The Eleventh Circuit Questions the Constitutionality of FCA’s Qui Tam Provision

Today, the Eleventh Circuit heard oral argument in a closely watched appeal concerning whether the qui tam provisions of the False Claims Act (“FCA”) are constitutional. The case—United States ex rel. Zafirov v. Florida Medical Associates—arrives at the Eleventh Circuit following a district court decision that found the qui tam mechanism, which allows a relator (or whistleblower) to pursue an FCA matter on behalf of the government, unconstitutional. The Eleventh Circuit is now considering an appeal of that decision. The implications of the Eleventh Circuit’s decision could have far-reaching effects on modern FCA enforcement and set the stage for a Supreme Court showdown.

Procedural Background

As discussed in a prior Alert, in September 2024, a federal district court judge in Florida dismissed a relator’s qui tam suit on constitutional grounds, concluding that a relator “wields significant authority” by conducting civil litigation in the name of the United States to vindicate purely public rights, and occupies a “continuing position established by law.” United States ex rel. Zafirov v. Florida Medical Associates, LLC, et al., No. 8:19-CV-01236-KKM-SPF, 2024 WL 4349242 (M.D. Fla. Sept. 30, 2024) (Mizelle, J.). As a result, the court concluded that FCA relators are “officers” who exercise significant executive power but are not properly appointed. Consequently, the district court found that it was unconstitutional under Article II’s Appointments Clause for a relator to proceed with FCA litigation in a case in which the government declines to intervene. The district court declined to reach the defendants’ other constitutional challenges under the Vesting and Take Care Clauses.

Other district and circuit courts that had previously considered this question had uniformly found the FCA’s qui tam mechanism to be constitutional. However, several Supreme Court Justices have recently suggested, albeit in dicta, that the qui tam provisions of the FCA may be “inconsistent” with Article II. See United States ex rel. Polansky v. Executive Health Resources, Inc., No. 21-1052 (Thomas, J., dissenting) (“There are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation.”) and (Kavanaugh, J. concurring, with Barrett, J.) (agreeing with Justice Thomas’s view and suggesting the Court “should consider the competing arguments on the Article II issue in an appropriate case”). Today’s Eleventh Circuit argument marked the first time an appellate court has considered this constitutional question in the wake of the Justices’ comments in Polansky.

Appellate Arguments

On appeal, the defendants continue to argue that qui tam relators wield core executive authority to prosecute the United States’ claims in federal court. They argue that the FCA’s qui tam provisions impermissibly delegate this core executive power to unsworn, unappointed private litigants who can file, control, and pursue enforcement litigation in the United States’ name, obtain punitive civil penalties, and significantly burden private parties. They contend that relators exercise this core executive authority without appointment or meaningful presidential control, in violation of the Appointments, Vesting, and Take Care Clauses.

The relator, supported by the United States, counters that longstanding practice, statutory guardrails, and the government’s oversight of litigation are sufficient to comply with Article II. More specifically, they assert that the FCA’s structure and practice preserve sufficient executive control. They point to the government’s ability to intervene and assume “primary responsibility” for the case, to dismiss or settle over a relator’s objection with court approval, and to seek judicial limits on a relator’s participation where necessary. They also invoke historical acceptance of the qui tam mechanisms and the Supreme Court’s recognition that relators have Article III standing based on the government’s partial assignment of claims. The relator argues that all of these features, taken together, avoid any Article II violation. Notably, while the United States’ reply brief, filed after the change in administration, walked back from some of its opening brief’s arguments, the government continued to defend the qui tam provisions’ constitutionality, relying heavily on the position that relators do not occupy a continuing position subject to the Appointments Clause, the historical pedigree of qui tam provisions contemporaneous with the Constitution’s drafting, and the even greater authority the executive has over qui tam actions under the provisions of the present statute.

Oral Argument

Today’s oral argument was before Circuit Court Judges Branch and Luck, and District Court Judge Moreno, sitting by designation. In addition to the relator and defendants, the Department of Justice and Chamber of Commerce also participated, supporting relator and defendants respectively. The relator and government continued to press the arguments raised in their briefing—stressing that the relator does not hold a “continuing office” and stressing the significant oversight authorities the Department of Justice maintains even in qui tam cases. In contrast, counsel for the defendant stressed that relators are able to exercise significant executive authority, without being appointed by or controlled by the Executive Branch, including the ability to file suit without consultation or prior review by any Executive Branch official.

The panel vigorously questioned all of the arguing counsel, exploring all three constitutional challenges—the Appointments Clause, Take Care Clause and Vesting Clause. It also engaged with several of the historical precedents relied upon by each of the parties to bolster their positions. Additionally, the judges examined whether and how the recent evolution of Article II doctrine articulated by the Supreme Court should impact their evaluation of the questions presented, as well as whether and how an earlier Supreme Court ruling upholding relators’ Article III standing should inform that analysis.

What to Watch Next

The ripple effects of the Eleventh Circuit’s decision could be immediate and significant. A ruling affirming the district court’s approach would unsettle a statutory framework that has generated the bulk of modern FCA investigations and recoveries and invite a reassessment of relators’ roles across pending and future cases within the Eleventh Circuit, as well as other jurisdictions. In the immediate term, relators would no longer be able to pursue cases declined by the government within the Eleventh Circuit—which covers Alabama, Florida, and Georgia. Although the government could, at least initially, continue to pursue intervened cases, an affirmance would disincentivize relators from even filing qui tam actions in these judicial districts, at least causing relators to consider other forums, and potentially leading to a reduction in the number of qui tam actions filed. And, although the issue did not receive any attention during oral argument, the defendants raised arguments that, if adopted, would call into question the constitutionality of the qui tam provisions even as to intervened cases.

Even before the Eleventh Circuit issues its opinion, the impact of Zafirov is already being felt beyond declined FCA cases. Litigants are now invoking Zafirov to challenge the continued participation of relators in intervened cases, arguing that Article II forbids such participation and that, at a minimum, the FCA permits courts to curtail relator involvement where it imposes undue burden and unnecessary expense. These litigants contend that, even when DOJ has intervened and is actively litigating, the statute leaves relators in the case as independent, unsupervised prosecutors whose participation can multiply discovery burdens, drive up defense costs, and complicate trial management.

The Eleventh Circuit’s decision will likely arrive against a landscape of increasing lower court scrutiny of relators’ status and executive control under Article II, which is the focus of several blockbuster cases at the Supreme Court this term. The court’s resolution of whether and how Article II applies to qui tam enforcement, and whether historical practice and FCA safeguards suffice, could rapidly influence case management, motion practice, settlement leverage, and the viability of pending qui tam actions across the country. Regardless of outcome, this issue is likely bound for the Supreme Court, where multiple Justices have already signaled interest in the Article II implications of qui tam enforcement.

For more information about the case and its implications, please reach out to your usual contact on the Ropes & Gray litigation and enforcement team.