The Supreme Court denied a petition from Cimznhca LLC to consider a Seventh Circuit decision that created a new way to consider the Department of Justice’s authority to dismiss FCA whistleblower cases. In its decision, the Seventh Circuit rejected both the D.C. Circuit’s Swift standard – which says DOJ has an unfettered right to dismiss FCA cases – and the Ninth Circuit’s Sequoia Orange standard – which requires DOJ to put forth a valid government purpose for dismissal. While finding Swift as more correct, the Seventh Circuit declined to adopt it in full.
Instead, the court held that the government may dismiss a qui tam action when it satisfies the standard contained in Federal Rule of Civil Procedure 41(a)(1)(A)(i), under which a plaintiff may dismiss an action by serving a notice of dismissal any time before the opposing party serves either an answer or a motion for summary judgment.
The Department of Justice opposed Cimznhca LLC’s petition for a Supreme Court review, and the court has declined the request.
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