In our 2020 and 2021 editions of our False Claims Act (FCA) guide, we noted recent developments relating to the United States Department of Justice’s (DOJ) authority under 31 U.S.C. §3730(c)(2)(A) to seek dismissal of suits filed under the qui tam provisions of the FCA. Beginning with the Granston Memo in 2018, which DOJ later incorporated into the Justice Manual, increased attention on the legal standard governing such motions to dismiss gave rise to a circuit split. That split widened in 2020 with the emergence of yet a third standard, and more so over the last year with additional case law interpreting the existing standards, and legislation introduced in the U.S. Senate that could limit DOJ’s control over qui tam litigation in significant ways. 

The Swift / Sequoia circuit split 

Going back almost 20 years, there has been a circuit split governing the standard applied to DOJ motions to dismiss suits filed under the qui tam provisions of the FCA where the government has declined to intervene. The D.C. Circuit “give[s] the government an unfettered right to dismiss an action,” rendering the government’s decision to dismiss essentially “unreviewable,” under its opinion in Swift v. United States.1 The Eighth Circuit has suggested a similar standard, noting that a government’s power to dismiss over relator’s objection is “subject only to notice and a hearing for the qui tam relator.”2 However, courts in the Ninth and Tenth Circuits apply the standard from United States ex rel. Sequoia Orange Co. v. Baird-Neece Packing Corp., which requires the government to demonstrate a valid purpose for dismissal and a “rational relation” between dismissal and accomplishment of that purpose.3 

The CIMZNHCA decision 

As noted in our 2021 FCA Guide, just after the Supreme Court declined in April 2020 to resolve the existing circuit split arising from the Swift and Sequoia standards,4 a third standard of review for DOJ dismissals emerged from the Seventh Circuit.5 In United States ex rel. CIMZNHCA, LLC v. UCB, Inc. (CIMZNHCA), the Seventh Circuit drew from the language in Rule 41(a) of the Federal Rules of Civil Procedure as the basis for deciding the government’s dismissal authority.6 The CIMZNHCA decision effectively affords the government a largely unfettered right to intervene and dismiss over the relator’s objection during the early stages of litigation, but once the defendant files a responsive pleading, then “an action may be dismissed at the plaintiff’s request only by court order, on terms that the court considers proper.”7 Finding the government had a rational basis for moving to dismiss, the Seventh Circuit reversed and remanded to the district court with instructions to enter judgment for the defendants on the relator’s claims, dismissing those claims with prejudice as to the relator.8 

The Third Circuit deepens a three-way circuit split 

Following the CIMZNHCA decision, in October 2021 the Third Circuit decided to adopt the same FRCP 41(a) standard in U.S. ex rel Polansky v. Executive Health Resources, Inc.9 In Polansky, the Relator’s claims implicated Medicare reimbursement policy and medical necessity determinations required to justify inpatient admissions over outpatient procedures.10 In accordance with the qui tam statute, the case remained under seal while DOJ investigated; ultimately DOJ declined to intervene.11 More than several years after the declination and periods of active litigation, in February 2019, DOJ informed the parties that it intended to dismiss the entire action pursuant to 31 U.S.C. § 3730(c)12 and filed its motion in August 2019.13 The district court granted the motion and “concluded that the [g]overnment had made an adequate showing under any of the prevailing standards.”14 

On the plaintiff’s appeal, the Third Circuit addressed two questions: (1) does the FCA require the government to intervene in order to seek dismissal pursuant to § 3730(c)(2) (A) – either at the first opportunity15 or “at a later date upon a showing of good cause”?16 ; and (2) what is the standard governing the government’s motion to dismiss?17 

In addressing the procedural question, the Third Circuit held that the government must intervene before it can move to dismiss, and that it can seek leave to intervene at any point in the litigation upon a showing of good cause. The circuit courts are also split on this procedural point, with the Third, Sixth, and Seventh Circuits interpreting the FCA to require intervention before the government can move to dismiss a relator’s case18 and the Ninth, Tenth, and D.C. Circuit’s disagreeing.19 

Turning to the standard governing the government’s motion to dismiss, the court followed the Seventh Circuit’s reasoning in CIMZNHCA, described above. The court held that the government, as an intervenor,20 is subject to F.R.C.P. 41(a), which articulates the standard the government must meet for a dismissal. Applying this standard, the Third Circuit affirmed the district court’s decision to grant the government’s motion to dismiss. Beyond the immediate dispute at issue, the Polansky decision creates further discord among the circuits about the standard for a motion to dismiss under § 3730(c)(2)(A), and it puts a brighter spotlight on the circuits that have not yet addressed the issue.21 

Potential legislative response 

With the Supreme Court only recently having declined to address the circuit split, Senator Charles Grassley has tried to take legislative action. In July 2021, Senator Grassley introduced a bill (S 2428 – False Claims Amendments Act of 2021) that addresses the standard for DOJ’s dismissal authority head on, and effectively adopts the Sequoia Orange standard followed in the Ninth and Tenth Circuits. The bill proposes to amend § 3730(c)(2)(A) to read as follows: “The Government may dismiss the action notwithstanding the objections of the person initiating the action if the person has been notified by the Government of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion, at which the Government shall identify a valid government purpose and a rational relation between dismissal and accomplishment of the purpose, and the person initiating the actions shall have the burden of demonstrating that the dismissal is fraudulent, arbitrary and capricious, or illegal.”22 The bill has advanced through the Senate Judiciary Committee, but the full Senate has not yet voted on it.23 

What’s next?

We expect that DOJ will continue to exercise restraint in filing motions to dismiss declined qui tam suits under 31 U.S.C. § 3730(c)(2)(A). These motions are, and always have been, rare, even after promulgation of the Granston memorandum. At the same time, the courts will continue to review DOJ’s use of its dismissal authority closely. In addition, because courts have not reached a consensus about the legal standards applicable to these motions, litigants will continue – absent congressional action – to maneuver through a deepening split among the circuits.


1. 318 F.3d 250, 252-53 (D.C. Cir. 2003). 
2. See United States ex rel. Rodgers v. Ark., 154 F.3d 865, 868 (8th Cir. 1998). 
3. 151 F.3d 1139, 1145 (9th Cir. 1998). See Ridenour v. Kaiser–Hill Co., L.L.C.,
397 F.3d 925, 940 (10th Cir. 2005). 
4. United States ex rel. Borzilleri v. AbbVie, Inc., 837 F. App’x 813 (2d Cir. 2020). On April 6, 2020, the Supreme Court denied a petition for certiorari that could have provided an opportunity for the Court to clarify the standard for DOJ dismissal. See United States ex rel. Schneider v. JP Morgan Chase Bank NA, 140 S. Ct. 2660 (2020) in the Supreme Court of the United States. See also Mike Theis & Stacey Hadeka, The CIMZNHCA decision: A third standard for DOJ dismissals, 
5. United States ex rel. CIMZNHCA, LLC, v. UCB, Inc., 970 F.3d 835 (7th Cir. 2020). 
6. 970 F.3d at 849-50 (noting that dismissals under Rule 41(a) are “[s]ubject to . . . any applicable federal statute,” which imports the limitations articulated in § 3730(c)(2)(A) and concluding the government may dismiss the action without the relator’s consent if the relator receives notice and opportunity to be heard as required by § 3730(c)(2)(A)); see also Fed. R. Civ. P. 41(a)(2). 
7. 970 F.3d at 849-50. 
8. Id. at 854. 
9. Polansky v. Exec. Health Res. Inc, No. 19-3810, 17 F.4th 376 (3d Cir. 2021). 
10. Id. 
11. Id. 
12. Id. 
13. Id. 
14. Id. 
15. 31 U.S.C. § 3730(c)(2)(A). 
16. Id. § 3730(c)(3). 
17. Polansky, 17 F.4th 376 (3d Cir. 2021). 
18. Id.; CIMZNHCA, 970 F.3d at 844 (7th Cir. 2020) (interpreting the FCA to require intervention upon a showing of good cause before the Government can move to dismiss a relator’s case under § 3730(c)(2)(A) but treating the government’s motion to dismiss as both a motion intervene and a motion to dismiss); and United States ex rel. Poteet v. Medtronic, Inc., 552 F.3d 503, 519-20 (6th Cir. 2009) (concluding § 3730(c)(2)(A) “applies only when the government has decided to ‘proceed[ ] with the action’” (quoting § 3730(c)(1)), abrogated on other grounds by United States ex rel. Rahimi v. Rite Aid Corp., 3 F.4th 813 (6th Cir. 2021). 
19. Ridenour v. Kaiser-Hill Co., 397 F.3d 925, 934-35 (10th Cir. 2005) (holding the Government “is not required to intervene . . . before moving to dismiss the action under § 3730(c)(2)(A)”); Swift v. United States, 318 F.3d 250, 252 (D.C. Cir. 2003) (reaching the same conclusion); and United States ex rel. Sequoia Orange Co. v. Baird-Neece Packing Corp., 151 F.3d 1139, 1145 (9th Cir. 1998) (suggesting the same understanding). 
20. The government did not formally intervene as a party. However, the court decided that there was no cause for remand on the basis of the record. The court reasoned, “we construe the Government’s motion to dismiss as including a motion to intervene because intervention was in substance what the government sought and in form what the False Claims Act requires.” Polansky, 17 F.4th 376 (3d Cir. 2021) (internal citations omitted). 
21. In July 2021, the Fifth Circuit, while affirming the district court’s decision to grant the Government’s motion to dismiss, declined to decide the proper judicial standard of review for DOJ dismissals. United States v. Eli Lilly & Co., Inc., 4 F.4th 255, 267-69 (5th Cir. 2021). 
22. 31 U.S.C. § 3730(c)(2)(A); False Claims Amendments Act of 2021, S.2428, 117th Cong. (2021) 
23. Id.