Does Private Enforcement Attract Excessive Litigation? Evidence from the False Claims Act

David Y. Kwok, United States Court of Appeals for the Ninth Circuit

Abstract

Abusive litigation is an ongoing concern in allowing the private enforcement of public laws, but the variety of courts and cases can make systematic identification of abuse difficult. To limit potential abuse under the False Claims Act, the federal government has the right of first refusal on all private enforcement actions. Utilizing a new data set from this government review procedure, I do not find numerous law firms acting as "filing mills" in pursuing a high volume of poorly selected cases. Repeat law firms appear to be improving over time, and there is a surprising number of successful single-shot law firms. The government rarely uses its unilateral power to dismiss cases, suggesting a cooperative equilibrium between public and private enforcement.