Bloomberg BNA

The defendants are likely to be large companies, because New York’s False Claims Act allows qui tam actions only in tax cases in which the defendant’s net income or sales is $1 million or more and the alleged damages are more than $350,000. The cases come amid a continuing public debate between corporate defense attorneys and the qui tam plaintiffs’ bar about the appropriateness of applying the False Claims Act in tax cases. The New York Court of Appeals ruled Oct. 20 that the state may proceed with its False Claims Act case against Sprint Nextel Corp. for the company’s alleged failure to collect and pay sales taxes on flat-rate calling plans (People v. Sprint Nextel Corp., 2015 BL 344427 (N.Y. 2015) (203 DTR K-1, 10/21/15). The closely watched Sprint case was remitted to the New York Supreme Court in Manhattan, where a trial date has been set for April 5. Two other cases involving large companies, Citigroup Inc. and Vanguard Group Inc., are winding their way through the courts (248 DTR K-4, 12/29/15).

Read more by downloading the .PDF below.