• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch

2

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

3

Current price of oil as of July 1, 2026

1

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch

2

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

3

Current price of oil as of July 1, 2026
Commentarycourts

A recent case could undermine the rules that have been protecting taxpayer money from fraud since the time of Lincoln

By
Eric Havian
Eric Havian
,
Michael Ronickher
Michael Ronickher
, and
Ari Yampolsky
Ari Yampolsky
Down Arrow Button Icon
By
Eric Havian
Eric Havian
,
Michael Ronickher
Michael Ronickher
, and
Ari Yampolsky
Ari Yampolsky
Down Arrow Button Icon
June 23, 2022, 11:45 AM ET
Since 1863, the False Claims Act has been the federal government's primary litigation tool in combating fraud against the government.
Since 1863, the False Claims Act has been the federal government's primary litigation tool in combating fraud against the government.SAUL LOEB - AFP - Getty Images
Add Fortune on Google for similar content.

We’re whistleblower lawyers who spend our careers speaking in legalese. But every once in a while, a case comes along that is so alarming, yet so couched in jargon, that an issue of great importance can easily escape notice. When that happens, the public deserves to know about it.

Our client, Senator Charles Grassley, has filed a friend-of-the-court brief urging the Supreme Court to review and overturn an appeals court case called SuperValu. Why do we bring this very dry sentence to the pages of a non-legal publication? Because the issue at hand is so simple and so important that every American can appreciate what’s at stake.

First, about the case. SuperValu, the grocery chain, sells prescription drugs to people covered by Medicare and Medicaid. The government pays the cost of those drugs. To make sure it pays the same as any other customer, the government requires SuperValu to report its “usual and customary charges to the general public” for customers who pay cash, with no insurance. The government won’t pay more than that price.

This case was started by two whistleblowers who sued under the False Claims Act and alleged that SuperValu offered rock-bottom prices to customers without insurance, but still charged high rates for Medicare and Medicaid patients. SuperValu allegedly didn’t report those lower prices, and instead told the government that its “usual” price was eight to 15 times higher than the prices it charged cash customers most of the time. The government then paid the higher prices.

The court agreed that SuperValu’s conduct violated the government’s rules. The question was whether SuperValu “knew” that it was doing something wrong.

The False Claims Act is the government’s primary tool to punish fraudsters who fleece taxpayers and allows whistleblowers to sue in the government’s name. But it rightly only punishes those who know they’re doing wrong, not innocent mistakes. Here, that should have been easy to show, since the whistleblowers had evidence that SuperValu was making more than 80% percent of its cash sales for less than its claimed “usual” prices, as well as an internal email saying that SuperValu should keep its pricing practices “stealthy.” However, the court let the company off the hook, figuring that as long as someone (though not necessarily Supervalu itself) could reasonably have thought that what SuperValu did was permitted, SuperValu couldn’t have “known” that what it did was wrong.

SuperValu didn’t have to show what it actually thought at the time. All the company’s lawyers had to say was that the “usual and customary price” rules were ambiguous. And that was enough to overcome the whistleblower’s evidence, including the damning internal email emphasizing the need for secrecy, a sign they may have “known” that what they were doing was unlawful.

Now, a corporate defendant cannot be liable for defrauding the government if the defendant’s lawyer, years later, can come up with some plausible interpretation of the law under which the defendant’s conduct would have been permissible–even if the defendant didn’t hold that view.

Back to the big picture. This case is the biggest threat to an anti-fraud statute that has, since its modernization 40 years ago, allowed the government to recover over $46 billion from companies that have defrauded the American public. It means that a company can get off the hook by saying: “I knew what I did was wrong, and I did it on purpose. But I’ve just hired lawyers who say someone else might possibly not have known that.”

It’s surprising this sort of argument could get any traction in the first place. It makes no sense. If an ordinary criminal tried that excuse for any crime, they would be laughed out of the courtroom. If not overturned, the decision will essentially give corporations license to defraud the government. That’s paid for by all of us taxpayers.

Government fraud is notoriously difficult to catch without whistleblowers. As Senator Grassley once said, trying to do so without whistleblowers is “about as useful as harvesting acres of corn with a pair of rusty old scissors.” If this case stands, a rusty pair of scissors is all the government will have left to fight fraud–and that will neither punish nor deter wrongdoers.

That’s why Senator Grassley has asked the Supreme Court to hear this case and overturn this seriously misguided decision. Companies need to appreciate that they cannot deliberately cheat the government, then avoid punishment if they just hire creative lawyers. That’s not how our justice system is supposed to work.

Eric Havian, Michael Ronickher, and Ari Yampolsky are partners at whistleblower law firm Constantine Cannon.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not reflect the opinions and beliefs of Fortune.

More must-read commentary published by Fortune:

  • TSMC chairman Mark Liu describes how the world’s largest chipmaker is reimagining the semiconductor industry
  • American businesses are coming home. Innovators in logistics will reap massive rewards
  • Web3 is not dead. Here’s what the crypto space will look like in 2030
  • Scary headlines about food shortages are misleading. Here’s why
  • I was a senior executive at WeWork before it imploded. Here’s the one behavior that could have saved the company

Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations.

About the Authors
By Eric Havian
See full bioRight Arrow Button Icon
By Michael Ronickher
See full bioRight Arrow Button Icon
By Ari Yampolsky
See full bioRight Arrow Button Icon
Add Fortune on Google for similar content.

Latest in Commentary

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in Commentary

rn
CommentaryCryptocurrency
Former Iran director at NSC: Crypto legislation is a ticket to sanctions evasion
By Richard NephewJuly 2, 2026
4 hours ago
m
Commentary250 Years of Innovation
McKinsey chairs: Building a more resilient industrial base may require $2 trillion in investment
By Eric Kutcher and Shubham SinghalJuly 2, 2026
4 hours ago
em
Commentary250 Years of Innovation
America’s 250th birthday has Elon Musk and a record IPO. Its 15th had Alexander Hamilton — and a stock market bubble
By Owen LamontJuly 2, 2026
8 hours ago
paramount
CommentaryAntitrust
How Paramount’s theater commitments could boost local economies across the nation
By Ike BrannonJuly 2, 2026
8 hours ago
elon
CommentaryChina
China has 400 private space companies. The West is barely paying attention
By Rainer ZitelmannJuly 2, 2026
9 hours ago
senate
CommentaryCongress
One rare bipartisan AI bill is moving through Congress. Here’s why it deserves to pass
By Neil Björkman and Betsy BrewerJuly 1, 2026
1 day ago

Most Popular

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch
Big Tech
As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch
By Marco Quiroz-GutierrezJuly 1, 2026
1 day ago
MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
Success
MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
By Sydney LakeJune 25, 2026
7 days ago
Current price of oil as of July 1, 2026
Personal Finance
Current price of oil as of July 1, 2026
By Joseph HostetlerJuly 1, 2026
1 day ago
Trump got a $78K pension from the Screen Actors Guild in 2025 because he appeared in Home Alone 2 in 1992
Politics
Trump got a $78K pension from the Screen Actors Guild in 2025 because he appeared in Home Alone 2 in 1992
By Sasha RogelbergJuly 1, 2026
1 day ago
CEO of $248 billion cybersecurity company says workers are about to face a ‘Darwinian moment’ thanks to AI: Evolve or get cut
Success
CEO of $248 billion cybersecurity company says workers are about to face a ‘Darwinian moment’ thanks to AI: Evolve or get cut
By Emma BurleighJuly 1, 2026
1 day ago
Philanthropy leader at Warren Buffett and Bill Gates’ Giving Pledge says children of billionaires are pushing them to give their wealth away faster
Success
Philanthropy leader at Warren Buffett and Bill Gates’ Giving Pledge says children of billionaires are pushing them to give their wealth away faster
By Preston ForeJune 27, 2026
5 days ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.