalty proceeding in which the state is already a party.

(4)(A) The court shall dismiss an action or claim under this section, unless opposed by the state, if substantially the same allegations or transactions as alleged in the action or claim were publicly disclosed:

(i) In a state criminal, civil, or administrative hearing, in which the state or its agents is a party;

(ii) In a legislative or auditor general's or other state of Rhode Island report, hearing, audit, or investigation; or

(iii) From the news media, unless the action is brought by the attorney general or the person bringing the action is an original source of the information.

(B) For purposes of this paragraph, "original source� means an individual who either: (i) Prior to the public disclosure under subsection (e)(4)(A), has voluntarily disclosed to the state the information on which the allegations or transactions in a claim are based; or (ii) Who has knowledge that is independent of and materially adds to the publicly disclosed allegations or transaction, and who has voluntarily provided the information to the state before filing an action under this section.

(f) State not liable for certain expenses. The state is not liable for expenses that a person incurs in bringing an action under this section.

(g) Any employee, contractor, agent, or associated others discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent, or associated others in furtherance of an action under this section, or other efforts to stop one or more violations of this chapter, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee, contractor, agent, or associated others whole. The relief shall include reinstatement with the same seniority status the employee, contractor, agent, or associated others would have had but for the discrimination; two (2) times the amount of back pay; interest on the back pay; and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys' fees. An employee, contractor, agent, or associated others may bring an action in the appropriate superior court for the relief provided in this subsection (g).

(h) Limitation on bringing civil action. A civil action under subsection (g) may not be brought more than three (3) years after the date when the retaliation occurred.

Legislative History

P.L. 2007, ch. 73, art. 18, §§ 1, 2; P.L. 2012, ch. 217, § 1; P.L. 2012, ch. 227, § 1; P.L. 2013, ch. 311, § 1; P.L. 2013, ch. 391, § 1; P.L. 2018, ch. 155, § 1; P.L. 2018, ch. 257, § 1.