I’ve blogged several times in this space about the Maryland False Claims Act, whose passage was narrowly averted in the last legislature, and I’ve noted critics’ concern that its ambiguous language could support private lawsuits challenging the tax bills of Maryland companies, with a verdict or settlement resulting in a percentage payment to the bounty-hunting complainant. Now I’ve got a short piece in Reason tracing where such statutes can lead when loosely worded in a way susceptible to exploitation by clever lawyers: a Philadelphia complainant is using New York’s liberally worded False Claims Act to challenge the federal taxes of a Philadelphia-based financial giant, the Vanguard Group, for what could be a very rich bounty payoff should the case settle. As I point out, “by getting pro-plaintiff laws through the legislature in just a few states — New York liberalized its law four years ago — advocates can set the stage for a nationwide informant push.”
P.S. My earlier writing also drew a two-part (!) indignant response from a plaintiff’s lawyer who makes a business of filing this type of suit. The most hilarious bit is Mr. Kitts’s after-the-fact claim that the unseating of (opponent) David Brinkley by (supporter) Michael Hough constituted some sort of “referendum” on the MFCA. As a resident of District 4 I never did meet a voter during the whole primary season who told me this (alas) obscure legislative controversy made any difference in how they cast their ballot.