Years ago, few lawyers thought a False Claims Act Case was appropriate to be resolved by mediation. It was Attorney General Janet Reno who introduced mediation to this practice area in the late 1990’s. She was optimistic the mediation process could be adapted to this and other types of Federal government-initiated litigation. Mediation is now widely used at various stages of complex multi-faceted False Claims Act cases, and sometimes it even succeeds. However, the unusual and at times complex nature of the relationship among Federal and State governments, the relator and defendant, and their counsel, make these cases challenging to resolve. Unfortunately, it is not uncommon in this practice area to be subjected to 3 or 4 time and resource consuming mediation sessions before success may finally emerge.
After over 35 years of rather intense litigation experience under the Federal and State False Claims Acts, on both sides of the “V”, I have concluded that success at the mediation table can be enhanced if certain key variables are acknowledged by all parties:
- ALL PARTIES MUST WANT TO EXPLORE MEDIATION- Parties should not be forced by scheduling issues, courts, or client pressures to mediate if they are not ready. If both sides are not motivated, for a variety of legitimate reasons, my experience is the mediation will fail by late morning. Even if the Department of Justice is not at the mediation table, they need to be fully apprised of the process. The government does not like surprises.
- THE FACTUAL AND LEGAL ISSUES TO BE MEDIATED MUST BE CLEARLY DEFINED AND AGREED TO BY ALL PARTIES- The good and bad of the False Claims Act practice is that there can and are a multitude of issues to be mediated: liability over intervened, non-intervened and partially intervened claims, State Attorney General Claims, 3730 (H) retaliation claim, private causes of action, attorney fees and costs, release issues, and even relator share. All can be very tricky to navigate for the uninitiated mediator.
- SELECTION OF THE MEDIATOR- Increasingly all parties to a False Claims Case (prosecutors, relators, and defense counsel) must all agree to and have faith in the selection of the mediator. This is paramount to success in the process. Too often courts, doing their duty, force mediation with a list of approved mediators or through well-meaning but busy magistrate judges. False Claims Act Cases are typically not their bread-and-butter cases. Both groups can be highly effective in more familiar practice areas. Unfortunately, the knowledge of substantive issues which pervade all aspects of the FCA law, as well as written and unwritten intricacies of this practice, often get in the way of resolution by some mediators. These cases often take a lot of time to resolve. I have watched many well-meaning mediators throw up their hands as they try to work through the uniqueness of the False Claims Act practice area. Parties often complain that the usual lets “split the baby” is not what they are looking for in a False Claims Act resolution.
The unique needs of False Claims Act litigants for subject matter savvy mediators have crystalized for me over the last few years as I have been asked to step off the battlefield, for a few days, to guide parties to an acceptable resolution. While sitting as a neutral mediator, who has had the benefit of years of experience as counsel for both relators and defendants, the impediments to resolution are at once crystalized, yet more capable of being addressed and resolved.
In sum, an effective and well-focused mediation process can save district courts, magistrate courts, prosecutors, relators, defendants, and their counsel tons of time, money, angst, and resources.
