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US Appeals Court Hears Challenge to False Claims Act Whistleblower Powers

By  |  December 14, 2025

A federal appeals court on Friday heard sharply opposing arguments over whether key whistleblower provisions of the U.S. False Claims Act violate the Constitution, a dispute that could have far-reaching implications for a law that has generated billions of dollars in government recoveries, according to Reuters.

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    The three-judge panel of the 11th U.S. Circuit Court of Appeals in Atlanta is reviewing a ruling by a Florida federal judge who last year struck down the provisions. The lower court concluded that the law improperly allows private individuals to exercise executive power without being accountable to the president, per Reuters.

    During the hearing, Circuit Judge Elizabeth Branch noted that some members of the U.S. Supreme Court have recently raised concerns about the constitutionality of the False Claims Act’s whistleblower mechanism. The law, originally enacted during the Civil War, permits private citizens to file lawsuits on behalf of the federal government alleging fraud against the United States, according to Reuters.

    Under the statute, whistleblowers may receive a percentage of any recovery. When the government intervenes and takes over the case, whistleblowers are entitled to between 15% and 25% of the proceeds. If the government declines to intervene, the share rises to between 25% and 30%, Reuters reported.

    Judges on the appeals panel questioned attorneys from both sides about the constitutional implications of allowing whistleblowers—who are not government employees—to pursue litigation in the name of the United States. A key focus was whether such whistleblowers could be subject to the Constitution’s appointments clause. Daniel Winik, arguing for the federal government, maintained that the executive branch retains sufficient oversight and control over these cases and urged the court to reverse the lower court’s decision, according to Reuters.

    The appeal was brought by whistleblower Clarissa Zafirov after U.S. District Judge Kathryn Mizelle dismissed her lawsuit in September 2024. Zafirov had accused Florida health care companies of defrauding Medicare by using inaccurate diagnosis codes to exaggerate patients’ medical conditions, per Reuters.

    In her ruling, Mizelle determined that the whistleblower provisions elevate private individuals—who are not appointed by or answerable to the president—into roles that function like officers of the United States. That conclusion is now at the center of the appellate court’s review, according to Reuters.

    Tejinder Singh, representing Zafirov, told the appeals court that whistleblowers do not qualify as officers under the Constitution. “They can’t compel the government really to do anything,” Singh said. “The government is still in the passenger seat and able to grab the wheel at any time.” His opposing counsel, Kannon Shanmugam, who argued on behalf of Florida Medical Associates and related entities, countered that whistleblowers under the statute “exercise significant executive authority,” according to Reuters.

    Both Singh and Shanmugam declined to comment after the hearing. The U.S. Chamber of Commerce also participated in the case in support of the health care providers, Reuters reported.

    The case is Clarissa Zafirov v. Florida Medical Associates LLC et al, before the 11th U.S. Circuit Court of Appeals, No. 24-13581.

    Source: Reuters