Roaming Polansky and the Constitutionality of Qui Tam

Three decades later, the George H.W. Bush SCOTUS strategy finally has three votes.

Enough about ICWA! Let's talk about qui tam!

Under the False Claims Act, private citizens can bring suit on behalf of the federal government for a "civil fraud" against the United States. These suits are known as qui tam claims, Latin for "in the name of the King." Qui tam suits raise several significant separation of powers issues. First, how can a private citizen assert an Article III injury, when the federal government suffers the injury? Second, how can a private citizen represent the "unitary" executive branch, as reflected in Article II?

In 1989, William Barr, the Assistant Attorney General for the Office of Legal Counsel, prepared a memorandum opinion for the Attorney General, concluding that private qui tam actions violate Article III standing doctrine and the separation of powers. The precise status of this document is somewhat in dispute, as an "Editor's Note" explains that "This memorandum was not intended to present the official position of the Department of Justice at the time of its writing, but rather was intended to contribute to a discussion within the Department over what position should be adopted." And in 1996, Walter Dellinger, as head of OLC, repudiated Barr's views.

But in the late 1980s and early 1990s, the constitutionality of qui tam suits was really, really important. And, as it turns out, this issue became something of a litmus test in the George H.W. Bush administration. When Justice Brennan retired, there were several candidates on the short list: Edith Jones, Kenneth Starr, Laurence Silberman, and (of course) David Souter. In hindsight, anyone would have been better than Souter, but one of the more qualified nominees--Kenneth Starr was disqualified. Why? Apparently, as Solicitor General, he thought a challenge to the qui tam provision would not work. As a result, he was blacklisted by Barr, as well as Mike Luttig. Yes, that Mike Luttig. Before Luttig was a former conservative judge (really a former-conservative who was a judge), he was a high-flying wunderkind in the Bush administration. Jan Crawford recounts in her book, Supreme Conflict, Barr and Luttig determined that Starr's views on qui tam made him unacceptable. (Jon Adler discussed it here). And, Attorney General Dick Thornburgh threatened to resign if Bush selected Starr. Alas, instead of Starr, we got David Souter.

So how was Souter on the qui tam issue? In 2000, Justice Souter joined a Justice Stevens dissent, finding that litigants had Article III standing to sue a state agency under the federal False Claims Act. Some stellar vetting there by the Bushies. (Runs in the family, apparently.) But that decision, Vermont Agency of Natural Resources v. U.S. ex rel Stevens, left open the Article II question. And, perhaps to Barr and Luttig's credit, the other Bush 41 nominee was solid on this issue.

Fast-forward to June 16, 2023. The Supreme Court decided United States ex rel. Polansky v. Executive Health Resources, Inc. No, not that roaming Polanski. This case involved a Doctor Polansky who alleged that a health firm defrauded the government. The question presented is fairly technical: can the government move to dismiss a qui tam case if it fails to intervene during an early stage known as the "sealing" period. Justice Kagan wrote a delightful majority opinion for eight justices, finding that the government could move to dismiss the complaint, even if it fails to intervene during the "sealing" period. Justice Thomas dissented. He would have found that the government lacks this ability.

I don't have strong thoughts on who has the better of the statutory argument. Rather, I will focus on the constitutional issue. Justice Thomas's dissent urged the Court to consider, in the appropriate case, whether the qui tam provision is consistent with Article II. Indeed, the case for its unconstitutionality is much stronger today than in 1989. After all, Barr could only rely on Morrison, and Justice Scalia's dissent. But now we have Seila Law and a string of other cases endorsing the unitary executive theory in various regards.

Justice Thomas explains:

The FCA's qui tam provisions have long inhabited something of a constitutional twilight zone. There are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation. Because "[t]he entire 'executive Power' belongs to the President alone," Seila Law LLC v. Consumer Financial Protection Bureau, (2020), it can only be exercised by the President and those acting under him, see id. (THOMAS, J., concurring in part and dissenting in part). And, as "[a] lawsuit is the ultimate remedy for a breach of the law," the Court has held that "conducting civil litigation . . . for vindicating public rights" of the United States is an "executive functio[n]" that "may be discharged only by persons who are 'Officers of the United States'" under the Appointments Clause, Art. II, §2, cl. 2. Buckley v. Valeo, (1976) (per curiam). A private relator under the FCA, however, is not "appointed as an officer of the United States" under Article II. Cochise Consultancy, Inc. v. United States ex rel. Hunt (2019). It thus appears to follow that Congress cannot authorize a private relator to wield executive authority to represent the United States' interests in civil litigation.

What is the strongest argument in favor the constitutionality of qui tam? Past practice:

The primary counterargument has emphasized the long historical pedigree of qui tam suits, including the fact that the First Congress passed a handful of qui tam statutes.

But Justice Thomas, as usual, favors original meaning over congressional practice:

"Standing alone," however, "historical patterns cannot justify contemporary violations of constitutional guarantees," Marsh v. Chambers, 463 U. S. 783, 790 (1983), even when the practice in question "covers our entire national existence and indeed predates it," Walz v. Tax Comm'n of City of New York, 397 U. S. 664, 678 (1970). Nor is enactment by the First Congress a guarantee of a statute's constitutionality. See Marbury v. Madison, 1 Cranch 137 (1803).

I don't think Marsh does enough here. In Marsh, the existence of prayer by the first Congress supported Nebraska's prayer policy. By contrast, Thomas argues that the qui tam laws by the first Congress undermine a similar law enacted two centuries later. Also, I would be very careful not to endorse Chief Justice Marshall's reasoning in Marbury. There are very good arguments to be made that Marshall did not offer the best reading of the Judiciary Act of 1789.

Ultimately, though Justice Thomas puts little weigh in liquidation. One day earlier, Justice Thomas doubted the relevance of early practice concerning "Indian affairs." Meanwhile, Justice Gorsuch insisted that early practice "liquidated" his understanding of the original meaning. (I can speculate why Justice Gorsuch could not join the Polansky dissent, or even signal his agreement with it).

The question is now squarely teed up for some future cert petition:

In examining these issues, moreover, it may be necessary to consider a question that Stevens left unaddressed: What is the source of Congress' power to effect partial assignments of the United States' damages claims? One candidate might be the Necessary and Proper Clause, Art. I, §8, cl. 18; but, if qui tam suits violate Article II, then it appears unlikely that any assignment effectuated by the FCA's qui tam provisions could be considered "necessary and proper for carrying into Execution" any constitutional power. See Gonzales v. Raich, 545 U. S. 1, 60 (2005)(THOMAS, J., dissenting) ("To act under the Necessary and Proper Clause," "Congress must select a means" not "'prohibited' by the Constitution" or "inconsistent with 'the letter and spirit of the Constitution'" (quoting McCulloch v. Maryland, 4 Wheat. 316, 421 (1819); alteration omitted)).

Are there more votes for cert? Justice Kavanaugh wrote a brief concurrence, joined by Justice Barrett, suggesting this issue can be litigated in the future.

I join the Court's opinion in full. I add only that I agree with JUSTICE THOMAS that "[t]here are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation." Post, at 7–8 (dissenting opinion). In my view, the Court should consider the competing arguments on the Article II issue in an appropriate case.

Again, when Kavanaugh swings left, his conservative concurrence says "we'll see." But given Justice Gorsuch's preference for liquidation, I don't see him casting a fourth vote for cert. What about the Chief? Maybe he can finally hunt the white whale from the Reagan years, and strike down the qui tam provision? Nope. He upheld Roe. He upheld the 1982 VRA Amendments. And I suspect he will soon uphold racial preferences. Roberts will now go out of his way to do the opposite of what the Reagan Revolution would predict. Sort of like Luttig.

Speaking of predictions, maybe in three decades, the Trump SCOTUS strategy will come to fruition, and there will be four votes to overrule Chevron!