One Challenge Down, Others Remain: The Eleventh Circuit’s Zafirov Decision

After nearly two years of waiting, the Eleventh Circuit issued its ruling in United States ex rel. Zafirov v. Florida Medical Associates on Sept. 1, 2026.  The case first became noteworthy in 2024, particularly for those in the health care and qui tam space, because it saw a federal district court declare the False Claims Act’s (FCA) qui tam device unconstitutional.

As we explained in a prior post, the False Claims Act (FCA) prohibits submitting fraudulent claims for payment to the United States. Although the government may prosecute such violations in its own right, it also authorizes a “relator” to prosecute these claims on the government’s behalf through a “qui tam” lawsuit.  In exchange for their service, the relator is given an “award,” i.e., a percentage of whatever is recovered.  Although qui tam suits can arise in any industry that does business with the government, health care fraud remains the leading source of FCA settlements and judgments: of the $6.8 billion recovered under the FCA in 2025, more than $5.7 billion related to matters involving the health care industry.   

Zafirov concerned a qui tam suit alleging that the defendant health care providers and related entities knowingly submitted false diagnosis codes to Medicare to receive greater reimbursements than they were owed. After years of litigation, the defendants moved for judgment on the pleadings or dismissal, arguing that the FCA’s qui tam provision violated Article II of the Constitution.

The district court agreed, holding that the FCA’s qui tam provision violates Article II’s Appointments Clause, which empowers the President, “by and with the Advice and Consent of the Senate,” to appoint “Officers of the United States.”  According to the District Court, qui tam relators are such “Officers of the United States,” but are not appointed by the President with the Senate’s advice and consent.

The Decision

The Eleventh Circuit reversed, finding that relators are not “officers of the United States,” and thus need not be “appointed” as set out in the Appointments Clause.  This is because relators do not occupy a “continuing position,” which, according to the Court, is required under the Supreme Court’s SEC v. Lucia decision.  Lucia laid out two “requirement[s]” to be an officer of the United States: first, one must “occupy a ‘continuing’ position established by law” and second, that person must “exercise significant authority pursuant to the laws of the United States.”

The Eleventh Circuit found that the office of “relator” is not a continuing position for several reasons.

First, a relator’s tenure is “occasional and temporary” because it lasts for the duration of a single case; the relator’s “intermittent, nonpermanent tenure tends to show that he does not hold a continuing position.” 

Second, even though a relator may hold the position for several years in connection with FCA litigation, the Supreme Court has not focused on “the overall length of a person’s time fulfilling his duties while evaluating the duration of the position.”  Rather, the Supreme Court addresses the “duration” question in the same manner as the “tenure” question — i.e., the inquiry is whether the putative officer’s duties were “permanent” or “occasional and intermittent.”  Because “a relator does not have a permanent tenure,” a relator “does not have a position with duration that makes him an officer.”

Third, the Eleventh Circuit found that a relator does not receive a “continuing emolument,” i.e., an “advantage, profit, or gain received as a result of one’s employment or one’s holding of office.”  To the extent that a relator’s share of a judgment or settlement is considered an “emolument,” the Court explained that it certainly not a “continuing” one.  Rather, a relator receives a one-time payment that is contingent on the success of the case, receives compensation only through a portion of a judgment (rather than through any regular appropriation), and works on an intermittent basis (whenever there is a claim to pursue and litigation is active).  Finally, a relator faces no penalty for failure to perform other than the loss of the opportunity to receive a contingent fee.

Finally, the Eleventh Circuit addressed the relator’s duties, concluding that they are personal to the relator.  Unlike an “officer,” whose duties continue (even if the person holding the office changes), a relator assumes a duty that cannot be assumed by another—except the Attorney General, in the case of government intervention.

Looking ahead

Having vacated the District Court’s ruling, the Eleventh Circuit remanded the case to the District Court to decide the defendant’s remaining constitutional arguments — namely, whether the FCA’s qui tam provision violates the Take Care and Vesting Clauses, which the District Court (and the Eleventh Circuit) declined to consider in the first instance.  The Vesting Clause vests “the executive power” not in the executive branch, but in the President personally.  The Take Care Clause instructs that the President “shall take Care that the Laws be faithfully executed.”  These are often invoked whenever someone other than the President exercises executive power and is insulated from presidential oversight.  Here, the district court will have to decide whether a qui tam relator’s authority to conduct civil litigation on behalf of the United States offends these provisions.  Depending on how the case resolves, it may ultimately be headed to the Supreme Court, especially if the circuits later split on the issue. 

Although we have yet to see a federal appellate court declare the FCA’s qui tam provision unconstitutional, at least three members of the Fifth Circuit  (Judges Smith, Duncan and Ho) and three sitting Supreme Court justices have indicated a willingness to consider the issue. Moreover, on March 18, 2026, the Third Circuit heard oral argument in United States ex rel. Penelow v. Janssen Products, LP, an appeal which followed an explosive $1.6 billion verdict, where the defendants have raised the now-familiar argument that the FCA’s qui tam provisions violate the Appointments, Take Care, and Vesting Clauses.

The legal issues may seem academic, but whether qui tam survives will have very tangible consequences for the government, those who do business with the government, and the bar.  According to the Department of Justice, whistleblowers filed 1,297 qui tam lawsuits in 2025 — the highest number in a single year — breaking 2024’s record of 980.  Although the government opened 401 investigations on its own, qui tam suits make up the lion’s share of new FCA lawsuits.  Not only do relators file the bulk of lawsuits, they also recover the most money on behalf of the government: of the $6.8 billion recovered under the FCA in 2025, more than $5.3 billion (approximately 78%) of that recovery came from qui tam actions and earlier-filed qui tam suits.

Although the Justice Department has identified health care fraud; procurement, loan and grant fraud; and tariff and customs avoidance as priorities of the Trump administration, if recent history is any guide, the government can’t go at it alone if it hopes to continue prosecuting civil frauds at current levels.  Indeed, although the government declined to intervene when Zafirov was first filed, it intervened to defend qui tam as soon as the defendants raised their constitutional challenges.

Regardless of how Zafirov ultimately shakes out, it is important for anyone doing business with the federal government to maintain robust compliance programs that are designed to mitigate FCA risk and to engage counsel in whatever segments of its present the risk of FCA enforcement.