It is now well established that the United States has a compelling government interest in protecting the confidentiality and integrity of ongoing fraud investigations. For that reason, Congress included the seal provision in the FCA.
In a very recent decision by the U.S. Court of Appeals (2nd Circuit), Grupp, Moll v. DHL, Case No. 12-3829 (2nd Cir. 2014) (Winter, Cabranes, Livingston), the Court emphasized the policy reasons for the sealing requirement in a False Claims Act (“FCA”) case: “to allow the government time to investigate the alleged false claim and to prevent qui tam plaintiffs from alerting a putative defendant to possible investigations.” The Court agreed with the U.S. government’s position that the FCA sealing provision is fundamental and rejected any time limit, including an 180-day limit, to the provision, because such limitation would “undermine both the FCA’s seal provisions and statute of limitation.”
The decision reaffirmed the government’s compelling interest in protecting the confidentiality and integrity of ongoing fraud investigations noted in prior decisions. ACLU v. Holder, 673 F.3d 245, 253 (4th Cir. 2011); U.S ex rel. Pilon, 60 F.3d 995, 998-999 (2d Cir. 1995) (secrecy allows the government to conduct the investigation without “tipping off” the defendant).