DOJ Formalizes Key FCA Enforcement Reforms: Limits on Agency Guidance and Expanded Dismissal Authority

On September 18, 2026, the Department of Justice (DOJ) announced revisions to the Justice Manual formalizing two significant changes to False Claims Act (FCA) enforcement policy. First, DOJ reestablished and enhanced a prior policy providing that alleged noncompliance with nonbinding agency guidance documents cannot establish civil FCA liability. Second, when making a declination decision, DOJ attorneys "will in each case" assess whether to seek dismissal.

These revisions align the Justice Manual with policies announced by Deputy Assistant Attorney General Brenna Jenny (DAAG Jenny) at the Federal Bar Association’s 2026 Qui Tam Conference in February 2026. While not surprising given DAAG Jenny's past statements, the revisions will be helpful to defendants in FCA investigations and litigation.

What Changed

1. Nonbinding regulatory guidance cannot establish a violation of law.

DOJ revised Justice Manual § 1-19.000 to move from a policy focused on limiting the use of agency guidance documents to one that more expressly recognizes their role in enforcement and litigation, while retaining important guardrails.

In 2018, DOJ under the first Trump administration issued a policy (the Brand Memo) prohibiting the use of the government’s enforcement authority "to effectively convert agency guidance documents into binding rules" and explaining that "noncompliance with guidance documents" does not afford a basis for proving a violation of law in affirmative civil enforcement cases, such as qui tam actions. That policy was later rescinded by then-Attorney General Garland during the Biden administration.

The current change reflects a return to the Brand Memo and revises the definition of "guidance document." The revised provisions reiterate that guidance documents do not have the force of law, may not create binding obligations, must include appropriate disclaimers, and should avoid coercive or mandatory language directed at the public. At the same time, DOJ attorneys may still rely on guidance to establish scienter, notice, industry or professional standards, accepted scientific or technical practices, compliance-related representations, and relevant legal or factual context.

For example, DOJ cannot rely on an allegation of noncompliance with a Special Fraud Alert issued by the Office of Inspector General for the Department of Health and Human Services to support an FCA claim. But if a defendant is on notice of a particular Special Fraud Alert, that document may still be highly relevant to the scienter analysis.

2. Dismissal "will" be considered along with declination

DOJ also revised Justice Manual § 4-4.111 to direct government attorneys to consider dismissal when evaluating whether to decline intervention in a qui tam action, replacing previously more permissive language. In addition, the Manual now expressly states that DOJ may re-evaluate whether dismissal is appropriate during the pendency of the litigation. The illustrative factors that DOJ will consider when deciding whether to seek dismissal remain largely the same.

These revisions track DAAG Jenny’s comments at the Qui Tam Conference, where she announced that DOJ sought dismissal of 25 qui tam cases in 2025 — a meaningful increase from past years — and that DOJ would consider dismissal in every case going forward. The Justice Manual revisions confirm her characterization that DOJ exercises its (c)(2)(A) dismissal authority “sparingly, but not reluctantly.”

Takeaways

• The revisions formalize previously announced changes in DOJ policy, and they reflect DOJ’s "commitment to fair notice, transparent enforcement, and the rule of law."
• DOJ continues to streamline FCA enforcement. Recent examples include a memorandum requiring completion of DOJ’s review of certain qui tam complaints within 120 days and the FOCUS Initiative for prioritizing data mining cases.
• FCA defendants may have stronger grounds to challenge enforcement theories that rely solely on agency guidance rather than an underlying statutory, regulatory, or contractual requirement. At the same time, DOJ will likely continue to use guidance documents as evidence of notice, scienter, industry standards, and other facts relevant to establishing liability.
• Requiring line attorneys to consider dismissal in every case is likely to result in an increase in dismissals, which would be a welcome development for FCA defendants.
• The revised dismissal policy gives FCA defendants litigating declined qui tam cases a basis for advocating that DOJ dismiss claims during the pendency of the litigation, particularly where those claims lack legal or factual merit, impose unnecessary litigation burdens, or otherwise fail to advance governmental interests.

Whether these revisions mark a meaningful shift or simply clarify existing practice will depend on how aggressively DOJ attorneys and FCA defendants invoke them in future investigations and litigation.
 

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