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What Is a Qui Tam Lawsuit — And Who Can File One?

Introduction

If you've witnessed fraud against the government—whether at a hospital, a private contractor, or a major corporation—you may be in a position to file a special type of lawsuit known as a Qui Tam action. These lawsuits are not only powerful tools for holding wrongdoers accountable, but they can also offer financial rewards to the individuals who come forward.

But what exactly is a Qui Tam lawsuit? Who can file one, and what does the process look like? This guide breaks it down in clear terms, with real-world examples to help you decide if your situation may qualify.

What Does "Qui Tam" Mean?

“Qui Tam” is short for a Latin phrase that loosely translates to: “he who sues on behalf of the king as well as himself.” In modern terms, it means a private individual—known as a whistleblower or relator—can file a lawsuit on behalf of the U.S. government when they know of fraud being committed against public funds.

These suits are authorized under the False Claims Act, a federal law that has existed since the Civil War but was strengthened in the 1980s to encourage insiders to report wrongdoing.

Who Can File a Qui Tam Lawsuit?

Anyone who has first-hand, non-public knowledge of fraud against the federal government may be eligible to file. This includes:

Employees who discover illegal billing at hospitals, defense contractors, pharmaceutical companies, or government-funded businesses.
Contractors or consultants with access to financial records or regulatory data.
Former employees who kept documentation of misconduct before leaving the company.

Importantly, the person filing the suit must not be relying on information already publicly disclosed—unless they were directly involved in the matter or are the original source.

What Counts as Fraud?

Qui Tam lawsuits typically involve financial fraud against government programs or contracts, such as:

Healthcare fraud (e.g., Medicare or Medicaid overbilling, billing for services not provided, kickbacks)
Defense contractor fraud (e.g., charging for defective products or inflating contract costs)
Government grant misuse
COVID-19 relief fraud (e.g., falsifying information to receive PPP loans)
Education or research fraud involving federal grants

If the government is paying the bill and a company is intentionally misrepresenting facts to increase their payments, it may qualify.

Real-World Example: Healthcare Whistleblower

A billing administrator at a chain of medical clinics noticed that doctors were submitting claims to Medicare for procedures that were never performed. After raising concerns internally and being ignored, she worked with an attorney to file a Qui Tam lawsuit.

The government investigated and recovered over $12 million in fraudulent payments. The whistleblower received approximately 20% of that—close to $2.5 million—for her role in the recovery.

How the Process Works

File a Sealed Complaint
The whistleblower works with an attorney to file a sealed complaint in federal court. This means the case is not public while the government investigates.
Government Review
The Department of Justice (DOJ) reviews the case and decides whether to “intervene” (take over the case) or let the whistleblower proceed independently.
Unsealing and Litigation
If the government joins, the case is unsealed and becomes public. If not, the whistleblower can still move forward with legal counsel.
Resolution
If the case is successful, the whistleblower may receive between 15% and 30% of the money the government recovers, depending on their contribution and whether the DOJ intervened.

Protection Against Retaliation

The False Claims Act also includes anti-retaliation provisions. If you're demoted, fired, harassed, or otherwise punished for your whistleblowing, you may be entitled to reinstatement, double back pay, and compensation for emotional distress or legal fees.

Conclusion

Qui Tam lawsuits are one of the most effective ways for insiders to stop fraud and protect taxpayer money—while also protecting themselves and potentially receiving significant financial rewards. If you believe you’ve witnessed fraud against the government, don’t stay silent. Speak with an attorney who specializes in whistleblower law to explore your rights and next steps.

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