Can a relator get a second bite at the apple in spite of his Whistleblower Attorney’s early procedural errors?
Tim McInnis Esq.
The US Court of Appeals for the Second Circuit recently saved a whistleblower’s lawsuit from dismissal caused by his own lawyer’s missteps. In this case, the whistleblower-relator filed a complaint in the SDNY under the qui tam provisions of the federal and New York State’s False Claims Acts (FCAs) against two major construction companies.
He alleged the defendants overbilled the governments for public construction projects, including the post-9/11 One World Trade Center. After investigating the allegations, the federal and state authorities declined to join the action. Thereafter, the relator’s attorney sent the district court judge an informal letter saying that, “I have spoke[n] to my client and in view of the government’s decision not to intervene he has decided not to pursue this matter any further.” Later, the relator found out that a different US Attorney’s Office (EDNY) was investigating the matter and he re-filed his case in that district.
Thereafter, the defendants persuaded the new district court judge to throw the case out on the basis that the old case had been previously “dismissed with prejudice” and thus could not be re-instituted. Turns out the district court judge was in error. As the Second Circuit noted: in order for a case to be dismissed “with prejudice” under Fed. R. Civ. P. 41, certain representations have to be. Since they had not been made in this case, the original case was deemed to have been dismissed “without prejudice” and the relator was permitted to go forward with his action. Lucky break. The whistleblower lawyer could have avoided the entire episode if he had filed a formal “stipulation of dismissal without prejudice” under Rule 41.
This case is captioned: Magdy M. Youssef, Plaintiff-Appellant, – v – Tishman Construction Corporation, Turner Construction Company, Defendants-Appellees. Docket No. 12-4135, 2014 U.S. App. LEXIS 4439 (2d Cir.).
