California Amends Its False Claims Act to Mirror Federal Law, Preserve Federal Incentive Awards, and Loosen the Reins on Whistleblower Suits
On September 27, 2012, Governor Brown signed Assembly Bill 2492 (“AB 2492”) amending California’s False Claims Act, California Government Code §§ 12650, et seq. (“CFCA”). The CFCA permits the Attorney General (or local prosecutors) to bring a civil action to recover treble damages and civil penalties against any person who knowingly makes or uses a false record or statement to either obtain money or property from the state or avoid paying or transmitting money or property to the state. In certain circumstances, private individuals—known interchangeably as “whistleblowers,” “qui tam plaintiffs,” or “relators”—are permitted to file suit in the name of the government; if their suit is successful, they share in any financial award. In 1987, California became the first state to adopt a False Claims Act.
The amendments just signed into law were largely designed to conform the CFCA to the federal False Claims Act, 31 U.S.C. §§ 3729, et seq. (“FCA”). The amendments take effect on January 1, 2013.