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Appellate Jurisdiction

By: Derek Hawkins//October 12, 2020//

Appellate Jurisdiction

By: Derek Hawkins//October 12, 2020//

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7th Circuit Court of Appeals

Case Name: United States of America ex. rel. CIMZNHCA, LLC, v. UCB, Inc., et al.,

Case No.: 19-2273

Officials: ROVNER, HAMILTON, and SCUDDER, Circuit Judges.

Focus: Appellate Jurisdiction

The False Claims Act allows the United States government to dismiss a relator’s qui tam suit over the relator’s objection with notice and opportunity for a hearing. 31 U.S.C. § 3730(c)(2)(A). The Act does not indicate how, if at all, the district court is to review the government’s decision to dismiss. The D.C. Circuit has said not at all; the Ninth Circuit has said for a rational basis. Compare Swift v. United States, 318 F.3d 250 (D.C. Cir. 2003), with United States ex rel. Sequoia Orange Co. v. Baird-Neece Packing Corp., 151 F.3d 1139 (9th Cir. 1998). In this case, the district court said it agreed with the Ninth Circuit but applied something closer to administrative law’s “arbitrary and capricious” standard and denied dismissal. The government has appealed. The relator contends we should either dismiss for want of appellate jurisdiction or affirm.

We find that we have jurisdiction and reverse. First, we interpret the Act to require the government to intervene as a party before exercising its right to dismiss under § 3730(c)(2)(A). We think it best, however, to construe the government motion here as a motion to both intervene and dismiss. This solves the jurisdictional problem without needing to create a new category of collateral-order appeals. On the merits, we view the choice between the competing standards as a false one, based on a misunderstanding of the government’s rights and obligations under the False Claims Act. And by treating the government as seeking to intervene, which it should have been allowed to do, we can apply a standard for dismissal informed by Federal Rule of Civil Procedure 41.

Reversed and remanded

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.

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