Calculating and predicting damages in a False Claims Act (“FCA”) case is usually a daunting process for probably the most seasoned FCA practitioners. Actually, even judges presiding over years of litigation and weeks of trial can get it unsuitable by tens of thousands and thousands of {dollars}.
Final week, the US District Courtroom for the District of Columbia issued an Order and corresponding Memorandum Opinion granting partly and denying partly a movement from the US to amend and complement the court docket’s findings of details and conclusions of legislation following a bench trial that concluded in March 2022. United States ex rel. Morsell v. Gen Digital (f/okay/a Symantec Company), Case No. 1:12-cv-00800 (Jan. 16, 2024) (Dkt. Nos. 374-75).
The court docket printed its preliminary findings in January 2023, coming into a partial judgment in favor of the US within the quantity of $1,229,950 in damages and penalties. In that preliminary ruling, the court docket famous that Symantec had knowingly violated the FCA by failing to tell the Normal Companies Administration (“GSA”) about transactions that ought to have triggered a value discount clause within the governing contract. Though clear on legal responsibility, the court docket acknowledged its incapability to discern damages with any diploma of certainty and that any damages evaluation can be as dependable as “pulling a quantity out of skinny air.” Id. at 5. Given the shortage of readability, the court docket “adopted a ballpark (and certainly exceptionally conservative) estimate to function a baseline” for damages and awarded the US $1,068,950.16 in treble damages together with penalties totaling $231,000. Id. at 6-7.
In its amended filings, the court docket reiterated its preliminary place on legal responsibility; however acknowledged that it had erred in its calculations of each damages and penalties. Id. at 10. After accepting the evaluation provided by the US in post-trial briefing, the court docket elevated the damages discovering to $16,121,696.04 and its evaluation of civil penalties to $36,872,000. Id. at 29. To place this in perspective, the court docket’s revised calculations resulted in a quantity that was greater than 40 instances bigger than its preliminary evaluation.
This ruling demonstrates how troublesome it may be to evaluate damages in an FCA case. Counsel should learn greater than tea leaves to foretell damages in an FCA case. They have to: (1) perceive the knowledgeable analyses from the respective events; (2) articulate a complete, understandable, and compelling method to calculating damages; and (3) pivot to different approaches when it turns into clear that the very fact finder isn’t shopping for the preliminary pitch.
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