Many whistleblower lawyers have been nervous with the recent GOP sweep in Washington. When I read the Justice Department’s press release last week indicating that the department paid out $435 million to whistleblowers this year, I viewed it as 435 million reasons why Wall Street hates the federal False Claims Act. While it still too early to know what the Republicans might propose to the False Claims Act, this week two Republican senators introduced legislation to extend and expand whistleblower laws to include auto industry workers who report safety violations. Whistleblowers would be eligible for up to 30% of whatever fines are collected by the NHTSA or Justice Department.
The proposed legislation, entitled “A Bill to Improve Motor Vehicle Safety by Sharing Certain Information,” S.D. 2949), was introduced on Thursday by Senators Dean Heller (R-NV), Bill Nelson (D-FL), Claire McCaskill (D-MO) and John Thune (R-SD). Senator McCaskill recently chaired two hearings concerning GM safety recalls. Senator Thune is the incoming chair of the Senate Commerce Committee.
As of this writing, the Library of Congress did not yet have a draft of the bill.
The Detroit News claims the call for expanded whistleblower award legislation comes in the wake of a hearing about airbags manufactured by Takata Corp. Those airbags are widely used in cars made by Honda, Chrysler, Ford, BMW, Saab, Dodge, Mazda and others. Safety advocates say they are responsible for several deaths. Senators have called the airbags “ticking time bombs”, “lethal deathtraps” and a “live hand grenade in front of drivers.”
The paper reports that during the hearing, Senator Heller asked if it was safe for his daughter to drive their 2007 Honda. A Honda executive hesitated 8 seconds before answering prompting several senators to get angry and demand speedier action by automakers.
We are pleased to see Congress working together in a bipartisan manner to expand whistleblower laws. The federal False Claims Act, on the books since the Civil War, has been effective in getting back tens of billions of dollars each year for taxpayers. Its reach, however, only extends to fraud against the government or a government funded program. The proposed legislation will represent the first major expansion of whistleblower legislation in recent years and comes on the heels of FIRREA in 1989 and the SEC Dodd Frank Whistleblower law in 2010.
Mahany & Ertl is a full service whistleblower law firm. We represent whistleblowers in federal False Claims Act cases, SEC whistleblowers (claims of companies violating U.S. securities laws), IRS whistleblowers (businesses or individuals not paying taxes) and FIRREA (actions that weaken or harm federally insured banks). Think you have inside information that may lead to an award? Give us a call.