DOJ revises Justice Manual guidance on two key False Claims Act issues

On September 18, 2026, the US Department of Justice (DOJ) announced two major revisions to the Justice Manual affecting the DOJ’s enforcement of the False Claims Act (FCA), 31 U.S.C. § 3729 et seq. (DOJ press release, “DOJ Revises Justice Manual to Strengthen False Claims Act Enforcement” (September 18, 2026).) In its announcement, the DOJ stated that these changes were intended to create “clearer standards that promote fair and effective enforcement.” Both revisions will be important for companies facing FCA investigations or declined qui tam litigation.

The first revision contains material changes and additions to the DOJ’s policies on the use of sub-regulatory agency guidance. According to the DOJ, the revision “reinstates and builds upon the [first Trump administration’s] 2017 policy that sub-regulatory guidance cannot impose legal obligations beyond those established by statute or regulation.” Although applicable across civil and criminal cases, these changes are particularly relevant in the FCA context where healthcare or life sciences companies are routinely alleged to have violated detailed provisions in US Centers for Medicare & Medicaid Services (CMS) manuals, coverage policies, local coverage determinations (LCDs), and other sub-regulatory materials.

The second revision adds a provision to the Manual directing DOJ attorneys considering whether to decline to intervene in a qui tam action to assess in every case whether the Government’s interests would be served by seeking dismissal under 31 U.S.C. § 3730(c)(2)(A) and expressly encourages the DOJ to revisit dismissal as declined litigation progresses. This change builds upon the DOJ’s 2018 Memorandum from then-Director of the Commercial Litigation Branch, Fraud Section, Michael Granston, which encouraged DOJ attorneys to consider exercising dismissal of qui tam actions. It also provides defendants with additional opportunities to engage the DOJ regarding dismissal – both at the time of declination and as litigation progresses.

1. DOJ overhauls section on use of sub-regulatory guidance

What changed? 

The Justice Manual previously included one section (§ 1-19.000) titled “Principles for Issuance and Use of Guidance Documents.” This short section addressed both the issuance and use of DOJ guidance documents and DOJ’s use of guidance documents issued by other agencies in the enforcement context. As to the latter, the policy briefly acknowledged that guidance documents do not themselves impose binding legal obligations. But the policy also stated that DOJ attorneys may rely on relevant guidance documents “when a guidance document may be entitled to deference or otherwise carry persuasive weight with respect to the meaning of the applicable legal requirements.”

The revised policy is now substantially expanded and divided into several sections. The second subsection (§ 1-19.200) – now titled “Limitations on Use of Guidance Documents in Litigation” – takes a much more restrictive approach. It removes the above “deference” language entirely and affirmatively instructs as follows: “Criminal and civil enforcement actions . . . must be based on violations of applicable legal requirements, not mere noncompliance with guidance documents issued by federal agencies, because guidance documents cannot by themselves create binding requirements that do not already exist by statute or regulation.” Instead, DOJ attorneys must establish “a violation by reference to statutes and regulations.”

The policy then sets forth five “illustrations of appropriate uses of guidance documents.” Many of these examples, however, contain express limitations on their scope:

First, the subsection emphasizes the ways in which many DOJ attorneys already use guidance documents: as evidence that the party had the requisite scienter, notice, or knowledge of the law where the party had awareness of that guidance. But even that example contains significant exceptions, including, most notably, that DOJ attorneys “may not treat awareness of a legal interpretation in a guidance document as an admission that the guidance document is a correct interpretation of the binding legal requirements in a statute or regulation.” The policy also provides that a guidance document can be used to demonstrate scienter only if it “describe[s] a relevant statute or regulation,” which may not always be clear from the face of the document.

Second, DOJ may use also guidance documents as “probative evidence” that a party has satisfied, or failed to satisfy, professional or industry standards. This may be true when analyzing, for example, whether a physician dispensed opioids without a “legitimate medical purpose” and outside “the usual course of [] professional practice,” 21 C.F.R. § 1306.04(a), in violation of the Controlled Substances Act. Or the rationale may apply when considering whether medical services billed to Medicare were “reasonable and necessary” by referencing the Medicare Benefit Policy Manual or LCDs. Importantly, however, the subsection cautions that such “usage should also not be conflated with a presumption that a guidance document correctly states the relevant professional or industry standard.” Defendants can (and should) still contest or rebut that proposition.

Third, a guidance document “reflecting scientific and technical processes” may be used to support a claim that a fact or expert witness is rendering an opinion that is or is not consistent with that process.

Fourth, guidance also may remain relevant where a defendant falsely certifies compliance with guidance and that certification is material to payment, or where a contract or provider agreement independently requires compliance with specified guidance. In the latter circumstance, the Manual emphasizes that “it is the contract – not the agency guidance itself – that makes the agency guidance pertinent.”

Fifth, guidance may be used to provide legal or factual context, including in the background section of a brief to explain agency process.

Thus, the revisions do not render agency guidance irrelevant to FCA investigations or litigation. Rather, they more clearly delineate the purposes for which DOJ may – and may not – rely on such guidance.

The revision reinstates prior Trump administration policies

The policies underlying this revision are not new. But the DOJ’s approach to sub-regulatory guidance has shifted considerately across administrations.

In 2017, under the first Trump administration, then-Attorney General Jeff Sessions issued a memorandum prohibiting the DOJ from using guidance documents “to impose new requirements on entities outside the Executive Branch” or to “create binding standards by which the Department will determine compliance with existing regulatory or statutory requirements.” (DOJ, “Prohibition on Improper Guidance Documents” (November 16, 2017).) This was then followed in 2018 by a Memorandum issued by Associate Attorney General Rachel Brand, which specifically prohibited prosecutors from using noncompliance with agency guidance to establish a violation of law in affirmative civil enforcement actions. (DOJ “Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases” (January 25, 2018).) The Justice Manual was then updated later that year to reflect these limitations.

After President Biden came into office, however, then-Attorney General Merrick Garland rescinded both memoranda. Although the Garland Memorandum continued to recognize that guidance documents cannot impose legally binding requirements or independently form the basis for an enforcement action, it afforded DOJ attorneys greater latitude to rely on guidance in litigation. (DOJ, “Issuance and Use of Guidance Documents by the Department of Justice” (July 1, 2021).)

In the second Trump administration, then-Attorney General Pamela Bondi reversed course in February 2025, rescinding the Garland Memorandum and directing DOJ to return to the principles reflected in the Sessions and Brand Memoranda. (DOJ, “Reinstating the Prohibition on Improper Guidance Documents” (February 5, 2025).) But the general policies underpinning the Garland Memorandum remained in the Justice Manual until the September 2026 revision.

The September 2026 revision provides the DOJ’s most current statement about the permissible role of guidance in enforcement actions. Although Democratic and Republican administrations alike have recognized that guidance documents cannot themselves create binding legal obligations, they have differed on the extent to which DOJ attorneys may rely on guidance in enforcement actions. The new revisions provide considerably greater detail on where the current administration draws that line.

Practical implications for investigations and litigation

For organizations facing FCA scrutiny, the revised policy creates several practical opportunities:

Identify the source of the alleged obligation early. At the start of any investigation, counsel should immediately try to ascertain whether the asserted “requirement” appears in a statute or duly promulgated regulation, or instead originates in a guidance document only. Subpoenas and civil investigative demands sometimes blur these distinctions.

Require a clear link between guidance and binding law. Where DOJ attorneys rely on guidance documents or the source of the alleged “requirement” is unclear, defense counsel should press the Government to identify the statute or regulation creating the underlying obligation and to explain how the guidance bears on that requirement. The revised Manual provides a much stronger rationale for doing so.

Separate falsity from scienter. The revised Manual makes clear that awareness of a legal interpretation contained in guidance may be relevant to scienter, but the DOJ may not contend that awareness is an admission that the guidance correctly interprets the underlying binding legal requirement. In other words, the revisions underscore the obvious yet fundamental point that falsity and scienter are separate elements of a claim.

2. DOJ directs attorneys to assess dismissal in every declined qui tam case

The DOJ also revised Justice Manual § 4-4.111 governing dismissal of qui tam actions under 31 U.S.C. § 3730(c)(2)(A) in two ways. First, the prior Manual instructed DOJ attorneys considering declination that they “should also consider whether” the Government’s interests would be served by dismissal. This is no longer a suggestion: The revised provision now directs that DOJ attorneys “will in each case assess” whether the Government’s interests are served by seeking dismissal.

Second, the revised Manual expressly addresses what happens after declination. It acknowledges that the DOJ may conclude that intervention is unwarranted, but that declination does not necessarily reflect a conclusion that the case lacks merit. But where the DOJ initially determines that dismissal is unwarranted, attorneys may “re-evaluate whether dismissal becomes appropriate as the litigation progresses.” This change operates against the backdrop of the Supreme Court’s decision in United States ex rel. Polansky v. Executive Health Resources, Inc., 599 U.S. 419 (2023). There, the Court confirmed that the Government may seek dismissal of a qui tam action over a relator’s objection after initially declining to intervene, so long as it first intervenes in the action, and held that Federal Rule of Civil Procedure 41 supplies the applicable standard for dismissal. The new Manual provisions provide more specific internal direction regarding when DOJ attorneys must and should consider exercising the statutory dismissal authority addressed in Polansky.

The existing factors announced in the 2018 Granston Memorandum remain substantially intact. DOJ attorneys should consider, among other things, whether dismissal would curb meritless qui tam litigation, prevent interference with agency policies or programs, protect the DOJ’s litigation prerogatives, preserve government resources, or prevent adverse precedent. The DOJ also instructs its attorneys to consult closely with the affected agency before seeking dismissal.

While a “C2A dismissal” (under 31 U.S.C. § 3730(c)(2)(A)) is a power DOJ has historically invoked infrequently and probably will continue to use on a limited basis, the revision signals that more active consideration may be given in appropriate cases. In 2025, the DOJ and the Department of Health and Human Services (HHS) announced an FCA Working Group focused on healthcare and life sciences enforcement. DOJ leadership indicated that evaluating whether to dismiss unmeritorious declined cases would be an important component of the Government’s FCA strategy. (McDermott Will & Schulte, “DOJ-HHS False Claims Act Working Group Will Pursue Healthcare, Life Sciences Enforcement Priorities” (July 31, 2025).) This Manual revision now expressly requires DOJ attorneys to assess dismissal in every case in which they recommend declination.

Practical implications for declined cases

Do not treat declination as the end of Government engagement. Defendants should evaluate whether to make a targeted § 3730(c)(2)(A) dismissal presentation to DOJ at or near the time of declination. Because the Manual now requires a dismissal assessment in every declined case, defendants may be able to stave off particularly meritless non-intervened qui tams before even being served. Even if a dismissal cannot be obtained yet, engagement with the Government may allow defense counsel to gather information that can be used to seek dismissal as the case proceeds.

Frame dismissal requests around the Government’s interests. A persuasive request should do more than argue that the relator’s case is weak. Defense counsel should consider the Granston factors and concretely identify the factors implicated by continued litigation.

Revisit dismissal as the case develops. The Manual now expressly contemplates reassessment after declination. Developments such as a ruling adopting or threatening to adopt a novel legal theory, substantial discovery directed to the Government or agency personnel, evidence of Government knowledge, or positions by the relator that conflict with agency policy may provide a basis for renewed engagement with the DOJ. But defendants should be strategic about timing: The fact that DOJ may reconsider dismissal does not mean defendants will receive multiple opportunities for consideration.

Connect weak regulatory theories to both revisions. In appropriate cases, the two Justice Manual changes may work together. A declined qui tam premised on alleged violations of nonbinding agency guidance may implicate the DOJ’s new limitations and the Granston factors. Defendants should consider whether those overlapping concerns provide a basis, along with others, for asking the DOJ to exercise its § 3730(c)(2)(A) dismissal authority.

Key takeaways

The September 18 revisions to the DOJ Manual do not signal a retreat from FCA enforcement.  Indeed, the DOJ continues to describe the FCA as one of the Government’s principal tools for combatting fraud, and recent DOJ initiatives point to substantial continuing enforcement activity.  The revisions do, however, appear designed to address two recurring issues in FCA cases: (i) legal theories that purport to elevate nonbinding regulatory guidance into substantive legal requirements and (ii) declined qui tam actions that continue to consume Government and private resources despite significant legal or factual deficiencies.