In an effort to avoid transforming the FCA into “an all-purpose antifraud statute,” the Sixth Circuit recently reaffirmed that relators must plead a connection between the alleged fraud and an actual claim made to the government. The Sixth Circuit’s decision in United States ex rel. Ibanez v. Bristol-Myers Squibb confirms the long-held rule that absent… Continue Reading
The FCA contains several provisions that are aimed at discouraging “parasitic” or duplicative qui tam actions. One such provision, known as the “government-action bar,” prohibits relators from bring a qui tam action “based upon allegations or transactions which are the subject of a civil suit . . . in which the Government is already a… Continue Reading
In United States v. Luce, the Seventh Circuit overturned a two-decade precedent by holding that proximate causation, and not “but for” causation, was the proper standard to employ in FCA cases. In so holding, the Seventh Circuit undid the 25-year circuit split it had created through use of “but for” causation in FCA cases. In Luce, the… Continue Reading
On September 11, 2017, in United States and State of Nevada ex rel. Welch v. My Left Foot Children’s Therapy, LLC, the Ninth Circuit held that an arbitration agreement between an employee-relator and her former employer was not broad enough to cover the Relator’s whistleblower claims under the FCA. This opinion raises questions as to… Continue Reading
Last year in Universal Health Services, Inc. v. United States ex rel. Escobar et al. (discussed on this blog), the Supreme Court reminded litigants that the False Claims Act “is not an all-purpose antifraud statute.” In that case, the Court expanded upon the FCA’s materiality standard, calling it both “rigorous” and “demanding.” How demanding that standard would… Continue Reading
On April 4, 2017, in United States ex rel. Hayes v. Allstate Ins. Co., 853 F.3d 80 (2nd Cir. 2017), the Second Circuit joined the D.C. Court of Appeals in holding that the first-to-file bar is not jurisdictional, and therefore, that a court is not deprived of subject matter jurisdiction upon a first-to-file bar finding.… Continue Reading
The Department of Justice has announced new, increased civil penalties that are applicable under the False Claims Act (FCA). The new range of FCA penalties is from $10,957 to $21,916. These increased statutory penalties reflect a continuing, inflation-based increase to the available statutory penalties. This marks the second year in a row in which the applicable penalties under… Continue Reading
The United States Supreme Court’s landmark decision in Escobar, which we have discussed previously, upheld the use of the implied certification theory where the implied certification of statutory/regulatory compliance is material to the government’s decision to pay the claims at issue. See generally Universal Health Servs., Inc. v. United States and Commonwealth of Mass. ex… Continue Reading
The Seventh Circuit says yes. Early this month, the Seventh Circuit reversed and remanded a district court’s holding that a qui tam Relator failed to properly plead a False Claims Act suit where the Complaint did not allege that the defendants sent a claim to the government. In reversing the District Court for the Eastern… Continue Reading
$200 million and pivotal legal precedent are at stake in the False Claims Act (“FCA”) case against AseraCare, Inc. (“AseraCare”), a for-profit hospice chain that was alleged to have fraudulently submitted claims that falsely certified hospice eligibility for patients who were not terminally ill. In May 2016, the United States Department of Justice (“DOJ”) announced… Continue Reading
In May 2016, the United States Supreme Court granted the petition for a writ of certiorari in State Farm Fire & Casualty Co. v. United States, ex rel. Rigsby, et al. During the next term, the Supreme Court will hear oral arguments and issue a ruling for the Rigsby case which is limited to one… Continue Reading
The Supreme Court handed down its much-anticipated opinion in Universal Health Services, Inc. v. United States ex rel. Escobar et al. yesterday—a case addressing the viability of the implied certification theory in FCA litigation. Justice Thomas, writing on behalf of a unanimous Court, found that the implied certification theory can in fact serve as a… Continue Reading
The DOJ recently intervened in a lawsuit against Prime Healthcare Services, Inc., and its subsidiaries (“Prime”). The lawsuit alleges that Prime submitted claims for medically unnecessary services and routinely pressured its staff to exaggerate Medicare beneficiaries illnesses in order to increase the number of inpatient admissions and billed for services as inpatient admissions that should… Continue Reading
Created in 2006, Medicare Part D is a government program that subsidizes the cost of prescription drugs to Medicare beneficiaries. The program is run through “Plan Sponsors” – private entities that receive a fixed monthly payment from the Center for Medicare and Medicaid Services (“CMS”) and subcontract with Pharmacy Benefit Managers to provide prescription drug… Continue Reading
The FCA’s implied certification theory is based on the concept that every time a payee submits a claim to the government it has impliedly certified compliance with all contractual, statutory, and regulatory obligations, and therefore, is entitled to payment. While the courts are currently divided on whether implied certification is a valid theory of liability, the courts that… Continue Reading
On April 19, 2016, the United States Supreme Court heard oral arguments in the case of Universal Health Services v. U.S. ex rel. Escobar. The Universal Health Services case was brought by two relators whose child had been seeing a counselor at UHS and who came to learn that the counselor was not licensed. The relators’ child… Continue Reading
In United States ex rel. Bias v. Tangipahoa Parish School Bd., — F.3d —-, 2016 WL 906227 (5th Cir. 2016), the Fifth Circuit provided guidance on the scope of individuals with standing to bring an FCA retaliation claim under 31 U.S.C. § 3730(h). In reversing the lower court’s dismissal, the circuit court explained that liability… Continue Reading
In fiscal year 2015, more than $1 Billion of the Government’s False Claims Act (FCA) recovery was derived from cases in which the Government declined to intervene. This significant recovery far exceeds the typical, annual recovery that is obtained by relators without Government intervention. During the past decade, the Government has intervened in approximately 20-24%… Continue Reading
The public disclosure bar is a statutorily created hurdle that plaintiffs must cross to successfully maintain a False Claims Act suit. The principle was originally enacted to prevent individuals from filing “parasitic” False Claims Act (FCA) lawsuits that were not based on their independent knowledge. The public disclosure bar has undergone several statutory changes during… Continue Reading
The United States Department of Justice has announced that it has recovered over $3.5 Billion from cases brought under the False Claims Act (FCA) in fiscal year 2015. This significant aggregate recovery is a slight decline from the $5.69 Billion that was recovered in fiscal year 2014; however, it is the fourth consecutive year in… Continue Reading
Over the past decade, efforts to enforce health care fraud regulations have been bolstered significantly with increased government funding and a dramatic increase in whistleblower claims filed under the False Claims Act’s qui tam provisions. The majority of FCA civil litigation in 2014, approximately 70 percent, resulted from these whistleblower claims and the substantial majority… Continue Reading
In United States ex rel. Adams v. Aurora Loan Servs., Inc., 2016 WL 697771, — F.3d —- (9th Cir. Feb. 22, 2016), the Ninth Circuit found that Fannie Mae and Freddie Mac were not government entities for purposes of the False Claims Act. In so holding, the Ninth Circuit provided further clarity to the distinction… Continue Reading
In United States ex rel. Gadbois v. PharMerica Corp., — F.3d —- (1st Cir. 2015), the First Circuit, in a matter of first impression, held that a relator’s complaint was not subject to dismissal under the first-to-file bar where an earlier-filed action based on the same underlying facts was settled and dismissed while the relator’s… Continue Reading
It is often stated that the sine qua non (the indispensable and essential action) of a violation of the False Claims Act (FCA) is the submission of a false or fraudulent claim. This principle has been recognized and cited in federal courts throughout the country. A recent case that was decided in the United States… Continue Reading
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