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In a case where a former Halliburton employee brought qui tam claims alleging that Halliburton engaged in fraud in Iraq, a federal district court held that qui tam claims brought under the False Claim Act (FCA) are arbitrable.
In U.S. ex rel. McBride v. Halliburton Co., No. 05-00828, 2007 WL 1954441 (D.D.C. July 5, 2007), McBride, a former Halliburton employee, brought an action against Halliburton for FCA violations. The FCA allows private persons to bring qui tam actions alleging violations of the FCA on the government's behalf. McBride alleged that, while working in Iraq, she witnessed Halliburton defraud the government. Halliburton moved to compel arbitration pursuant to an arbitration clause in the employment agreement.
The Court held that qui tam claims brought under the FCA are arbitrable. McBride failed to meet her burden under the Federal Arbitration Act of proving "that Congress intended to preclude arbitration of the statutory claims at issue." Section 3730(h) of the FCA provides that employees retaliated against for bringing FCA claims "shall be entitled to all relief necessary to make the employee whole…in the appropriate district court of the United States," but as the Court noted, this section applies to personal claims rather than qui tam claims. Since McBride was bringing qui tam claims, Section 3730(h) was inapplicable.
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