David Blum commented on a bill, which passed in the California Assembly, that would expand the state’s False Claims Act. The bill next heads to the state Senate, where similar legislation stalled last year. If passed, A.B. 2570 will allow whistleblowers to file claims against companies that they allege are violating the tax code.
Blum told Law360 that while the bill does have some protections against frivolous lawsuits, they don't remove the general privacy concerns of having false claims acts encompass tax matters. “Ultimately, you are being audited through the courts. Someone has the ability to obtain some very significant, confidential, and proprietary information about a company that they have now brought a False Claims Act against.”