The Supreme Court’s Allison Engine Decision Has Potentially Far-Reaching Implications for False Claims Act Liability In Health Care Cases

    13 June 2008
    Allison Engine Co. v. U.S. ex rel. Sanders, decided by a unanimous Court on June 9, 2009, involved an action under the False Claims Act against subcontractors on a U.S. defense contract. The subcontractors were required to certify to the prime contractor that the items they furnished were manufactured in accordance with Navy specifications. A whistleblower alleged that because the items did not conform to Navy specifications, the certifications of compliance were false and that the subcontractors were liable for violation of the False Claims Act. Section 3729(a)(2) of the Act imposes liability on any person who knowingly uses a “false . . . statement to get a false or fraudulent claim paid or approved by the Government.” Section (a)(3) imposes liability on anyone who “conspires to defraud the Government by getting a false or fraudulent claim allowed or paid.”