Foley Hoag partner Giselle Joffre says that False Claims Act enforcement is skewed against defendants.

“There are some big hammers with respect to potential disbarment or exclusion from federal reimbursement, the heavy toll of litigation costs and the reputational concerns for public companies,” Joffre told Corporate Crime Reporter in an interview last week. “It becomes a very difficult decision for a public company to make to defend a case to the very end even when the facts are on their side. Whistleblowers do have some leverage there to negotiate settlements.”

“And that’s unfortunate, especially when the government has made an independent determination that they believe, sometimes after a years long investigation, that there is no reason to pursue the case.” 

Joffre spent the early part of her career in the U.S. Attorney’s office in Boston, one of the premiere False Claims Act enforcement centers in the country.

Do False Claims Act whistleblower attorneys do forum shopping? 

“I saw that when I was at the office from 2012 to 2016. I’m not sure how much that is still happening. I have defended False Claims Act matters outside of Massachusetts recently.” 

“When I was there, there were clearly whistleblowers who could have brought their qui tam complaint more conveniently in a different forum but chose to bring it in Massachusetts because of the experience of the office. I suppose there is also more experience on the judicial bench here when it comes to the False Claims Act.” 

Would you say that the vast majority of False Claims Act cases are driven by whistleblower complaints?

“I don’t know the data on that, but from my personal experience I would say yes. The other two ways that they came up with were one, prosecutors literally reading about something in the newspaper and saying – this seems wrong, let’s investigate it –and there ends up being False Claims Act misconduct there. Or if there are investigations by agencies for other matters that lead to False Claims Act conduct. Maybe the FDA is looking into something and their agents stumble across documents that give rise to False Claims Act concerns and they reach out to prosecutors.” 

“But from my personal experience, most of the cases are whistleblower driven. It’s people on the inside with specific access to information who know first that there is a possibility that the government has been cheated.”

Is your practice exclusively on the defense side?

“Yes.”

If a False Claims Act whistleblower came to you with a case, you wouldn’t take it?

“No, I wouldn’t take it. At Foley Hoag we have not to date done any representation of whistleblowers.”

Despite all of the rhetoric from Lisa Monaco and the Justice Department about ramping up corporate crime prosecutions, there still have been very few under the Biden administration. How would you explain that?

“It’s early yet. Most of the cases that I see take years to reach the public eye. From an investigations perspective, things are pretty active. We have to wait a year or two before we can judge whether they are being true to their goal of being more aggressive on corporate crime.”

What about cases you are currently working on?

“Most of what I’m working on now is still under investigation. We recently resolved a False Claims Act complaint in California where we represented a genetic testing company. The complaint raised concerns of alleged kickbacks in connection with the processing of a genetic test. The company did not admit any wrongdoing and ultimately there was a settlement. This was a case where the federal and state governments declined, but the whistleblower decided to litigate the matter.” 

“For the past five to ten years or so, you are seeing more of these cases where the government declines but whistleblowers move forward because they have the litigation support and the financial ability to litigate those cases without government intervention.”

You have written about credit that the government gives to companies for cooperating. That gives rise to these deferred and non prosecution agreements. Are we going to see that continue under the Biden administration or are we going to see stricter law enforcement that will lead to more corporate guilty pleas?

“We still have to wait and see. I was at the ABA White Collar conference in California not too long ago and Biden administration officials doubled down on the focus on the individual. And that’s the point where guilty pleas may be more impactful, where their corporate executives are being held accountable.” 

“Certainly a guilty plea matters when it comes to a company’s reputation. But we often are seeing companies and prosecutors on the same page in wanting to correct the conduct. Companies may be willing to pay fines. Even when they enter into deferred prosecution agreements, they are paying significant fines. Given the willingness to reopen the monitorship door, I expect to see more monitorships, more deferred prosecution agreements and more opportunities for companies to cooperate with the government on corrective action going forward. I’m curious to see whether more executives will actually be held accountable under this administration.” 

“If that happens, that will make our job as defense attorneys more challenging in defending our executive clients and getting their point of view and their individual stories heard to ensure that they are treated fairly.”

What are some issues that arise when you are conducting an internal investigation?

“Privilege is always an issue. We are seeing interesting questions arise when we do internal investigations. There are questions as to how much the government demands that we share and how much of that is ultimately protected by settlement privilege down the line. We are seeing attempts by the government to be increasingly involved at the investigation stage. And that raises privilege questions. If you have the government attempting to direct you very specifically to talk with certain people, to gather data, to analyze data in a certain way, how do you both be cooperative on behalf of your clients but still maintain privilege necessary to be an effective advocate?” 

“I see a tension with the government trying to become increasingly involved and putting pressure on what cooperation looks like. I’m interested to see how that plays out down the road. In three or four instances recently, I have had those types of inquiries. When I was a prosecutor, I thought the government was a little bit more hands off when it came to internal investigations. That will be an interesting challenge for defense attorneys and for our clients. How much do we cooperate? How much do we try to safeguard the privilege? What are the ultimate benefits for cooperation down the line? And what guarantees can we have when we are putting ourselves in a position where the privilege may be weakened?”

[For the complete Interview with Giselle Joffre, see 36 Corporate Crime Reporter 19(12), May 9 2022, print edition only.]