As reported on Law360 last Thursday, DOJ has quietly revised its FCA statistics for fiscal year 2017, which we wrote about when they came out last December. We have posted a redline comparing the two versions. DOJ offered no explanation for these alterations, but we think the redline shows DOJ making two different types of changes:
First, it appears that DOJ miscategorized some cases as intervened when they were not intervened, and decided to fix that. For example, for the “Overview” table of recoveries across all industries, recoveries for FY 2017 in cases where the government intervened were decreased by $466 million, and recoveries where the government declined to intervene were increased by nearly the same amount, $472 million. Similar, though smaller, shifts from intervened to declined cases can be seen in FY 2012 (~$45 million) and FY 2013 (~$71 million). Neither FY 2014 nor FY 2015, nor fiscal years prior to 2012, saw similar moves. We do not really understand how DOJ would have made this sort of mistake. One possibility is that DOJ had second thoughts about counting cases where it intervened only for purposes of settlement after relators had litigated the case. Another is that DOJ had counted recoveries by relators in cases where DOJ intervened and settled only some of the relators’ allegations, and the relators continued on to recover on their remaining theories.
Second, it seems that DOJ is making other smaller adjustments to the total recoveries. For instance, total recoveries for 2017 increased by $6 million. FY 2012 and FY 2016 also saw increases in recoveries of $200 thousand and $93 million respectively, and FY 2014 saw a $4 million decrease. Total qui tam recoveries for FY 2015 and FY 2013 did not change. It might be that DOJ made these changes to account for recoveries that had been left out in the December 2017 version of the chart, perhaps because they were non-qui tam cases brought by U.S. Attorneys’ Offices, for which DOJ “maintains no data.” The 2014 decrease might also reflect instances where a judgment or verdict was overturned on appeal.
While this may be the first time that we know of where DOJ altered the FCA statistics report for a year after that year’s press release, it is not the first time DOJ has changed its statistics without telling anyone. For example, we have prepared a (slightly messy) redline comparing the FY 2016 press release against the December version of the FY 2017 press release. That comparison shows that DOJ altered the recovery numbers, and even the number of new cases filed, going back as far as 2001. For reasons that we do not quite understand, the total recoveries listed for most years between FY 2008 through FY 2016 were higher when reported by DOJ in the 2017 press release than in the 2016 press release. One notable exception is FY 2015, which was slashed by $662 million, or about the amount of the 2015 Trinity Guardrails jury verdict that the Fifth Circuit threw out this year. And we expect that next year’s press release will have to cut down the 2017 recovery number by about $350 million after a district court in Florida tossed a jury verdict there, a decision which we will discuss in a future article.