U.S. ex rel. Eisenstein v. City of N.Y.

U.S. Supreme Court No. 
U.S. Supreme Court No. 08–660
Oral Argument 
April 21, 2009
Decided 
June 8, 2009
Background of the Case 

The petitioner filed a qui tam action against the City of New York and four of its employees, alleging that the city deprived the government of tax revenue by deducting fees that it charged to non-resident workers from their taxable income. The government declined to intervene but requested continued service of pleadings. The United States District Court for the Southern District of New York granted the City’s motion to dismiss and entered final judgment. The relator, who was proceeding pro se, filed a notice of appeal in the Second Circuit 54 days after the district court entered judgment. The Second Circuit dismissed the relator’s appeal as untimely, holding that since the government did not intervene in the action, it was therefore not a party to the action, and thus, pursuant to Rule 4 of the Federal Rules of Appellate Procedure, the relator had 30 – not 60 – days in which to file his notice of appeal. The relator (who was now represented by counsel) appealed to the United States Supreme Court and the Court granted certiorari.

The Court's Decision 

The Court determined that the government did not become a party to privately-filed qui tam actions until it intervened in the case. The relator argued the government was a party to such actions even without intervening, because it is always named in the caption and is always the real party in interest all FCA cases, it has the ability to request pleadings and deposition transcripts, and it is always bound by the judgment in non-intervened cases. The Court rejected this argument and reasoned that conferring party status on the government when it declined to intervene would render the FCA’s intervention procedure superfluous, since the government would not need to intervene in FCA cases if it was already a party. The Court noted that the FCA and FRAP 4 use the term "party," not "real party in interest," that a case caption can contain the name of a person or entity without that person or entity necessarily becoming a party, and that a judgment’s ability to bind the government does not provide a basis to conclude the government was a party to the action. The Court further reasoned that if the government was a party to non-intervened actions, then it would already have the right to receive pleadings and deposition transcripts and would not need to request them. Ultimately, the Court determined that the FCA’s intervention provisions demonstrated Congress’s intent to give the government the discretion to intervene, and the Court did not want to disregard this intent by forcing party status upon the government when it chose not to intervene. Thus, the Court rejected the petitioner’s arguments and held when the government declines to intervene in a qui tam action, it is not a party to the action for purposes of filing an appeal. Consequently, since the petitioner filed his notice of appeal more than 30 days after entry of the district court’s judgment, the Court affirmed the Second Circuit’s dismissal of the appeal as untimely.