D.C. Circuit will not rehear False Claims suit against national bank

Courts False Claims Act / FIRREA Appellate D.C. Circuit

On February 16, the U.S. Court of Appeals for the D.C. Circuit denied a petition for an en banc rehearing of its December 2017 ruling affirming the dismissal of a False Claims Act suit against a national bank. The petition resulted from a 2013 lawsuit filed by a consumer against the bank, which alleged, among other things, that the bank falsely asserted that it had complied with certain obligations under the 2012 National Mortgage Settlement (the “Settlement”). The district court dismissed the suit, finding that the consumer lacked standing because he did not exhaust the required dispute resolution procedures contained in the Settlement. In December 2017, the D.C. Circuit affirmed the dismissal but disagreed with the lower court’s reasoning. According to the appellate opinion, the circuit court held that the consumer’s second amended complaint did not contain any allegedly false or deceptive statements made by the bank to the government-approved settlement monitor and that ultimately, “the decisive point is that the Monitor was aware of the practices and concluded that [the bank] was in compliance.”