South-Western Legal Studies in Business

No Protection Due Whistleblower Who Reported Nonsense Gossip

Appeals court held that an employee who claimed she was dismissed for reporting possible illegal activities to the FBI has no basis for protection under the False Claims Act or state whistleblower law as the information reported was complete nonsense.

Topic Employment Law
Key Words

False Claims Act; Anti-Retaliation; Whistleblower; Reasonable Suspicion

C A S E   S U M M A R Y

Lang worked for the Northwestern University Medical Faculty Foundation. She called the FBI to report that executives of the foundation were lying to the Federal Reserve System in order to obtain a "gold bond rating" and to get a federal loan on favorable terms. Soon after, she was dismissed. The foundation stated that it was because funding for her position ended when a grant ran out that supported the position. She sued, contending she was fired in retaliation for having called the FBI, which could violate the False Claims Act, which gives employees a remedy when they suffer retaliation for "lawful acts done by the employee" that assist a federal investigation, such as for fraudulent claims submitted to a federal agency. The district court dismissed the suit; Lang appealed.


Affirmed. Lang's claims were all false. Apparently it was based on some office gossip. The Federal Reserve System has nothing to do with foundation financial ratings and is not involved in loans to them. She did not know of any specific act or statement by a foundation officer to support her claims. Hence, she cannot look to the False Claims Act for protection. It protects employees who have reasonable suspicions about activities that could lead to actions against the employer. Lang's suspicions were not reasonable, so she has no status under the False Claims Act or under Illinois law concerning whistleblowers, which requires parties to have probable cause to believe the information they are reporting about criminal activity.


Lang v. Northwestern University, ---F.3d--- (2006 WL 3802831, 7th Cir., 2006)

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