DOJ Justice Manual Revisions: Curbing Meritless Qui Tam Actions and Limiting the Use of Guidance Documents in FCA Enforcement

Key Points

• DOJ attorneys must now assess whether seeking dismissal of a qui tam action serves the government’s interests whenever DOJ declines to intervene. 
• The Justice Manual lists seven non-exhaustive factors for seeking dismissal of a qui tam action, including curbing meritless actions and preventing parasitic actions that duplicate a preexisting government investigation. 
• DOJ cannot bring criminal or civil cases based solely on noncompliance with agency guidance documents, because guidance cannot by itself create binding requirements not already in statute or regulation. 
• DOJ may still use agency guidance as evidence of scienter, industry standards, and a party’s compliance with guidance, among other things. 
• Defense counsel can rely on the Justice Manual’s enumerated factors to argue for dismissal both in early discussions with DOJ and throughout litigation.

On September 18, 2026, the Department of Justice (DOJ) issued two significant updates to the Justice Manual affecting False Claims Act (FCA) enforcement. First, DOJ attorneys are now required to affirmatively assess whether dismissal of a qui tam action serves the government’s interests whenever the DOJ declines to intervene. Second, DOJ clarified that it cannot bring criminal or civil cases based solely on violations of agency guidance documents, while preserving several ways guidance may still be used as evidence. Together, these revisions signal a shift toward curbing “meritless” qui tam suits and reinforcing that FCA liability must be grounded in actual legal requirements, not sub-regulatory guidance alone.

Announcing the guidance-related update, Associate Attorney General Woodward explained, “the Department of Justice should enforce the law, not make law through enforcement.”

Background on the False Claims Act

The FCA is a federal statute that subjects alleged violators to significant treble damages and per-claim penalties for knowingly submitting false claims for payment to the U.S. government. It is arguably DOJ’s most powerful enforcement tool when investigating fraud, particularly given the “bet-the-company” consequences often threatened in FCA investigations and litigation, especially for companies in highly regulated industries such as health care.

A key feature of the statute is that it allows private citizens (relators) to initiate qui tam suits and stand in the shoes of the government. DOJ may choose to intervene early in these actions but also retains authority to intervene and seek dismissal at a later phase of litigation upon a showing of good cause.

Part One: DOJ Dismissal of Civil Qui Tam Actions

The revisions to the Justice Manual highlight DOJ’s emphasis on exercising its power to dismiss qui tam actions. Rather than merely encouraging consideration of dismissal where the DOJ has declined intervention, the revised manual now requires DOJ attorneys to affirmatively assess whether “the government’s interests are served by seeking dismissal.” This represents a shift away from discretion and toward an obligation that dismissal be assessed whenever the DOJ declines to intervene.

The revision clarifies that moving for dismissal will not be warranted in every case where the DOJ declines intervention, but that DOJ should continue to evaluate whether dismissal becomes appropriate as litigation progresses. In determining whether dismissal is appropriate, the DOJ directs attorneys to consider the following non-exhaustive list of factors:

• Curbing meritless qui tam actions; 
• Preventing parasitic or opportunistic qui tam actions that duplicate a preexisting government investigation and add no useful information to it; 
• Preventing interference with an agency’s policies or the administration of its programs; 
• Controlling litigation brought on behalf of the U.S., in order to protect the DOJ’s litigation prerogatives; 
• Safeguarding classified information and national security interests; 
• Preserving government resources, particularly where the government’s costs (including the opportunity costs of expending resources on other matters) are likely to exceed any expected gain; and 
• Addressing egregious procedural errors that could frustrate the government’s efforts to conduct a proper investigation.

Should one or more of these factors be present, the DOJ may move to dismiss the action. DOJ attorneys are also encouraged to consult with qui tam relators regarding deficiencies in their case, so that the relator, rather than the DOJ, voluntarily initiates the dismissal.

A Clearer Path to Dismissal

Defense practitioners should view this policy shift as supporting dismissal arguments both in early discussions with DOJ and throughout the course of litigation. Counsel should rely on the enumerated factors to advocate for dismissal post-declination or following later developments in a case’s progression.

Part Two: Limits on the Use of Sub-Regulatory Guidance in FCA Enforcement

The second revision makes clear that DOJ cannot bring criminal or civil cases based solely on violations of agency guidance. The updated Justice Manual language states:

• “Criminal and civil enforcement actions brought by the Department must be based on violations of applicable legal requirements, not mere noncompliance with guidance documents issued by federal agencies, because guidance documents cannot by themselves create binding requirements that do not already exist by statute or regulation.”

Although this may offer some comfort to companies concerned about liability for violating agency guidance, it would be a mistake to disregard guidance entirely. The update makes clear that guidance documents still matter and can continue to play an important evidentiary role. DOJ outlined several ways it will still use guidance documents to help prove FCA liability:

• Scienter, Notice, Knowledge, and Mens Rea: DOJ can use guidance to show a party knew, or should have known, what the law required, even though the guidance itself is not law. 
• Professional or Industry Standards, Practices, Duties, or Customs for Government Agencies: DOJ can use guidance as evidence of an industry standard and whether it has been met. 
• Scientific or Technical Processes: DOJ can use guidance as evidence of an accepted scientific or technical practice and whether it has been followed. 
• A Party’s Compliance with Guidance: DOJ can pursue a party who falsely claims to have followed guidance, or who fails to follow guidance required by contract. 
• Legal or Factual Context: DOJ can cite guidance in court filings to explain the legal or factual background of a case.

Implications for Regulated Entities

While DOJ will no longer pursue FCA liability theories based solely on non-compliance with guidance, guidance documents remain usable as evidence of a defendant’s knowledge, industry standards, and compliance expectations. Government contractors, companies, and other regulated entities should not treat this update as license to disregard agency guidance altogether. These documents continue to provide relevant and useful information about compliance expectations.

Key Takeaways

1. Engage DOJ Early on Dismissal Arguments. For defendants in qui tam actions, consider proactively presenting dismissal arguments while still advocating for declination. 
2. Monitor Evolving DOJ Practice. The real-world impact of the revised dismissal policy remains to be seen. Closely tracking the factors that lead DOJ to intervene and move for dismissal will be important for devising defense strategies and negotiating with relators’ counsel. 
3. Do Not Ignore Agency Guidance. While guidance alone cannot serve as the sole basis for an FCA enforcement action, it remains relevant evidence of scienter, industry standards, and compliance expectations. Companies should continue to integrate relevant guidance materials into training and compliance protocols. 
4. Align FCA Defense Strategies with the Justice Manual Update. Companies facing FCA investigation or litigation should assess whether the government’s theory rests on an actual violation of law. If it does not, and instead rests solely on guidance noncompliance, there may be an opportunity to persuade DOJ that the investigation should not proceed.

For questions about how the Justice Manual revisions may affect an FCA investigation or qui tam action, contact Troutman Pepper Locke’s False Claims Act + Other Whistleblower Actions team within the White Collar Litigation + Investigations Practice Group.