This week, the Supreme Court handed down its decision in Kellogg, Brown & Root Services, Inc. v. U.S. ex rel. Carter.  This case concerned the Wartime Suspension of Limitations Act (WSLA), a statute that suspends the statute of limitations for “any offense” involving fraud against the US government “when the United States is at war or Congress has enacted a specific authorization for the use of the Armed Forces[.]” 18 U.S.C. § 3287.

In recent years, courts including the Fourth Circuit and the Fifth Circuit have held that because Congress passed specific Authorizations for the Use of Military Force, the WSLA has applied since the beginning of US. military operations in Afghanistan in 2001 and Iraq in 2002.  See U.S. v. ex rel. Carter v. Halliburton Co., 710 F.3d 171, 179 (4th Cir. 2013); U.S. v. Pfluger, 685 F.3d 481, 485 (5th Cir. 2012).

In this week’s unanimous opinion, the Court reversed the Fourth Circuit’s application of the WSLA to a civil False Claims Act (FCA) action, holding that the WSLA “must be construed to refer only to crimes.” 576 U.S. ___, 12-1497, slip op. at 11 (May 26, 2015). To that end, where a “case involves civil claims, the WSLA does not suspend the applicable statute of limitations.” Id.

The Court also affirmed the Fourth Circuit’s decision that the FCA’s “first-to-file” bar only applies while the first-filed qui tam case is still pending and that “a qui tam suit under the FCA ceases to be ‘pending’ once it is dismissed.” Id. at 13.

While this ruling re-establishes the statute of limitations for civil FCA qui tam claims, it also has the effect of confirming that the statute of limitations for criminal fraud cases is effectively non-existent in the current climate.  As a result, Ex rel. Carter could lead to the US government bringing more criminal prosecutions to address older alleged FCA violations, particularly in light of the Department of Justice’s previous public commitment to bring more criminal FCA cases.