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Vermont Agency of Natural Resources v. United States ex rel. Stevens

ELR Citation: 30 ELR 20622
Nos. No. 98-1828, 120 S. Ct. 1858/50 ERC 1545/(U.S., 05/22/2000) rev'd

The U.S. Supreme Court holds that a private individual has standing to bring suit in federal court on behalf of the United States under the False Claims Act (FCA), but that the FCA does not subject a state or state agency to liability in such actions. The case arose after a former employee of the Vermont Agency of Natural Resources brought a suit against the agency for allegedly filing false claims to the U.S. Environmental Protection Agency (EPA) in connection with various federal grant programs administered by EPA.

The Court first holds that the former employee, a qui tam relator under the FCA, has Article III standing. The FCA can reasonably be regarded as effecting a partial assignment of the government's damages claim, and here, the U.S. injury-in-fact suffices to confer standing on the former employee. Morever, this conclusion is confirmed by the long tradition of qui tam actions in England and the American Colonies. The Court, however, then holds that a state or state agency is not a "person" subject to liability under the FCA. The text of the original FCA does less than nothing to overcome the long-standing presumption that states are not covered by the term "person." Moreover, although the liability provision of the original FCA has undergone various changes, none of them suggests a broadening of the term "person" to include states. Further, several features of the current statutory scheme support the conclusion that states are not subject to qui tam liability. The Court, therefore, does not address the question whether an action in federal court by a qui tam relator against a state would run afoul of the Eleventh Amendment. It notes, however, that there is "a serious doubt" on that score.

Justice Stevens, with whom Justice Souter joins, dissents and would hold that Congress intended the term "person" to include states.

[A prior decision in this litigation is published at 29 ELR 20405.]

Counsel for Petitioner
David M. Rocchio, Special Ass't Attorney General
Attorney General's Office
Pavilion Office Bldg.
109 State St., Montpelier VT 05609
(802) 828-3171

Counsel for Respondent
Mark G. Hall
Paul, Frank & Collins
One Church St., Burlington VT 05402
(802) 658-2311

Joined by Rehnquist, C.J., O'Connor, Kennedy, Thomas, and Breyer, JJ.; Breyer, J., concurring separately; Ginsburg, J., concurring in judgment, joined by Breyer, J.; Stevens, J., dissenting, joined by Souter, J.