State Farm Fire & Casualty Co. v. United States, ex rel. Rigsby (15-513)

argument 15-513

State Farm Fire & Casualty Co. v. United States, ex rel. Rigsby

Supreme Court of the United States 56 min 5 speakers 8 chapters transcribed 7 days ago official recording ↗

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What is the core dispute over the False Claims Act seal requirement in State Farm v. United States?

John G. Roberts 0:00

We'll hear argument first this morning in case fifteen five thirteen State Farm Fire and Casualty Company. versus United States ex REL Rigsby. Ms Solomon?

Unknown 0:11

Mr Chief Justice, and may it please the Court, the False Claims Act asks very little of a private key TAM relator who would step into the government's shoes, file under seal, serve only on the government and maintain the seal until it is lifted. Respondents here violated that requirement. They leaked the content and existence of their suit. to the associated press ABC and the New York Times. And yet under the rule adopted by the Court of Appeals they suffered no consequence whatever for that violation. This court should reverse or vacate and hold that such bad faith, willful, and severe violations warrant dismissal under either any appropriate test. Did you seek any sanction uh for the seal violations in this case other than dismissal?

Unknown 0:59

We did not, Your Honor. We sought dismissal repeatedly. Why not? Well, Your Honor, we think dismissal is the appropriate sanction and that any alternative sanction would be uh toothless here. from the defendant's point of view, but I thought the whole purpose Of sealing. The materials was not to tip off The defendant. And if that's so Then the defendant Like benefit from being tipped off, and the government Who I think you agree is the primary um concern of Congress to be protected, the government then would be left with the choice of either drop dropping uh the suit or uh expending its own resources on it. So the one who is really penalised In addition to the Keetan plaintiffs is the government. Your Honor, we think that Congress intended a statutory bargain that does not give the government

Unknown 2:04

absolute discretion to decide whether the seal has been violated. And let me explain first what the statutory bargain is. The statutory bargain set forth in thirty seven thirty B two is the relator gets the litigating authority of the government, it gets to see share in any award the government might obtain, but on condition, on a mandatory condition, that it abide by the simple requirements I mentioned of keeping the s uh the the plate under seal. Well Your Honor, we don't agree with that. We don't we think that Congress could have said that the seal should be maintained at the Attorney General's discretion. It did not say that. It said the seal would be.

Unknown 2:49

requirement followed than the government does. Respectfully I disagree, Your Honor. Yeah. But let me go back to the question. The government does have an interest in having the SEAL maintained. The SEAL is under the eighty six amendments.

Unknown 3:09

And also pursue any criminal investigations that might have already commenced or be commenced in light of the complaint. But that doesn't just protect the government's discretion. It protects the operation of the statute. And the way it does that is it gives the government a period of time in which it may decide to do any of three things intervene and conduct the key TAM case. decline to intervene, or as in hap as happens in very many cases, settle the case with the defendants before the seal is lifted. And as the second circuit said in Pylon, which we think gives the best version of a discretionary test. The uh incentives for settlement which benefits the taxpayers and the Treasury will often disappear if a potentially meritorious complaint is filed and a defendant is willing to reach a a a speedy and valuable settlement with the government in order to avoid unsealing.

Unknown 4:04

So you're

John G. Roberts 4:04

arguing you're arguing the government's interests, but It it rings a little hollow when we see that the government is on the other side.

Unknown 4:13

Yes, Mr. Chief Justice, I am in a difficult position, arguing that uh we we serve the government's interests better than the government suggests. But let me say why I think it is very important not to see this as something that is the government seal to be maintained at the government's discretion. When Congress sets A mandatory precondition to suit. This court has always held that the requirement merits dismissal. Hallstrom is the case most clearly on point.