Constitutional Challenges and Shifting Landscape Reshape False Claims Act Enforcement

Constitutional challenges, judicial pushback, and political priorities are reshaping the False Claims Act landscape, according to experts at the 2026 ABA White Collar Crime Institute in San Diego. The panel discussion, featuring high-profile participants including Michael Granston, Giselle Joffre, Jacqueline Romero, and Aviva Gilbert, with Preston Pugh moderating, revealed an increasingly complex enforcement environment where government assertiveness meets growing judicial skepticism.

The most dramatic development centers on constitutional challenges to the FCA’s qui tam provisions, which allow private whistleblowers to sue on the government’s behalf and receive a portion of any recovery. The Zafirov litigation has emerged as the likely vehicle to bring this question before the Supreme Court, with fundamental questions at stake: Can private citizens exercise executive enforcement power that Article II reserves for U.S. officers?

A Florida district court recently became the first to rule that qui tam relators are effectively “officers” whose self-appointment and unchecked litigation authority violate the Appointments Clause. The Eleventh Circuit’s subsequent oral arguments saw judges aggressively questioning all parties about constitutional boundaries and whether Justice Clarence Thomas’s pointed dissent in Polansky signals the Supreme Court’s direction.

The implications could transform FCA enforcement overnight. Qui tam cases drive the vast majority of FCA actions, and their curtailment would eliminate the government’s most powerful multiplier effect. What once seemed a fringe legal theory is now entering the mainstream, with panelists noting that companies should prepare for a potentially different enforcement landscape.

“This is no longer an outlier argument,” noted one participant. “Companies need to consider how their FCA exposure might change if relator-driven cases decline or disappear.”

Meanwhile, the concept of materiality is quietly shifting in defendants’ favor. Courts are increasingly asking whether false claims actually induced government action, with the Supreme Court’s Kousisis decision (though not an FCA case) supporting dismissal of claims where real-world impact was minimal.

This evolution affects litigation strategy at every stage. Defense attorneys now have more room to build “immateriality” narratives early, focusing discovery on what the government knew and whether it continued payments despite that knowledge. Summary judgment, traditionally difficult in FCA cases, becomes more viable with the right fact pattern.

“The strongest FCA defenses in 2026 are being built on what actually happened in the real world, rather than parsing regulatory text,” one panelist observed.

The FCA’s enforcement scope continues expanding beyond traditional healthcare fraud into emerging areas including customs and tariff fraud, cybersecurity compliance failures, and controversies surrounding gender-affirming care. This last category has met notable judicial resistance, with several courts quashing subpoenas and expressing reluctance to let the FCA resolve unsettled clinical or scientific disputes.

This judicial pushback signals important limitations. “The FCA is powerful, but not boundless,” remarked one speaker. “The government’s pursuit of novel theories doesn’t guarantee success.”

Political considerations increasingly influence enforcement priorities. Resource allocation, case selection, and enforcement emphasis reflect executive orders, cultural flashpoints, and policy agendas—including scrutiny of DEI practices. Healthcare enforcement is simultaneously becoming more data-driven and systematic, with enhanced DOJ-HHS coordination making investigations less predictable.

This politicization means compliance programs focused solely on statutes and regulations are inadequate. Understanding the political landscape has become as important as monitoring the Federal Register, with actionable fraud definitions shifting alongside administrative priorities.

For businesses, the message is clear: FCA risk is enterprise-wide, not departmental. Companies must scrutinize every interaction with federal funds—from billing and claims to cybersecurity certifications, trade representations, ESG disclosures, supply chain compliance, and DEI initiatives. Any certification to the federal government warrants the same scrutiny as financial statements.

For legal counsel, success depends on establishing compelling narratives early, both internally with stakeholders and externally with DOJ. Materiality and intent defenses hinge on framing that begins during investigations.

As one panelist concluded, “Understanding why cases are brought—the policy logic, political context, and enforcement philosophy—has become the most reliable early warning system available.”