What general counsel and business leaders need to know:

• A Familiar Tool, New Targets: The False Claims Act (FCA), long used to pursue fraud claims against health care institutions and government contractors, is now being extended to sectors that have never faced this scrutiny before—employers, universities, nonprofits, and academic medical centers—through a "false certification" theory targeting diversity, equity, and inclusion (DEI) initiatives.
• The Certification Trap: Federal agencies are adding language to funding forms and contracts requiring entities to certify they do not have illegal DEI programs. If an organization cannot show that its diversity initiatives align with federal civil rights law, falsely certifying that information triggers FCA liability with treble damages and per-claim penalties.
• Unsettled Legal Ground Favors Defendants—for Now: No court has tested the government's materiality or scienter arguments in DEI-FCA cases. Early settlements involved conduct from 2017—before DEI executive orders—raising serious questions about how prosecutors prove bad faith for initiatives that were lawful at the time.

In this episode of Diagnosing Health Care, Epstein Becker Green attorneys Lauri F. Rasnick, Daniella R. Lee, Leah Brownlee Taylor, and Haley Morrison discuss Civil Investigative Demand protocols, how to document good-faith compliance without waiving privilege, and what general counsel and compliance officers should do this week to prepare.