House defeats ‘sue-and-settle’ bill

CHARLESTON, W.Va. — The House of Delegates rejected the controversial “false claims” bill, which would have allowed individuals to sue the state or businesses if they suspected fraud and then claim part of the settlement money.

The 55-41 defeat of HB 4001 on Tuesday followed a lengthy debate on the House floor where opponents denounced the legislation as primarily benefiting trial lawyers and potentially damaging business.

The bill was the first to move in the House this session, pushed by House Judiciary Committee Chairman Tim Manchin (D-Marion).  The Fairmont attorney argued the bill, which is similar to laws in 36 other states and the federal government, would reward taxpayers who uncovering wrongdoing.

“It works,” Manchin said. “It catches people who cheat the government. I can’t understand why we’re afraid to provide the same incentives to our brave West Virginians who come forward and do the honest thing.”

The legislation would have allowed individuals who bring successful suits for fraud to receive a portion of the reclaimed money.

However, the business community pushed back hard against the bill, claiming it would open a flood of litigation and further damage the state’s business climate.

“We unfortunately will end the session the way we began it … considering legislation that virtually every proponent of economic development in this state agrees would represent a windfall for the sue-and-settle industry at the expense of small business,” said Del. Paul Espinosa (R-Jefferson).

The outcome of Tuesday’s vote means the bill is likely dead for this session.


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