Tick Tock: Wait for Definitive Ruling Continues as Courts Confront FCA Qui Tam Constitutionality

The constitutionality of the False Claims Act's (FCA) qui tam provisions was long considered settled law. That changed recently when several judges, including three U.S. Supreme Court justices, recommended revisiting the issue, and one district court judge concluded that the provisions are unconstitutional as to non-intervened cases.

This Holland & Knight alert summarizes the current state of play as the legal community awaits a ruling from the U.S. Court of Appeals for the Eleventh Circuit in U.S. ex rel. Zafirov v. Florida Medical Associates LLC.

Setting the Stage

The qui tam provisions of the FCA have enjoyed long-standing acceptance in the U.S. judicial system. But the question of constitutionality of these provisions has started to gain traction in subtle ways, first in a Supreme Court dissenting opinion and eventually in two outlier federal district court opinions (both by the same federal judge).

The FCA's qui tam provisions allow private individuals (known as "relators") to bring fraud claims on behalf of the U.S. government and share in any recovery. These provisions have enjoyed long-standing acceptance, with multiple federal circuit courts affirming their constitutionality over the past two decades.

Recently, however, the constitutional foundation of these provisions has come under increasing scrutiny. The core arguments against constitutionality center on three provisions of Article II of the U.S. Constitution:

• The Appointments Clause. Critics argue that relators function as "officers" of the U.S. who appoint themselves by filing suit, without presidential appointment or U.S. Senate confirmation.
• The Vesting Clause. Opponents contend that qui tam actions vest core executive power – the authority to pursue claims and penalties in the government's name – in private individuals.
• The Take Care Clause. Challengers assert that the provisions allow private persons to initiate and prosecute suits to enforce federal law without adequate executive oversight.

Challenging the Status Quo

• Supreme Court Signals. Since 2023, Supreme Court Justices Clarence Thomas, Brett Kavanaugh and Amy Coney Barrett have all raised concerns about whether the qui tam provisions of the FCA violate Article II of the Constitution and urged the Court to consider the issue in an appropriate case. While the Court recently declined a petition for certiorari on the issue, the justices' statements have energized challenges in the lower courts.
• The First Ruling of Unconstitutionality. A single federal district court judge has ruled – twice – that the FCA's qui tam provisions violate Article II. The judge reasoned that relators are "officers" whose self-appointment through unrestricted filing of qui tam actions in the government's name violates the Appointments Clause.
• Courts Upholding Constitutionality. In contrast, other federal courts have continued to reject constitutional challenges. Those courts opine that relators are not "officers" because they do not occupy a continuing position, do not receive a government salary and are limited to ordinary tools of civil litigation. Those courts have also emphasized the government's comprehensive statutory authority to intervene, stay discovery and dismiss a relator's action, as well as the long historical pedigree of qui tam statutes dating to the earliest Congresses.

Active Circuit Court Proceedings

The constitutionality question is now actively being considered by multiple federal circuits:

• Eleventh Circuit (the Case to Watch). The appeal to the Eleventh Circuit in S. ex rel. Zafirov v. Florida Medical Associates LLC is widely regarded as the most significant pending proceeding on this issue. It is the only case on appeal from an actual ruling of unconstitutionality, meaning the court must squarely decide – for the first time at the appellate level – whether the qui tam provisions violate Article II. The outcome will set the first circuit-level precedent directly addressing the merits of the constitutional challenge in the modern era. The court heard oral argument in late 2025, and the parties debated whether relators exercise "significant authority," whether historical practice supports constitutionality and whether the government retains sufficient supervisory control. A decision is pending.
• Third Circuit. The case on appeal in the Third Circuit involves several issues, including constitutionality of the qui tam provisions. Although the Third Circuit heard oral argument earlier this year, the case has since been referred to mediation, thus it remains uncertain whether the panel will issue a merits decision. Even so, it is also possible the panel could issue a ruling on other grounds and not address the constitutionality question.
• Fifth Circuit. Historically, the Fifth Circuit has held that the FCA's qui tam provisions are constitutional. However, in concurring opinions, two Fifth Circuit judges recently suggested that the court should revisit, in an appropriate case, whether there are serious constitutional problems with the qui tam provisions of the FCA (suggesting that qui tam relators act as executive officers who appoint themselves, thereby violating the Appointments Clause). The issue is currently part of a pending appeal in the Fifth Circuit.
• Sixth Circuit. The Sixth Circuit recently denied a petition for interlocutory appeal on the constitutionality question citing binding circuit precedent upholding the provisions.
• Supreme Court. A petition for certiorari urging the Court to resolve the issue was recently filed and declined. Additional petitions are expected as the circuit courts continue to develop the law, especially if the circuits diverge on the issue.

What This Means

To date, only one judge has concluded that the qui tam provisions are unconstitutional. Courts across the country have otherwise continued to uphold them. However, the level of judicial interest, particularly from the Supreme Court, signals that the issue is far from closed.

If the Eleventh Circuit reverses the district court and upholds the qui tam provisions as constitutional, the immediate practical effect will be limited – qui tam enforcement will likely continue as it has for decades. However, reversal would not end the debate. Given the Supreme Court's expressed interest and active challenges in other circuits, the issue will likely continue to percolate and eventually reach the Supreme Court.

If the Eleventh Circuit affirms the district court's ruling of unconstitutionality, the impact could be immediate and far-reaching. Though this would apply only to federal, non-intervened cases – and it is an open question how this will impact the states who have passed their own FCA statutes based on their own constitutions – an appellate endorsement of the constitutional challenge would create a circuit split, likely fast-tracking Supreme Court review. In the interim, defendants in FCA qui tam actions nationwide would have powerful new ammunition to challenge relator standing, potentially chilling new filings and most certainly complicating pending cases. Such a ruling could fundamentally reshape the FCA enforcement landscape, which has historically relied heavily on qui tam relators who are responsible for the majority of FCA recoveries. It is important to note there is nothing about the arguments before any of the courts that would impact the U.S.C. § 3730(h) cases that often accompany qui tam actions.

Continued litigation and additional petitions to the Supreme Court are expected as this issue works its way through the federal courts. Organizations subject to potential FCA exposure should monitor these developments closely, as the outcome may significantly alter the litigation landscape. If you have any questions about the potential impact to your business, contact the authors.

Holland & Knight Associates Lindsey Cook, Kaatje S. Greenberg and Tooba Hussain also contributed to this alert.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.