MS False Claims Act; create.

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To: Judiciary A
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Representative Hurst

HOUSE BILL NO. 1707

AN ACT TO CREATE THE "MISSISSIPPI FALSE CLAIMS ACT"; TO 1
PROHIBIT ANY PERSON FROM KNOWINGLY PRESENTING, OR CAUSING TO BE 2
PRESENTED, A FALSE OR FRAUDULENT CLAIM FOR PAYMENT OR APPROVAL TO 3
A STATE AGENCY OR ANY EMPLOYEE OR AGENT OF A STATE AGENCY; TO 4
REQUIRE STATE AGENCIES TO DILIGENTLY INVESTIGATE SUSPECTED 5
VIOLATIONS OF THE ACT; TO AUTHORIZE CIVIL ACTION BY A QUI TAM 6
PLAINTIFF; TO PROVIDE FOR A MONETARY AWARD TO THE QUI TAM 7
PLAINTIFF OUT OF THE PROCEEDS OF THE ACTION OR SETTLEMENT, IF ANY; 8
TO BAR CERTAIN CIVIL ACTIONS; TO PROVIDE A STATUTE OF LIMITATIONS 9
FOR BRINGING A CIVIL ACTION UNDER THE ACT; TO PROHIBIT EMPLOYER 10
INTERFERENCE WITH EMPLOYEE DISCLOSURE; TO PROVIDE THAT THE 11
REMEDIES PROVIDED IN THE ACT ARE NOT EXCLUSIVE AND SHALL BE IN 12
ADDITION TO ANY OTHER REMEDIES PROVIDED BY LAW; AND FOR RELATED 13
PURPOSES. 14
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 15
SECTION 1. This act shall be known and may be cited as the 16
"Mississippi False Claims Act." 17
SECTION 2. As used in this act, unless the context clearly 18
indicates otherwise: 19
(a) "Claim" means a request or demand for money, 20
property or services when all or a portion of the money, property 21
or services requested or demanded issues from or is provided by a 22
state agency; 23
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(b) "Employer" includes an individual, corporation, 24
firm, association, business, partnership, organization, trust and 25
the state and any of its agencies, institutions or political 26
subdivisions; 27
(c) "Knowingly" means that a person, with respect to 28
information, acts: 29
(i) With actual knowledge of the truth or falsity 30
of the information; 31
(ii) In deliberate ignorance of the truth or 32
falsity of the information; or 33
(iii) In reckless disregard of the truth or 34
falsity of the information; 35
(d) "Person" means an individual, corporation, firm, 36
association, organization, trust, business, partnership, limited 37
liability company, joint venture or any legal or commercial 38
entity; and 39
(e) "State agency" means the State of Mississippi or 40
any of its branches, agencies, departments, boards, commissions, 41
officers, institutions or instrumentalities. 42
SECTION 3. (1) A person shall not: 43
(a) Knowingly present, or cause to be presented, to a 44
state agency or an employee or agent of a state agency or to a 45
contractor, grantee or other recipient of state funds a false or 46
fraudulent claim for payment or approval; 47
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(b) Knowingly make or use, or cause to be made or used, 48
a false record or statement to obtain from a state agency approval 49
or payment on a false or fraudulent claim; 50
(c) Conspire to defraud a state agency by obtaining 51
approval or payment on a false claim; 52
(d) When in possession, custody or control of property 53
or money used or to be used by a state agency, knowingly deliver 54
or cause to be delivered less property or money than the amount 55
indicated on a certificate or receipt; 56
(e) When authorized to make or deliver a document 57
certifying receipt of property used or to be used by a state 58
agency, knowingly make or deliver a receipt that falsely 59
represents the property used or to be used; 60
(f) Knowingly buy, or receive as a pledge of an 61
obligation or debt, property of a state agency from any person 62
that may not lawfully sell or pledge the property; 63
(g) Knowingly make or use, or cause to be made or used, 64
a false record or statement to conceal, avoid or decrease an 65
obligation to pay or transmit money or property to a state agency; 66
or 67
(h) As a beneficiary of an inadvertent submission of a 68
false claim to a state agency and having later discovered the 69
falsity of the claim, fail to disclose the false claim to the 70
state agency within a reasonable time after discovery. 71
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(2) Proof of specific intent to defraud is not required for 72
a violation of subsection (1) of this section. 73
(3) A person who violates subsection (1) of this section 74
shall be liable for: 75
(a) Three (3) times the amount of damages sustained by 76
a state agency because of the violation; 77
(b) A civil penalty of not less than Five Thousand 78
Dollars ($5,000.00), nor more than Ten Thousand Dollars 79
($10,000.00), for each violation; 80
(c) The costs of a civil action brought to recover 81
damages or penalties; and 82
(d) Reasonable attorney's fees, including fees for 83
state agency counsel, and litigation costs and expenses including, 84
but not limited to, expert witness fees, deposition costs and 85
document and exhibit preparation and related expenses. 86
(4) A court may assess two (2) times the amount of damages 87
sustained by a state agency and no civil penalty if the court 88
finds all of the following: 89
(a) The person committing the violation furnished the 90
state agency with all information known to that person about the 91
violation within thirty (30) days after the date on which the 92
person first obtained the information; 93
(b) At the time that the person furnished the state 94
agency with information about the violation, a criminal 95
prosecution, civil action or administrative action had not been 96
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begun with respect to the violation, and the person did not have 97
actual knowledge of the existence of an investigation into the 98
violation; and 99
(c) The person fully cooperated with any investigation 100
by the state agency. 101
SECTION 4. (1) State agencies shall diligently investigate 102
suspected violations of Section 3 of this act, and if a state 103
agency finds that a person has violated or is violating that 104
section, the state agency may bring a civil action against that 105
person pursuant to this act. 106
(2) A state agency may, in appropriate cases, delegate the 107
authority to investigate or to bring a civil action to the 108
Attorney General, and when this occurs, the Attorney General shall 109
have every power conferred upon the state agency under this act. 110
SECTION 5. (1) Where the amount in controversy exceeds Ten 111
Thousand Dollars ($10,000.000) exclusive of penalties, fees and 112
costs, a person may bring a civil action for a violation of 113
Section 3 of this act on behalf of the person and the State of 114
Mississippi. The action shall be brought in the name of the State 115
of Mississippi. The person bringing the action shall be referred 116
to as the "qui tam plaintiff." Once filed, the action may be 117
dismissed only with the written consent of the court, taking into 118
account the best interest of the parties involved and the public 119
purposes behind this act. Venue for actions brought under this 120
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subsection shall be the Circuit Court of the First Judicial 121
District of Hinds County. 122
(2) A complaint filed by a qui tam plaintiff shall be filed 123
in camera in the circuit court and shall remain under seal for at 124
least sixty (60) days. No service shall be made on a defendant 125
and no response is required from a defendant until the seal has 126
been lifted and the complaint served pursuant to the Mississippi 127
Rules of Civil Procedure. 128
(3) On the same day as the complaint is filed, the qui tam 129
plaintiff shall serve the state agency to which the false claim 130
was made with a copy of the complaint and written disclosure of 131
substantially all material evidence and information the plaintiff 132
possesses. The state agency may intervene and proceed with the 133
action within sixty (60) days after receiving the complaint and 134
the material evidence and information. Upon a showing of good 135
cause and reasonable diligence in the state agency's 136
investigation, the state agency may move the court for an 137
extension of time during which the complaint shall remain under 138
seal. 139
(4) Before the expiration of the sixty-day period or any 140
extensions of time granted by the court, the state agency shall 141
notify the court that it: 142
(a) Intends to intervene and proceed with the action; 143
in which case, the seal shall be lifted and the action shall be 144
conducted by the state agency; or 145
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(b) Declines to take over the action; in which case, 146
the seal shall be lifted and the qui tam plaintiff shall proceed 147
with the action. 148
(5) When a person brings an action under this section, no 149
person other than the state agency to which the false claim was 150
made may intervene or bring a related action based on the facts 151
underlying the pending action. 152
SECTION 6. (1) If a state agency proceeds with the action, 153
the state agency shall have the primary responsibility of 154
prosecuting the action and shall not be bound by an act of the qui 155
tam plaintiff. The qui tam plaintiff shall have the right to 156
continue as a party to the action, subject to the limitations of 157
this section. 158
(2) The state agency may seek to dismiss the action for good 159
cause notwithstanding the objections of the qui tam plaintiff if 160
the qui tam plaintiff has been notified of the filing of the 161
motion and the court has provided the qui tam plaintiff with an 162
opportunity to oppose the motion and to present evidence at a 163
hearing. 164
(3) The state agency may settle the action with the 165
defendant notwithstanding objections by the qui tam plaintiff if 166
the court determines, after a hearing providing the qui tam 167
plaintiff an opportunity to present evidence, that the proposed 168
settlement is fair, adequate and reasonable under all of the 169
circumstances. 170
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(4) Upon a showing by the state agency that unrestricted 171
participation during the course of the litigation by the qui tam 172
plaintiff would interfere with or unduly delay the state agency's 173
prosecution of the case, or would be repetitious, irrelevant or 174
for purposes of harassment, the court may, in its discretion, 175
impose limitations on the qui tam plaintiff's participation, such 176
as: 177
(a) Limiting the number of witnesses that the qui tam 178
plaintiff may call; 179
(b) Limiting the length of testimony of those 180
witnesses; 181
(c) Limiting the qui tam plaintiff's cross-examination 182
of witnesses; or 183
(d) Otherwise limiting the qui tam plaintiff's 184
participation in the litigation. 185
(5) Upon a showing by a defendant that unrestricted 186
participation during the course of litigation by the qui tam 187
plaintiff would be for purposes of harassment or would cause the 188
defendant undue burden or unnecessary expense, the court may limit 189
the participation by the qui tam plaintiff in the litigation. 190
(6) If a state agency elects not to proceed with the action, 191
the qui tam plaintiff shall have the right to conduct the action. 192
If the state agency so requests, the qui tam plaintiff shall serve 193
the state agency with copies of all pleadings filed and all 194
deposition transcripts in the case, at the state agency's expense. 195
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When the qui tam plaintiff proceeds with the action, the court, 196
without limiting the status and rights of the qui tam plaintiff, 197
may permit the state agency to intervene at a later date upon a 198
showing of good cause. 199
(7) Whether or not a state agency proceeds with the action, 200
upon a showing by the state agency that certain actions of 201
discovery by the qui tam plaintiff would interfere with the 202
state's investigation or prosecution of a criminal or civil matter 203
arising out of the same facts, the court may stay that discovery 204
for a period of not more than sixty (60) days. The showing by the 205
state agency shall be conducted in camera. The court may extend 206
the sixty-day period upon a further showing in camera that the 207
state has pursued the criminal or civil investigation or 208
proceeding with reasonable diligence and any proposed discovery in 209
the civil action will interfere with the ongoing criminal or civil 210
investigation or proceeding. 211
SECTION 7. (1) Except as otherwise provided in this 212
section, if a state agency proceeds with an action brought by a 213
qui tam plaintiff and the state prevails in the action, the qui 214
tam plaintiff shall receive: 215
(a) At least fifteen percent (15%) but not more than 216
twenty-five percent (25%) of the proceeds of the action or 217
settlement, depending upon the extent to which the qui tam 218
plaintiff substantially contributed to the prosecution of the 219
action; or 220
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(b) No more than ten percent (10%) of the proceeds of 221
the action or settlement if the court finds that the action was 222
based primarily on disclosures of specific information not 223
provided by the qui tam plaintiff relating to allegations or 224
transactions in a criminal, civil, administrative or legislative 225
hearing, proceeding, report, audit or investigation or from the 226
news media, taking into account the significance of the 227
information and the role of the qui tam plaintiff in advancing the 228
case to litigation. 229
(2) If a state agency does not proceed with an action 230
brought by a qui tam plaintiff and the state prevails in the 231
action, the qui tam plaintiff shall receive an amount that is not 232
less than twenty-five percent (25%) but not more than thirty 233
percent (30%) of the proceeds of the action or settlement, as the 234
court deems reasonable for collecting the civil penalty and 235
damages. 236
(3) Whether or not a state agency proceeds with an action 237
brought by a qui tam plaintiff: 238
(a) If the court finds that the action was brought by a 239
person who planned or initiated the violation of Section 3 of this 240
act upon which the action was based, the court may reduce the 241
share of the proceeds that the person would otherwise receive 242
under subsection (1) or (2) of this section, taking into account 243
the role of the person as the qui tam plaintiff in advancing the 244
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case to litigation and any relevant circumstances pertaining to 245
the violation; or 246
(b) If the person bringing the action is convicted of 247
criminal conduct arising from that person's role in the violation 248
of Section 3 of this act upon which the action was based, that 249
person shall be dismissed from the civil action and shall not 250
receive a share of the proceeds. The dismissal shall not 251
prejudice the right of the state agency to continue the action. 252
(4) Any award to a qui tam plaintiff shall be paid out of 253
the proceeds of the action or settlement, if any. The qui tam 254
plaintiff shall also receive an amount for reasonable expenses 255
necessarily incurred in the action plus reasonable attorney's 256
fees; provided that if a qui tam plaintiff receives a reduced 257
award under paragraph (a) of subsection (3) of this section, the 258
court shall also reduce or not award attorney's fees and costs. 259
(5) The State of Mississippi is entitled to all proceeds 260
collected in an action or settlement not awarded to a qui tam 261
plaintiff. The state is also entitled to reasonable expenses 262
incurred in the action plus reasonable attorney's fees, including 263
fees for state agency counsel. Proceeds and penalties collected 264
by the state shall be deposited as follows: 265
(a) Proceeds in the amount of the false claim and 266
attorney's fees and costs shall be returned to the fund or funds 267
from which the money, property or services came; and 268
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(b) Any civil penalties and all remaining proceeds 269
shall be deposited in the State General Fund. 270
SECTION 8. If a state agency does not proceed with the 271
action and the qui tam plaintiff conducts the action, the court 272
may award a defendant reasonable attorney's fees and costs if the 273
defendant prevails and the court finds the action clearly 274
frivolous, clearly vexatious or brought primarily for purposes of 275
harassment. 276
SECTION 9. (1) No court shall have jurisdiction over an 277
action brought under Section 5 of this act by a present or former 278
employee of a state agency unless the employee, during employment 279
with the agency and in good faith, exhausted existing internal 280
procedures for reporting false claims and the agency failed to act 281
on the information provided within a reasonable period of time. 282
(2) No court shall have jurisdiction over an action brought 283
under Section 5 of this act against an elected or appointed state 284
official, a member of the State Legislature or a member of the 285
judiciary if the action is based on evidence or information known 286
to the state agency or to the Attorney General when the action was 287
brought. 288
(3) No court shall have jurisdiction over an action brought 289
under Section 5 of this act when that action is based on 290
allegations or transactions that are the subject of a criminal, 291
civil or administrative proceeding in which the State of 292
Mississippi is a party. 293
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(4) Upon motion of a state agency, a court may, in its 294
discretion, dismiss an action brought under Section 5 of this act 295
if the elements of the alleged false claim have been publicly 296
disclosed in the news media or in a publicly disseminated 297
governmental report at the time the complaint is filed. 298
SECTION 10. A state agency is not liable for expenses or 299
fees that a qui tam plaintiff may incur in investigating or 300
bringing an action under this act. 301
SECTION 11. A civil action authorized under this act shall 302
not be brought more than three (3) years after the date when facts 303
material to the right of action are known or reasonably should 304
have been known, and in no event shall such an action be brought 305
more than ten (10) years after the date on which the violation was 306
committed. 307
SECTION 12. Notwithstanding any other provision of law, a 308
final judgment rendered in a criminal proceeding charging fraud or 309
false statement, whether upon a guilty verdict after trial or upon 310
a plea of guilty or nolo contendere, shall estop the defendant 311
from denying the essential elements of a fraud against taxpayers 312
action where the criminal proceeding concerns the same transaction 313
that is the subject of the fraud against taxpayers action. 314
SECTION 13. In an action brought under this act, the state 315
agency or the qui tam plaintiff shall be required to prove all 316
essential elements of the cause of action, including damages, by a 317
preponderance of the evidence. 318
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SECTION 14. Liability shall be joint and several for any act 319
committed by two (2) or more persons in violation of this act. 320
SECTION 15. (1) An employer shall not make, adopt or 321
enforce a rule, regulation or policy that prevents an employee 322
from disclosing information to a state agency or other government 323
or law enforcement agency or from acting in furtherance of a fraud 324
against taxpayers action, including investigating, initiating, 325
testifying or assisting in an action filed or to be filed under 326
this act. 327
(2) An employer shall not discharge, demote, suspend, 328
threaten, harass, deny promotion to or in any other manner 329
discriminate against an employee in the terms and conditions of 330
employment because of the lawful acts of the employee on behalf of 331
the employee or others in disclosing information to a state agency 332
or other government or law enforcement agency or in furthering a 333
fraud against taxpayers action, including investigating, 334
initiating, testifying or assisting in an action filed or to be 335
filed under this act. 336
(3) An employer that violates subsection (2) of this section 337
shall be liable to the employee for all relief necessary to make 338
the employee whole, including reinstatement with the same 339
seniority status that the employee would have had but for the 340
violation, two (2) times the amount of back pay with interest on 341
the back pay, compensation for any special damage sustained as a 342
result of the violation and, if appropriate, punitive damages. In 343
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ST: MS False Claims Act; create.
addition, an employer shall be required to pay the litigation 344
costs and reasonable attorney's fees of the employee. An employee 345
may bring an action under this section in any court of competent 346
jurisdiction. 347
SECTION 16. The remedies provided for in this act are not 348
exclusive and shall be in addition to any other remedies provided 349
for in any other law or available under common law. 350
SECTION 17. This act shall take effect and be in force from 351
and after July 1, 2026. 352