United States of America, Ex Rel., and Michael E. Green v. Northrop Corporation Norm Bussard

In this case, we address an important and difficult question involving the qui tam provisions of the False Claims Act, 31 U.S.C. §§ 3729 et seq. We must determine whether the release of a qui tam claim, when entered into without the United States’ knowledge or consent, and prior to the filing of an action based on that claim, is enforceable. We hold that it is not.

BACKGROUND

In November 1988, Michael Green (“Appellant”), a former employee of Northrop, filed a complaint in California Superior Court against Northrop and several unnamed defendants alleging a number of state-law causes of action stemming from his termination by Northrop in October 1988. According to Green, while working as a criminal investigator for Northrop’s Advanced Systems Division, he uncovered evidence that Northrop had “double charged” the U.S. Air Force for equipment procured for the B-2 bomber program. Green maintained that he was discharged for having brought this information to the attention of certain Northrop officials and because he sought the advice of an attorney.

Northrop and Green eventually negotiated a settlement of this suit, and entered into a “Settlement Agreement and General Release” (the…