Sixth Circuit Adopts Whistleblower–Friendly Objective Intent Standard for FCA Retaliation Claims Premised on Constructive Discharge
In Smith v. LHC Group, Inc., the Sixth Circuit has adopted an objective intent standard: an employee alleging constructive discharge in violation of the False Claims Act need not prove that the employer took actions designed to force the employee to quit. As long as the employee’s resignation is a reasonably foreseeable consequence of the employer’s actions, the intent requirement is satisfied.
The decision makes it significantly easier for whistleblowers to assert a retaliation claim premised on constructive discharge, and makes it significantly more difficult for employers to quickly and efficiently dispose of litigation.
In this case, the whistleblower complained to her employer about alleged fraud by the company based on medical documentation she was processing. When they didn’t address her concerns, she felt that she was being forced to participate in fraud, which led her to instead resign.
