1.1 	A bill for an act
1.2 	relating to civil law; modifying provisions governing false claims against the state; 
1.3 	providing additional grounds for liability;amending Minnesota Statutes 2024, 
1.4 	sections 15C.01, subdivisions 7, 8, by adding a subdivision; 15C.02; 15C.03; 
1.5 	15C.05; 15C.06; 15C.11; 15C.145; 15C.15, subdivisions 1, 2; 15C.16; proposing 
1.6 	coding for new law in Minnesota Statutes, chapter 15C.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2024, section 15C.01, is amended by adding a subdivision 
1.9 	to read:
1.10 		Subd. 4a.Ownership or investment interest. "Ownership or investment interest" means:
1.11 	(1) a direct or indirect possession of equity in the capital, stock, or profits totaling more 
1.12 	than ten percent of an entity;
1.13 	(2) an interest held by an investor or group of investors who engage in the raising or 
1.14 	returning of capital and who invest, develop, or dispose of specified assets; or
1.15 	(3) an interest held by a pool of funds by investors, including a pool of funds managed 
1.16 	or controlled by private limited partnerships, if those investors or the management of that 
1.17 	pool or private limited partnership employ investment strategies to earn a return on that 
1.18 	pool of funds.

1.19 	Sec. 2. Minnesota Statutes 2024, section 15C.01, subdivision 7, is amended to read:
1.20 		Subd. 7.Prosecuting attorney. "Prosecuting attorney" means:
1.21 	(1) the attorney general, if the false or fraudulent claim involves money, property, or 
1.22 	services provided by the state; or
2.1 	(2) the county attorney, city attorney, or other attorney representing a political subdivision,
2.2 	if the false or fraudulent claim involves money, property, or services provided by the political 
2.3 	subdivision:
2.4 	(i) the county attorney, city attorney, or other attorney representing a political subdivision; 
2.5 	or
2.6 	(ii) the attorney general upon the request of the county attorney, city attorney, or other 
2.7 	attorney representing the political subdivision as the attorney general deems proper.

2.8 	Sec. 3. Minnesota Statutes 2024, section 15C.01, subdivision 8, is amended to read:
2.9 		Subd. 8.State. "State" means the state of Minnesota and includes a department or,
2.10 	agency of the state, board, bureau, division, commission, council, office, or other government 
2.11 	entity performing a governmental or proprietary function for the state.

2.12 	Sec. 4. [15C.015] EFFECT OF DECISION TO FOREGO REFUND OR PAY CLAIM.
2.13 	In determining materiality under this chapter, the decision of the state or a political 
2.14 	subdivision to forego a refund or to pay a claim despite actual knowledge of fraud or falsity 
2.15 	shall not be considered dispositive.

2.16 	Sec. 5. Minnesota Statutes 2024, section 15C.02, is amended to read:
2.17 	15C.02 LIABILITY FOR CERTAIN ACTS.
2.18 	(a) A person who commits any act described in clauses (1) to (7) (8) is liable to the state 
2.19 	or the political subdivision for a civil penalty in the amounts set forth in the federal False 
2.20 	Claims Act, United States Code, title 31, section 3729, and as modified by the federal Civil 
2.21 	Penalties Inflation Adjustment Act Improvements Act of 2015, plus three times the amount 
2.22 	of damages, including consequential damages, and interest on the amount of damages 
2.23 	calculated as the prejudgment interest rate in effect on the day the payment or benefit was 
2.24 	received or paid, for the period from the date that the benefit was received or paid to the 
2.25 	date that the state recovers the amount of the payment or value of the benefit, that the state 
2.26 	or the political subdivision sustains because of the act of that person, except as otherwise 
2.27 	provided in paragraph (b):
2.28 	(1) knowingly presents, or causes to be presented, a false or fraudulent claim for payment 
2.29 	or approval;
2.30 	(2) knowingly makes or uses, or causes to be made or used, a false record or statement 
2.31 	material to a false or fraudulent claim;
3.1 	(3) knowingly conspires to commit a violation of clause (1), (2), (4), (5), (6), or (7), or 
3.2 	(8);
3.3 	(4) has possession, custody, or control of property or money used, or to be used, by the 
3.4 	state or a political subdivision and knowingly delivers or causes to be delivered less than 
3.5 	all of that money or property;
3.6 	(5) is authorized to make or deliver a document certifying receipt for money or property 
3.7 	used, or to be used, by the state or a political subdivision and, intending to defraud the state 
3.8 	or a political subdivision, makes or delivers the receipt without completely knowing that 
3.9 	the information on the receipt is true;
3.10 	(6) knowingly buys, or receives as a pledge of an obligation or debt, public property 
3.11 	from an officer or employee of the state or a political subdivision who lawfully may not 
3.12 	sell or pledge the property; or
3.13 	(7) knowingly makes or uses, or causes to be made or used, a false record or statement 
3.14 	material to an obligation to pay or transmit money or property to the state or a political 
3.15 	subdivision, or knowingly conceals or knowingly and improperly avoids or decreases an 
3.16 	obligation to pay or transmit money or property to the state or a political subdivision.; or
3.17 	(8) knowingly makes or uses, or causes to be made or used, a false record or statement 
3.18 	resulting in the underpayment of taxes due to the unemployment insurance program 
3.19 	established under chapter 268 or in the payment of unemployment benefits of more than 
3.20 	$15,000 in a calendar year, notwithstanding the exclusion set forth in section 15C.03.
3.21 	(b) Notwithstanding paragraph (a), the court may assess not less than two times the 
3.22 	amount of damages that the state or the political subdivision sustains because of the act of 
3.23 	the person if:
3.24 	(1) the person committing a violation under paragraph (a) furnished an officer or 
3.25 	employee of the state or the political subdivision responsible for investigating the false or 
3.26 	fraudulent claim violation with all information known to the person about the violation 
3.27 	within 30 days after the date on which the person first obtained the information;
3.28 	(2) the person fully cooperated with any investigation by the state or the political 
3.29 	subdivision of the violation; and
3.30 	(3) at the time the person furnished the state or the political subdivision with information 
3.31 	about the violation, no criminal prosecution, civil action, or administrative action had been 
3.32 	commenced under this chapter with respect to the violation and the person did not have 
3.33 	actual knowledge of the existence of an investigation into the violation.
4.1 	(c) A person violating this section is also liable to the state or the political subdivision 
4.2 	for the costs of a civil action brought to recover any penalty or damages.
4.3 	(d) A person who has an ownership or investment interest in a person who violates 
4.4 	paragraph (a), clauses (1) to (8), knows about the violation, and fails to disclose the violation 
4.5 	to the state or a political subdivision within 60 days of identifying the violation is liable to 
4.6 	the state or political subdivision under paragraph (a).
4.7 	(e) The damage multiplier as set forth in this section must be trebled or doubled, as 
4.8 	applicable, before subtractions are made for compensatory payments received by the state 
4.9 	from any source, including but not limited to the defendant, or before subtractions are 
4.10 	otherwise made because of an offset or credit received by the state from any source, including 
4.11 	but not limited to the defendant.
4.12 	(d) (f) A person is not liable under this section for mere negligence, inadvertence, or 
4.13 	mistake with respect to activities involving a false or fraudulent claim.
4.14 	(g) No person may take an action to impede another person from commencing an action 
4.15 	under this chapter or communicating directly with the state or prosecuting attorney or their 
4.16 	agent about possible conduct giving rise to a violation of this chapter, including enforcing 
4.17 	or threatening to enforce a confidentiality agreement or requiring a waiver of a distribution 
4.18 	to a person or requiring waiver of attorney fees, costs, or expenses. A person who violates 
4.19 	this paragraph is liable for each violation:
4.20 	(1) an amount not to exceed the greater of $50,000 for a natural person or $250,000 for 
4.21 	any other person; or
4.22 	(2) the gross amount of pecuniary gain to the person as a result of the violation if the 
4.23 	violation involved fraud, deceit, manipulation, or knowing disregard of a regulatory 
4.24 	requirement.
4.25 	The person bringing the action, or who is the original source of the information leading to 
4.26 	an action by the prosecuting attorney, is entitled to 25 percent of the amount ordered against 
4.27 	a person found liable under this paragraph. The remainder of the net proceeds must be 
4.28 	credited to the false claims account pursuant to section 15C.15.
4.29 	(h) This section applies to violations of tax law only if:
4.30 	(1) the net income or sales of the person against whom the action is brought equals or 
4.31 	exceeds $1,000,000 for any taxable year subject to an action brought pursuant to this chapter, 
4.32 	or the value of an estate sued through its personal representative exceeds $3,000,000; and
4.33 	(2) the damages pleaded in the action exceed $350,000.
5.1 	(i) The attorney general must consult with the commissioner of revenue prior to filing 
5.2 	or intervening in an action under this chapter that is based on the filing of false claims, 
5.3 	records, or statements made under a tax law. If the state declines to participate or to authorize 
5.4 	participation by a political subdivision in the action, the qui tam plaintiff must obtain approval 
5.5 	from the attorney general before making a motion to compel the commissioner of revenue 
5.6 	to disclose tax records.

5.7 	Sec. 6. Minnesota Statutes 2024, section 15C.03, is amended to read:
5.8 	15C.03 EXCLUSION.
5.9 	Except as provided under section 15C.02, paragraphs (a), clause (8), (h), and (i), this 
5.10 	chapter does not apply to claims, records, or statements made under portions of Minnesota 
5.11 	Statutes relating to taxation.

5.12 	Sec. 7. Minnesota Statutes 2024, section 15C.05, is amended to read:
5.13 	15C.05 PRIVATE REMEDIES; COMPLAINT UNDER SEAL; COPY OF 
5.14 	COMPLAINT AND WRITTEN DISCLOSURE OF EVIDENCE TO BE SENT TO 
5.15 	PROSECUTING ATTORNEY.
5.16 	(a) Except as otherwise provided in this section, a person may maintain an action under 
5.17 	this chapter on the person's own account and that of the state; the person's own account and 
5.18 	that of a political subdivision; or on the person's own account and that of both the state and 
5.19 	a political subdivision. After an action is commenced, it may be voluntarily dismissed only 
5.20 	if the court and the prosecuting attorney give written consent to the dismissal and their 
5.21 	reasons for consenting.
5.22 	(b) If an action is brought under this section, no other person may bring another action 
5.23 	under this section based on the same facts that are the subject of the pending action.
5.24 	(c) An action may not be maintained under this section:
5.25 	(1) against the state, the legislature, the judiciary, the executive branch, or a political 
5.26 	subdivision, or respective officers, members, or employees if the action is based on evidence 
5.27 	or information known to the state or political subdivision when the action was brought; or
5.28 	(2) if the action is based upon allegations or transactions that are the subject of a civil 
5.29 	action or an administrative proceeding for a monetary penalty to which the state or a political 
5.30 	subdivision is already a party.
5.31 	(d) A complaint in an action under this section must be commenced by filing the 
5.32 	complaint with the court in chambers and the court must place it under seal for at least 60 
6.1 	days. No service may be made upon the defendant until the complaint is unsealed. The seal 
6.2 	must not preclude the prosecuting attorney from providing the complaint, any other pleadings, 
6.3 	or the written disclosure of substantially all material evidence and information possessed 
6.4 	by the person bringing the action to a state agency or political subdivision, a law enforcement 
6.5 	agency in this state or another state, or a federal law enforcement agency so that the actions 
6.6 	may be investigated or prosecuted. The seal applies to the law enforcement agencies served 
6.7 	to the same extent as the seal applies to other parties in the action.
6.8 	(e) If a complaint is filed under this section, the plaintiff shall serve a copy of the 
6.9 	complaint on the prosecuting attorney in accordance with the Minnesota Rules of Civil 
6.10 	Procedure and at the same time shall serve a written disclosure of all material evidence and 
6.11 	information the plaintiff possesses.
6.12 	(f) A court must dismiss an action or claim under this section, unless opposed by the 
6.13 	prosecuting attorney, if substantially the same allegations or transactions as alleged in the 
6.14 	action or claim were publicly disclosed:
6.15 	(1) in a criminal, civil, or administrative hearing in which the state or a political 
6.16 	subdivision or its agent is a party;
6.17 	(2) in a report, hearing, audit, or investigation of the legislature, the governing body of 
6.18 	a political subdivision, the legislative auditor, or the state auditor, provided that the 
6.19 	information is not deemed publicly disclosed because it was provided pursuant to chapter 
6.20 	13 or any other federal, state, or local law permitting the public to request, receive, or view 
6.21 	documents or information in the possession of public entities; or
6.22 	(3) by the news media, provided that the allegations or transactions are not deemed 
6.23 	publicly disclosed in the news media merely because information of allegations or 
6.24 	transactions are posted on the Internet or otherwise published digitally.
6.25 	This paragraph does not apply if the action or claim is brought by the prosecuting attorney 
6.26 	or the person bringing the action or claim is an original source of the information.

6.27 	Sec. 8. Minnesota Statutes 2024, section 15C.06, is amended to read:
6.28 	15C.06 PROSECUTING ATTORNEY INTERVENTION; MOTION TO EXTEND 
6.29 	TIME; UNSEALING OF COMPLAINT.
6.30 	(a) Within 60 days after receiving a complaint and disclosure under section 15C.05, the 
6.31 	prosecuting attorney shall intervene or decline intervention or, for good cause shown, move 
6.32 	the court to extend the time for doing so. The motion may be supported by affidavits or 
6.33 	other submissions in chambers.
7.1 	(b) The complaint must be unsealed after the prosecuting attorney decides whether or 
7.2 	not to intervene, but if the prosecuting attorney declines to intervene, the person bringing 
7.3 	the action under section 15C.05 may elect not to proceed with the action by voluntarily 
7.4 	discontinuing the action, without an order and without unsealing the action, by filing with 
7.5 	the court a notice of discontinuance and serving a copy of the notice on the prosecuting 
7.6 	attorney. The complaint in these cases must remain sealed until the prosecuting attorney 
7.7 	makes an in camera motion to unseal the complaint.
7.8 	(c) Notwithstanding the prosecuting attorney's decision regarding intervention in an 
7.9 	action brought by a plaintiff under section 15C.05, the prosecuting attorney may pursue the 
7.10 	claim through any alternate remedy available to the state, including an administrative 
7.11 	proceeding to determine a civil monetary penalty. If the prosecuting attorney pursues an 
7.12 	alternate remedy in another proceeding, the person initiating the action has the same rights 
7.13 	in that proceeding as if the action had continued under section 15C.05. A finding of fact or 
7.14 	conclusion of law made in the other proceeding that has become final is conclusive on all 
7.15 	parties to an action under section 15C.05. For purposes of this paragraph, a finding or 
7.16 	conclusion is final if it has been finally determined on appeal to the appropriate state court, 
7.17 	if the time for filing an appeal has expired, or if the finding or conclusion is not subject to 
7.18 	judicial review. For purposes of this paragraph, a criminal prosecution against a defendant 
7.19 	constitutes an alternate remedy except that this subdivision must not be interpreted to allow 
7.20 	the person initiating an action under this chapter to intervene in a criminal proceeding against 
7.21 	a person for violating a provision of law.

7.22 	Sec. 9. Minnesota Statutes 2024, section 15C.11, is amended to read:
7.23 	15C.11 LIMITATION OF ACTIONS; REMEDIES.
7.24 	(a) An action under this chapter may not be commenced more than three years after the 
7.25 	date of discovery of the fraudulent activity by the prosecuting attorney or more than six 
7.26 	years after the fraudulent activity occurred, whichever occurs later, but in no event more 
7.27 	than ten years after the date on which the violation is committed.
7.28 	(b) A finding of guilt in a criminal proceeding charging a false statement or fraud, 
7.29 	whether upon a verdict of guilty or a plea of guilty or nolo contendere, stops the person 
7.30 	found guilty from denying an essential element of that offense in an action under this chapter 
7.31 	based upon the same transaction as the criminal proceeding.
7.32 	(c) In an action under this chapter, the state or the political subdivision and any plaintiff 
7.33 	under section 15C.05 must prove the essential elements of the cause of action, including 
7.34 	damages, by a preponderance of the evidence.
8.1 	(d) In an action brought under section 15C.05, the pleading is not required to identify 
8.2 	specific claims that result from an alleged course of misconduct, or any specific records or 
8.3 	statements used, if the facts alleged in the complaint and ultimately proven true would 
8.4 	provide a reasonable indication that one or more violations of this chapter are likely to have 
8.5 	occurred and if the allegations in the pleading provide adequate notice of the specific nature 
8.6 	of the alleged misconduct to permit the state or a local government to effectively investigate 
8.7 	and defendants to fairly defend against the allegations.

8.8 	Sec. 10. Minnesota Statutes 2024, section 15C.145, is amended to read:
8.9 	15C.145 RELIEF FROM RETALIATORY ACTIONS.
8.10 	(a) An A current or former employee, contractor, or agent is entitled to all relief necessary 
8.11 	to make that employee, contractor, or agent whole if that employee, contractor, or agent is 
8.12 	discharged, demoted, disciplined, penalized, suspended, interfered with, sued, intimidated, 
8.13 	threatened, harassed, restrained, coerced, defamed, blacklisted, or in any other manner
8.14 	otherwise retaliated against; discriminated against in the compensation, terms and, conditions, 
8.15 	location, or privileges of employment, contract, business, or profession; or otherwise harmed 
8.16 	or penalized by an employer, former employer, or any other person because of lawful acts 
8.17 	done by the current or former employee, contractor, agent, or associated others in furtherance 
8.18 	of an action under this chapter or other efforts to stop one or more violations or potential 
8.19 	violations of this chapter regardless of whether other factors may have also contributed to 
8.20 	the adverse action.
8.21 	(b) Relief under paragraph (a) shall include reinstatement with the same seniority status 
8.22 	that the current or former employee, contractor, or agent would have had but for the 
8.23 	discrimination, two times the amount of back pay, interest on the back pay, and compensation 
8.24 	for any special damages sustained as a result of the discrimination, including any other 
8.25 	damages available at law, and litigation costs and reasonable attorney fees.
8.26 	(c) A civil action under this section may not be brought more than three years after the 
8.27 	date when the retaliation occurred.
8.28 	(d) For purposes of this section, a "lawful act" includes but is not limited to the following:
8.29 	(1) conducting or assisting with an investigation for, initiation of, testimony for, or 
8.30 	assistance in an action filed or to be filed pursuant to this chapter;
8.31 	(2) conducting or assisting with an investigation in good faith, as that term is defined in  
8.32 	section 181.931, subdivision 4, of a potential violation of this chapter;
9.1 	(3) meeting with potential or retained counsel or agents or representatives of the state 
9.2 	or prosecuting attorney about the matter that is the subject of an action filed or to be filed 
9.3 	pursuant to this chapter; or
9.4 	(4) obtaining or transmitting to the state, prosecuting attorney, a local government, a qui 
9.5 	tam plaintiff, or private counsel engaged to investigate or file or potentially file a cause of 
9.6 	action under this chapter documents, data, correspondence, electronic mail, medical records, 
9.7 	financial records, trade-secret information, intellectual property, or any other information 
9.8 	even though the act may violate a contract or agreement, employment term, or duty owed 
9.9 	to the employer or contractor so long as the possession and transmission of the documents 
9.10 	are for the purpose of furthering efforts to stop one or more violations or potential violations 
9.11 	of this chapter.
9.12 	(e) Nothing in paragraph (d) prevents a law enforcement agency from bringing a civil 
9.13 	or criminal action against a person for violating a provision of law.

9.14 	Sec. 11. Minnesota Statutes 2024, section 15C.15, subdivision 1, is amended to read:
9.15 		Subdivision 1.Deposit of funds. The net proceeds received by the state in an action 
9.16 	under this chapter, after distributions made to private plaintiffs and as otherwise required 
9.17 	by federal law, must be deposited in the state treasury and credited as follows:
9.18 	(1) the portion of net proceeds equal to the amount of the actual damages that the state 
9.19 	sustains because of an act specified in section 15C.02 must be credited to the fund that 
9.20 	sustained the damages;
9.21 	(2) the portion of net proceeds equal to the additional recovery of federal money 
9.22 	authorized by United States Code, title 42, section 1396h, for a recovery under this chapter, 
9.23 	as determined by the commissioner of management and budget, must be credited to the 
9.24 	false claims account under subdivision 2, provided that the amount credited may not exceed 
9.25 	$1,000,000 in a fiscal year; and
9.26 	(3) if clause (2) does not apply, 50 percent of the remaining net proceeds must be credited 
9.27 	to the false claims account under subdivision 2, provided that the amount credited must not 
9.28 	exceed $1,000,000 in a fiscal year; and
9.29 	(3)(4) the remainder of the net proceeds must be credited to the general fund.

9.30 	Sec. 12. Minnesota Statutes 2024, section 15C.15, subdivision 2, is amended to read:
9.31 		Subd. 2.False claims account. A false claims account is established in the special 
9.32 	revenue fund in the state treasury. The commissioner of management and budget may enter 
10.1 	into interagency agreements to deposit up to $2,055,000 for litigation and related expenses 
10.2 	under this chapter. Money in the account deposited through interagency agreement or under 
10.3 	subdivision 1 is annually appropriated to the attorney general for purposes of this chapter.
10.4 	All interest and income derived from investment and deposit of money in the account must 
10.5 	be credited to the false claims account.

10.6 	Sec. 13. Minnesota Statutes 2024, section 15C.16, is amended to read:
10.7 	15C.16 REPORTING.
10.8 	The attorney general shall report to the chairs and ranking minority members of the 
10.9 	senate and house of representatives committees with jurisdiction over state government 
10.10 	finance by January October 15 each year, on activities under this chapter during the prior 
10.11 	calendar fiscal year. The report must include:
10.12 	(1) the number of complaints received by the attorney general under section 15C.05;
10.13 	(2) the number of times the attorney general intervened and declined to intervene after 
10.14 	receiving a complaint;
10.15 	(3) an estimate of the amount of time spent by attorneys in the attorney general's office 
10.16 	and an estimate of the amount of time spent by other staff in the attorney general's office 
10.17 	on activities under this chapter; and
10.18 	(4) net proceeds received by the state in each action under this chapter.

10.19 	Sec. 14. [15C.17] REPORTING BY THE OFFICE OF THE STATE AUDITOR.
10.20 	(a) Notwithstanding chapter 13 or any other law classifying data held by the state auditor 
10.21 	as not public data, as defined in section 13.02, subdivision 8a, if in the course of an audit 
10.22 	the state auditor identifies data related to a potential false claim submitted to the state or a 
10.23 	political subdivision, the state auditor may share the data with the attorney general or the 
10.24 	political subdivision. The state auditor may participate, with the consent of the attorney 
10.25 	general, in a subsequent investigation or prosecution of that false claim.
10.26 	(b) If the state auditor elects to participate in an investigation and prosecution of a false 
10.27 	claim, the state auditor's interests must be represented by the attorney general.

10.28 	Sec. 15. [15C.18] OTHER LAW ENFORCEMENT AUTHORITY AND DUTIES.
10.29 	This chapter does not:
11.1 	(1) preempt the authority or relieve the duty of law enforcement agencies to investigate 
11.2 	and prosecute suspected violations of law;
11.3 	(2) prevent or prohibit a person from voluntarily disclosing information concerning a 
11.4 	violation of this chapter to a law enforcement agency; or
11.5 	(3) limit the powers granted under other laws to the attorney general, state agencies, or 
11.6 	political subdivisions to investigate possible violations of this chapter and take appropriate 
11.7 	action, including seeking injunctive relief.

11.8 	Sec. 16. EFFECTIVE DATE; RETROACTIVE APPLICATION.
 11.9 	This act is effective August 1, 2026, and applies retroactively to false claims, records, 
11.10 	and statements made on or after January 1, 2017.