The Third Circuit recently heard oral argument on the ongoing question regarding the constitutionality of the qui tam provision of the False Claims Act (FCA). The issue arose in United States ex rel. Penelow v. Janssen Products, LP, No. 25-1818 (3d Cir.) — a non-intervened qui tam that went to trial and ultimately led to a jury rendering a whopping $1.64 billion verdict against Janssen. The panel included Judge Paul Matey, Judge Cindy K. Chung, and Judge Arianna J. Freeman.
Background
In recent years, Supreme Court Justices Clarence Thomas, Brett Kavanaugh, and Amy Coney Barrett have voiced their concerns that the FCA’s qui tam provision violates Article II of the Constitution because relators exercise core executive authority without being properly appointed as “officers” of the United States by the president (see United States ex rel. Polansky v. Executive Health Resources, Inc., 599 U.S. 419 (2023); Wisconsin Bell, Inc. v. United States ex rel. Heath, 145 S. Ct. 498 (2025)). This has sparked a flurry of constitutionality arguments throughout lower courts, and some of those arguments are finally making their way to the appellate courts. In December 2025, the Eleventh Circuit heard oral argument on the issue in United States ex rel. Zafirov v. Florida Medical Associates, LLC. You can read more about that case here. The Third Circuit has now been presented the question and has the opportunity to weigh in on the debate.
Oral Argument
At argument, counsel for Amici and the United States addressed the constitutionality issue. Questions from the bench were largely focused on whether relators hold an office that implicates Article II, the historical use of qui tam provisions, and whether there are any set of circumstances in which Founding Era law could support the modern FCA qui tam provision.
Judge Matey was the most curious regarding the issue of whether a relator holds an office implicating Article II. It was the first question from the panel related to the constitutionality issue. During Amici counsel’s argument, Judge Matey asked pointed questions about how and why relators hold a “continuing office” and whether the ability to swap a relator out with someone else was important to the analysis. In response, Amici counsel analogized the continuing office of relator to roles such as special counsel and noted that, although a relator’s role is tied to a specific case, the FCA permits other individuals to step into the relator’s shoes — for example, a relator’s estate in the case of the relator’s death. Judge Matey also pushed the United States on the issue, noting distinctions between an officer and an office. The United States responded that an officer must hold an office and that relator does not hold any continuing office because the right as a relator under the FCA is personal to the relator and cannot be passed on to anyone else.
Judges Matey and Chung both seemed skeptical of each side’s use of the historical record to support their positions. Amici counsel was questioned regarding the long-standing history of qui tam suits in the United States. During the United States’ argument, Judge Matey commented that “the history is certainly engaging” but questioned whether it was “entirely consistent with the provisions of the modern False Claim Act.”
Importantly, and most interestingly, Judge Chung — joined by Judge Matey — questioned Amici’s decision to challenge the FCA’s qui tam provision facially, rather than as applied. Judge Chung’s line of questioning implied she may be more inclined to find that the qui tam provision was unconstitutional as applied (i.e., a non-intervened case in which the relator prosecutes an FCA action on their own). Judge Chung pushed Amici counsel on this issue with multiple questions, asking why under Founding Era law it would be impermissible for a relator to bring a qui tam action under seal and then allow the government to either (1) intervene and dismiss or (2) intervene and pursue. While both Amici counsel and the United States pointed out those were not the facts at issue in the case before the court, Amici counsel conceded that such a situation raises less constitutional concerns, but continued to argue that the unconstitutional appointment occurs at the time the relator files the qui tam action and “then force[s]” the government to investigate and make a decision regarding whether to intervene.
Conclusion
Ultimately, the Third Circuit panel asked challenging questions of both sides. The judges were particularly interested in situations where the United States decides not to intervene in the litigation — such as in the case before it — and appeared open-minded to holding the qui tam provision of the FCA unconstitutional in those specific circumstances only. While no decision has been reached, the Third Circuit’s approach may offer a third, middle-of-the-road answer to the emerging question by holding the FCA unconstitutional in situations where the government chooses not to intervene, rather than under all circumstances.
