Taylor Chenery and Brian Irving Examine “Good Cause” Standard for Extending Seal Period in FCA Cases

November 7, 2018
Law360

In an article published in Law360, Bass, Berry & Sims attorneys Taylor Chenery and Brian Irving examined the implications of courts’ willingness to grant repeated requests by the government to extend the period during which a False Claims Act (FCA) action remains sealed while the government investigates the allegations and determines whether to intervene. In U.S. ex. rel. Brasher v. Pentec Health Inc., the court broke from that practice by denying the government’s eleventh request for extension and adopting a narrow view of how to establish “good cause” for extending the seal period.

The court in the Brasher case granted the government’s first ten requests to extend the seal period over five years. The court then denied not only the government’s eleventh request to extend but also the government’s, relator’s, and defendant’s joint motion to reconsider that denial and granted the government 30 days to make an intervention decision. The court noted that the seal period is “not to allow the Government to prosecute a civil action entirely under seal and then to present a settlement as a fait accompli to the Court and the general public.” Rather, the seal is intended only to allow the government sufficient time to decide whether to intervene and that any resulting settlement “is incidental to the central purpose of the statute.”

The court also noted that courts generally have grown increasingly impatient with the government’s repeated requests to extend the seal period. While it remains to be seen whether this is part of a growing trend, “Brasher is an illuminating look into the considerations faced by courts deciding government requests to extend the seal period,” write Taylor and Brian. “Whether other courts are emboldened to take similarly strong stands remains to be seen.”

The full article, “A Critical Approach To Repeat Extensions of FCA Seal Period,” was published by Law360 on November 6, 2018, and is available online. In addition, Taylor and Brian authored a November 2018 Inside the FCA blog post about the Brasher case, which is available here.