The Unconventional Relator: Data Miner Whistleblowers Benefit Everyone
In two previous blog posts, I have written about the proliferation of outsider relators, also referred to as “data miners,” bringing False Claims Act cases based on publicly available data but without any insider knowledge of fraud. First, I wrote about this trend generally and then, more specifically, in the context of the Paycheck Protection Program. Since then, data miner-derived PPP settlements have become a fairly regular occurrence, including the following:
– $21.6 million recovered from companies owned by a large multinational corporation, which itself was ultimately owned and controlled by the People’s Republic of China
– $9 million from a roofing company that applied for separate loans for each of its affiliated companies when they collectively exceeded eligibility requirements
– $3.8 million from a company owned by a large, foreign parent company
– $1 million from a company that marketed cannabis products
This, in turn, has defense attorneys asking whether data miners are “appropriate” relators under the False Claims Act. Generally, they argue that the answer is “no” because, in their opinions, the statute was intended to entice and reward “classic whistleblowers,” insiders with specific information about fraud, not industrious private investigators who are able to root out fraud using only their know-how and publicly available data.
These arguments depend primarily on the lawyers’ own beliefs about what the False Claims Act should be or what they think Congress probably intended. But the False Claims Act, in its own words, is broader and more powerful than they suggest.
For one, this contention misunderstands or underappreciates the ultimate purpose of the False Claims Act – to recover monies that rightfully belong to the government. It is illogical that the drafters of the False Claims Act would have preferred that fraudsters keep millions of dollars in stolen funds rather than reward a data miner with a small percentage of the recovery.
Moreover, Congress inserted provisions into the statute that prevent data miners from abusing the statute. For example, the “public disclosure bar”[1] requires the dismissal of cases based on publicly disclosed information unless the whistleblower provides additional independent and material information.
Defense lawyers routinely point to this provision as proof that Congress did not intend for data miners to be able to bring FCA cases. But this ignores that Congress also gave the Department of Justice veto power over the public disclosure bar. So the Department of Justice has the discretion to permit these same data miners to file and litigate cases when it is in the best interest of the government.[2] If Congress wanted to exclude all data miners from bringing False Claims Act cases, it could have made the public disclosure bar absolute or amended it to reflect that goal,[3] but it didn’t.
Further, the statute allows for a reduced relator’s share for intervened cases, from 0% to 10% of the recovery, if an action is “based primarily on disclosures of specific information.”[4] In other words, if the Department of Justice and the court decide that the relator does not deserve a reward because they did not meaningfully contribute to a recovery, it has a means to reduce or eliminate their share. But if the DOJ finds value in the relator’s contributions, there is a clear means (and, thus, Congressional intent) to reward them for having filed the case. Or it can allow the data miner relator to litigate the case on its behalf and receive a full relator’s share of 25% to 30%.
In sum, unless you are in the business of committing fraud or representing those who do, it should not be controversial that non-traditional whistleblowers helping to recover funds are good for the government and good for taxpayers. Just as Congress included a reward to encourage insiders to come forward, that same reward inspires non-insiders to spend their time and resources to uncover fraud, consistent with the purpose of the False Claims Act.
This piece was written by Jason Marcus of Bracker and Marcus LLC.
[1] 31 U.S.C. § 3730(e)(4)(A)
[2] See United States ex rel. Collins v. Robertson, 2025 U.S. Dist. LEXIS 188679 (N.D. Ga. 2025) (veto employed in a PPP case, resulting in a judgment for the United States of $361,294.74).
[3] The Public Disclosure Bar was most recently amended in 2010 as part of the Patient Protection and Affordable Care Act. It narrowed the bar and included the Government veto, making it easier for whistleblowers to bring cases. Although they were not as ubiquitous, it was well known at the time that there were “outsider” relators such as data miners bringing FCA cases.
[4] 31 U.S.C. § 3730(d)(1)
