## Facts

- Jonathan Stevens, a former attorney for the Vermont Agency of Natural Resources (a state agency), filed a qui tam action under the False Claims Act (FCA) alleging the Agency submitted false claims to the EPA in connection with federal grant programs.
- The FCA authorizes a private relator to sue in the name of the United States and share in any recovery.
- Stevens sought treble damages and civil penalties against the state agency.
- The Agency moved to dismiss, arguing that (1) a State is not a “person” subject to FCA liability and (2) the Eleventh Amendment bars a private FCA qui tam damages action against a State in federal court.
- The district court denied dismissal; the Second Circuit affirmed; the Supreme Court granted certiorari.

## Issues

1. Whether an FCA qui tam relator has Article III standing to sue on behalf of the United States.
2. Whether a State or state agency is a “person” subject to liability under the FCA in a private qui tam action.

## Decision

- The Court held that a qui tam relator has Article III standing because the FCA functions as a partial assignment of the Government’s damages claim, allowing the relator to assert the United States’ injury in fact.
- The Court held that a State or state agency is not a “person” subject to FCA liability in a private qui tam action.
- The Court reversed the Second Circuit and directed dismissal of the action against the Vermont agency.
- The Court did not resolve the Eleventh Amendment question, noting that interpreting “person” to exclude States avoided serious constitutional concerns.

## Legal Principles

- An assignee of a claim has standing to assert the injury in fact suffered by the assignor; the FCA may be treated as a partial assignment of the Government’s damages claim to the relator.
- A relator’s potential bounty is not, by itself, a cognizable Article III injury; standing rests on the United States’ assigned injury (including fiscal harm from false claims).
- There is a longstanding presumption that the term “person” does not include sovereigns (including States) absent a clear statement from Congress.
- Courts may apply constitutional avoidance: when a statutory reading would create serious constitutional doubt (including Eleventh Amendment concerns), an alternative reasonable construction should be adopted.

## Conclusion

The Court concluded that FCA qui tam suits satisfy Article III because the relator sues as a partial assignee of the United States’ claim, but States and state agencies are not “persons” subject to FCA qui tam damages and penalties, requiring dismissal of the action against the Vermont agency.


Vt. Agency of Nat. Res. v. United States ex rel. Stevens, 529 U.S. 765 (2000)