Riley v. St. Luke’s Episcopal Hospital
IN
THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_______________
97-20948
_______________
JOYCE RILEY,
Plaintiff-Appellant,
VERSUS
ST. LUKE’S EPISCOPAL HOSPITAL;
DR. BRANISLAV RADOVANCEVIC; O. HOWARD
FRAZIER, M.D.;
SURGICAL ASSOCIATES OF TEXAS, P.A.;
UNIVERSITY OF TEXAS HEALTH SCIENCE
CENTER AT HOUSTON;
BAYLOR COLLEGE OF MEDICINE; TEXAS
HEART INSTITUTE;
and
EDWARD K. MASSIN, M.D.,
Defendants-Appellees.
_________________________
Appeal from the United States District Court
for the Southern District of Texas
________________________
November 15, 1999
Before SMITH, DeMOSS, and STEWART, Circuit Judges.
JERRY E. SMITH, Circuit Judge:
Joyce Riley appeals the dismissal, for want of jurisdiction, of her action
for damages under the False Claims Act ("FCA"), 31 U.S.C.
? 3729 et seq. While we conclude, based on intervening circuit
caselaw, that the district court did have jurisdiction, we also determine that
Riley may not maintain her suit, for the provisions of the FCA under which she
sued violate the Take Care Clause of Article II of the Constitution.
Accordingly, we affirm the dismissal.
Riley, a former nurse in the heart transplant unit of St. Luke’s Episcopal
Hospital ("St. Luke’s"), sued eight defendants: St. Luke’s,
Baylor College of Medicine, the University of Texas Health Science Center at
Houston, the Texas Heart Institute, Surgical Associates of Texas, Doctors Edward
Massin and O. Howard Frazier, and Branislav Radovancevic. Riley alleges that
these defendants violated the FCA by defrauding and conspiring to defraud the
United States Treasury.(1)
Riley brought her suit under the qui tam provisions of the FCA,
which allow individual citizens to sue for fraud on behalf of the government and
collect part of the government’s recovery. Pursuant to the procedures
established in the qui tam provisions, see 31 U.S.C.
? 3730(b)(2), Riley filed a preliminary statement under seal, which the
United States reviewed at length. The government eventually decided not to
intervene under 31 U.S.C. ? 3730(b)(4)(B), so Riley proceeded in the
district court on her own.
After Riley filed her original complaint, the defendants moved to dismiss under
Fed. R. Civ. P. 12(b)(6) for failure to state a claim. The district court denied
each motion but requested additional briefing to address Riley’s standing under
Article III of the United States Constitution. Riley, the University of Texas
Health Science Center at Houston, and the United States as intervenor for the
limited purpose of defending the FCA’s constitutionality, briefed the standing
issue. Riley then filed a second amended complaint, which was met with another
round of motions to dismiss. Among the grounds for dismissal was an assertion by
the University of Texas Health Science Center at Houston that the Eleventh
Amendment bars Riley from suing it, because it is an arm of the state. See
U.S. Const. amend. XI.
In a scholarly and persuasive opinion, the district court dismissed Riley’s
claims on jurisdictional grounds, concluding that she had suffered no
injury-in-fact and therefore lacked standing to sue. See Riley v. St. Luke’s
Episcopal Hosp., 982 F. Supp. 1261, 1263-69 (S.D. Tex. 1997) (Hoyt, J.).
Because the court dismissed on standing grounds, it did not reach the arguments
presented in the motions to dismiss, including the Eleventh Amendment defense.
On appeal, the defendants maintain that Riley lacks standing, and they assert
two other constitutional arguments that they presented to the district court in
their motions to dismiss: (1) that the qui tam provisions of the FCA
violate the Constitution’s Appointments Clause and (2) that qui tam actions
in which the government does not intervene violate the Take Care Clause and the
constitutional doctrine of separation of powers. The United States continues its
intervention for the limited purpose of defending the constitutionality of the qui
tam provisions.
II.
Congress enacted the FCA in 1863 to combat widespread fraud by government
contractors during the Civil War.(2)
The Act, which was amended in 1943 and 1986, provides that anyone who presents a
false money claim to the federal government shall be liable for double or treble
damages and civil penalties of up to $10,000 per false claim. See 31 U.S.C.
? 3729. Under the qui tam provisions of the Act, any person may
bring a civil action "for the person and for the United States
Government" to recover damages and penalties.(3)
See id. ? 3730(b)(1). Though initiated by a private person–a
"relator"–a qui tam action is "brought in the name of
the Government." See id.
The qui tam provisions indicate that the United States is the real
party in interest, with the relator functioning as the government’s attorney. To
initiate a qui tam action, a relator must serve on the government the
complaint and a written disclosure of the information he possesses. See id.
? 3730(b)(2). The Attorney General then must decide, within sixty days,
whether to "intervene and proceed with the action."(4)
See id. By the expiration of the sixty days, the Attorney General must
inform the court whether the government shall proceed with the action; if not,
"the person bringing the action shall have the right to conduct the
action." See id. ? 3730(b)(4)(B).
If the Attorney General declines to proceed, the relator alone represents the
United States, taking full control of the litigation, including discovery,
admissions, and presentation of evidence, subject only to a few specific
limitations.(5)
If the relator prevails, most of the recovery is paid into the Treasury, with
the relator keeping between 25% and 30% as his reward. See id.
? 3730(d)(2). The relator is also entitled to attorneys’ fees. See id.
If the Attorney General initially decides not to proceed, he may intervene
later only upon a showing of "good cause," and such intervention may
not limit "the status and rights of the person initiating the action."
See id. ? 3730(c)(3). The relator thus retains primary control
over the case, despite the government’s intervention.
If the Attorney General does enter the action within the initial sixty-day
period, the government has "primary responsibility for prosecuting the
action." See id. ? 3730(c)(1). The relator, however, retains
"the right to continue as a party to the action." See id.
This participation right gives him a substantial role in the litigation, and he
is entitled to a hearing if the Attorney General decides to dismiss the action. See
id. ? 3730(c)(2)(A).
If the Attorney General proposes to settle the case but the relator objects, the
settlement may proceed only if "the court determines, after a hearing, that
the proposed settlement is fair, adequate, and reasonable under all the
circumstances." See id. ? 3730(c)(2)(B). In addition, the
relator participates fully at trial, calling and cross-examining witnesses,
except that
[u]pon a showing by the Government that unrestricted participation during the
course of the litigation by the person initiating the litigation would interfere
with or unduly delay the Government’s prosecution of the case, or would be
repetitious, irrelevant, or for the purposes of harassment, the court may, in
its discretion, impose limitations on the person’s participation.
See id. ? 3730(c)(2)(C).
When the False Claims action is primarily conducted by the Attorney General,
the relator receives between 15% and 25% of the proceeds, plus reasonable
expenses (including attorneys’ fees), as determined by the court. See id.
? 3730(d)(1). Moreover, if the government decides to pursue its claim in
some forum other than an FCA suit–such as an administrative penalty action–the
relator has the same rights in that proceeding that he would have in court. See
id. ? 3730(c)(5).
III.
Riley and the government contend that the long history of qui tam
actions in federal courts indicates that such actions surely are
constitutionally valid. But the qui tam mechanism’s historical pedigree
is not sufficient to insulate the FCA’s qui tam provisions from serious
constitutional scrutiny.
Riley and the government correctly point out that qui tam actions have
been recognized throughout American history and were approved under English
common law prior to the founding of the Republic.(6)
They also note that the first Congress enacted several statutes containing qui
tam provisions,(7)
a fact they believe indicates that the framers did not think the qui
tam concept is inconsistent with the Constitution.(8)
Longstanding historical usage, however, does not, by itself, render a
practice constitutional.(9)
When the Supreme Court has deferred to history to validate the constitutionality
of a practice, the practice has been one that was extensively debated by the
adopting Congress and had become "part of the fabric of our society."(10)
Qui tam actions that are brought by uninjured relators and in which
the government does not intervene simply do not possess historical credentials
worthy of blind deference. There is no evidence that the early Congresses
considered the constitutionality of such actions, and the presence of a few
early qui tam statutes does not amount to an "unambiguous and
unbroken history." Indeed, such statutes were adopted in the Republic’s
early years only sparsely, and they largely disappeared over a century ago.
Many of the early statutes granting bounties were simply informer laws that
granted informers a reward but no right to sue on behalf of the government.(11)
Of those qui tam statutes that did permit private actions, most
redressed injuries suffered by private individuals–not by the government
exclusively.(12)
Later Congresses authorized qui tam actions only sporadically; apart
from the FCA, subsequent Congresses enacted only seven qui tam
statutes, and none was adopted after 1871.(13)
In short, this is no "unambiguous and unbroken history" indicating
that qui tam actions by uninjured plaintiffs suing on the government’s
behalf "have become part of the fabric of our society." See Marsh,
463 U.S. at 792.
In addition, the fact that the First Congress adopted some form of qui
tam does not necessarily mean that qui tam actions are
constitutional. Indeed, in Marbury v. Madison, 5 U.S. (1 Cranch)
137 (1803), the Court struck down as unconstitutional ? 13 of the
Judiciary Act, adopted by the First Congress, and the Supreme Court has
subsequently opined that numerous other actions taken by the First Congress were
unconstitutional.(14)
The notion that a Congress whose members were involved in the adoption of a
constitutional provision are the definitive expounders of the provision’s
meaning is suspect. For example, the same Congress that proposed the Fourteenth
Amendment adopted one week later a statute that reaffirmed racial
segregation of public schools in Washington, D.C. See Marsh,
463 U.S. at 814 n.30 (Brennan, J., dissenting). Accordingly, we decline
simply to defer to history to resolve the constitutional questions presented.
IV.
The district court held that it lacked power to adjudicate Riley’s claim
under Article III, which limits the federal judiciary’s power to resolving
"cases" or "controversies." See U.S. Const. art.
III, ? 2. The court determined that Riley lacked standing under
Article III because she had not alleged all the elements of standing
required by recent Supreme Court decisions; in particular, she lacked an
injury-in-fact. See Riley, 982 F. Supp. at 1268.
On appeal, the defendants present a number of arguments in support of the
district court’s conclusion that a qui tam relator who has not
experienced any personalized injury fails the test for Article III standing set
forth in Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).(15)
We are precluded, however, from addressing those contentions, for a panel of
this court recently concluded that a qui tam relator who has suffered
no personalized injury may have standing even if the government does not
intervene. See United States ex rel. Foulds v. Texas Tech Univ., 171
F.3d 279, 288 n.12 (5th Cir. 1999), petition for cert. filed, 68
U.S.L.W. 3138 (U.S. Aug. 23, 1999) (No. 99-321), petition for cert. filed,
68 U.S.L.W. 3153 (U.S. Aug. 27, 1999) (No. 99-365), petition for
cert. filed (Aug. 27, 1999) (No. 99-513).(16)
In what amounts to no more than a passing reference in a brief footnote, the Foulds
panel, in stating that an uninjured qui tam relator may have standing,
relied on two authorities: a pre-Defenders of Wildlife opinion of this
court concluding that an uninjured relator had standing, see United States
ex rel. Weinberger v. Equifax, 557 F.2d 456, 460 (5th Cir. 1977), and a
recent opinion in which the Supreme Court adjudicated an FCA qui tam
suit without objecting to the standing of the uninjured relator, see Hughes
Aircraft Co. v. United States ex rel. Schumer, 520 U.S. 939 (1997).
Defendants argue that neither of these authorities is controlling.
Weinberger, issued before the Supreme Court strengthened the
standing doctrine, adopted a now-repudiated "statutory permission"
theory, which reasons that uninjured relators have standing because Congress has
granted it to them via statute.(17)
That theory, adopted by some other courts that have approved relator standing,(18)
was viable when there was some confusion as to whether injury-in-fact is a
prudential standing requirement that is waivable.(19)
But the Supreme Court since has indicated that the injury requirement is a
constitutional–not a prudential–standing requirement and, accordingly, cannot
be waived by legislation.(20)
The Hughes Aircraft Court’s failure to object to a lack of standing
also does not compel the conclusion that qui tam relators meet Article
III’s standing requirements. The Court’s failure to address standing should not
necessarily be read as an implicit holding that standing exists,(21)
for in dismissing the relator’s action on statutory grounds, the Court may
simply have been taking the "prudential" route of avoiding
constitutional questions.(22)
Notably, Hughes Aircraft was decided before Steel Co. v. Citizens
for a Better Env’t, 523 U.S. 83, 94-95 (1998), which rejected that
prudential approach for jurisdictional questions.
Nonetheless, the panel that decided Foulds–albeit sua sponte
and without benefit of briefing–did raise the issue of relator standing,
concluding that a qui tam relator who lacked a personalized injury had
standing, even when the government had declined to intervene. Our "rule of
orderliness" therefore binds us on this issue, as a panel of this court
cannot overrule a prior panel, absent circumstances not present here. See
Montesano v. Seafirst Commercial Corp., 818 F.2d 423, 425-26 (5th Cir.
1987).(23)
Defendants contend that Foulds‘s discussion of relator standing is dictum
and thus is not binding on us. They note that the Foulds court did not
need to reach the issue of the relator’s standing to resolve the question
presented in that case–i.e., whether the Eleventh Amendment barred the
relator’s claims against state entities–for the Eleventh Amendment issue was
itself jurisdictional. See Foulds, 171 F.3d at 288 (characterizing
whether the Eleventh Amendment applies as a "threshold jurisdictional
issue"). Hence, Foulds‘s holding that the Eleventh Amendment
barred the qui tam relator’s suit against state entities disposed of
all claims in that case, regardless of whether the relator individually
possessed Article III standing. Defendants therefore urge that Foulds‘s
discussion of a qui tam relator’s standing does not control the Article
III issue presented in this appeal.
We disagree that Foulds is not controlling. In concluding that Foulds‘s
discussion of the relator’s standing is unnecessary to the opinion’s ultimate
conclusion and is therefore dictum, the defendants assume that the
jurisdictional requirements of Article III and the Eleventh Amendment are
"at the same level." In other words, it is not necessary, they assume,
to determine whether there is an Article III case or controversy before
deciding whether the Eleventh Amendment limits the federal court’s power to hear
the case.
The Supreme Court has concluded otherwise. In Calderon v. Ashmus,
523 U.S. 740, 745 (1998), the Court determined that it "must first
address" whether a particular action for a declaratory judgment was an
Article III case or controversy before deciding the Eleventh Amendment question
on which certiorari had been granted. The Calderon Court explained that
"[w]hile the Eleventh Amendment is jurisdictional in the sense that it is a
limitation on the federal court’s judicial power, and therefore can be raised at
any stage of the proceedings, we have recognized that it is not coextensive with
the limitations on judicial power in Article III."(24)
Hence, while the Foulds court was correct to characterize whether
the Eleventh Amendment applies as a "threshold jurisdictional issue," see
Foulds, 171 F.3d at 288, defendants are wrong in assuming that Article III
standing–a more "basic" jurisdictional requirement–need not be
addressed before considering whether the Eleventh Amendment abrogates federal
jurisdiction. Foulds‘s discussion of standing, then, is not dictum
and binds this panel to the conclusion that an uninjured qui tam
relator may have Article III standing.
V.
The defendants moved to dismiss, inter alia, on the ground that qui
tam actions that are brought by uninjured relators such as Riley and in
which the government does not intervene violate the Constitution’s Take Care
Clause and the constitutional doctrine of separation of powers. Although the
district court dismissed only on the basis of lack of standing, the defendants’
alternative constitutional arguments are properly before us on appeal(25)
and provide an alternative ground for affirming the dismissal.(26)
A.
The Take Care Clause states that "[the Executive] shall take Care
that the Laws be faithfully executed." U.S. Const. art. II, ? 3. The
doctrine of separation of powers prohibits one branch of government from
intruding on the constitutionally granted powers of another.(27)
The doctrine may be violated when one branch of government aggrandizes itself at
the expense of another or when one branch "impermissibly
undermine[s]" the constitutionally granted powers and functions of another,
even if there is no aggrandizement.(28)
Defendants contend that Congress’ enactment of qui tam provisions
that permit relators to bring actions on behalf of the government, even when the
government declines to intervene, violated separation of powers and the Take
Care Clause, because Congress transferred power to prosecute the government’s
claims from the Executive Branch to unaccountable private relators. Defendants
maintain that (1) prosecution of the government’s claims by individuals wholly
outside the Executive Branch constitutes a violation of the Take Care Clause,
and (2) the fact that the Legislative Branch stripped the Executive Branch of
its exclusive prosecution power constitutes a violation of the separation of
powers doctrine.(29)
We consider these arguments together, because they are closely intertwined: Each
is concerned with the encroachment on the Executive’s exclusive power to conduct
litigation on behalf of the United States.
B.
The Take Care Clause gives the Executive the power to enforce the laws, see
Springer v. Philippine Islands, 277 U.S. 189, 202 (1928), and such power
includes the authority "to investigate and litigate offenses against the
United States," see United States ex rel. Stillwell v. Hughes
Helicopters, Inc., 714 F. Supp. 1084, 1088 (C.D. Cal. 1989)
(citing Buckley v. Valeo, 424 U.S. 1, 138 (1976)). There are relatively
few cases in which the Supreme Court has discussed the Executive Branch’s
"take care" duties and the separation of powers problems that are
raised when an act of Congress impinges on those duties. In Commodity
Futures Trading Comm’n v. Schor, 478 U.S. 833, 856 (1986), the Court
stated that an act of Congress is unconstitutional if it "impermissibly
undermines" the powers of the Executive–leaving unanswered the definition
of "permissible." In Nixon v. Administrator of Gen. Servs.,
433 U.S. 425, 443 (1977), the Court held that Congress may not disrupt
"the proper balance between the coordinate branches [by] prevent[ing] the
Executive from accomplishing its constitutionally assigned functions"; the
Court did not explain what degree of congressional interference is necessary
before the "proper balance" has been disrupted.
In a more recent case, the Court suggested that vesting federal law enforcement
authority in officials who are not under the meaningful control of the President
violates the Take Care Clause. Striking down (on other grounds) Brady Act
provisions that required state officials to execute federal law by conducting
background checks on gun purchasers, the Court explained:
The Constitution does not leave to speculation who is to administer the laws
enacted by Congress; the President, it says, "shall take Care that the Laws
be faithfully executed," Art. II, ? 3, personally and through
officers whom he appoints . . . . The Brady Act effectively
transfers this responsibility to thousands of [state law enforcement officers]
in the 50 States, who are left to implement the program without meaningful
Presidential control (if indeed meaningful Presidential control is possible
without the power to appoint and remove). The insistence of the Framers upon
unity in the Federal Executive–to insure both vigor and accountability–is
well-known . . . . That unity would be shattered, and the power of the
President would be subject to reduction, if Congress could act as effectively
without the President as with him, by simply requiring state officers to execute
its laws.
Printz v. United States, 521 U.S. 898, 936 (1997) (citations
omitted).(30)
The Court’s most thorough analysis of the Take Care Clause and its
relationship to the separation of powers doctrine appears in Morrison v.
Olson, 487 U.S. 654 (1988), in which the Court upheld the constitutionality
of the independent counsel provisions of the Ethics in Government Act. The Court
announced that when congressional action potentially undermines the Executive’s
litigative function, the test of constitutionality is whether the Executive
Branch retains sufficient "control" over the litigation "to
ensure that the President is able to perform his constitutionally assigned
duties." Id. at 696. While this test is not much more instructive
than are the formulations in Schor and Nixon and the dicta in Printz,
it is the Court’s most direct pronouncement on this category of separation of
powers problems, and the courts that have considered the constitutionality of
the FCA’s qui tam provisions agree that the Morrison
"control" test is the appropriate standard to apply in addressing the
Take Care Clause/separation of powers issue.(31)
C.
We therefore use Morrison as our guide. To determine whether
the qui tam provisions violate the Take Care Clause and the separation
of powers doctrine, we first consider the extent to which the provisions reduce
the Executive’s control of litigation on the government’s behalf, and we then
compare that loss of control to the degree of loss the Morrison Court
found to be constitutionally acceptable.(32)
1.
FCA qui tam actions in which the government does not intervene
encroach on two aspects of the Executive’s authority: (1) the discretion to
decide whether to prosecute a claim and (2) the control of litigation brought to
protect the government’s interests. First, the provisions permit a private
citizen to sue on behalf of the government, even though the Attorney
General–perhaps because he believes that institution of the action is inimical
to the government’s interests–has decided not to pursue the claim.(33)
This power removes from the Executive Branch the prosecutorial discretion that
is at the heart of the President’s power to execute the laws.(34)
Riley and the government maintain that the prosecutorial discretion given the
Executive means simply that he cannot be compelled to pursue an enforcement
action he believes to be unwarranted; his discretion does not include the power
to bar others from filing lawsuits under statutory schemes that permit
enforcement through both governmental and private actions. But Riley and the
government are falsely analogizing qui tam actions to actions in which
the plaintiff sues on his own behalf and incidentally benefits the government,
as in an antitrust case.(35)
Private enforcement actions by aggrieved individuals are not subject
to the Executive’s prosecutorial discretion, but when the sole injury–the only
ticket into court–belongs to the government, the Executive’s prosecutorial
discretion must include the power to decide whether to bring suit. Therefore,
the FCA provisions permitting qui tam actions to proceed when the
government has decided not to intervene do encroach on the Executive’s authority
to initiate litigation aimed solely at redressing the government’s injuries.
Second, the FCA’s qui tam provisions significantly limit the
government’s ability to control the litigation. The Executive may not freely
dismiss a qui tam action; if the relator objects to the decision to
dismiss, the government must notify the relator of the filing of the motion to
dismiss, and the court must grant the relator a hearing before deciding whether
to permit dismissal.(36)
See 31 U.S.C. ? 3730(c)(2)(A).
Moreover, the Executive may not freely settle a qui tam action; if
the relator objects to the government’s attempt to settle, the government must
obtain court approval, and the court may approve only after it holds a hearing
and finds that the settlement is "fair, adequate, and reasonable under all
the circumstances."(37)
See id. ? 3730(c)(2)(B). The Executive may not freely restrict
the relator’s participation in the qui tam action; the government must
first show the court that the relator’s unrestricted participation "would
interfere with or unduly delay the Government’s prosecution of the case, or
would be repetitious, irrelevant, or for purposes of harassment." See
id. ? 3730(c)(2)(C). Finally, the Executive has no power to remove
the relator from the litigation under any circumstances.(38)
2.
Having considered how the FCA’s qui tam provisions encroach on
Executive authority, we now compare that encroachment to the loss of executive
authority occasioned by the independent counsel provisions at issue in Morrison.
We conclude that, in FCA qui tam actions in which the government does
not intervene, important safeguards that ensure the Attorney General’s control
of the independent counsel are lacking. FCA qui tam actions in which
the government does not intervene thus fail to provide the Attorney General with
"sufficient control over the [relator] to ensure that the President is able
to perform his constitutionally assigned dut[y]" to take care that the laws
be faithfully executed. See Morrison, 487 U.S. at 696. Accordingly, the
FCA provisions permitting qui tam actions to proceed when the
government does not intervene impermissibly undermine the President’s exercise
of his constitutionally assigned duties and thereby violate the separation of
powers doctrine.
In upholding the independent counsel provisions, the Morrison
Court stressed four features of the Ethics in Government Act that preserved
Executive control of prosecutions:
Most importantly, [1] the Attorney General retains the power to remove
the counsel for "good cause," a power that we have already concluded
provides the Executive with substantial ability to ensure that the laws are
"faithfully executed" by an independent counsel. [2] No independent
counsel may be appointed without a specific request by the Attorney General, and
the Attorney General’s decision not to request appointment if he finds
"no reasonable grounds to believe that further investigation is
warranted" is committed to his unreviewable discretion. The Act thus
gives the Executive a degree of control over the power to initiate an
investigation by the independent counsel. [3] In addition, the jurisdiction
of the independent counsel is defined with reference to the facts submitted by
the Attorney General, and [4] once a counsel is appointed, the Act
requires that the counsel abide by Justice Department policy unless it
is not "possible" to do so.
Morrison, 487 U.S. at 696 (emphasis added).
None of these features is present in the FCA’s qui tam provisions.
The Attorney General has no power to remove a relator, no matter how
irresponsible the suit becomes. If he makes the proper showing to the court, the
Attorney General may limit the relator’s participation, see
31 U.S.C. ? 3730(c)(2)(C), and may dismiss the action after the court
has provided the relator with a hearing on the motion to dismiss, see id.
? 3730(c)(2)(A), but may not simply remove the relator, see id. ? 3730(c)(1),
(3).
Perhaps more importantly, the second crucial feature present in the
independent counsel statute is missing: The Attorney General loses all control
over the decision whether to initiate the suit. Even if the Attorney General
determines that there are "no reasonable grounds" for the fraud
action, the relator may override that judgment and initiate a lawsuit. The
action goes forward in the government’s name, under total control of the
self-interested and publicly unaccountable relator, even if the Attorney General
has concluded that proceeding with a lawsuit is not merited or is otherwise not
in the United States’s interests or is even contrary to those interests.(39)
The third and fourth features are also conspicuously absent. The Attorney
General has no control over the breadth of a relator’s suit. Indeed, a relator
may make sweeping allegations that, while true, he is unable effectively to
litigate. He thereby can bind the government, via res judicata, and
prevent it from suing over those concerns at a later date when more information
is available. Finally, the relator, unlike the independent counsel, need not
adhere to the rules and policies of the Department of Justice.
In Kelly, the Ninth Circuit recognized these distinctions between
the independent counsel statute and the FCA’s qui tam provisions but
held that a proper analysis would focus on the net effect of the provisions on
the Executive’s powers–not on the presence or absence of the particular
features the Morrison Court had highlighted.(40)
It then concluded that "[t]aken as a whole, . . . the FCA
affords the Executive Branch a degree of control over qui tam relators that is
not distinguishable from the degree of control the Morrison Court found
the Executive Branch exercises over independent counsels."(41)
Kelly, 9 F.3d at 757.
We disagree. Even taking the qui tam provisions "as a
whole" and not focusing on any of the particular differences between the
provisions and the independent counsel statute, qui tam effects a
greater degree of encroachment on Executive prerogatives than does the Ethics in
Government Act upheld in Morrison. The Ninth Circuit admitted that the
"Attorney General[‘s] . . . unreviewable discretion to
request appointment of a counsel, and therefore to initiate litigation by a
counsel," is an "unqualified control built into the independent
counsel provisions," and that "[c]learly, the government has greater
authority to prevent the initiation of prosecution by an independent counsel
than by a qui tam relator." Id. at 754. Once suit has been filed,
the controls the Executive Branch may exercise–most of which require court
approval of some sort–are simply not sufficient to counterbalance this major
encroachment on Executive power.
Another fundamental difference between the qui tam provisions and the
independent counsel statute supports our conclusion. The independent counsel
device was intended to address a narrow structural problem–the perceived
conflict of interest when the Attorney General is called on to investigate
criminal wrongdoing by his close colleagues within the Executive Branch. The Morrison
Court accepted the independent counsel as an appropriate means of dealing
with this intra-branch conflict. The device arguably does not unduly encroach on
executive power, because its very purpose is to investigate impermissible
executive activity. Moreover, it is narrowly tailored to achieve its
purpose: It encroaches on the Executive only to the limited extent necessary to
protect against a conflict of interest, while retaining executive control
consistent with that objective.
The FCA’s qui tam provisions, on the other hand, are not aimed at a
structural defect within the Executive Branch (They simply aim to increase
protections against fraud.) and are not narrowly tailored to achieve their ends.(42)
Given the independent counsel statute’s special objective and narrow tailoring,
the Morrison Court likely was especially forgiving of Executive
encroachment. Morrison, then, represents, as we have said, the outer
boundary of constitutionally permissible encroachment on executive powers, and
the FCA’s qui tam provisions must fall under Morrison‘s
compelling balancing test.(43)
VI.
The dissent suggests that qui tam actions in which
the government does not intervene are constitutionally acceptable as valid
delegations of executive authority. There are two problems with this analysis.
First, there is no real delegation of executive authority in
such cases. Congress cannot be delegating to relators the President’s
power and duty to take care that the laws be faithfully executed, for Congress
may not delegate purely executive power without the acquiescence of the
Executive. The Executive Power Clause vests the executive power solely
in the President, see U.S. Const. Art. II, ? 1 ("The
executive Power shall be vested in a President of the United States of
America."), so any delegation of executive power must come from the
Executive.(45)
There is certainly no express delegation of executive power from the Attorney
General to qui tam relators, and we disagree with the dissent’s
assertion that a decision not to intervene in a qui tam action is
appropriately viewed as an implicit delegation of executive authority to the
relator.
The meaning of an Attorney General’s decision not to
intervene is ambiguous at best. It might represent his belief that the qui
tam action would harm the government’s interests; for example, a suit
against a defense contractor may lead to the divulging of sensitive information.
There is no way to tell, from a mere decision not to intervene, whether the
Attorney General is saying to the relator, "We don’t have the resources to
pursue this action; go ahead and do it for us," or "Bringing this
action is contrary to our interests; don’t pursue it."(46)
In addition, the dissent’s delegation theory must fail
because of the absence of an "intelligible principle" to guide the
relator’s exercise of his allegedly delegated executive authority. Neither the
FCA nor the Attorney General offers a relator any guidance as to how he should
exercise his allegedly delegated authority to litigate the government’s claims.
The relator is not even told to litigate "in the public interest" or
"for the public good." Without any intelligible principle to
constrain the relator’s discretion, there can be no valid delegation of
executive authority. See J.W. Hampton, Jr. & Co. v. United States,
276 U.S. 394, 409 (1928); American Trucking Ass’n v. EPA, 175 F.3d
1027, 1034 (D.C. Cir. 1999). The dissent asserts, perplexingly, that the
intelligible principle is "the ability of the Executive to intervene in any
qui tam suit," but the possibility of Executive intervention is
not really a guiding principle at all; it in no way assists the relator in
figuring out how to exercise his allegedly delegated executive authority.
Because the dissent has not demonstrated (1) a genuine
delegation of executive authority or (2) an intellible principle to guide the
relator’s exercise of such authority, its delegation argument fails to show the
constitutionality of FCA qui tam actions in which the government does
not intervene.
VII.
The defendants argued forcefully in the district court, and
contend now, that Riley’s lawsuit also violates Article II of the Constitution
because, as a qui tam relator suing on behalf of the federal
government, Riley is acting as an "officer of the United States" but
has not been appointed in conformity with Article II’s Appointments Clause.(47)
Defendants contend that the FCA’s qui tam provisions
violate the Appointments Clause by authorizing private parties to initiate and
conduct litigation on behalf of the United States–a power properly exercised
only by persons who qualify as "officers" under the Appointments
Clause. See, e.g., Buckley, 424 U.S. 1, 140 (1976) (per curiam).
Riley and the government admit that qui tam relators are not appointed
pursuant to any of the mechanisms set forth in the Appointments Clause, but they
aver that relators are not "officers" and that, accordingly, they need
not be appointed according to Article II’s provisions. Because we affirm the
dismissal on the ground that the qui tam provisions of the FCA violate
the Take Care Clause and the separation of powers doctrine, we, like the
district court, find it unnecessary to reach the Appointments Clause issue.(48)
AFFIRMED.
DeMOSS, Circuit Judge, specially concurring:
I concur in parts I, II, III, V, VI and VII of the majority
opinion authored by Judge Smith, which hold that qui tam actions
brought by uninjured relators violate the Constitution’s Take Care Clause and
the constitutional doctrine of separation of powers when the government has not
intervened in the suit. Accordingly, I concur in the judgment of the Court,
which affirms the decision of the district court.
I do not agree with and am unable to join in the reasoning
and analysis of part IV of the majority opinion,(49)
which finds error in the district court’s legal determination that Riley lacked
Article III standing to bring this suit. In my view, neither precedent nor
history, nor any more abstract theory of constitutional or logical analysis
requires the conclusion that Riley, who suffered no particularized or personal
injury, is blessed with standing to bring this suit on behalf of an otherwise
disinterested government. To the contrary, the Supreme Court’s recent
structuralist approach to jurisdiction heralds a new era in the evolution of the
standing doctrine; one in which the rigors of the injury requirement inherent in
the case or controversy component of Article III will not be excused on the
theory that they constitute mere prudential considerations. See Steel
Co. v. Citizens for a Better Env’t, 118 S. Ct. 1003, 1016-20
(1998); see also Federal Election Comm’n v. Akins,
118 S. Ct. 1777, 1784-87 (1998). Given the very real possibility of en banc or
even Supreme Court review, and with no intent to distract or detract from the
wisdom of the majority’s view with respect to the remaining issues, I write
separately to explain why I believe that the district court’s conclusion that
Riley lacked standing is correct, and why we should take that rationale into
account when judging the propriety of the district court’s decision dismissing
Riley’s claims.
I. BACKGROUND
Plaintiff-appellant Joyce Riley filed this suit pursuant to
the qui tam provisions of the False Claims Act, 31 U.S.C.
?? 3729-3733 (the FCA). Those provisions authorize individual citizens to
sue on behalf of the government for fraud committed against the government. The qui
tam provisions ultimately permit a successful individual plaintiff —
called a "relator" — to collect part of the government’s recovery.
Riley filed a preliminary statement under seal, which the U.S. Department of
Justice reviewed at length. See 31 U.S.C. ? 3730(b)(2). Having
reviewed Riley’s statement, the government declined its right to intervene in
the suit, see ? 3870(b)(4)(B), and Riley proceeded on her own in
the district court.
After Riley filed her original complaint, the various
defendants filed motions to dismiss for failure to state a claim. The district
court denied each motion, but requested additional briefing to address Riley’s
standing under Article III of the Constitution. Riley, the University of Texas
Health Science Center, and the United States, as intervenor for the limited
purpose of defending the FCA’s constitutionality, briefed the standing issue.
Riley then filed a second amended complaint, which was met with another round of
motions to dismiss under Rule 12(b)(6).
The district court dismissed Riley’s claims on jurisdictional
grounds, concluding that Riley lacked Article III standing because she had not
even alleged any personal injury in fact, which is part of the "irreducible
constitutional minimum" that must be shown to establish Article III
standing. See United States ex rel. Riley v. St. Luke’s
Episcopal Hosp., 982 F. Supp. 1261, 1268 (S.D. Tex. 1997). The
district court further held that there was no constitutionally valid analysis
that would permit Riley to pursue her fraud claims for injury to the government.
Specifically, the district court held that Congress could not, by way of the
FCA’s qui tam provisions, legislatively delegate or assign to a private
citizen the right to pursue the government’s interest with respect to claims
that would otherwise be constitutionally vested within the control of the
Executive branch. See id. at 1264-69.
Riley appealed, arguing that qui tam relators suing
under the FCA have standing to sue on behalf of the United States, even when the
United States has declined to prosecute the suit on its own. Riley offers a
variety of theories in support of her position. Specifically, Riley argues that
the standing of qui tam relators is well-established by binding
precedent, that the constitutional validity of qui tam actions is
proven by a long and illustrious history of congressional usage, and finally,
that Article III standing concerns about qui tam suits are answered by
any number of more abstract constitutional theories, including the statutory
permission theory, the assignment theory, the retaliation theory, and the bounty
theory. I will begin with a brief statement of Article III principles and then
consider each of these arguments in turn.
- . GENERAL PRINCIPLES
Federal court jurisdiction extends only to "cases"
and "controversies." U.S. Const. art. 3, ? 2; see also Steel
Co., 118 S. Ct. at 1016; Lujan v. Defenders of
Wildlife, 112 S. Ct. 2130, 2136 (1992). Standing is an essential
and constitutionally mandated part of the case or controversy requirement of
Article III, see Lujan, 112 S. Ct. at 2136, which
prevents the judicial process from being merely "a vehicle for the
vindication of the value interests of concerned bystanders," Valley
Forge Christian College v. Americans United for Separation, 102
S. Ct. 752, 758 (1982). Although standing may be informed by some
prudential considerations as well, the Supreme Court has unambiguously defined
three indispensable elements that comprise the "irreducible constitutional
minimum" required to establish Article III standing. See Lujan,
112 S. Ct. at 2136.
"First, the plaintiff must have suffered an `injury in
fact.’" Lujan, 112 S. Ct. at 2136; see also
Steel Co., 118 S. Ct. at 1016-17; Association
of Community Orgs. for Reform Now v. Fowler, 178 F.3d 350, 356
(5th Cir. 1999). The alleged injury must be "actual or imminent," as
opposed to "conjectural" or "hypothetical." See Lujan,
112 S. Ct. at 2136. Of equal importance, the alleged injury must be concrete and
particularized in the sense that it "affects the plaintiff in a personal
and individual way." Id. at 2136 & n.1.
Second, there must be causation. See Steel
Co., 118 S. Ct. at 1016-17; Lujan, 112
S. Ct. at 2136. Causation is established when the plaintiff’s alleged injury is
directly related to the defendant’s objectionable conduct, and is "not the
result of the independent action of some third party not before the court."
Lujan, 112 S. Ct. at 2136. Finally,
"there must be redressibility." Steel Co.,
118 S. Ct. at 1017. Redressibility is established when there is a likelihood
that the requested relief will redress the plaintiff’s alleged injury. Steel
Co., 118 S. Ct. at 1017; Lujan,
112 S. Ct. at 2136.
No one contends that the Supreme Court has ever explicitly
waived or excused failure to comply with these fundamental standing
requirements, whether in a qui tam suit or any other type of suit. To
the extent there could be any remaining doubt, surely Steel Co.
and Lujan foreclose any argument that an uninjured
plaintiff, who by definition has not suffered any cognizable personal injury,
nonetheless enjoys Article III standing.
No one claims that Riley herself has sustained the type of
concrete and personalized injury required to satisfy the rigors of Article III.
That fact alone would seem to preclude a finding of standing in this case. But
Riley’s articulated theories of standing, and the theories relied upon by those
of our sister circuits that have permitted uninjured qui tam relators
to proceed with suit, are premised upon the proposition that such relators
"stand in the shoes" of the government with respect to the injury
caused by the fraudulent claims. If Riley is to stand in the government’s shoes,
then we must come up with some constitutionally competent explanation for
explaining how she got there.
III. THE PRECEDENT ARGUMENT
A. Supreme Court Precedent
Riley contends that the Supreme Court either implicitly or
explicitly approved of qui tam relator standing under the FCA in four
cases. In three of those cases, United States ex rel. Schumer v.
Hughes Aircraft Co., 117 S. Ct. 1871 (1997); United
States ex rel. Marcus v. Hess, 63 S. Ct. 379 (1943); and Marvin
v. Trout, 26 S. Ct. 31 (1905), the Supreme Court decided qui
tam cases brought under the FCA (Hughes and Hess)
or some other statute (Marvin) without questioning its
Article III ability to do so. Thus, Riley reads the Supreme Court’s failure to
address standing sua sponte as an implicit assertion that standing
existed in each case. This reasoning is inherently suspect. See Giles
v. NYLCare Health Plans, Inc., 172 F.3d 332, 336 n.2 (5th Cir.
1999) ("Even though subject matter jurisdiction can be raised sua
sponte, we take nothing away from our failure to do so in these
cases."). But there are even better reasons for rejecting the
"implicit" holdings suggested by Riley.
The first case, Marvin v. Trout, 26
S. Ct. 31 (1905), did not present any question related to the qui tam provisions
of the False Claims Act, the statute at issue here. To the contrary, Marvin
involved only the constitutional validity of an Ohio state statute
that was applied in that case to permit a spouse to recover gambling losses
from, inter alia, the owner of the gambling establishment where the losses were
incurred. The Supreme Court noted that no well-defined constitutional issues had
been presented to the lower courts or to the Supreme Court. Id.
at 33-34. Indeed, the Supreme Court noted that the federal issues involved were
so poorly defined that similar petitions had been held to raise no federal issue
at all. Id. at 34-35. Nonetheless, in a subsequent
discussion assuming that there was a due process violation at issue, the Supreme
Court first raised and then rejected the argument that every action brought by
an informer to recover a penalty or forfeiture granted by statute would be per
se unconstitutional. Id. Given the limitations on both
the issues presented and the holding in Marvin, that
case cannot be cited with any credibility as a considered holding on the issue
of standing under the FCA.
Only two of Riley’s four Supreme Court cases, Hughes
and Hess, involved the qui tam provisions set
out in the FCA, the statute at issue in this case. It is abundantly clear from
the text of Hughes itself that the Supreme Court did
not intend any "implicit" holding on the issue of Article III
standing. Indeed, the writ of certiorari in Hughes was
expressly limited to "the nonconstitutional questions presented by the
petition" for writ of certiorari. Hughes, 117 S.
Ct. at 1875 n.3. The "constitutional challenges to the qui tam
provisions" of the FCA, which were presented to and decided by the courts
below, and which included the argument that qui tam relators lack
standing, see United States ex rel. Schumer v. Hughes
Aircraft Co., 63 F.3d 1512, 1520-21 (9th Cir. 1995), vacated, 117
S. Ct. 1871 (1997), were simply not before the Supreme Court for
decision. Hughes, 117 S. Ct. at 1875 n.3. Instead, the
Hughes court decided the case on a merit-based issue
of statutory construction. See id. at 1878.
Hess
may skate a little closer to some of the constitutional concerns raised by the
FCA’s qui tam provisions, but the case is likewise silent on the issue
of the Article III requirement for an injury in fact, or any of the other
fundamental elements of Article III standing. To the contrary, the disposition
in Hess, like the disposition in Hughes,
is based upon an issue of merit-based statutory construction. See Hess,
63 S. Ct. at 383-84.
The timing and context of Hess, and
the plain language used in Hughes, compels the
conclusion that the Supreme Court did not intend to reach any issue relating to
Article III standing in those cases. See Ara Lovitt, Note, Fight for
Your Right to Litigate: Qui Tam, Article II, and the President, 49 Stan. L.
Rev. 853, 855 n.12 (1997) (suggesting, in 1997, that the Supreme Court may be
waiting upon a circuit split to directly address the standing of qui tam
relators); see also Edward A. Hartnett, The Standing of the
United States: How Criminal Prosecutions Show that Standing Doctrine is Looking
for Answers in all the Wrong Places, 97 Mich. L. Rev. 2239, 2243-45 (1999)
(explaining how courts have avoided reconciling the injury in fact standing
requirement with ancient qui tam practice). Significantly, all four of
the Supreme Court cases Riley relies upon, including Hughes
and Hess, were decided before Steel
Co. v. Citizens for a Better Env’t, 118 S. Ct. 1003 (1998). Steel
Co. considered and rejected the argument that the Court can assume
hypothetical jurisdiction to reach the merits in a case without regard to
whether the parties have raised a disputed question relating to Article III
jurisdiction. See id. at 1012-15 & n.3
(noting the absence of any Supreme Court cases addressing the merits before
first answering any "disputed question of Article III jurisdiction").
For these reasons, the Court should reject Riley’s invitation to draw any
meaningful inference from the Court’s silence in Marvin,
Hess, and Hughes on the
important issue of Article III standing.
The fourth Supreme Court case, which Riley reads more broadly
as explicitly holding that a qui tam relator has Article III standing
is Lujan v. Defenders of Wildlife, 112 S. Ct. 2130
(1992) — the very case the district court cited for the proposition that qui
tam relators who lack a personalized injury also lack Article III standing
to sue. Lujan involved a challenge to a rule
promulgated by the Secretary of the Interior interpreting certain provisions of
the Endangered Species Act. See id. at 2135.
The Supreme Court stated that the rule at issue could not vest private citizens
with standing to sue on the theory that the statutory provisions involved
created "an abstract, self-contained, noninstrumental `right’ to have the
Executive observe the procedures required by law." Id.
at 2143. In reaching that conclusion, the Court distinguished the issue
presented from the "unusual case in which Congress has created a concrete
private interest in the outcome of a suit against a private party for the
government’s benefit, by providing a cash bounty for the victorious
plaintiff." Id. at 573. To the extent this is
relevant at all in this FCA suit, it is plainly dictum used to define the scope
of the Lujan decision, rather than any explicit
approval of qui tam actions under the FCA or, for that matter, qui
tam actions in general. As in Hughes, Hess,
and Trout, the standing of qui tam relators
under the FCA was simply not before the Lujan Court.
To sum up, Riley has not offered any binding or persuasive
authority that the Supreme Court has either implicitly or explicitly closed the
door on arguments that qui tam relators under the FCA lack standing.
B. Fifth Circuit Precedent
The majority somewhat reluctantly concludes that Fifth
Circuit precedent precludes a holding that Riley lacked Article III standing in
this case. The majority opinion’s analysis on this important issue in our
Circuit is based upon the purported binding effect of a passing footnote
reference in United States ex rel. Foulds v. Texas Tech University,
171 F.3d 279, 288 n.12 (5th Cir. 1999), petition for cert. filed, 68
U.S.L.W. 3138 (Aug. 23, 1999) (No. 99-32).
While I agree, and even applaud the majority opinion’s
reasoning with respect to the remaining constitutional issues, I am not
persuaded that Foulds or any other Fifth Circuit case
constitutes binding precedent competent to waive the Article III requirement of
a particularized and personal injury in qui tam suits. Moreover, and
without regard to the binding effect of the brief sub-textual reference to
standing in Foulds, it seems very likely that this
case will invite en banc scrutiny, and I therefore think it appropriate that a
more comprehensive analysis of the Foulds opinion, and
the majority’s treatment of that opinion, be available to the en banc court.
Foulds includes
the following language in footnote 12:
No one has challenged [relator] Fould’s standing in this
case. We must, however, consider possible objections to standing sua sponte.
Lang v. French, 154 F.3d 217, 222 (5th Cir. 1998). Our
court has explicitly found that qui tam plaintiffs have standing. United
States ex rel. Weinberger v. Equifax, Inc., 557 F.2d 456, 460 (5th
Cir. 1977). As noted in a district court opinion concluding that relators lack
standing, since our opinion in Equifax, the Supreme
Court has refined its standing jurisprudence. United States ex rel.
Riley v. St. Luke’s Episcopal Hosp., 982 F. Supp. 1261 (S.D. Tex.
1997). Yet, with regard to this issue, we consider persuasive a recent Supreme
Court decision dealing with a qui tam issue under the False Claims Act. See Hughes
Aircraft Co. v. United States ex rel. Schumer, 520 U.S. 939, 117
S. Ct. 1871, 138 L. Ed. 2d 135 (1997) (holding that portions of the 1986
amendments to the Act do not apply retroactively). The Hughes
Aircraft Court did not raise any standing objections.
Foulds,
171 F.3d 288 n.12.
I do not believe that this brief footnote reference
constitutes a considered and binding holding on the issue of the Article III
standing of qui tam relators. First of all, the Foulds
panel did not need to reach the issue of the relator’s standing in order to
resolve the dispositive question in that case, i.e., whether the
Eleventh Amendment barred the relator’s claims against state entities. As the
panel correctly noted, the Eleventh Amendment issue was itself jurisdictional,
and sufficient to dispose of the case. See Foulds,
171 F.3d at 285-88.
The majority disagrees. Curiously, the majority first
characterizes the purportedly controlling language in Foulds
as "no more than a passing reference," but then concludes that that
passing reference is nonetheless binding on novel issues that were never briefed
or otherwise placed in dispute in Foulds. This
remarkable conclusion was drawn from Calderon v. Ashmus,
118 S. Ct. 1694 (1998), which held that the particular action for declaratory
judgment and injunctive relief at issue in that case did not present a
justiciable controversy within the meaning of Article III. Calderon
was not a standing case, and did not set forth any new jurisdictional or
jurisprudential rule that standing must in all cases be addressed sua sponte by
a federal court prior to consideration of any other jurisdictional limitations.
Rather, Calderon merely noted that Eleventh Amendment
limitations are not co-extensive with those basic limitations upon the federal
judicial power specified in Article III of the Constitution, and then observed
that reviewing the case for compliance with Article III’s case or controversy
requirement prior to addressing the Eleventh Amendment issue was more "in
keeping with" the Supreme Court’s "precedents." Id. at
1697 & n.2.
The majority reads Calderon‘s
observation that the Eleventh Amendment is not co-extensive with Article III as
a holding that Article III is in some undefined way "a more `basic’
jurisdictional requirement." The majority reads Calderon‘s
statement that resolving the Article III issue in that case before reaching the
Eleventh Amendment issue in that case was more "in keeping with" the
Supreme Court’s existing precedent as a holding that Article III questions must
always in every case be addressed before Eleventh Amendment questions. The
majority concludes that the Foulds panel’s discussion
of standing was therefore, under Calderon, a necessary
and essential part of the holding in Foulds.
There are several problems with this analysis. First, I
believe that what a particular decision "held" must be judged, not by
external authority that could hypothetically have directed the result, but by
what the particular panel of the Court wrote down on the pages comprising the
decision. Thus, I reject the notion that our judgment about what constitutes the
holding in Foulds, and what mere dicta, must
necessarily be informed by resort to the external legal authority in Calderon.
Second, the majority’s conclusion that Article III
limitations are more "basic" than Eleventh Amendment is presumably
based upon the fact that Eleventh Amendment objections to the court’s
jurisdiction can be waived, while Article III requirements go directly to the
power of the court and may not. Foulds examined this
difference for the purpose of characterizing the Eleventh Amendment issue
presented as jurisdictional. The Court stated that the significance of the
Eleventh Amendment "lies in its affirmation that the fundamental principle
of sovereign immunity limits the grant of judicial authority in Art[icle] III of
the Constitution." Foulds, 171 F.3d at 285. Foulds
then quoted from the Calderon language relied upon by
the majority in this case. Foulds acknowledged Calderon‘s
statement that the Eleventh Amendment and Article III are not co-extensive, but
reiterated this Court’s view, as established by numerous cases, that the
Eleventh Amendment, while "not part and parcel of the Article III
restrictions," nonetheless partakes of subject matter jurisdiction. See
id. at 285-86 & n. 9. Thus, Foulds
itself seems to belie the majority’s conclusion that Calderon
mandates a world in which Article III questions take primary place over Eleventh
Amendment questions in all circumstances.
Further, to the extent that Calderon
could be read to so hold, that premise is completely negated by the Supreme
Court’s disposition of the appeal from our en banc decision in Marathon
Oil Co. v. Ruhrgas, 145 F.3d 211 (5th Cir. 1998) (en banc). See
Ruhrgas v. Marathon Oil Co., 119 S. Ct. 1563 (1999).
In Marathon Oil, a majority of this en banc court held
that in removed cases, the district courts must first decide non-waiveable
issues of subject matter jurisdiction before reaching any waiveable issues of
personal jurisdiction. See Marathon Oil, 119
S. Ct. at 1569. The Supreme Court reversed, holding that while a determination
on the issue of subject matter jurisdiction must necessarily precede any
determination on the merits, "the same principle does not dictate a
sequencing of jurisdictional issues." Id. at
1570. Rather, the decision to reach subject matter jurisdiction before other
jurisdictional issues is one for the Court’s discretion. See id.
at 1572. The Court recognized that in "most instances" a determination
of the Court’s subject matter jurisdiction would not involve any arduous
inquiry. See id. When, however, a relatively
straightforward jurisdictional basis for disposing of the case is available, the
Court does not abuse its discretion by seizing upon that course rather than
reaching a difficult and novel question that would be required to determine the
Court’s subject matter jurisdiction. Id.
Stated simply, Marathon abolishes
any inference from Calderon, that the Foulds
panel must have necessarily decided the Article III issue to reach its
determination that the Eleventh Amendment posed jurisdictional barriers. To the
contrary, the novelty of the standing issue in light of recent Supreme Court
precedent and the difficulty of reaching an informed decision in the absence of
any briefing or adversarial argument, explains why the Foulds
panel restricted the standing issue to footnote dicta and decided the case
instead on the Eleventh Amendment grounds. As further support for this
conclusion, I would note that our Court has twice, since the purported
"holding" in Foulds, declined to engage the
more difficult standing issue, deciding the cases on the basis of more
accessible jurisdictional arguments instead. If Foulds
were as clear as the majority suggests, there would be no reason to expressly
avoid stating that uninjured qui tam relators have standing to sue
under the FCA. See United States ex rel. Russell v. Epic Healthcare
Management Group, __ F.3d __, 1999 WL 824560, at *3 (5th Cir.
1999) (involving qui tam provisions of the FCA, and stating "[w]e
need not here join the debate over a relator’s standing under Article
III"); see also TTEA v. Ysleta Del Sur Pueblo,
181 F.3d 676, 683 n.1 (1999) (involving qui tam provision relating to
the rights of an Indian tribe, and stating that standing was not directly
relevant because a holding that the qui tam relator lacked standing
would only solidify the Court’s conclusion that there was no jurisdiction to
grant declaratory relief). For the foregoing reasons, I conclude that an Article
III decision was not essential to the Court’s Eleventh Amendment disposition in Foulds.
The language in footnote 12 of Foulds is therefore
simply dicta, which is not binding upon this panel.
In addition to the reasons given above, I note that the
purported "holding" in Foulds is not
supported by any reasoned analysis of the issue in the text of that opinion.
Moreover, and as will shortly be clear, the purported "holding" is not
supported by any citations that plainly require the conclusion that uninjured qui
tam relators have standing under the FCA even when the government does not
choose to intervene.
Foulds
cites two primary authorities: this Court’s opinion in
United States ex rel. Weinberger v. Equifax,
557 F.2d 456, 460 (5th Cir. 1977), and the Supreme Court’s opinion in United
States ex rel. Schumer v. Hughes Aircraft Co., 117 S. Ct. 1871
(1997). As discussed above, Hughes simply did not
decide any constitutional issues at all. To the contrary, the Hughes
Court expressly avoided reaching any decision concerning the Article III
standing of qui tam relators, notwithstanding the fact that the issue
was presented and decided below. See Hughes,
117 S. Ct. at 1875 n.3. Hughes, therefore, is no
authority at all with respect to Article III standing.
Foulds
also cited this Court’s decision in Weinberger.
Although Weinberger held, in 1977, that uninjured qui
tam relators have standing, even the Foulds panel
recognized that the force of that case has been substantially undermined by
refinements in the Supreme Court’s treatment of Article III standing. See
Foulds, 171 F.3d at 288 n.12. Weinberger
was decided long before the Supreme Court clarified the constitutional scope of
Article III standing in cases such as Steel Co. and
Lujan. Aside from Foulds, the
Court has only cited the Weinberger decision one time
for the proposition that qui tam relators enjoy Article III standing, see
United States ex rel. Weinberger v. State
of Florida, 615 F.2d 1370, 1370 (5th Cir. 1980), and even then,
the reference was only in passing and was not material to the disposition of the
case. So much for the proposition that Weinberger
amounts to seminal Fifth Circuit precedent. Moreover, the reasoning supporting
the relevant holding in Weinberger is brief, and
merely states that Congress granted standing by passing the statute, without
examining whether Congress has any authority to do so. Weinberger,
557 F.2d at 460. The statutory permission theory of qui tam relator
standing poses significant constitutional questions, some of which are addressed
in the majority’s analysis and some of which are addressed in the following
section.
Having negated the premise that binding precedent places
Riley squarely in the shoes of the government, I will now examine whether any of
Riley’s more abstract constitutional theories are competent to place her there.
IV. RILEY’S ALTERNATIVE THEORIES
A. Statutory Permission Theory
Riley first argues that relators meet standing requirements
because Congress has said that they do. In other words, Riley claims that the
FCA is a statutory grant of standing to qui tam relators. A few
decisions, including this Court’s decision in Weinberger,
have taken this "statutory permission" approach. See, e.g., United
States ex rel. Woodard v. Country View Care Ctr., Inc., 797 F.2d
888, 893 (10th Cir. 1986) ("The statute of course eliminated any standing
problem"); Weinberger, 557 F.2d at 460 (reasoning
that "the statute clearly accords [the relator] standing to bring the
action").
But the statutory permission approach fails because Congress
is itself constrained by the Constitution. The Constitution requires a
personalized injury, and Congress cannot, by legislation, waive that
requirement. See Raines v. Byrd, 117 S. Ct. 2312,
2318 n.3 (1997) ("It is settled that Congress cannot erase Article III’s
standing requirements by statutorily granting the right to sue to a plaintiff
who would not otherwise have standing."). Those courts that have adopted
the statutory permission approach likely viewed the injury element as a
prudential standing requirement that Congress could waive. Indeed, earlier
Supreme Court opinions referred to waiveable prudential standing requirements. See,
e.g., Warth v. Seldin, 95 S. Ct. 2197, 2206 & n.12
(1975). But the Court has now stated, without equivocation, that a
particularized and personal injury is a constitutional — not a prudential —
standing requirement, which cannot be waived by legislation. See Lujan,
112 S. Ct. at 2136.
The courts that have adopted the statutory permission
approach may also have confused Congress’s power to create rights with the power
to create standing. Congress can, of course, enact statutes creating new
substantive legal rights, the invasion of which can give rise to the kind of
particularized injury necessary to create standing. See Linda R.S.
v. Richard D., 93 S. Ct. 1146, 1148 n.3 (1973). In no event,
however, "may Congress abrogate the article III minima: A plaintiff must
always have suffered ‘a distinct and palpable injury to himself’ . . . that is
likely to be redressed if the requested relief is granted." Gladstone,
Realtors v. Village of Bellwood, 99 S. Ct. 1601, 1608 (1979). In
light of more recent Supreme Court authority, such as Steel Co.
and Lujan, those cases relying upon a statutory
permission theory and the statutory permission theory itself, must fail.
B. Assignment Theory
Riley contends that she also has standing as an
"assignee" of the government’s fraud claim. Indeed, some courts have
approved of relator standing on the theory that the qui tam relator is
an assignee of the government’s own fraud action. See, e.g., United
States ex rel. Kelly v. Boeing Co., 9 F.3d 743, 748 (9th Cir.
1993) ("the FCA effectively assigns the government’s claims to qui tam
plaintiffs . . . who then may sue based upon an injury to the federal
treasury"). Under the assignment theory, the FCA qui tam
provisions operate as an enforceable unilateral contract, the terms of which are
accepted by the relator upon the filing of suit. See id.
at 748.
There are several difficulties with the assignment theory.
First of all, the FCA’s language contains no mention of an assignment. Courts
may not simply re-write statutes in order to make them constitutional. Moreover,
the assignment theory is really just a variation of the statutory permission
theory, and the same criticism applies: Congress cannot circumvent the standing
requirement by conferring standing, even if it does so using the assignment
mechanism.
Riley asserts that it is not important to inquire whether an
actual assignment has occurred; the fact that courts permit assignment indicates
that a personalized injury is not an absolute pre-requisite to Article III
standing. This premise conflicts with express language in Lujan,
which states that "the injury must affect the plaintiff in a personal and
individual way." Lujan, 112 S. Ct. at 2136 n.1.
Absent a valid assignment, there is absolutely no justification for excusing the
requirement that the plaintiff allege a particularized and personal injury.
The "assignment" in the FCA does not comport with
basic principles of contract law and thus cannot be a valid assignment. First of
all, an assignor must give up his interest in that which has been assigned. See
Restatement (Second) of Contracts ? 317(1) (1980). But the FCA provisions
permit the government to retain, not only an interest in the lawsuit, but
control over certain aspects of the lawsuit. For example, the government can
settle the case over the relator’s objections. See 31 U.S.C.
? 3730(c)(2)(B). The government can dismiss the case over the relator’s
objections. Id. at ? 3730(c)(2)(A).
The "assignment" purportedly made in the FCA must
also fail because Article II ? 3 vests the right to prosecute with the
Executive branch, while the assignment of that right to a private citizen is
being made in the FCA by the Legislative branch. Congress cannot assign
something it does not "own." Finally, no legal right to prosecute a
fraud claim existed at the time the supposed "offer" of assignment is
claimed to have been made (i.e., at the enactment of the FCA). Thus,
the FCA qui tam provisions should be viewed, at the most, as a promise
to make an assignment in the future, rather than an actual assignment.
The assignment exception to the personalized injury
requirement should be narrowly confined to those cases in which the assignee
really "steps into the shoes" of the assignor. There are simply too
many differences between a valid assignment and the FCA’s qui tam
provisions to conclude that the FCA’s qui tam provisions set out a
valid Congressional assignment of the Executive right to prosecute a case for
injury to the government. Hence, the assignment theory must also fail in this
case.
C. Retaliation Theory
Riley argues that she was injured, and thus has standing,
because her employer retaliated against her for filing her qui tam
action. Her reasoning echoes that of a few courts that have found that qui
tam relators meet the injury requirement because they are likely to face
retaliation for initiating a qui tam suit. See, e.g., United
States ex rel. Dunleavy v. County of Delaware, 123 F.3d 734, 739
(3d Cir. 1997); United States ex rel. Neher v. NEC Corp.,
11 F.3d 136, 138 (11th Cir. 1994). Those courts assert that the possibility of
the extreme emotional strain resulting from exposure to the fraudulent scheme,
or the time and expense required to bring suit, or the possibility of
retaliation for filing the suit, may serve as the injury in fact that confers
standing.
The defendants correctly note that this argument proves too
much. If the emotional, financial, or retaliatory costs of filing a lawsuit
constitute an injury upon which standing may rest, then every plaintiff will be
blessed with standing. The defendant, after all, could always
retaliate. The Supreme Court recently eliminated any doubt as to the validity of
the retaliation theory, stating:
Obviously, . . . a plaintiff cannot achieve standing to
litigate a substantive issue by bringing suit for the cost of bringing suit. The
litigation must give the plaintiff some other benefit besides reimbursement of
costs that are a byproduct of the litigation itself.
Steel Co.,
118 S. Ct. at 1019. The possibility of retaliation — like emotional and
litigation-based transaction costs — are "by product[s] of the litigation
itself" and thus cannot be grounds for standing to litigate.
Furthermore, the "retaliation" claim is expressly
dealt with in subsection (h) of ? 3730. That subsection gives an
"employee" who is "discriminated against in the terms and
conditions of employment by his or her employer" an entitlement to
"all relief necessary to make the employee whole." 31 U.S.C. ?
3730(h). This subsection further gives the employee the right to
"reinstatement," two times back pay, interest on back pay, and
compensation for any special damages sustained as a result of the
discrimination, all of which are relief applicable only against the employer. Id.
Finally, this sub-section gives federal district courts jurisdiction to provide
this relief. Id. In the present case, subsection (h)
may give Riley her own claim (as distinct from the government’s claim) against
her employer, St. Luke’s Hospital, but it could not possibly give Riley any
claim against the other defendants named herein. For all of these reasons,
Riley’s retaliation claim does not support any judgment finding that she has
standing to prosecute claims for injury to the government under the FCA’s qui
tam provisions. The retaliation theory must fail.
D. Bounty Theory
Riley also argues that she has standing to pursue her FCA
action because she has a concrete interest in the outcome of her lawsuit. She
argues that the FCA provides a bounty for successful relators, see 31
U.S.C. ? 3730(d), and relators thus have a concrete interest in succeeding in
their fraud actions. Several courts have found standing on the basis of the
relator having an interest in the outcome of the litigation. See, e.g., United
States ex rel. Kreindler & Kreindler v. United Technologies Corp.,
985 F.2d 1148, 1154 (2d Cir. 1993).
The Supreme Court, however, has required an injury
— not merely an incentive or interest. Defendants contend that an incentive or
interest is not an injury and will not satisfy Article III’s injury requirement.
See Sierra Club v. Morton, 92 S. Ct. 1361, 1368 (1972)
(existence of ideological interest to litigate vigorously is not sufficient
basis for finding injury in fact); Valley Forge, 102
S. Ct. at 766 ("[s]tanding is not measured by the intensity of the
litigant’s interest or the fervor of his advocacy.").
The presence of a statutory bounty for successful qui tam
plaintiffs does not satisfy the injury requirement because the injury
requirement does more than merely ensure that parties have an incentive to
prosecute a claim vigorously. The requirement of a particularized and personal
injury also ensures that the judiciary stays in its assigned role as arbiter of
disputes and does not wander into the arena of policy making (the Legislature’s
role) or ensuring the execution of laws (the Executive’s role). As the Lujan
Court explained:
If the concrete injury requirement has the
separation-of-powers significance we have always said, the answer must be
obvious: To permit Congress to convert the undifferentiated public interest in
executive officers’ compliance with the law into an "individual right"
vindicable in the courts is to permit Congress to transfer from the President to
the courts the Chief Executive’s most important constitutional duty, to
"take Care that the Laws be faithfully executed." It would enable the
courts, with the permission of Congress, "to assume a position of authority
over the governmental acts of another and co-equal department," and to
become "’virtually continuing monitors of the wisdom and soundness of
Executive action.’" We have always rejected that vision of our role.
112 S. Ct. at 2145 (citations omitted); see also Antonin
Scalia, The Doctrine of Standing As An Essential Element Of The Separation
Of Powers, 17 Suffolk U. L. Rev. 881 (1983). Requiring merely an incentive,
rather than an injury personal to the party in interest, would not adequately
circumscribe the judiciary. Permitting a statutory bounty, standing alone, to
vest a plaintiff with sufficient interest to bring suit inherently involves an
impermissible encroachment upon the separation-of-powers principles that lie at
the heart of the Constitution. I therefore conclude that the bounty theory must
likewise fail.
V. THE HISTORICAL ARGUMENT
I cannot close without commenting briefly upon Riley’s final
argument, which is that the historical pedigree of qui tam suits
compels us to conclude that qui tam relators have standing. I recognize
that "[s]tanding to sue is part of the common understanding of what it
takes to make a justiciable case." Steel Co., 118
S. Ct. at 1016. For that reason, and as noted in the majority opinion, the
Supreme Court has on occasion permitted history to play a supporting role in its
constitutional analysis. But even the dissent must concede that history alone
cannot validate an unconstitutional practice. See Marsh v. Chambers,
103 S. Ct. 3330, 3335 (1983); see also Walz v. Tax Comm’r,
90 S. Ct. 1409, 1416 (1970). Indeed, in those circumstances in which the Supreme
Court has deferred in any significant measure to historical usage, the
constitutional implications of the challenged practice were debated by the
adopting Congress. The practice was then employed in a manner so consistent and
so free of ambiguity that the practice can fairly be said to constitute
"part of the fabric of our society." See Marsh, 103
S. Ct. 3334-36 & n.12.
Qui tam provisions simply do
not meet this threshold. As the majority points out, many of the early qui
tam provisions differed substantially from the FCA provisions at issue here
by merely granting an informing citizen a reward, rather than permitting those
citizens to sue on behalf of an otherwise disinterested government. Moreover,
and as described in the dissenting opinion, the use of the qui tam provisions
has been sporadic at best.
Judge Stewart’s dissent attempts to explain the distinctions
drawn by the majority between the qui tam provisions at issue in this
suit and their historical antecedents. His dissent also attempts to explain
historical gaps in which qui tam suits were not employed. Indeed, I am
impressed by the breadth of the dissenting analysis. But ultimately history,
while important, is neither sacrosanct nor supreme — particularly where, as
here, there is no indication that the adopting legislatures debated the
constitutional questions, and the historical practice at issue has been only
sporadically or incompletely employed. In the final analysis, I am persuaded
that the historical credentials offered by Riley and appearing in the dissenting
opinion do not justify the radical departure from fundamental and well-settled
Article III jurisprudence that would be required to permit a qui tam plaintiff
to sue in the absence of a particularized injury personal to the plaintiff.
CONCLUSION The
district court correctly recognized that relator standing is inconsistent with
contemporary standing doctrine, that the precedent to the contrary is
unpersuasive because it relies on outdated or fallacious legal reasoning, and
that the historical credentials of qui tam actions are not enough to
rescue the practice.
For the forgoing reasons, I would affirm the district court’s
holding that Riley lacked the particularized and personal injury required to
establish Article III standing in this case in which the Attorney General
declined to intervene and take over prosecution of the government’s fraud
claims.
CARL E. STEWART, Circuit Judge, dissenting.
The qui tam relator provisions of the False Claims
Act provide a pecuniary and, ultimately, useful, tool to ensure that the civil
laws are obeyed. The provisions allow concerned citizens to protect the
government’s interest in ensuring that its laws are followed by rewarding
individuals who bring complaints forward and then assist the government in the
prosecution of those claims.(50)
More importantly to the case at bar, the qui tam law enables the
Attorney General to maximize her resources by not requiring her and her staff to
seek out every violation of the federal law. Indeed, the qui tam
relator provisions represent an invaluable aid in detecting low-visibility
offenses to the public purse.
In my opinion, the qui tam relator provisions of the
False Claims Act are consistent with the Take Care Clause of Article II, even
when the government elects not to intervene in an action filed by a relator. An
examination of the historical pedigree of this statute and others like it,
coupled with an inquiry into the separation of powers concerns raised by the
majority, reveals that the qui tam provisions comply with the
Constitution. Because my colleagues reach a different conclusion, I respectfully
dissent.(51)
I
A
The majority observes, ante at 5, and I heartily agree, that
history does not "by itself" validate the constitutionality of the qui
tam relator provisions of the False Claims Act ("FCA").(52)
Indeed, no set of historical credentials should ever be worthy of our
"blind deference." Ante at 5. Where the majority falters in its
discussion, see ante at 4-6, of the historical antecedents to this law,
however, is in believing Riley and the government to have advanced such a
sweeping argument. On the contrary, neither Plaintiff-Appellant nor the
Intervenor ever suggests that the qui tam relator provisions in the FCA
should be validated solely on the basis of history. Instead, Riley and the
government argue, in my opinion persuasively, the more refined proposition that qui
tam‘s historical tradition "sheds light not only on what the draftsmen
intended [the Take Care Clause] to mean, but also on how they thought that
Clause applied to the practice authorized by the First Congress–their actions
reveal their intent."(53)
In other words, when assessing the qui tam provisions in light of the
Take Care Clause, we should view history as a touchstone illuminating our way,
not as a dispositive treatment.
By contrast, the majority’s rigid approach to the history of
the qui tam relator provisions fails to accord any weight to the role
of history in constitutional analysis. The majority relies, ante at 5, on Marsh
v. Chambers seemingly to conclude that we may turn to history only when it
amounts to an "unambiguous and unbroken history." Although the Marsh
Court referred to the "unique history" of the legislative practice of
opening each session with a prayer by a state-funded chaplain to legitimize this
practice,(54)
the Court has never suggested, in Marsh or elsewhere, that such a
difficult threshold showing is necessary each and every time history is utilized
in constitutional adjudication. By scanning the history of the qui tam
laws, finding inconsistencies therein, and then declaring that history so
ambiguous and broken that it should be entirely excluded from our analysis, the
majority eliminates the usefulness of that history as an implement with which to
understand and to interpret the relevant constitutional language.(55)
As the Supreme Court long ago explained,
The necessities which gave birth to the Constitution, the
controversies which preceded its formation, and the conflicts of opinion which
were settled by its adoption, may properly be taken into view for the purpose of
tracing to its source any particular provision of the Constitution in order
thereby to be enabled to correctly interpret its meaning.(56)
This more fluid approach is especially prudent when reviewing
separation of powers challenges, such as that presented by the case at bar,
because the notions underlying our tripartite government are not explicit in the
text of the Constitution.(57)
The whole range of history can enlighten our understanding in such a situation
because,
[a]lthough the Court has not considered separation of powers
cases to be nonjusticiable, it has had relatively few occasions in which to set
out the governing constitutional principles. It is for this reason that there is
perhaps less guidance here than in other areas of constitutional law. What
principles there are derive from a relatively few "great cases"
involving conflicts between two branches of the federal government. Much of the
"law" in the area therefore amounts to historical practices, informal
and formal, of the various branches, and to understandings that take the
Constitution as their starting point but that derive in large part from
perceived practical necessities.(58)
With this approach to enactments of the past as a guidepost,
I seek below to recast the history of qui tam laws in a more judicious
light than the majority’s effort.
B
Qui tam(59)
actions sprang from thirteenth-century English common law as a method by which
to supplement the power of the crown.(60)
The artifice of citizens’ bringing legal actions on behalf of the sovereign was
created at a time in which the legal machinery of the English government was
still fairly primordial; consequently, many offenses to the public’s
interest–such as fraud on the government and general violations of the criminal
law–remained undetected and unprosecuted.(61)
Qui tam actions, in which a private citizen could bring suit on behalf
of the sovereign as well as for himself, directly responded to this need, and
the government encouraged their filing by rewarding the private citizen with a
share of the fine, penalty, or forfeiture.(62)
Qui tam actions "became increasingly entrenched in English
precedent," and, as Parliament began enacting a variety of specific
statutory authorizations, "a consistent part of British legislative
policy."(63)
Since qui tam statutes dotted the legal landscape in
Hanoverian England, it is hardly surprising that the concept of qui tam
migrated to this side of the Atlantic along with other elements of English law
and custom.(64)
Indeed, the functionality of qui tam laws was sufficiently
well-established that our founders did not hesitate in making liberal use of
such provisions in statutes passed during the early years of the Republic.(65)
Wisely recognizing that the fledgling government did not have the legal
machinery in place to prevent fraud against it, members of the first several
Congresses drew on the tradition that the English Parliament had established to
enact a variety of qui tam statutes "to create a self-regulating
atmosphere among the predominant trades of the era."(66)
As had our English cousins’, early American legislatures utilized qui tam
statutes as a crucial ress to the government’s ability to enforce the laws;
indeed, at least seven statutes utilizing qui tam provisions were
passed by the First Congress.(67)
As the federal government began to expand in the first
decades of the nineteenth century, its regulatory and law-enforcement mechanisms
became firmly-established and the need for private prosecution of the law
naturally waned.(68)
Concurrently, public opinion about qui tam relators became increasingly
negative as various abuses by such relators were revealed; in particular,
critics pointed to the small group of "bounty-hunting" qui tam
plaintiffs who would settle their claims for amounts prejudicial to the
government’s best interest.(69)
The resulting statutory restrictions on qui tam suits significantly
limited the attractiveness of such suits.(70)
The Civil War witnessed a renaissance of qui tam
actions. Widespread reports of corruption and fraud by companies supplying the
Union Army gave birth to the qui tam provisions found in the False
Claims Act of 1863.(71)
Indeed, President Lincoln himself suggested that the qui tam provisions
be inserted into the statute.(72)
Sometimes referred to as "Lincoln’s law,"(73)
the FCA allowed private citizens to file civil actions against any party who had
presented a false claim for payment to the United States government and rewarded
qui tam relators fifty percent of the recovered money.(74)
With the end of the Civil War, military suppliers faded
somewhat from public scrutiny and qui tam actions once again fell under
attack. In particular, critics focused on the fact that government employees who
simply combed public records, instead of offering original information, could
bring qui tam actions.(75)
When the Supreme Court eventually legitimated this practice in United States
ex. rel. Marcus v. Hess,(76)
Congress immediately responded by debating whether the FCA should require the
relator to be an original source of at least some of the information underlying
the qui tam suit;(77)
additionally, the resulting amendments reduced the size of the reward that may
be given to the relator(78)
and, for the first time, permitted the government to intervene in such suits.(79)
The practical effect of the 1943 debates and amendments upon qui
tam suits was, in the words of one commentator, to create an "ice
age."(80)
The changes discouraged qui tam actions to such a degree that, in 1986,
Congress decided once again to widen the path for the qui tam relator.
Particularly galvanizing Congress was a burgeoning federal deficit and a fear
that defense contractors and others were–to hum an old tune–swindling the
government.(81)
The 1986 liberalization increased the reward available to qui tam
relators(82)
and permitted more of the public record to be a source of the information.(83)
Since the 1986 amendments, qui tam suits have seen a
second rebirth. Statistics illustrate the difference the amendments made.
Whereas 33 qui tam suits were filed in 1987, 274 such suits were filed
in 1995.(84)
Moreover, the total recovery generated by qui tam statutes has jumped,
from a paltry $2 million in 1988, to a remarkable $243 million in 1995.(85)
Indeed, since 1987, the FCA’s qui tam provisions resulted in a recovery
of more than a billion dollars.(86)
Consequently, in evaluating qui tam‘s place in history, I cannot
overlook the boon to the federal Treasury occasioned by such statutes. Indeed,
"[q]ui tam, or standing in the shoes of the king, is an old
occupation but never before has it been so profitable."(87)
C
The majority’s conclusion that qui tam has not
become "part of the fabric of our society"(88)
is, quite plainly, troublesome. Even assuming that finding the provision to be
part of that "fabric" were necessary, which it is not, see supra
Part I.A., the history of qui tam actions is indisputably an ancient
one;(89)
not only were they an important part of the legal tradition brought to America
during the colonial period, but qui tam provisions were also in place
when the legal machinery of our modern government was in its nascent phases.
Indeed, even the Supreme Court has recognized the historical importance of qui
tam.(90)
The majority counters this evidence by concluding summarily,
ante at 5-6, that, since Congress has reduced the number of qui tam
statutes over the lifetime of this nation, such provisions do not have support
in history. As I have illustrated above, however, both Parliament and Congress
after it typically enacted qui tam statutes when the government’s legal
processes required bolstering; such statutes inevitably become less necessary as
the government’s internal law enforcement mechanisms strengthen. Consequently,
the fact that the FCA contains the primary qui tam provisions in use
today does not undermine the "unambiguous and unbroken history" of
such suits. Congress has frequently resorted to qui tam statutes as
needed; the majority’s suggestion that qui tam statutes are
old-fashioned, see ante at 5-6, only enhances this observation.(91)
While the number of such statutes has waxed and waned, a qui tam
statute has been on the books almost every day for the past 200 years.
In sum, the history of qui tam provisions should
guide our understanding of their relationship to the constitutional
proscriptions of the Take Care Clause. Although history should never be
perceived as a dispositive source of constitutional guidance, it is certainly
persuasive authority that the drafters of the Take Care Clause considered the
Clause to be in harmony with the many qui tam statutes that they and
their successors enacted. With this understanding of qui tam‘s history
firmly in mind, I now turn to the merits of the constitutional question. In Part
II of the opinion, I address the majority’s contention that the qui tam
provisions violate the separation of powers principles embodied in the Take Care
Clause. In Part III, I suggest a different, more compelling, approach to the
separation of powers question presented by these provisions. Part IV of the
opinion examines the various historical justifications for the separation of
powers and explains how the qui tam relator provisions pass muster
under any of them. Finally, Part V concerns persuasive authority from a sister
circuit.
II
The majority holds that the qui tam provisions
violate separation of powers doctrine by running afoul of the Take Care Clause
of Article II. Amazingly, however, my colleagues cannot point to a single
analogous case in which the Supreme Court has found that an enactment of
Congress violates separation of powers. Instead, the majority makes recourse to
three decisions, Commodity Futures Trading Comm’n v. Schor,(92)
Nixon v. Administrator of Gen. Servs.,(93)
and Morrison v. Olson,(94)
each of which rejected separation of powers challenges to legislative
enactments, and attempts to distinguish each from the case at bar. I believe
their effort fails, and in this Part of my opinion, I will address why each case
actually supports the conclusion that the qui tam provisions do not
violate separation of powers.
While the majority correctly states the principle that
"[t]he doctrine of separation of powers prohibits one branch of government
from intruding on the constitutionally granted powers of another," ante at
9, it never persuasively explains how the provisions at issue in the case sub
judice so intrude. Instead, it makes passing reference to Congress’s having
"stripped the Executive Branch of some of its power," ante at 9, and
then moves on to consider, ante at 11, "the separation of powers problem
that is raised when an act of Congress impinges on the Executive Branch’s ‘take
care’ duties."
The qui tam relator provisions do not violate
separation of powers because they neither "impermissibly undermine[]"(95)
the executive’s power nor "prevent the Executive from accomplishing its
constitutionally assigned functions."(96)
In Schor, the Supreme Court rejected a constitutional challenge to
Congress’s empowerment of the CFTC to entertain state law counterclaims in
reparation proceedings, finding that the grant of such authority did not violate
Article III.(97)
The majority’s best effort at reconciling this case, which opened the door to a
variety of non-Article III adjudications, is implicitly to criticize the Court
for not enunciating the dividing line between "permissible" and
"impermissible" legislative action. Ante at 11. This back-door
distinction is unavailing because the Court found the statute to be a permissible
intrusion not subject to a separation of powers attack.
Schor built upon Nixon,
in which the Court similarly rejected a separation of powers challenge to
Congress’s direction to an Executive Branch official–the Administrator of
General Services–to take custody of President Nixon’s presidential papers and
tape recordings for the purpose of archiving. The Court held that the limited
screening undertaken by the archivists did not violate the President’s
expectation of confidentiality and privacy and thus did not constitute anything
other than "a very limited intrusion" into the domain of the Executive
Branch.(98)
Again, the majority’s discussion of this case amounts to a criticism that the
Court "did not explain what degree of congressional interference is
necessary before the ‘proper balance’ [between the coordinate branches] has been
disrupted." Ante at 11. It is not, of course, unusual for the Court to
eschew paragraphs of dicta describing what might have constituted a violation
when its decision holds an act constitutional. Schor and Nixon
provide, in my view, a cache of support for the proposition that legislative
enactments enjoy a certain presumption of constitutionality in this area.
This point is hammered home, none too subtly, by the crown
jewel of the majority’s opinion. In Morrison, the Court upheld the
constitutionality of the independent counsel provisions of the Ethics in
Government Act.(99)
My colleagues gamely attempt to distinguish this case by discussing, ante at
13-14, the safeguards mentioned in Morrison and then positing that the qui
tam relator provisions fail to satisfy the Morrison Court’s
concerns. While the majority attempts to find its target simply by attacking the
qui tam provisions point-by-point under Morrison‘s test, the
fact remains that Morrison represents the zenith of the Court’s
permissive approach to separation of powers concerns, neither the "outer
limits" of that jurisprudence nor the ingress for the separation of powers
attack envisioned by the majority.
Indeed, the majority’s only two significant efforts to
rationalize Morrison‘s imprimatur of Congress’s action bear out the
difficulty in the majority’s position. First, my colleagues announce–with no
support other than caprice–that "[t]he independent counsel provisions of
the [Ethics in Government Act] likely represent the outer limits of
congressional encroachment on another branch’s powers and functions." Ante
at 11 n.31. The majority then opines that the Supreme Court only upheld the
independent counsel statute because it viewed the "device’s encroachment on
executive powers as an evil that had to be incurred to provide some
accountability within the Executive Branch." Id. Nowhere in the
Court’s lengthy, 7-1 opinion, authored by the Chief Justice, does it suggest
that the statute represented "an evil," that the justification for the
law "was unique," or that the holding in Morrison represented
"the outer boundary" in the Court’s separation of powers
jurisprudence.
The majority also arrives at the spurious conclusion that,
since the independent counsel statute was designed to address "a narrow
structural problem" within the Executive Branch, it could not be an
impermissible intrusion on Executive authority. Ante at 15. The majority’s
conclusory support for this statement is that the statute was "narrowly
tailored" because it authorized an independent counsel only in limited
circumstances. Id.; see also ante at 11 n.31. With all due
respect, I believe that if an action of one branch violates separation of
powers, it violates separation of powers. The fact that a structural problem may
have existed within the Executive Branch did not give Congress authority under
this doctrine ipso facto to intrude on the Executive Branch’s
province, just as even the narrowest statute would not avoid violating the
principle in the face of the strict construction that the majority gives the
term "separation of powers."
Read in the light of these three cases, each of which upheld
a statute against a separation of powers challenge, it is apparent that, far
from undermining the executive’s power in any constitutional sense, the qui
tam provisions serve exactly the opposite role. Before any qui tam
action may proceed, the relator must serve on the government the complaint and a
written disclosure, and the Attorney General must then choose whether to
"intervene and proceed with the action,"(100)
or to allow the relator "to conduct the action."(101)
If the Attorney General decides to intervene, the government has "primary
responsibility for prosecuting the action."(102)
A fourth case cited by the majority, Printz v. United
States,(103)
is the only opinion relied upon by my colleagues that actually held an act
unconstitutional. The Printz Court, however, rested its decision not on
separation of powers doctrine but upon notions of federalism incorporated in the
Constitution.(104)
The Printz Court noted that the Brady Act transferred the
responsibility of administering a federal law to state law enforcement officers
who were "to implement the program without meaningful Presidential
control."(105)
Here, of course, Congress has not shifted to qui tam relators the
requirement to administer the laws; indeed, contra Printz,
after the filing of the action the Executive at all times retains discretion
with respect to the FCA claim. Congress has not removed from the Attorney
General her power to enforce the law, as the Supreme Court found that the Brady
Act did. Instead, Congress has arguably made the Attorney General’s job easier
by deputizing private citizens who may bring to the attention of the Executive
Branch potential violations of law.
In a situation such as that presented by the case at bar,
where the Attorney General decides not to intervene in the action, it is true
that the relator has the authority to prosecute a claim on behalf of the United
States. See ante at 3-4. Unlike the majority, however, I do not assign
apocalyptic weight to this event. Instead, I submit that, when the government
declines to intervene in a qui tam action, it has delegated its own
law enforcement authority;(106)
Congress has not usurped it at all, much less for its own uses.(107)
Simply stated, the qui tam relator provisions do not violate separation
of powers principles.
III
In my view, the qui tam provisions are
constitutional for an additional reason. Congress, with the approval of the
President,(108)
may delegate power–legislative, executive, and judicial–to administrative
agencies.(109)
Similarly, the President may delegate executive power to entities independent of
any formal branch of government.(110)
In Humphrey’s Executor v. United States, a case cited by the majority,
ante at 9 n.27, for the boilerplate proposition that each branch must remain
"free from the control or coercive influence" of the other,(111)
a unanimous Supreme Court actually restrained the President from
exercising his constitutionally-bestowed executive authority to remove an
officer of the United States because he had previously delegated his authority
to that official, who then became independent of Executive Branch control.(112)
The Court observed, in sweeping language, that the NLRB was "independent of
executive authority" and "free to exercise its judgment without the
leave or hindrance of any other official or any department of the
government."(113)
This seminal decision, of course, abetted the rise of independent agencies by
overcoming the nondelegation doctrine, a theory of some currency in the 1930’s
which provided that Congress could not cede its power to another branch of
government or to an independent party.(114)
During the New Deal, the Supreme Court held two statutes unconstitutional under
the nondelegation doctrine, opining that, in the absence of an
"intelligible principle" for the exercise of delegated power,(115)
such an act was surely unconstitutional.(116)
Since 1935, the Supreme Court has stamped every delegation of
authority, both legislative and executive, with the imprimatur of
constitutionality, always finding that seemingly-ineluctable "intelligible
principle."(117)
Indeed, "[i]n recent years, [the Supreme Court’s] application of the
nondelegation doctrine principally has been limited to the interpretation of
statutory texts, and, more particularly, to giving narrow constructions to
statutory delegations that might otherwise be thought to be
unconstitutional."(118)
In any event, all agree that Presidential control and supervision over the
decisions of independent officers is limited;(119)
similarly, a finding that executive control over qui tam relators is,
to some degree, limited would not offend separation of powers doctrine or
whatever principles of nondelegation remain viable because relators, while not
independent "agencies," receive their authority through the
conjunctive action of Congress and the President through the operation of an
intelligible principle, namely, the ability of the Executive to intervene in any
qui tam suit.
In one of the latest challenges to an act of Congress
charging a violation of the nondelegation doctrine, the unanimous Supreme Court,
in Touby v. United States,(120)
upheld the constitutionality of ? 201(h) of the Controlled Substances Act of
1970.(121)
The Act authorizes the Attorney General to schedule as a "controlled
substance" any drug that he or she has found to meet certain statutory
criteria relating, inter alia, to a "history and current pattern
of abuse" and constituting a risk to the public health. If the drug is
scheduled, its manufacture, possession, or distribution becomes a criminal
offense.
The Court rejected the petitioner’s contention that the
statute concentrates too much power in the hands of the Attorney General by
allowing her to define the very crimes that she then has the responsibility to
prosecute.
This argument has no basis in our separation-of-powers
jurisprudence. The principle of separation of powers focuses on the distribution
of powers among the three coequal Branches; it does not speak to the
manner in which authority is parceled out within a single Branch . . .
Petitioners’ argument that temporary scheduling authority should have been
vested in one executive officer rather than another does not implicate
separation-of-powers concerns; it merely challenges the wisdom of a legitimate
policy judgment made by Congress.(122)
Although Touby addressed delegation by Congress to the
Executive Branch rather than by the Executive to citizen relators, the principle
enunciated–that Congress’s legitimate policy decisions do not implicate
separation of powers concerns, should inform our decision here. In the case at
bar,
the FCA provides the Executive Branch the option of
delegating its authority; once done, the ability of the Executive to control the
litigation whose course it has left to the relator does not implicate separation
of powers principles,(123)
just as the wisdom of a particular delegation does not present a justiciable
issue.(124)
The majority does not address the delegation issue presented
by this case; instead, my colleagues skirt a discussion of this fundamental,
accepted practice by dwelling on what they take to be the great teaching of Morrison
v. Olson: that one branch–in this case, Congress–cannot take power away
from another without leaving sufficient "control" of the exercise of
that power in the hands of the branch which constitutionally manages it.(125)
See ante at 11. I take no issue with the majority’s point here:
Congress surely may not take so much power away from the Executive Branch that
its authority in a law-enforcement area is undermined. I respectfully note,
however, that, even under the qui tam relator statute, the President
still ultimately retains substantial control over the Executive Branch’s
litigative functions. As such, the case before us is more appropriately viewed
as one concerning the delegation of powers and the evisceration of the
nondelegation doctrine.
Accordingly, the majority’s concern with the qui tam
relator provision’s violation of the Take Care Clause should not carry the day.
Just as the Executive may delegate some of its power to an independent party,
traditional principles of prosecutorial discretion allow executive officials
some leniency in deciding when and how to enforce the law.(126)
The majority contends, ante at 12, that the qui tam provisions
constrain prosecutorial discretion by allowing a private citizen to sue on
behalf of the government even when the Attorney General decides not to pursue
the claim.(127)
The path to this conclusion is a tortuous one at best; in my view, when the
Attorney General decides not to pursue the claim, she has delegated to the
relator the prosecutorial authority and discretion that are normally incumbent
upon the Executive Branch. The discretion itself has not been eliminated.(128)
The fallacy of the majority’s argument is best illustrated by
its effort, ante at 12, to describe how qui tam actions in which the
government does not intervene, such as the instant case, nonetheless
"encroach on the Executive’s authority to initiate litigation aimed solely
at redressing the government’s injuries." The majority contends that, since
prosecutorial discretion includes "the power to decide whether to bring
suit," allowing the relator initially to file the suit somehow undermines
the discretion. See also ante at 14 (chronicling as particularly
important the Attorney General’s decision whether to bring suit). While I would
agree that bringing suit is a part of prosecutorial discretion, both in the
civil and criminal contexts, I fail to see how the fact of the government’s
choosing not to prosecute itself when the relator wishes to do so is in any way
akin to allowing a third party to bring suit in the government’s name over
the government’s objection, which is the situation that the majority
implies exists here. To the contrary, there may be many reasons why the
government does not intervene: lack of manpower or other resources,
disinclination to perform the necessary investigation about a particular
offender, small amount of money at stake, doubts about the ability of the suit
to succeed. Regardless of the situation, however, the government has not
objected to the suit. Indeed, the government only stands to benefit
from the suit’s progress; if the relator loses a suit in which the government
chose not to intervene, then the so-called loss of prosecutorial discretion is
moot since the Attorney General could have prosecuted the case herself; if the
relator wins, the Treasury recovers funds.
In addition, and perhaps most tellingly, the relator may not
dismiss the suit voluntarily unless the Attorney General consents to such
action.(129)
The majority attempts to bury this significant information in a footnote, ante
at 3 n.5, but it is a decisive point. The government has discretion over the
suit from the moment that the relator brings the facts to the Attorney General’s
attention; the government may intervene or not, but the suit cannot simply be
dismissed on the whim of the relator if the government believes it to be
meritorious. This is a crucial distinction from the hypothetical statute that
strips the Attorney General of all discretion and allows a relator to proceed
willy-nilly through the court system; the qui tam relator provisions of
the FCA on the contrary require a more measured approach. At all times after the
filing of the action onward, the government takes the lead, to the degree it
desires, in the prosecution of the case.
IV
The separation of powers concern raised by the majority is a
phantom one for another reason as well. Although the majority does not even
pause to address the underpinnings of the separation of powers doctrine, the
motivations of the Founders in fashioning a tripartite government offer helpful
insight into this case. Throughout our history, constitutional pundits have held
that the distribution of national powers–commonly referred to as
"separation of powers" or "checks and balances"–serves
either of two distinct purposes. The first justification for our constitutional
structure is rooted in principles of efficiency. According to this view, "a
division of labor among the various branches makes government more efficient,
especially because of the concentration of executive power in the President, who
can act with dispatch."(130)
An alternative, and at times even concomitant, rationale justifies the
separation of powers as necessary to prevent tyranny. Adherents of this view
argue that the system of checks and balances "diffuses governmental power,
diminishing the likelihood that any one branch will be able to use its power
against the citizenry."(131)
Neither rubric, nor any other that the majority may have putatively advanced,
explains why the qui tam relator provisions of the FCA violate the
constitutional separation of powers as expressed in the Take Care Clause.
A
The logic of the efficiency argument is that, following the
disastrous ascendency of the Articles of Confederation, the Framers of the
Constitution sought to create a strong, energetic Executive who would preside
over a government whose duties were sensibly divided between its three branches.(132)
Support for this view extends to the Constitutional Convention:
Efficiency was stressed as a principal reason for
establishing an executive independent from the legislature by, among others,
John Adams, Thomas Jefferson, John Jay, and James Wilson. . . . [Wilson’s] views
are particularly apposite:
. . . [I]n the active scenes of government, there are
emergencies, in which the man . . . who deliberates, is lost. But, can either
secrecy or dispatch be expected, when, to every enterprise, mutual
communication, mutual consultation, and mutual agreement among men, perhaps of
discordant views, of discordant tempers and of discordant interests, are
indispensably necessary? . . . If, on the other hand, the executive power of
government is placed in the hands of one person, is there not reason to expect,
in his plans and conduct, promptitude, activity, firmness, consistency, and
energy?
. . . .
Despite the assertions to the contrary, the efficiency version
has been dominant throughout American constitutional history. Separation of
powers has never been a barrier to a high level of cooperation between the
political branches of government–a situation that, speaking generally, has
found judicial acceptance . . . .(133)
Indeed, Alexander Hamilton defended the Constitution’s
expansion of executive power on the ground that such power is
essential to the protection of the community against foreign attacks; it is not
less essential to the steady administration of the laws; to the protection of
property against those irregular and highhanded combinations which sometimes
interrupt the ordinary course of justice; to the security of liberty against the
enterprises and assaults of ambition, of faction, and of anarchy.(134)
Of course, in recent years, many theorists have come to view
the separation of powers as a system consumed by its own inefficiency.(135)
The theory here is that the powerful checks built into the constitutional
structure prevent the federal government from accomplishing anything with ease;
it is instead the victim of numerous stalemates.(136)
Regardless, the majority does not argue that the qui tam
relator provisions somehow make the Executive Branch inefficient; if
anything, the FCA provides enhanced efficiency by allowing the Executive to pick
and choose which battles it will fight, rather than forcing the executive to
enforce the law in every case, with no regard to whether the claim is worthy of
enjoying the weight of the government behind it.(137)
B
Another force underlying the Take Care Clause and the
separation of powers doctrine driving it is the prevention of tyranny rationale.
James Madison opined that "[t]he accumulation of all powers, legislative,
executive, and judiciary, in the same hands, whether of one, a few, or many, and
whether hereditary, self-appointed, or elective, may justly be pronounced the
very definition of tyranny."(138)
Of the two rationales, most constitutional theorists have placed the emphasis on
some form of this justification instead of the efficiency rationale. In his
impassioned dissent in Myers v. United States,(139)
for example, Justice Brandeis wrote that the "doctrine of the separation of
powers was adopted by the Convention of 1787, not to promote efficiency but to
preclude the exercise of
arbitrary power. The purpose was, not to avoid friction, but,
by means of the inevitable friction incident to the distribution of the
governmental powers among three departments, to save the people from
autocracy."(140)
Over the course of two centuries of constitutional law, the
separation of powers doctrine has admittedly been glossed by other
justifications for its necessity, based largely in extrapolations of the
prevention of tyranny explanation. Although the majority does not suggest and I
do not believe that any of these explanations mandates our finding the qui
tam relator provision of the FCA unconstitutional, I address each briefly
for the sake of thoroughness.
The separation of powers ensures the primacy of the rule of
law because it provides that the power to make law is not in the hands of those
who execute it. By enacting this form of constitutional government, the
Legislative Branch is constrained from passing oppressive laws because they will
not be exempt from their operation.(141)
Such is not the concern of the qui tam provision, since there is no
argument that Congress is itself usurping executive authority.
Another, more cynical, subset of the tyranny justification
was the Framers’ concern that government officials act not in their own
interests but in the interest of the public. Consequently, if governmental power
were concentrated in one branch, there would be an increased risk that that
branch would act to increase the power of government at the expense of the
governed. Separation of powers, under this theory, acted as a partial remedy by
guarding both liberty and private property against governmental action. Indeed,
if one branch tried to use its power oppressively, "[a]mbition [would] be
made to counteract ambition"(142)
in the form of another branch’s resistance.(143)
The branch thought to constitute the greatest danger in this regard was the
legislative; during the operation of the Articles of Confederation, the
legislature, in the view of many of the Framers, intruded impermissibly into the
sphere of liberty and private property.(144)
A third justification for the constitutional distribution of
powers stresses the goal of limited government. Utilizing a system of checks and
balances ensures that "no law can be brought to bear against the citizenry
without a broad consensus."(145)
In this respect, "there is an intimate connection between the separation of
powers and the protection of private ordering."(146)
This rationale stresses a connection between the distribution of power at the
national level and the desire to limit the power of democratic politics to alter
the status quo.
Finally, a subset of the prevention of tyranny rationale is
concerned with the problem of factions. Separation of powers, in this view, was
designed to prevent the usurpation of governmental power by private groups
seeking to obtain distribution of wealth or opportunities in their favor; such
private groups might use the authority of government to oppress.(147)
The separation of powers, then, was designed to protect minority groups against
tyranny, since it was thought unlikely that a faction could gain control over
all three branches of government simultaneously.(148)
Whichever rationale one brings to the issue of the qui
tam provisions, I believe that the interplay between the Legislative and
Executive Branches is entitled to some deference from the Judicial Branch. As
one commentator recently observed:
Just as the framers saw their structural choices as parts of
a package separating legislative from executive power to protect liberty and
avoid governmental tyranny, so should we view checks and balances doctrine as a
package, its specific elements subject to revision to ensure fidelity to the
constitutional premise of divided governmental powers.(149)
In other words, Congress’s decision to allow the Executive to
shift some of its law-enforcement authority to private citizens does not violate
separation of powers principles particularly where the historical justifications
for the principle, discussed supra, are not violated. Indeed, in this
instance, the rationales discussed above support the implementation of the qui
tam provisions insofar as the provisions enable the Executive Branch to
function more efficiently while not increasing the likelihood that Congress–or
the Executive, for that matter–will tyrannically govern.(150)
Simply put, the discretion that the FCA grants the Executive Branch in no way
implicates tyrannical behavior either by Congress or the President. The FCA
allows the President to carry that litigation forward which the Executive Branch
deems worthy; all other cases it abandons to the devices of the relator, a
circumstance which diminishes the fear of tyranny by leaving one whole class of
cases outside the ambit of governmental control or concern.
V
In addition to Morrison, which, despite the
majority’s best efforts to distinguish it, nonetheless rejected a separation of
powers challenge to a statute more intrusive on Executive power than this one,
several of our sister circuits have examined the qui tam relator
provisions of the FCA for constitutional infirmities under the separation of
powers doctrine and found them not to be wanting. In United States ex rel.
Kelly v. Boeing Co.,(151)
for example, the Ninth Circuit ruled that, taken as a whole, the qui tam
relator provisions left the Executive Branch with a degree of control
"indistinguishable from the degree of control the Morrison Court
found the Executive Branch exercises over independent counsels."(152)
While I might quibble with the exacting analogy to Morrison, I believe
that the Kelly court’s approach–to consider the net effect of the
executive controls available under the qui tam provisions–is a
defensible one. The better course is to view the Executive’s action as a
delegation of prosecutorial authority, but, in either case, the statute should
be viewed as constitutional.(153)
VI
Because I believe that the Executive and Legislative Branches
came to such a compromise with the qui tam relator provisions of the
FCA, and because the history of qui tam statutes supports their
existence in this incarnation, I disagree with the decision rendered by the
majority finding the qui tam statute unconstitutional. Additionally,
because I believe that the Executive Branch appropriately delegated some its
prosecutorial functions to the relator in this case, I would reverse the
judgment of the district court.(154)
I dissent.
Specifically, Riley alleges that defendants (1) unnecessarily admitted
patients to the hospital; (2) unnecessarily upgraded patients’ services (e.g.,
needlessly transferred them into intensive care); and (3) allowed
Radovancevic, an unlicensed physician, to perform services and prescribe
medicines and then accepted government money from Medicare and the Civilian
Health and Medical Program of the Uniform Services for the services and
prescriptions.
2. The district court provided an excellent summary of the
workings of the qui tam provisions of the FCA. See Riley, 982
F. Supp. at 1263.
3. The term "qui tam," which has been
in use for centuries, is short for "qui tam pro domino rege quam pro se
imposo sequitur," which means "who brings the action as well for
the king as for himself." See Bass Anglers Sportsman’s Soc’y of Am. v.
U.S. Plywood-Champion Papers, Inc., 324 F. Supp. 302, 305 (S.D. Tex.
1971).
4. The government may, "for good cause shown,"
move the court for an extension of the 60-day examination period. See
31 U.S.C. ? 3730(b)(3).
5. A qui tam action may be dismissed only if
the court and the Attorney General give written consent. See 31 U.S.C.
? 3730(b)(1); Searcy v. Philips Electronics N. Am. Corp.,
117 F.3d 154, 159 (5th Cir. 1997) (holding that voluntary dismissal requires
government consent even if the government does not intervene). If the government
shows that discovery by the relator would interfere with ongoing civil or
criminal investigations or prosecutions, the court may stay discovery for a
period not to exceed 60 days. See 31 U.S.C. ? 3730(c)(4). The
court may impose further stays if the Attorney General shows "that the
Government has pursued the criminal or civil investigation or proceedings with
reasonable diligence and any proposed discovery in the [qui tam] action
will interfere with the ongoing criminal or civil investigation or
proceedings." See id.
6. See Marvin v. Trout, 199 U.S. 212, 225 (1905)
("Statutes providing for actions by a common informer, who himself had no
interest in the controversy other than that given by the statute, have been in
existence for hundreds of years in England, and in this country since the
foundations of the Government.").
7. ? ?? ? –
"" ? ? ?
8. Riley also notes that the first Congress provided for
federal courts to hear "prize cases," which, she asserts, are
analogous to qui tam actions. Under the prize statutes, a privateer
could bring a captured vessel into the jurisdiction of the United States and
file an in rem action. If the vessel was condemned, the captor was
entitled to the ship or its value. See, e.g., The Sally, 12 U.S.
(8 Cranch) 382 (1814); The Nassau, 71 U.S. (4 Wall.) 634 (1866).
The prize cases are inapposite, however, for the prize statutes empowered the
President to commission privateers, who then acted as authorized agents of the
Executive and collected captured vessels as compensation for their services. See
The Sally, 12 U.S. (8 Cranch) at 384 ("[T]he prize act
. . . operates as a grant from the United States of all property
rightfully captured by commissioned privateers, as prize of war.").
Relators, by contrast, are not commissioned by the Executive to act as
government agents.
9. See Marsh v. Chambers, 463 U.S. 783, 790
(1983) ("Standing alone, historical practice cannot justify contemporary
violations [of the Constitution.]"); Walz v. Tax Comm’r, 397 U.S.
664, 678 (1970) ("It is obviously correct that no one acquires a vested or
protected right in violation of the Constitution by long use, even when that
span of time covers our entire national existence and indeed predates
it.").
10. See Marsh, 463 U.S. at 792.
For example, in holding that appointing paid chaplains to open legislative
proceedings does not violate the Establishment Clause, the Marsh Court
reviewed the Framers’ extensive debates regarding the practice’s
constitutionality and drew a distinction between actions carefully considered by
the Framers and those "taken thoughtlessly, by force of long tradition and
without regard to the [constitutional] problems." Id. at 791.
The Court also noted that "the unambiguous and unbroken history of more
than 200 years" indicated that the practice "ha[d] become part of the
fabric of our society." Id. at 792.
11. Five of the qui tam provisions enacted by
the First Congress fit this model. See Act of July 31, 1789, ch.
5, ? 38, 1 Stat. 29, 48; Act of Sept. 1, 1789, ch. 11, ? 21, 1 Stat.
55, 60; Act of Aug. 4, 1790, ? 69, 1 Stat. 145, 177 (customs and maritime
laws providing for a share of recovery to informers); Act of Sept. 2, 1789, ch.
13, ? 8, 1 Stat. 65, 67 (penalties levied against Treasury Department
officials for violation of prohibitions attached to their office); Act of March
3, 1791, ch. 8, ? 1, 1 Stat. 215 (same). Two other statutes
authorized government appointed census-takers to bring suits against
uncooperative citizens and to retain half of any fines recovered. See Act
of March 1, 1790, ch. 2, ? 6, 1 Stat. 101, 103; Act of July 5, 1790, ch.
25, ? 1, 1 Stat. 129.
12. See Act of July 31, 1789, ch. 5, ? 29,
1 Stat. 29, 45 (permitting recovery against customs officials who failed to
display a table of fees and duties); Act of Aug. 4, 1790, ch. 35, ? 55, 1
Stat. 145, 173 (same); Act of July 20, 1790, ch. 29, ? 1, 1 Stat. 131
(allowing recovery against ships’ masters who failed to contract with crew); id.
? 4, 1 Stat. 131, 133 (permitting recovery against persons harboring
runaway seamen). Two other statutory provisions permitted only injured parties
to sue. See Act of May 31, 1790, ch. 15, ?? 2, 6, 1 Stat.
124, 125-26 (allowing authors and publishers to recover from copyright
violators).
13. Those statutes were (1) Act of Feb.
20, 1792, ch. 7, ? 25, 1 Stat. 232, 239 (providing that informer could sue
for penalties under postal statute and keep half); reenacted Mar. 3, 1845,
ch. 43, ? 17, 5 Stat. 732, 738; (2) Act of Mar. 22, 1794, ch. 11,
?? 2, 4, 1 Stat. 347, 349 (providing that individual could prosecute on
government’s behalf for slave trading); reenacted by Act of Mar. 26, 1804,
ch. 38, ? 10, 2 Stat. 283, 286; Act of Mar. 2, 1807, ch. 22, ? 3, 2
Stat. 426; Act of Mar. 4, 1909, ch. 321, ?? 254-57, 35 Stat. 1138, 1140;
(3) Act of July 6, 1797, ch. 11, ? 20, 1 Stat. 527, 532 (providing that
informer received half of penalties related to duties on paper products–unclear
whether informer could sue); adopted by Act of Feb. 28, 1799, ch. 17, ? 5,
1 Stat. 622, 623 (same for penalties involving altering stamp duties); (4)
Act of May 3, 1802, ch. 48, ? 4, 2 Stat. 189, 191 (providing that
individual could prosecute on government’s behalf for employment of other than a
"free white person" in postal service); (5) Act of Aug. 5, 1861, ch.
45, ? 11, 12 Stat. 292, 296-97 (providing that individual could sue import
assessor acting without taking oath, and keep half the fine); (6) Act of
July 8, 1870, ch. 230, ? 39, 16 Stat. 198, 203 (providing that
individual could sue on government’s behalf for unlawful contracting with
Indians); reenacted by Act of May 21, 1872, ch. 177, ? 3, 17 Stat.
136, 137. The First Congress’s statute regarding unlawful trading with Indians
was also reenacted. Act of Mar. 1, 1793, ch. 19, ? 12, 1 Stat. 329,
331; Act of May 19, 1796, ch. 30, ? 18, 1 Stat. 469, 474; Act of
Mar. 30, 1802, ch. 13, ? 18, 2 Stat. 139, 145; Act of June 30,
1834, ch. 161, ? 27, 4 Stat. 729, 733-34.
14. See, e.g., Wallace v. Jaffree, 472
U.S. 38, 100 (1985) (Rehnquist, J., dissenting) (federal aid to sectarian
schools unconstitutional despite grants of such aid by the first Congress); Marsh,
463 U.S. at 814 n.30 (1983) (Brennan, J., dissenting) (First Congress’s statute
requiring public whipping of thieves presumably unconstitutional today); INS
v. Chadha, 462 U.S. 919, 982 n.18 (1983) (holding that use by First
Congress of precursors to the legislative veto was unconstitutional); Hayburn’s
Case, 2 U.S. (2 Dall.) 408 (1792) (declining to enforce First Congress’s
statute giving courts non-judicial duties). Cf. New York Times Co. v.
Sullivan, 376 U.S. 254, 276 (1964) ("broad consensus" that
Sedition Act of 1789 was unconstitutional).
15. The defendants argue that the weight of authority
holding that uninjured qui tam relators may have standing, see
United States ex rel. Berge v. Board of Trustees, 104 F.3d 1453,
1457-58 (4th Cir.), cert. denied, 522 U.S. 916 (1997); United
States ex rel. Killingsworth v. Northrop Corp., 25 F.3d 715, 720 (9th
Cir. 1994); United States ex rel. Kreindler & Kreindler v. United Techs.
Corp., 985 F.2d 1148, 1154 (2d Cir. 1993); United States ex rel.
Kelly v. Boeing Co., 9 F.3d 743 (9th Cir. 1993); United States ex rel.
Woodard v. County View Care Ctr., 797 F.2d 888, 893 (10th Cir. 1986); United
States ex rel. Weinberger v. Equifax, 557 F.2d 456, 460 (5th Cir.
1977), is unpersuasive, for each court that has approved a relator’s standing
under the FCA has relied on fallacious reasoning or on standing theories that
are invalid in light of the subsequent decision in Defenders of Wildlife.
16. The district court did not have the benefit of Foulds,
which was issued after judgment was entered herein.
17. See Weinberger, 557 F.2d at 460 (reasoning
that "the statute clearly accords [the relator] standing to bring the
action").
18. See, e.g., Woodard, 797
F.2d at 893 ("The statute of course eliminated any standing
problem.").
19. See Warth v. Seldin, 422 U.S. 490, 501
(1975) (referring to prudential standing requirements that are waivable by
statute).
20. See Defenders of Wildlife, 504 U.S. at 560
(holding that the injury requirement is part of the "irreducible
constitutional minimum of standing"); Raines v. Byrd, 521 U.S.
811, 820 n.3 (1997) ("It is settled that Congress cannot erase Article
III’s standing requirements by statutorily granting the right to sue to a
plaintiff who would not otherwise have standing.").
21. See Giles v. NYLCare Health Plans, Inc.,
172 F.3d 332, 338 n.12 (5th Cir. 1999) ("Even though subject matter
jurisdiction can be raised sua sponte, we take nothing away from our
failure to do so in these cases.").
22. See, e.g., Ashwander v. Tennessee Valley Auth.,
297 U.S. 288, 348 (1936) (Brandeis, J., concurring).
23. Despite the fact that Foulds has decided the
issue, we have discussed the question, for the benefit of the reader, because
the Foulds court engaged in no analysis of the standing question.
24. Id. at 745 n.2 (citing Idaho v. Coeur
d’Alene Tribe, 521 U.S. 261, 267 (1997); Patsy v. Board of Regents,
457 U.S. 496, 515 n.19 (1982)).
25. See Colautti v. Franklin, 439 U.S.
379, 397 n.16 (1979) ("Appellees, as the prevailing parties, may of course
assert any ground in support of that judgment, ‘whether or not that ground was
relied upon or even considered by the trial court.’") (quoting Dandridge
v. Williams, 397 U.S. 471, 475 n.6 (1970)).
26. Wooton v. Pumpkin Air, Inc., 869 F.2d 848,
850 n.1 (5th Cir. 1989) ("When the judgment of the district court is
correct, it may be affirmed on appeal for reasons other than those asserted or
relied on below.") (quoting Terrell v. University of Tex. Sys. Police,
792 F.2d 1360, 1362 n.3 (5th Cir. 1986)).
27. See Humphrey’s Executor v. United States,
295 U.S. 602, 629-30 (1935) ("The fundamental necessity of maintaining each
of the three general departments of government entirely free from the control or
coercive influence, direct or indirect, of either of the others
. . . is hardly open to serious question.").
28. See Clinton v. Jones, 520 U.S. 681, 701
(1997) (stating that "the separation of powers doctrine requires that a
branch not impair another in the performance of its constitutional duties")
(quoting Loving v. United States, 517 U.S. 748, 757 (1996)); Morrison
v. Olson, 487 U.S. 654, 694-95 (1988); Commodity Futures Trading Comm’n
v. Schor, 478 U.S. 833, 856-57 (1986); Nixon v. Administrator of Gen.
Servs., 433 U.S. 425, 443 (1977). See also Neil Kinkopf, Of
Devolution, Privatization and Globalization: Separation of Powers Limits on
Congressional Authority To Assign Federal Power to Non-federal Actors,
50 Rutgers L. Rev. 331, 338-39 (1998).
29. The dissent insists that there is no separation of
powers problem, because "Congress has not usurped [executive authority] at
all, much less for its own use." In so reasoning, the dissent commits the
error of viewing all separation of powers violations as requiring aggrandizement
of one branch at the expense of another.
The separation of powers doctrine is not so limited; it may also be violated
when one branch "impermissibly undermine[s]" the constitutionally
assigned powers of another, even if the trespassing branch does not usurp those
powers for itself. See, e.g., Jones, 520 U.S. at 701
("[T]he separation of powers doctrine requires that a branch not impair
another in the performance of its constitutional duties.") (quoting Loving,
517 U.S. at 757). Defendants’ argument is that Congress, in stripping the
Executive of his exclusive power to intiate and control causes of action that
belong exclusively to the government, impermissibly undermined the President’s
power to "take Care that the Laws be faithfully executed." Defendants
do not attempt to show that Congress aggrandized itself, but they need not do so
to establish a separation of powers violation.
30. The Printz Court observed that early
statutes requiring state officials to enforce federal laws imposed only
adjudicative, not executive, duties on state officials. See Printz, 521
U.S. at 927 (recognizing "early [federal] statutes imposing obligations on
state courts" but noting an "utter lack of statutes imposing
obligations on the States’ executives"). This observation counters the
government’s argument that the history of state officials’ executing federal law
demonstrates that the Constitution does not require that the President retain
meaningful control over federal law enforcement. The early statutes to which the
government points as indicating that state officials have historically enforced
federal law may have permitted adjudicative tasks, but they could not properly
have allowed state officials to sue on behalf of the federal government, for
"[a] lawsuit is the ultimate remedy for a breach of the law, and it is to
the President . . . that the Constitution entrusts the
responsibility to ‘take Care that the Laws be faithfully executed.’" Buckley
v. Valeo, 424 U.S. 1, 138 (1976) (per curiam).
31. See, e.g., Kelly, 9 F.3d
at 750-71; United States ex rel. Truong v. Northrop Corp.,
728 F. Supp. 615, 620-22 (C.D. Cal. 1989) (reasoning that "under Morrison
v. Olson, for the qui tam provisions of the False Claims Act to
pass constitutional muster, the executive branch must retain ‘sufficient’
. . . control over the litigation"); Stillwell, 714
F. Supp. at 1089-90; United States ex rel. Newsham v. Lockheed Missiles
& Space Co., 722 F. Supp. 607, 611-13 (N.D. Cal. 1989).
32. The independent counsel provisions of the EGA likely
represent the outer limits of congressional encroachment on another branch’s
powers and functions. As discussed below, the provisions were narrowly tailored
to address a particularly perplexing intra-branch conflict: the conflict of
interest that exists when the Attorney General is called on to investigate
criminal wrongdoing by his close colleagues within the Executive Branch.
The Supreme Court accepted the independent counsel device’s encroachment on
executive powers as an evil that had to be incurred to provide some
accountability within the Executive Branch. The problem presented was unique,
and the Court was thus particularly forgiving of executive encroachment. We
therefore view Morrison as expressing the outer boundary of executive
encroachment; any legislation that leads to more encroachment than that the Morrison
Court considered must be unconstitutional.
33. See 31 U.S.C. ? 3730(c)(3) ("If
the Government elects not to proceed with the action, the person who initiates
the action shall have the right to conduct the action.").
34. See United States v. Nixon, 418 U.S. 683,
693 (1974) ("[T]he Executive Branch has exclusive authority and absolute
discretion to decide whether to prosecute a case"); Heckler v. Chaney,
470 U.S. 821, 832 (1985) ("[T]he decision of a prosecutor in the Executive
Branch not to indict . . . has long been regarded as the special
province of the Executive Branch, inasmuch as it is the Executive who is charged
by the Constitution to ‘take Care that the Laws be faithfully executed.’").
35. The dissent draws a similar false analogy between qui
tam actions and title VII suits. It construes title VII suits by private
plaintiffs as the private enforcement of federal law. This analogy fails,
because a private title VII plaintiff sues to redress his own injury and only
incidentally benefits the government. By contrast, the only interest
most qui tam relators vindicate is the government’s. Qui tam
actions, unlike title VII suits, aim to redress purely public injuries.
36. The requirement that the government obtain court
permission to dismiss a qui tam suit raises serious questions regarding
the balance of power between the Executive and Judicial Branches. See United
States v. Cox, 342 F.2d 167, 171 (5th Cir. 1965) (en banc) ("It
follows, as an incident of the constitutional separation of powers, that the
courts are not free to interfere with the free exercise of the discretionary
powers of the attorneys of the United States in their control over criminal
prosecutions."); In re Int’l Bus. Machs. Corp., 687 F.2d 591,
602 (2d Cir. 1982) ("The district court’s involvement in the executive
branch’s decision to abandon litigation might impinge upon the doctrine of
separation of powers."). Such questions are not implicated in this case,
however, because they involve potential interference with Executive prerogatives
not by a relator, as here, but by the judiciary.
37. Gravitt v. General Elec. Co., 680 F. Supp.
1162 (S.D. Ohio 1988), illustrates how the qui tam provisions encroach
on the Executive’s control of settlements. There, the court refused to accept
the government’s settlement, lecturing the Justice Department on the inadequacy
of its investigation into the matter alleged in the relator’s complaint. See
id. at 1164. It turns out, however, that the fraud complained of
resulted in a net undercharge to the government, and a few years later, the
Justice Department succeeded in settling for the sum the Gravitt court
initially rejected. See Memorandum re: Constitutionality of the Qui
Tam Provisions of the False Claims Act, 13 U.S. Op. Off. Legal Counsel
207, 219.
38. See 31 U.S.C. ? 3730(c)(1) (providing
that if the government intervenes, the relator "shall have the right to
continue as a party to the action, subject to the limitations set forth in
paragraph (2)," none of which permits removal); id. ? 3730(c)(3)
(providing that if government intervenes after initially deciding not to do so,
it may not limit relator’s status and rights). One commentator has pointed out
that a plain reading of ? 3730(c)(3) appears to bar the government from
dismissing a case if it intervenes after initially declining to do so, for
dismissal would certainly "limit[] the status and rights of the person
initiating the action." See James T. Blanch, Note, The
Constitutionality of the False Claims Act’s Qui Tam Provisions, 16 Harv.
J.L. & Pub. Policy 701, 766 (1993). But see Kelly, 9 F.3d at 752
& n.8 (reasoning that to preserve the FCA, the Act should be
interpreted to give government similar degree of control over litigation as if
it had intervened at litigation’s inception).
39. As the Foulds panel noted, "the
government does not expect that the relator will act first and foremost with the
government’s interests in mind." Foulds, 171 F.3d at 290. Qui
tam relators "are motivated primarily by prospects of monetary reward
rather than the public good." Hughes Aircraft, 520 U.S.
at 949.
Of course, this concern about encroachment on the Executive’s prosecutorial
discretion is present only in qui tam actions in which the government
declines to intervene. When the Attorney General does intervene, the Executive
is essentially initiating the action at the urging of an informer, and he
thereby retains "a degree of control over the power to initiate" the
action. Accordingly, our holding addresses only those FCA qui tam
actions, such as Riley’s, in which the government declines to participate. We
express no opinion as to whether qui tam actions in which the
government intervenes violate the Take Care Clause or the separation of powers
doctrine.
40. The Kelly court explained:
[The defendant] suggests that we should look at the precise means of
executive control identified and found sufficient in Morrison, and
then base our decision on the absence of those same means in the qui tam
provisions. [The relator], on the other hand, suggests that we identify all
possible means of executive control in the qui tam provisions, and then
compare them in toto to the means of control identified in Morrison.
We believe that, under Morrison, Kelly’s approach is the correct one.
Kelly, 9 F.3d at 752.
41. The Second and Sixth Circuits, as well, have rejected
Take Care Clause and separation of powers challenges to the qui tam
provisions on the basis of the FCA’s preservation of executive authority. See
Kreindler & Kreindler, 985 F.2d at 1155; United States ex rel.
Taxpayers Against Fraud v. General Elec. Co., 41 F.3d 1032, 1041 (6th
Cir. 1994).
42. There are many other ways in which Congress could
increase fraud enforcement. For example, it could provide greater resources to
the Attorney General or greater bounties to informers.
43. Because our holding prohibits only those qui tam
actions in which the government does not intervene, the dissent’s statistics
indicating the effectiveness of all FCA qui tam actions are
inapposite. The dissent cites statistics showing that FCA qui tam
actions have resulted in a "boon to the federal treasury," implicitly
suggesting that such statistics should influence our opinion of the
constitutionality of the qui tam action at issue in this case. While
the alleged effectiveness of the FCA’s qui tam provisions should not
affect our decision as to their constitutionality, we note that the only
statistics relevant to this case would describe the effectiveness of a subset
of qui tam actions–those in which the government does not intervene.
Department of Justice reports indicate that such actions, relative to qui
tam actions in which the government does intervene, have not resulted in a
"boon to the federal treasury." As of October 1998, the government had
recovered $2.189 billion in cases in which it had intervened but only $60
million in cases in which it had not. See Justice Department Recovers More
than $2 Billion in False Claims Act Awards and Settlements (Dep’t of
Justice press release Oct. 23, 1998). These statistics indicate that less than
2.7% of total recovery under the FCA’s qui tam provisions comes from
actions in which the government does not intervene. The cases in which the
government intervenes–cases that are not affected by our holding–are generally
the meritorious cases.(44)
44. Statistics provided by the Department
of Justice in October of 1995 reveal that of the 1,105 qui tam cases
filed up to that point, only 153 (or less than 15%) of the cases resulted in a
recovery. See Aerospace Indus. Ass’n Br. at 10. Such statistics
demonstrate that the great majority of qui tam suits–suits that can
impose high costs on defendants–are meritless. ‘
45. See
Steven G. Calabresi and Saikrishna B. Prakash, The President’s Power To
Execute the Laws, 104 Yale L.J. 541, 593 (1994) (noting that "the
Executive Power Clause grants ‘the executive Power’ solely and exclusively to
the President," so "Congress may not exercise ‘the executive Power’
itself, nor may it give that power to other subordinate entities"). Cases
approving congressional delegation of judicial power, such as those cited by the
dissent, are inapposite, for Article III, in contrast to Article II, vests
judicial power in "one supreme Court, and in such inferior Courts as
the Congress may from time to time ordain and establish." U.S. Const.
Art. III, ? 1 (emphasis added). The Constitution thus contemplates
congressional delegation of judicial power but not legislative delegation of the
President’s authority to take care that the laws be faithfully executed.
46. One might
argue that if the Attorney General did not want the action brought, he could
merely intervene and dismiss the action, so a decision not to intervene must be
an implicit delegation. The FCA, however, makes it difficult for the government
to dismiss actions it does not want brought. The government may not intervene in
the action and dismiss it over the relator’s objections unless the Attorney
General obtains court approval–from a democratically unaccountable federal
court–after granting the relator a hearing. See 31 U.S.C.
? 3730(c)(2)(A).
Moreover, if the government does not intervene within
60 days, it cannot, under the FCA’s plain text, reenter and dismiss the
suit, for in entering a qui tam action after initially declining to
intervene, the government may not "limit the status and rights of the
relator," as it undoubtedly would do if it entered the litigation and
sought dismissal of the action. See id. ? 3730(c)(3). Hence, a
strategy of intervention and dismissal is difficult, and a decision not to
intervene should not be viewed as an implicit delegation by the Attorney
General; it might instead result from a decision that the lawsuit is harmful and
should not be pursued.
The case would be different if the FCA required the Attorney
General, in announcing his decision not to intervene, to state that he was
delegating authority to sue to the qui tam relator. Under the current
statute, however, it is not appropriate to infer delegation by the Executive
from a decision not to intervene.
47. The
Appointments Clause states:
[The President] shall nominate, and by and with the Advice
and Consent of the Senate, shall appoint Ambassadors, other public Ministers
and Consuls, Judges of the supreme Court, and all other Officers of the United
States, whose Appointments are not herein otherwise provided for, and which
shall be established by Law. But the Congress may by Law vest the appointment
of such inferior Officers, as they think proper, in the President alone, in
the Courts of Law, or in the Heads of Departments.
U.S. Const. art. II, ? 2, cl. 2.
The Article II arguments the defendants presented in addition to
their Article III challenge constitute alternative grounds for affirming the
district court’s dismissal and are properly before us on appeal. See Colautti,
439 U.S. at 397 n.16 ("Appellees, as the prevailing parties, may of
course assert any ground in support of that judgment, ‘whether or not that
ground was relied upon or even considered by the trial court.’") (quoting Dandridge,
397 U.S. at 475 n.6); Wooton, 869 F.2d at 850 n.1 ("When
the judgment of the district court is correct, it may be affirmed on appeal for
reasons other than those asserted or relied on below.") (quoting Terrell,
792 F.2d at 1362 n.3).
48. In the
district court, the University of Texas Health Science Center at Houston
defended on the ground, inter alia, that, because it is an arm of the
state, the Eleventh Amendment forbids suits against it by a private party,
absent a waiver of sovereign immunity. In Foulds, this court agreed
with that analysis, holding that the Eleventh Amendment bars a qui tam
suit by a relator against a state entity. See Foulds, 171 F.3d at
288-94. All parties herein agree that the Foulds holding precludes
liability on the part of the University of Texas Health Science Center at
Houston, and this is an alternate ground for affirmance as to that defendant,
which is entitled to dismissal as well under our conclusion that this suit is
barred by the Take Care Clause and separation of powers doctrine.
49. Judge Stewart
joined part IV of Judge Smith’s majority opinion in footnote two of his
dissenting opinion, making the discussion therein the majority view.
50. Indeed, the
Supreme Court cynically opined that qui tam relators "are
motivated primarily by prospects of monetary reward rather than the public
good." Hughes Aircraft Co. v. United States ex rel. Schumer, 520 U.S. 939,
949 (1997).
51. The majority
discusses at length the propriety of Plaintiff-Appellant’s standing to bring her
claim in federal court, see ante at 6-9, ultimately concluding that a
recent opinion of this court confers standing upon her. See ante at 8.
That opinion, United States ex rel. Foulds v. Texas Tech Univ., 171
F.3d 279 (5th Cir. 1999), indeed provided that a qui tam
relator who has not suffered personalized injury may nonetheless have standing
to bring a case even where the government does not intervene in the case. See
171 F.3d at 288 n.12. Since I agree with the majority’s conclusion that Foulds
controls this case, I pause only to add that I believe that Riley has standing
in this case even in light of Steel Co. v. Citizens for a Better Environment,
523 U.S. 83, –, 118 S. Ct. 1003, 1016-20 (1998), which limited standing in
certain areas but did not completely foreclose a plaintiff’s ability to bring a
claim despite the absence of a personalized injury.
52. 31 U.S.C. ?
3730(b)-(f) (1994).
53. Marsh v.
Chambers, 463 U.S. 783, 790 (1983).
54. Id.
at 791.
55. See, e.g.,
Mistretta v. United States, 488 U.S. 361, 401 (1989) (noting that history, in
the sense of "’traditional ways of conducting government[,] . . . give[s]
meaning’ to the Constitution") (quoting Youngstown Sheet & Tube Co. v.
Sawyer, 343 U.S. 579, 610 (1952) (Frankfurter, J., concurring); Commodity
Futures Trading Comm’n v. Schor, 478 U.S. 833, 858 (1986) (faulting petitioner
for failing to identify "historical support for the critical link he posits
between the provisions of Article III that protect the independence of the
federal judiciary and those provisions that define the extent of the judiciary’s
jurisdiction over state law claims"); The Pocket Veto Case, 279 U.S. 655,
689 (1929) (noting that "[l]ong settled and established practice is a
consideration of great weight" in constitutional interpretation).
56. Knowlton v.
Moore, 178 U.S. 41, 95 (1900).
57. See
Printz v. United States, 521 U.S. 898, 905 (1997) ("Because there is no
constitutional text speaking to this precise question, the answer to the
[constitutional] challenge must be sought in historical understanding and
practice, in the structure of the Constitution, and in the jurisprudence of this
Court.").
58. Geoffrey R.
Stone et al., Constitutional Law 366 (2nd ed. 1991).
59. One subject
about which the majority and I do agree is the ancient nature of "qui
tam" actions. I believe it is worth noting that the phrase itself was
at least in circulation at Blackstone’s time. See 3 William Blackstone,
Commentaries *160.
60. See
Dan D. Pitzer, The Qui Tam Doctrine: A Comparative Analysis of Its
Application in the United States and the British Commonwealth, 7 Tex. Int’l
L.J. 415, 417 (1972); Note, The History and Development of Qui Tam,
1972 Wash. U. L.Q. 81, 83.
61. See
Pitzer, supra note 11, at 417-18; Note, supra note 11, at
83-87.
62. See
Pitzer, supra note 11, at 417-18; Note, supra note 11, at
83-87.
63. See
Pitzer, supra note 11, at 418 (citing 4 William S. Holdsworth, A
History of English Law 355 (1924)); see also Note, supra note
11, at 90 ("Thus in the seventeenth century the qui tam concept
had wide acceptance in England. Non-statutory qui tam actions may still
have been possible, but this was by no means certain. On the other hand,
statutory versions of qui tam were very much in evidence.").
64. See
Note, supra note 11, at 97 ("[I]t seems clear that qui tam
as it existed in early America was virtually identical to English qui tam.
The colonies and newly established states adopted not only the letter but the
spirit of this unique procedure.").
65. See,
e.g., Act of July 31, 1789, ch. 5, ? 29, 1 Stat. 29, 45 (customs
duties); Act of March 1, 1790, ch. 2, ? 3, 1 Stat. 101, 102 (census
returns); Act of May 31, 1790, ?? 2, 6, 1 Stat. 124, 125-26
(copyright); Act of July 20, 1790, ch. 29, ?? 1, 4, 1 Stat. 131, 133
(seamen); Act of July 22, 1790, ch. 33, ? 3, 1 Stat. 137, 137-38
(Indians); reenacted by Act of Mar. 1, 1793, ch. 19, ? 12, 1 Stat. 331;
Act of May 19, 1796, ch. 30, ? 18, 1 Stat. 474; Act of Mar. 30, 1802, ch.
13, ? 18, 2 Stat. 145; Act of June 30, 1834, ch. 161, ? 27, 4 Stat.
733-34; Act of August 4, 1790, ch. 35, ? 55, 1 Stat. 145, 173 (import and
tonnage duties). The majority argues, ante at 5 & n.12, that some of these
statutes are not appropriately viewed as "qui tam" provisions
because the qui tam plaintiff addressed injuries suffered only by
himself, and not by the government. My reading of these statutes suggests, on
the contrary, that the suits that they authorized redressed injuries suffered both
by the government and private citizens. Regardless, even if my colleagues’
interpretation is the correct one, those statues allowed the filing of suits in
the government’s name. Consequently, whose injury was redressed by the suit
does not implicate the Take Care Clause.
66. Dorothea
Beane, Are Government Employees Proper Qui Tam Plaintiffs?, 14
J. Legal Med. 279, 282 (1993).
67. See supra
note 16. In addition to these seven statutes, the majority, ante at 6 n.13,
cites six more qui tam laws enacted between 1792 and 1872, excluding
the FCA. Those later statutes are: (1) Act of Feb. 20, 1792,
ch. 7, ? 25, 1 Stat. 239 (postal penalties); reenacted Mar. 3, 1845, ch.
43, ? 17, 5 Stat. 738; (2) Act of Mar. 22, 1794, ch. 11, ?? 2, 4, 1
Stat. 349 (illegal slave trading); reenacted by Act of Mar. 26, 1804, ch. 38,
? 10, 2 Stat. 286; Act of Mar. 2, 1807, ch. 22, ? 3, 2 Stat. 426;
Act of Mar. 4, 1909, ch. 321, ?? 245-57, 35 Stat. 1140; (3) Act of July
6, 1797, ch. 11, ? 20, 1 Stat. 532 (paper duties); adapted by Act of Feb.
28, 1799, ch. 17, ? 5, 1 Stat. 623 (same for penalties involving altering
stamp duties); (4) Act of May 3, 1802, ch. 48, ? 4, 2 Stat. 191 (postal
employment); (5) Act of Aug. 5, 1861, ch. 45, ? 11, 12 Stat. 296-97
(import duties); (6) Act of July 8, 1870, ch. 230, ? 39, 16 Stat. 203
(illegal trade with Indians); reenacted by Act of May 21, 1872, ch. 177,
? 3, 17 Stat. 137. One commentator adds five more qui tam
statutes, all passed in the 1790’s, to this list. See Harold J. Krent, Executive
Control over Criminal Law Enforcement: Some Lessons From History, 38 Am. U.
L. Rev. 275, 296 n.104 (1989) (citing (1) Act of March 3, 1791, ch. 15, ? 44, 1
Stat. 199, 209 (illegal importation of liquor); (2) Act of June 9, 1794, ch. 65,
? 12, 1 Stat. 397, 400 (failure to pay auction duty); (3) Act of June 5, 1794,
ch. 48, ? 5, 1 Stat. 373, 375 (failure to follow transport regulations); (4)
Act of June 5, 1794, ch. 51, ? 21, 1 Stat. 384, 389 (failure to pay refined
sugar duty); (5) Act of June 5, 1794, ch. 48, ? 5, 1 Stat. 376, 378 (failure to
pay wine duty)).
68. See
Kent D. Strader, Comment, Counter Claims Against Whistleblowers: Should
Counterclaims Against Qui Tam Plaintiffs be Allowed in False Claims Act
Cases?, 62 U. Cin. L. Rev. 713, 727-28 (1993); Valerie R. Park, Note,
The False Claims Act, Qui Tam Relators, and the Government: Which is
the Real Party to the Action?, 43 Stan. L. Rev. 1061, 1064 (1991) ("As
the American system of government developed, government agencies became more
effective, as did conventional law enforcement procedures. This diminished the
need for qui tam.") (internal citations omitted).
69. See
Park, supra note 19, at 1064 (citing Robert W. Fisher, Jr., Qui Tam Actions:
The Role of the Private Citizen in Law Enforcement, 20 UCLA L. Rev. 778,
779-780 (1973)).
70. See
Strader, supra note 19, at 728 n.86 (noting that, prior to the Civil
War, "[t]hese restrictions included: short statutes of limitations; strict
venue statutes; penalties for wrong-doing informers; requiring informers to pay
costs if they did not prevail; giving states exclusive control of penal actions;
labeling suits as criminal instead of civil; and eliminating monetary awards to
the qui tam plaintiffs"); Park, supra note 19, at 1064.
71. 31 U.S.C. ??
3729-3733 (1994). See Anna Mae Walsh Burke, Qui Tam: Blowing the
Whistle for Uncle Sam, 21 Nova L. Rev. 869, 871 (1997); Strader, supra
note 19, at 728-29; Park, supra note 19, at 1066.
72. See
James B. Helmer, Jr. & Robert C. Neff, Jr., War Stories: A History of Qui
Tam Provisions of the False Claims Act, The 1986 Amendments to the False
Claims Act, and Their Application in the United States ex. rel Gravitt v.
General Electric Co. Litigation, 18 Ohio N.U. L. Rev. 35, 35 (1991)
(citing 132 Cong. Rec. H6482 (daily ed. Sept 9, 1986) (statement of Rep.
Berman)).
73. See
Burke, supra note 22, at 872; Evan Caminker, Comment, The
Constitutionality of Qui Tam Actions, 99 Yale L.J. 341, 387
(1989).
74. See
Act of March 2, 1863, ch. 67, 12 Stat. 696 (1863) (codified as amended at 31
U.S.C. ?? 3729-3731 (1994)).
75. See
Burke, supra note 22, at 872.
76. 317 U.S. 537
(1943).
77. See
S. Rep. No. 99-345, at 12 (1985), reprinted in 1985 U.S.C.C.A.N. 5266,
5277 ("The [1943] Senate specifically provided that jurisdiction would be
barred on qui tam suits based on information in the possession of the
government unless the relator was the original source of that information.
Without explanation, the resulting conference report dropped the clause
regarding original sources of allegations."); see also Burke, supra
note 22, at 872 (discussing this legislative history).
78. See
Act of Dec. 23, 1943, ch. 377, 57 Stat. 608 (1943) (codified as amended at 31
U.S.C. ? 3730(d) (1994)).
79. See id.
80. See
Park, supra note 19, at 1066.
81. See id.
(citing, inter alia, S. Rep. No. 99-345, at 1-8 (1985), reprinted
in 1985 U.S.C.C.A.N. 5266, 5266-73.). Apparently, "[s]ome things never
change: Today, perhaps ten percent of the Federal budget [amounting to upwards
of $100 billion] is being lost each year due to fraud against the taxpayers, and
there are indications of massive procurement abuses occurring in the recent
military budget." Caminker, supra note 24, at 349 (internal
quotation marks ommitted); see also Strader, supra note 19, at
713 n.1 (relying on statements made by the Department of Justice to reach the
same conclusion).
82. See
31 U.S.C. ? 3730(d)(2); see also Park, supra note 19, at 1067
(discussing this change).
83. See
31 U.S.C. ? 3730(e)(4); see also Burke, supra note 22, at 873
(discussing this alteration). Congress’s actions in liberalizing the qui tam
laws occurred first in the False Claims Amendments Act of 1986, Pub. L. No.
99-562, 100 Stat. 3153 (codified at 31 U.S.C. ?? 3730 (1994)). Two years
later, with the Major Fraud Act of 1988, Pub. L. No. 100-700, 100 Stat. 4631,
4638 (codified at 31 U.S.C. ? 3730 (1994)), Congress again amended the FCA,
this time to confront the issue of qui tam relators who themselves
commit fraud against the government.
84. See
Burke, supra note 22, at 870.
85. See id.
at 871.
86. See id.
87. 3 William
Blackstone, Commentaries *160.
88. Marsh v.
Chambers, 463 U.S. 783, 792 (1983).
89. In Marsh,
the majority’s primary conduit for its "fabric of society" argument,
the Supreme Court compared practices "carefully considered by the
Framers," ante at 5 n.10, with those "taken thoughtlessly, by force of
long tradition." 463 U.S. at 791. No serious argument, advanced by the
majority or within my ken, supports the implication that the qui tam
provisions were enacted "thoughtlessly."
In addition, I admit that I am somewhat nonplussed by the
majority’s choice of the bracketed alteration "constitutional" in its
citation to Marsh, ante at 5 n.10. In fact, the full quotation reads
"taken thoughtlessly, by force of long tradition and without regard to the
problems posed by a pluralistic society." Id. at 791. The Court’s
use of "pluralistic society," as it explains in the sentences
immediately following, referenced the multitude of religious beliefs held by the
Framers. See id. at 791-92. The Court was not speaking to the
Establishment Clause question in this portion of its opinion; it was only noting
that the vigorous debates accompanying the enactment of certain statutes lent
credence to them, a circumstance which the majority does not prove was lacking
with the adoption of the qui tam statutes.
90. See
Marvin v. Trout, 199 U.S. 212, 225 (1905) ("Statutes providing for actions
by a common informer, who himself had no interest in the controversy other than
that given by the statute, have been in existence for hundreds of years in
England, and in this country since the foundation of the Government."). In United
States ex rel. Marcus v. Hess, the Third Circuit’s decision began with the
premise "that qui tam or informer actions have always been
regarded with disfavor." United States ex rel. Marcus v. Hess, 127
F.2d 233, 235 (3rd Cir.), rev’d, 317 U.S. 537 (1943). In
reversing the lower court, Justice Black wrote that "[w]e cannot accept
either the interpretative approach or the actual decision of the court below. Qui
tam suits have been frequently permitted by legislative action and have not
been without defense by the courts." Marcus, 317 U.S. at 541.
91. Moreover, the
fact that criticism has been leveled at qui tam statutes throughout
their history should not affect our constitutional analysis. The proper place to
debate the merits of a law is Congress; the judiciary’s role in this
exercise is simply to decide whether the framers, in drafting the Take Care
Clause, meant to exclude qui tam statutes as one of the potential
mechanisms by which to enforce the law. As a sister circuit sagely observed,
"Congress has let loose a posse of ad hoc deputies to uncover and prosecute
frauds against the government. States and state agencies . . . may prefer the
dignity of being chased by the regular troops; if so, they must seek relief from
Congress." United States ex rel. Milam v. Univ. of Texas M.D. Anderson
Cancer Ctr., 961 F.2d 46, 49 (4th Cir. 1992).
92. 478 U.S. 833
(1986).
93. 433 U.S. 425
(1977).
94. 487 U.S. 654
(1988).
95. Commodity
Futures Trading Comm’n v. Schor, 478 U.S. 833, 856 (1986).
96. Nixon v.
Administrator of Gen. Servs., 433 U.S. 425, 443 (1977).
97. Schor,
478 U.S. at 857.
98. Nixon,
433 U.S. at 451.
99. Morrison v.
Olson, 487 U.S. 654, 696 (1988).
100. 31 U.S.C. ?
3730(b)(2).
101. Id.
? 3730(b)(4)(B).
102. Id.
? 3730(c)(1). The majority implies, ante at 3-4, that the fact that the relator
still participates in an action in which the government intervenes and shares in
any damages awarded the government somehow undermines the Executive’s authority.
Cf. infra note 78 (discussing the majority’s disingenuous treatment of
cases in which the Executive chooses to intervene). How the relator’s
participation undermines authority is an opaque concept indeed; the relator’s
knowledge of events and, presumably, of the litigants, would seem to benefit the
government’s prosecution of the case. In addition, the statute’s provision, see
? 3730(d)(1), that the relator share in the damage award does not implicate
separation of powers concerns; rather, it serves as a reward to a citizen who
brings to light a violation of federal law that would otherwise likely escape
detection and then devotes a portion of his or her life (likely several years)
to bringing the perpetrators to justice.
Other statutes that create a private right of action function
in similar, albeit not identical, ways. Title VII of the Civil Rights Act of
1964, 42 U.S.C. ? 2000e (1994), for example, allows a private citizen to
initiate a suit on her own behalf, against a private entity, in order to enforce
federal law. While such an action is not on behalf of the United
States, as is a qui tam action, the principle–that a private citizen
may enforce federal law–is the same. Cf. Caminker, supra note
24, at 344 (noting that qui tam statutes and citizen-suit statutes
"serve the same purpose: [b]oth are designed to encourage private citizens
to help the executive branch deter and redress violations of Federal
law.").
103. 521 U.S. 898
(1997).
104. See id.
at 935 ("The Federal Government may neither issue directives requiring the
States to address particular problems, nor command the States’ officers, or
those of their political subdivisions, to administer or enforce a federal
regulatory program."). In the course of its opinion striking down the law
on federalism grounds, the Court does address federal separation of powers, see
id. at 922-23, as the majority notes, ante at 10, but it most assuredly
does not base its conclusion there. See id. at 905 (mapping the
opinion’s course down the three channels necessary to reach its result:
"historical understanding and practice, [the] structure of the
Constitution, and [the] jurisprudence of this Court"); cf. supra
note 6 (noting the importance of history to constitutional questions where the
document itself is silent). Instead, Printz is more appropriately
viewed as a companion to New York v. United States, 505 U.S. 144
(1992), wherein the Court held that Congress cannot compel a state to enact or
to enforce a regulatory program. See 505 U.S. at 166.
105. Id.
at 922.
106. See
infra Part IV.
107. The majority
criticizes this conclusion, ante at 6 n.29, apparently assigning to this dissent
the untenable position that only "aggrandizement" of power by one
branch at the expense of another may constitute a separation of powers
violation. One branch may indeed "impermissibly undermine" the
constitutionally-assigned powers of another without aggrandizing its own power, see
Clinton v. Jones, 520 U.S. 681, 701 (1997), but finding that sort of
constitutional violation requires more guesswork than the concededly more
obvious attempt to aggrandize. The type of action that constitutes
"impermissbl[e] undermin[ing]" is open to a great deal more
interpretation, as this case demonstrates.
Therefore, that Congress did not authorize an aggrandizement
of its own power at best is persuasive authority for the notion that the statute
is constitutional; it is neither intended as a dispositive, nor a myopic,
observation.
108. The majority
misinterprets the delegation question that I address infra. It is
beyond peradventure that "Congress may not delegate purely executive power
without the acquiescence of the Executive." Ante at 18. I agree
whole-heartedly with that proposition and discuss here instance of delegation in
which the Executive has concurred. For the reasons that follow, I believe that
the qui tam relator provisions at issue in this case exemplify a
delegation of Executive power to which the Executive has acquiesced.
109. See
generally R. Kevin Bailey, Note, "Did I Miss Anything?":
Excising the National Security Council from FOIA Coverage, 46 Duke L.J.
1475, 1493 n.101 (1997) (discussing at length the history of the delegation of
legislative power to independent agencies).
110. See
Humphrey’s Executor v. United States, 295 U.S. 602, 627, 628 (1935) (holding
that the President, having ceded his authority in a particular area to an
independent agency, may not attempt to exercise control over the actions of such
an agency, even though it would not have existed but for the delegation of
power). Cf. Myers v. United States, 272 U.S. 52, 134 (1926) (providing
that the President exercises "unrestricted power" in directing the
actions to be taken by his executive subordinates).
111. Id.
at 629-30.
112. See id.
at 631-32.
113. Id.
at 625-26; see also Morrison v. Olson, 487 U.S. 654, 659-60 (1988)
(holding that a statutory scheme designed to protect independent agency
officials from executive control is constitutional).
114. See
Stone et al., supra note 9, at 416.
115. Strictly
speaking, as I have indicated, the nondelegation doctrine referred only to
delegations of legislative power to the executive. Nevertheless, the rationale
behind the doctrine applies with equal force to judicial and executive
delegations as well. See, e.g., Mistretta v. United States, 488 U.S.
361, 371 (1989) (holding that the power to promulgate sentences was not
improperly delegated to an independent Sentencing Commission); Commodity Futures
Trading Comm’n v. Schor, 478 U.S. 833, 857 (1986) (holding that the CFTC’s
adjudicative functions did not violate separation of powers); Crowell v. Benson,
285 U.S. 22, 46, 50 (1932) (allowing delegation of judicial power to Employees’
Compensation Commission under the theory that it adjudicated "private
rights" only); Murray’s Lessee v. Hoboken Land & Improvement Co., 59
U.S. (18 How.) 272, 275 (1855) (reasoning that, because the government can only
be sued with its permission, Congress can establish the terms and conditions of
such litigation, including that the matter be resolved by a non-Article III
adjudicator).
116. See
A.L.A. Schechter Poultry Corp. v. United States, 295 U.S. 495, 541-42 (1935)
(declaring the National Industrial Recovery Act’s ("NIRA") "fair
competition" provisions invalid because they supplied the President with
"virtually unfettered" control over trade and industry); Panama
Refining Co. v. Ryan, 293 U.S. 388, 432-33 (1935) (holding unconstitutional an
NIRA provision that delegated power to the President without providing an
intelligible principle for its exercise).
The "intelligible principle" test itself was
developed a few years earlier in J.W. Hampton, Jr. & Co. v. United
States, 276 U.S. 394 (1928). In that case, the Supreme Court considered a
delegation by Congress, authorizing the President to revise certain tariffs
whenever he determined revision to be necessary, to "equalize the said
differences in costs of production in the United States and the principal
competing country." 276 U.S. at 401. The Court approved the delegation
because Congress had established an "intelligible principle" by which
the justices could determine whether the President had acted within his
delegated authority. See id. at 409. Significantly, then the
"intelligible principle" formulation permits the delegation of
discretion.
117. The Court
has also found some delegations to be constitutional where they collaterally
implicate aspects of legislative, executive, and/or judicial power. See,
e.g., Wiener v. United States, 357 U.S. 349, 356 (1958) (holding that the
adjudicatory nature of the War Claims Commission implicitly limited the
President’s power to remove its officials, despite the fact that the President
had appointed them).
118. Mistretta,
488 U.S. at 373 n.7. For an example of such an application, see Industrial
Union Dep’t v. American Petroleum Institute, 448 U.S. 607, 646 (1980)
(announcing the rule that "[a] construction of [a] statute that avoids [an]
open-ended grant [of delegated power] should certainly be favored.").
119. See,
e.g., Cass R. Sunstein, Constitutionalism after the New Deal, 101
Harv. L. Rev. 421, 444 (1987) ("[T]he power of the President to control
regulatory agencies was frequently limited by law or in practice[,]" even
as the President’s power otherwise increased during the New Deal period).
120. 500 U.S. 160
(1991).
121. 21 U.S.C. ?
811(h) (1988).
122. 500 U.S. at
167-68 (citation omitted) (emphasis added).
123. See
Humphrey’s Executor, 295 U.S. at 631-32.
124. See
Touby, 500 U.S. at 168.
125. My
colleagues note that other circuits passing on the constitutionality of the
FCA’s qui tam provisions have deferred to Morrison‘s
"control" test. See ante at 11 & n.30. As I explained supra,
I do not dispute that Morrison is a partial answer to the question
presented by the qui tam provisions; I simply believe that it is an
incomplete response in light of the Executive Branch’s ability to delegate its
powers to an independent party, in this case the qui tam relator. The
independent counsel cannot be considered an "independent" party in the
same way, primarily because the Executive Branch itself–through the Attorney
General–must in every case involving potential wrongdoing within the
Executive Branch determine whether an independent counsel is needed. To borrow a
metaphor from classical mythology, Athena, in the person of the independent
counsel, springs from Zeus’s head and becomes a stubborn maverick. The qui
tam statute works in exactly the opposite way: the relator brings the case
to the attention of the Executive, who then chooses whether or not to let the
relator proceed with the action on her own or to take over the litigation
itself. At no point must the Executive determine whether to appoint a
relator to undertake the Executive’s investigatory functions. The majority
concludes that this factor makes the qui tam relator provision more
restrictive than the independent counsel law. See ante at 15
("[T]he controls the Executive Branch may exercise . . . are simply not
sufficient to counterbalance this major encroachment on Executive power.").
I disagree because the independent counsel statute requires the
appointment of an independent counsel unless there are "no reasonable
grounds to believe that further investigation is warranted;" in that sense,
the Executive has less control than in the instant scenario. By
contrast, the qui tam statute never requires even the
government’s acquiescence in a case, much less an actual appointment.
I believe that Morrison‘s "control" test
does not invalidate the qui tam relator provisions. While politics
might on some level impact the Executive’s decision to intervene in a particular
case, it is in all cases the Executive Branch itself that determines how much
control it will have over a qui tam action, not Congress. It is beyond
peradventure that Congress would ever exercise "control" over a qui
tam action in the same fashion that it politically may attempt to control
the Executive’s implementation of the independent counsel statute.
126. Cf.
Heckler v. Chaney, 470 U.S. 821, 835 (1985) (concluding that the Executive’s
exercise of prosecutorial discretion does not violate the Take Care clause).
127. Of course,
the majority also notes, ante at 14 n.37, that "this concern about
encroachment on the Executive’s prosecutorial discretion is present only in qui
tam actions in which the government declines to intervene." While I
agree in principle with this statement, the text of the majority’s opinion does
not always maintain a firm grip on this moderating observation. In the preceding
paragraphs, the majority attacked the qui tam provisions for
interfering with the Executive Branch’s "ability to control the
litigation," ante at 12, even where the Attorney General elected to
intervene. In my view, this vacillation is a fatal flaw in the majority’s
argument: if losing control over litigation does not represent a violation of
the separation of powers doctrine, then neither does the Executive’s decision to
delegate its prosecution of a case to a third party.
128. The majority
adverts to Chaney and to Untied States v. Nixon, 418 U.S. 683
(1974), but those cases actually undermine the majority’s position. Nixon
in particular recognized the principle of "absolute discretion" in the
Executive Branch’s role as prosecutor. 418 U.S. at 693. As I have stated
earlier, the qui tam provisions do not eliminate that discretion, for
the Attorney General may elect to intervene to prosecute the case herself, or
she may request that the district court dismiss the case. See 31
U.S.C. ? 3730(c)(2)(A). When she does neither, she has not lost power, as
the majority suggests; she has simply passed the mantle of her power on to the
relator.
129. See
31 U.S.C. ? 3730(b)(1); Searcy v. Philips Electronics N. Am. Corp., 117 F.3d
154, 159 (5th Cir. 1997).
130. Stone et
al., supra note 9, at 362-63.
131. Id.
at 363.
132. See id.
133. Arthur
Selwyn Miller, An Inquiry into the Relevance of the Intentions of the
Founding Fathers, with Special Emphasis upon the Doctrine of Separation of
Powers, 27 Ark. L. Rev. 583, 588-89 (1973).
134. The
Federalist No. 70, at 423 (Alexander Hamilton) (Clinton Rossiter ed., 1961).
135. See,
e.g., Theodore J. Lowi, The End of Liberalism: The Second Republic of the
United States 67 (2nd ed. 1980) (suggesting that the "separatist
tendencies and self-defeating proclivities of the independent functions"
contributes to a government with power but "without planning"); Lloyd
N. Cutler & David R. Johnson, Regulation and the Political Process,
84 Yale L.J. 1395, 1401 (1975) (suggesting that the Constitution’s "large
measure of inertia against change" handicaps Congress’s and the President’s
ability to manage the affairs of the government).
136. See
Stone et al., supra note 9, at 365.
137. The
majority, ante at 14, complains that even a qui tam relator who
presents credible allegations "can bind the government, via res
judicata, and prevent it from suing over those concerns at a later date
when more information is available." This concern is ethereal at best.
While I concede that a hypothetical case might arise that the government deems
worthy but not yet ripe, it is far likelier that, upon presentation of a valid
claim, the government will assume control of the litigation than leave the case
to the vagaries of the relator. Any res judicata concern, then, could
be alleviated with recourse to a voluntary dismissal of the claim. See
31 U.S.C. ? 3730(c)(2)(A).
138. The
Federalist No. 47, at 301 (James Madison) (Clinton Rossiter ed., 1961).
139. 272 U.S. 52
(1926).
140. Id.
at 293 (Brandeis, J., dissenting).
141. The primary
safeguard under this view is that it makes the laws apply
to the lawmakers. This is probably the meaning of Montesquieu’s statement
concerning tyrannical laws tyrannically applied; if the legislators cannot
ensure a tyrannical execution, i.e., one which favors themselves, they will be
less likely to make tyrannical laws for fear that they themselves will be
tyrannically ruled by them. [If] a separate executive will enforce the law even
against the lawmakers, the lawmakers will not have a "distinct interest
from the rest of the Community."
David F. Epstein, The Political Theory of The Federalist
129-30 (1984). But cf. Peter M. Shane, Presidents, Pardons, and
Prosecutors: Legal Accountability and the Separation of Powers, 11 Yale L.
& Pol’y Rev. 361, 364 (1993) (arguing that "the advantages offered by
checks and balances in promoting the rule of law are significant" but that
"categorical separation [of powers] tends to subvert, rather than encourage
executive conformity to law").
142. The
Federalist No. 51, at 322 (James Madison) (Clinton Rossiter ed., 1961).
143. See
Edward H. Levi, Some Aspects of the Separation of Powers, 76 Colum. L.
Rev. 371, 374 (1976) (contending that the separation of powers "was based
upon the skeptical idea that only the division of power among three governmental
institutions–executive, legislative, and judicial–could counteract the
inevitable tendency of concentrated power to overreach and threaten
liberty").
144. Compare
Gordon S. Wood, The Creation of the American Republic, 1776-1787, at 609 (1969)
(concluding that the separation of powers was intended to ensure "the
protection of individual rights against all governmental encroachments,
particularly by the legislature, the body which the Whigs have traditionally
cherished as the people’s exclusive repository of their public liberty"), with
The Federalist No. 48, at 309 (James Madison) (Clinton Rossiter ed., 1961)
("In a democracy, where a multitude of people exercise in person the
legislative functions and are continually exposed, by their incapacity for
regular deliberation and concerted measures, to the ambitious intrigues of their
executive magistrates, tyranny may well be apprehended, on some favorable
emergency, to start up in the same quarter.").
145. Stone et
al., supra note 9, at 364.
146. Id.
at 364-65.
147. See
The Federalist No. 10, at 77-78 (James Madison) (Clinton Rossiter ed., 1961).
148. Critics of
this view opine that the separation of powers actually aggravates the problem of
factions because it allows certain well-organized groups to block necessary
regulations. See Stone et al., supra note 9, at 365.
149. Abner S.
Greene, Checks and Balances in an Era of Presidential Lawmaking, 61 U.
Chi. L. Rev. 123, 124 (1994).
150. The theory
of "ordered liberty," or, more precisely, the notion that separation
of powers is part of a scheme designed to protect individual liberty from the
encroachments of majoritarian politics, not as a constraint upon the efficient
operation of government, also serves to support the notion that the qui tam
relator provision does not violate the separation of powers. See
Rebecca L. Brown, Separated Powers and Ordered Liberty, 139 U. Pa. L.
Rev. 1513, 1515-16 (1991) ("'[O]rdered liberty’ analysis would have the
Court examine governmental acts in light of the degree to which they tend to
detract from fairness and accountability in the process of government. If the
process is impaired in this way, then the action poses a threat to individual
liberty.").
151. 9 F.3d 743
(9th Cir. 1993).
152. Id.
at 757.
153. See also
United States ex rel. Taxpayers Against Fraud v. General Elec. Co., 41 F.3d
1032, 1041 (6th Cir. 1994) ("The qui tam provisions adopted by
Congress do not contradict the constitutional principle of separation of powers.
Rather, they have been crafted with particular care to maintain the primacy of
the Executive Branch in prosecuting false-claims actions, even when the relator
has initiated the process."); United States ex rel. Kreindler &
Kreindler v. United Techs. Corp., 985 F.2d 1148, 1154-55 (2nd Cir.
1993) (holding that FCA suits "do not constitute an intrusion into areas
committed to other governmental branches" because, "in adjudicating
FCA cases, courts further the Congressional purpose of augmenting executive
enforcement of fraud cases").
154. Although I
believe that qui tam relators are most certainly not "officer[s]
of the United States," U.S. Const. art. II–largely for the same reasons
that I contend that they do not violate the Take Care Clause–who must be
appointed in accordance with the Appointments Clause, I do not address that
issue at length above because neither the district court nor the majority
grounded its opinion there. I note only that the Supreme Court’s jurisprudence
establishes that, even if qui tam relators are officers of the United
States, they are appropriately appointed by the Attorney General, since the
clause provides that "the Congress may by Law vest the Appointment of such
inferior Officers . . . in the Heads of Departments." Id. Buckley
v. Valeo makes this point quite clearly: the Attorney General may make
certain appointments because her office is "in the Executive Branch."
Buckley v. Valeo, 424 U.S. 1, 127 (1976) (per curiam). See also Weiss
v. United States, 510 U.S. 163, 172-73 (1994) (rejecting an Appointments Clause
challenge to the appointment of military judges on the ground that the President
himself, having appointed the officers in the first instance, was not required
to make a "second appointment" of certain officers to the post of
military judge); Freytag v. Comm’r, 501 U.S. 868, 891-92 (1991) (rejecting an
Appointments Clause challenge to a statute authorizing the chief judge of the
Tax Court to appoint special trial judges because the Tax Court is a "Court
of Law" recognized by the Appointments Clause).