A Federal U.S. court in North Carolina has denied a motion to dismiss a major lawsuit filed against Duke University and two former employees, allowing the case to go forward.
Last year, the U.S. District Court of the Western District of Virginia unsealed a whistleblower lawsuit filed by another former employee at Duke against the university, a biologist and her former supervisor, alleging they included fraudulent data in applications and reports involving more than 60 grants. The total amount: $200 million. If successful, Duke may have to refund three times the amount of allegedly ill-gotten gains, and the whistleblower could himself receive millions.
The researcher, Erin Potts-Kant, her supervisor William Michael Foster, and Duke all filed motions to dismiss; this week, that motion was denied.
In general, sidestepping motions to dismiss increases the likelihood a case will succeed, especially this type of whistleblower lawsuit, filed under the False Claims Act. The next step: Discovery, in which both sides will start sharing documents and deposing witnesses.
John Thomas, a partner at Gentry Locke who is representing the whistleblower in the case, declined to comment. We received the same response from a spokesperson at Duke.
Last month, the district court judge of the Western District of Virginia, where the case was originally filed, ruled in favor of Duke’s request to move the case to Durham, North Carolina, where Duke is located.
When we wrote about this case last August for Science, an attorney who specializes in these types of cases told us it could set a precedent:
The Duke case “should scare all [academic] institutions around the country,” says attorney Joel Androphy of Berg & Androphy in Houston, Texas, who specializes in false claims litigation. It appears to be one of the largest [false claims act] suits ever to focus on research misconduct in academia, he says, and, if successful, could “open the floodgates” to other whistleblowing cases.
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This is the part that stood out for me: “The total amount: $200 million. If successful, Duke may have to refund three times the amount of allegedly ill-gotten gains, and the whistleblower could himself receive millions.”
Seem that a University could potentially save itself the 3X fine by actively prosecting the misconduct case on it’s own thereby avoiding the qui tam suit. If this has the effect of keeping “ethics offices” from stonewalling misconduct it will be terrific!
Praise the judge! These institutions and their phony researchers are bilking the taxpayer, outright robbery. These academics have gall with dismissal motions, welcome to the real world morons.
Can someone explain why the whistleblower could stand to win millions? I’m not familiar with the technical proceedings of such cases, but if this is common, isn’t that kind of a perverse incentive for future would be ‘whistleblowers’?? Or is s/he going to win millions because they were defamed(/or something) by Duke?
The False Claims Act permits the whistle-blower to be awarded up to 30% of any funds recovered.
http://www.workplacefairness.org/false-claims-act-qui-tam
From a legal website: The amount of money a whistleblower is paid as a reward depends on how much money the government recovers as a result of the whistleblower lawsuit. A whistleblower who files a successful claim is paid a reward that equals between 15% and 25% of the amount recovered by the government if the government joined in the case prior to settlement or trial. If the government does not join in the case, and the whistleblower and his or her attorney pursue it on their own, the whistleblower can receive up to 30% of the total amount recovered. Qualified whistleblowers who are represented by experienced attorneys can receive substantial monetary rewards, sometimes many millions of dollars, for a successful claim.
The amount of a whistleblower reward is also impacted by the type of fraud that is reported, the amount of work that the whistleblower and his or her attorney have performed to assist the government in recovering the money, the whistleblower’s involvement in the fraud (if any), and whether the government joined in the lawsuit before it was resolved.
The false claims act covers attempts to obtain government funds by presentation of falsehoods – in this case the inclusion of allegedly fraudulent data in grant application(s). In qui tam, the person bringing the case is essentially suing someone on behalf of the government to get their money back, and they get a cut of the proceeds. It’s worth noting that the bar to be crossed to prove intent to deceive the government is quite high, and there have been some notable failures of qui tam (such as Helene Hill http://www.helenezhill.com/)
Another legal question regarding: “In general, sidestepping motions to dismiss increases the likelihood a case will succeed, especially this type of whistleblower lawsuit, filed under the False Claims Act” 1) What is a “sidestepping a motion to dismiss”? and 2) Why does “sidestepping motions to dismiss” increase the likelihood a case will succeed?