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69 Geo. Wash. L. Rev. 766 (2000-2001)
Private Monitoring and Antitrust Enforcement: Paying Informants to Reveal Cartels

handle is hein.journals/gwlr69 and id is 776 raw text is: Private Monitoring and Antitrust Enforcement: Paying Informants to Reveal Cartels William E. Kovacic* I. Introduction Many systems of public law enlist private parties to supplement efforts by government bodies to detect and prosecute illegal conduct.' Some sys- tems reward private parties for supplying public enforcement officials with information about violations of statutes or regulations.2 Other systems de- centralize the power to prosecute by creating private rights of action.3 In 1986, the United States began a bold experiment with private partici- pation in law enforcement by adopting the 1986 amendments to the Civil False Claims Act (CFCA).4 The 1986 amendments bolstered a U.S. statute enacted during the mid-nineteenth century by enhancing incentives for pri- vate individuals to bring qui tam actions challenging fraud against the federal government.5 The 1986 amendments transformed the enforcement of legal rules involving the payment or collection of funds by the U.S. government.6 Before 1986, qui tam actions under the CFCA amounted to a handful each * William E. Kovacic is the General Counsel of the Federal Trade Commission. He is on leave from The George Washington University Law School. Professor Kovacic thanks Jonathan Baker, Andrew Gavil, Robert Marshall, Michael Meurer, and Patrick Rey for many useful com- ments and discussions. The views expressed in this article are Professor Kovacic's views and do not necessarily reflect the views of the Federal Trade Commission or any of its individual members. 1 See generally William M. Landes & Richard A. Posner, The Private Enforcement of Law, 4 J. LEGAL. STUD. 1 (1975) (describing content of and rationale for private enforcement mechanisms); A. Mitchell Polinsky, Private Versus Public Enforcement of Fines, 9 J. LEGAL STUD. 105 (1980) (same). 2 See, e.g., 26 C.F.R. § 301.7623-1 (2001) (allowing payment of bounties to individuals who provide information to the U.S. government leading to recovery of underpaid federal taxes). 3 Andrew I. Gavil, Federal Judicial Power and the Challenges of Multijurisdictional Direct and Indirect Purchaser Antitrust Litigation, 69 GEo. WASH. L. REv. 860 (2001) (describing oper- ation of private rights of action under federal and state antitrust laws); Barton H. Thompson, Jr., Innovations in Environmental Policy: The Continuing Innovation of Citizen Enforcement, 2000 U. ILL. L. REv. 185, 192-98 (describing role of private rights of action in implementing federal environmental protection statutes). 4 False Claims Amendments Act of 1986, Pub. L. No. 99-562, 100 Stat. 3153 (1986) (codi- fied as amended at 31 U.S.C. §§ 3729-3731 (1994)). 5 William E. Kovacic, Whistleblower Bounty Lawsuits as Monitoring Devices in Govern- ment Contracting, 29 Loy. L.A. L. REv. 1799, 1801-07 (1996) (discussing adoption of 1986 Civil False Claims Act Amendments). The phrase qui tam is an abbreviation of the phrase Qui tam pro domino rege quam pro si ipso in hac parte sequitur, which means Who sues on behalf of the King as well as for himself. BLACK's LAW DICTIONARY 1262 (9th ed. 1999). 6 William E. Kovacic, The Civil False Claims Act as a Deterrent to Participation in Govern- ment Procurement Markets, 6 Sup. CT. ECON. REV. 201, 217-23 (1998) (describing significance of 1986 CFCA reforms). October/December 2001 Vol. 69 No. 5/6

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