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Supreme Court’s Decision in Schindler Elevator Sinks Relator’s Case Based on FOIA Request

Date Published
May 20, 2011

On May 16, 2011, the Supreme Court issued its decision in Schindler Elevator Corp. v. United States ex rel. Kirk, No. 10-188, holding that a federal agency’s written response to a Freedom of Information Act (“FOIA”) request constitutes a “report” for purposes of the public disclosure bar of the False Claims Act (“FCA”).

Writing for the Court, which was split 5-3, Justice Thomas explained that, because the term “report” is not defined in the public disclosure bar, the Court must rely upon its “ordinary meaning.” As such, the Court cited dictionary definitions that describe “report” as “something that gives information” and a “notification.” Thomas concluded that such expansive commonplace definitions were “consistent with the generally broad scope of the FCA’s public disclosure bar.”
The Court further explained that there was “no textual basis for adopting a narrower definition of report.” Specifically, Thomas criticized the lower court’s analysis because it only analyzed the words “immediately surrounding” the term “report” rather than employed an evaluation of the statute as a whole. The Court buttressed its position by arguing that the “ordinary meaning” of report—presumably something that gives information” and a “notification—does not “render superfluous other sources of public disclosure” contained in the statute.

Judge Thomas attacked the relator, Daniel Kirk, who is a former employee of Schindler Elevator, stating that his case is a “classic example of the ‘opportunistic’ litigation that the public disclosure bar is designed to discourage.” Yet, and as noted by Justice Ginsburg in her dissent, which was joined by Justices Breyer and Sotomayor, the Court reached this conclusion despite the fact that Kirk was using the FOIA request merely as “corroboration for his allegations”—which were based on personal knowledge—rather than as the sole evidentiary basis for his complaint.

Although the Court’s broad reading of the public disclosure bar in Schindler Elevator is damaging for whistleblowers who seek to bring well-supported FCA qui tam claims, it is possible that Congressional action will limit, or nullify, the Court’s decision. Namely, just as Congress abrogated the Court’s decision in Graham County Soil and Water Conservation District v. United States ex rel. Wilson, 130 S. Ct. 1396 (2010)—a case relied upon by the Schindler Elevator Court—by amending the FCA (see 31 U.S.C. § 3730(e)(4)(A)(i)-(ii)), Congress could take similar action here. Indeed, Justice Ginsburg said as much in her dissent, stating that the Court’s decision “severely limits whistleblowers’ ability to substantiate their allegations” and calling the problem one that is “worthy of Congress’ attention.”

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