/>iIn August, the 11th Circuit affirmed the district court’s decision to dismiss relator Bruce Jacobs’ qui tam action against JPMorgan Chase Bank (“JP Morgan”), and in doing so, held that blog posts constitute “news media” for purposes of the public disclosure bar. The relator alleged that JP Morgan forged the endorsement of Washington Mutual loan promissory notes it had acquired with its purchase of the bankrupt Washington Mutual. According to the relator, Washington Mutual failed to properly endorse every loan it originated, forcing JPMorgan to repurchase loans already sold to Freddie Mac and Fannie Mae or render make-whole payments and losing the ability to submit servicing reimbursement payments. The complaint alleged that JPMorgan forged endorsements using stamps bearing prior Washington Mutual employees’ names. The complaint also alleged that JPMorgan had submitted false reimbursement claims to Freddie Mac and Fannie Mae for servicing these loans.
The district court held that the relator’s claims were precluded by the public disclosure bar under the False Claims Act because several blog posts detailing substantially similar claims were posted on the internet prior to the relator filing his suit. The FCA provides that a court “shall dismiss an [FCA]action or claim …, unless opposed by the Government, if substantially the same allegations or transactions as alleged in the action or claim were publicly disclosed … from the news media.” 31 U.S.C. § 3730(e)(4)(A)
The 11th Circuit reviewed the facts and allegations of the case under the three-part test of the FCA’s public disclosure bar. The first prong requires that the allegations were publicly disclosed “from the news media” and published prior to the lawsuit. (31 U.S.C. § 3730(e)(4)(A); see also United States ex rel. Osheroff v. Humana, Inc., 776 F.3d 805, 812 (11th Cir. 2015)). The court quickly determined that the blog posts in question were published prior to the relator filing suit. Next, the 11th Circuit determined that the blog posts, one from a foreclosure information site and two from a website detailing alleged mortgage fraud in Miami, were “publicly available websites” and “intended to disseminate information” that qualified as news media under the public disclosure bar, as held in Osheroff. The court, rebutting the relator’s arguments, stated that although not all websites are “news media,” the definition is not limited to traditional news outlets and the key consideration is whether a website is “publicly available” and “intended to disseminate information” to the public, no matter the size or sweep of the blog.
The 11th Circuit also analyzed the second and third prongs of the public disclosure bar and concluded that the allegations detailed in the blog posts were “substantially the same” as the allegations in the relator’s complaint, and that the relator could not prove he was the “original source” of the information in the blog posts.
This decision helps pinpoint and define nontraditional news media articles that could be used in challenging qui tam lawsuits under the public disclosure bar. Although the court declined to address whether social media posts constitute news media, many other forms of publicly posted information, such as podcasts, have the potential to be considered “news media,” and could be the subject of future public disclosure bar challenges.
