Feature Comment: Two Steps Forward, One Step Back—The D.C. Circuit Expands The False Claims Act’s Reach, But Not For Mere Mistakes U.S. v. Sci. Applications Int’l Corp., 626 F.3d 1257 (D.C. Cir. 2010) For Government contractors, one of the most important cases of 2010 was the D.C. Circuit’s unanimous decision in U.S. v. Sci. Applications Int’l Corp. The Court expanded the scope of the False Claims Act (FCA) not only by adopting the implied certification theory of liability (which it had previously only implicitly endorsed), but also by holding that FCA plaintiffs need only show that a contractor withheld information about its noncompliance with a material contractual requirement, regardless of whether that requirement was an express condition precedent to payment. At the same time, however, the Court limited the reach of the FCA in other ways. The Court rejected “collective knowledge” as an appropriate vehicle for establishing corporate knowledge of employee wrong doing. The Court also made it more difficult to prove damages in many FCA cases, there by lessening the potential award against contractors even if the case is successful. So while SAIC may be viewed as expanding the FCA’s reach, it just as surely added important safeguards to protect defendants from the quasi-criminal nature of FCA liability for what are more properly breach of contract matters. Background—Science Applications International Corp. (SAIC) executed two contracts with the Nuclear Regulatory Commission (NRC), an indepen
