The Dust Settles: Fifth Circuit Affirms Government’s (c)(2)(A) Dismissal Authority

On April 18, 2025, the United States Court of Appeals for the Fifth Circuit affirmed the district court’s decision in U.S. ex rel. Vanderlan v. Jackson HMA, LLC granting the government’s motion to dismiss a qui tam action under 31 U.S.C. § 3730(c)(2)(A). In affirming yet another (c)(2)(A) dismissal based on U.S. ex rel. Polansky v. Executive Health Resources Inc., Vanderlan confirmed the broad discretion a district court has in dismissing FCA cases over the objections of a relator.

On appeal, the Fifth Circuit considered whether the district court (1) erred in denying the relator an evidentiary hearing; (2) erred in granting the government’s (c)(2)(A) motion; and (3) applied the proper standard — dismissal under § 3730(c)(2)(A), rather than settlement under § 3730(c)(2)(B).

As to whether the district court erred in denying the relator an evidentiary hearing, the Fifth Circuit found no error. The circuit court reasoned that, since Polansky, appellate courts have interpreted the “hearing” requirement of § 3730(c)(2)(A) to mean a hearing on written briefs. Here, the district court had reconsidered its decision, allowed multiple rounds of briefing, held a live hearing where the relator presented his arguments, and gave the relator the opportunity to submit evidence. Because § 3730(c)(2)(A) and relevant case law require no more, the Fifth Circuit concluded that the district court met its procedural duties.

The Fifth Circuit turned next to the heart of the appeal — whether the district court erred in granting the government’s (c)(2)(A) motion. Again, the circuit court found no error. In the introduction to its opinion, the court provided a brief history of the FCA, underscoring that the relator’s role in a qui tam action is, and has always been, to act as a vehicle for enforcing the government’s interests when the government is the injured party. Citing Polansky, the Fifth Circuit confirmed that the injury a relator asserts, therefore, “belongs exclusively to the Government.” When the qui tam action no longer serves the government’s interests, the FCA permits the government to abandon the qui tam action altogether, even over the objections of the relator. Because qui tam suits are brought on behalf of the government, the Supreme Court in Polansky emphasized that courts should grant substantial deference to the government’s decision to dismiss a qui tam action. The Fourth Circuit adopted this reasoning in U.S. ex rel. Doe v. Credit Suisse AG, 117 F. 4th 155 (4th Cir. 2024), and further held that even greater deference applies under Rule 41(a)(1) of the Federal Rules of Evidence, which permits dismissal by a plaintiff without a court order. Because continuing with the litigation would no longer serve the government’s interests, and because the government’s motion fell under Rule 41(a)(1), the Fifth Circuit found no reason to depart from the Fourth Circuit’s approach.

As to whether the district court applied the correct standard — dismissal under § 3730(c)(2)(A) rather than settlement under § 3730(c)(2)(B) — the Fifth Circuit found no error. The court found that § 3730(c)(2)(B) applies only when the government proposes a settlement for court approval and the relator objects; absent both conditions, the provision is inapplicable. In any event, the relator forfeited this argument by failing to raise it adequately in his opening brief, as required to preserve an issue on appeal.

In affirming the district court’s dismissal, the Fifth Circuit reinforced the post-Polansky framework that grants the government broad discretion to terminate qui tam actions that no longer serve its interests. In so doing, the court not only clarified the procedural and substantive standards governing § 3730(c)(2)(A) dismissals but also signaled strong judicial support for the government’s gatekeeping role in FCA litigation.

© Arnold & Porter Kaye Scholer LLP 2025 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.