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July 22, 2016

22 July 2016

District Court Applying Escobar Rejects DOJ’s Materiality Allegations Under Rule 9(b)

In one of the first post-Escobar decisions applying the Supreme Court’s guidance on materiality under the False Claims Act, a federal district court in California has concluded that bare-bones allegations that ‘the government would not have paid a claim’ do not satisfy Rule 9(b).  The case involves allegations that defendants submitted false claims to federal healthcare programs for diagnostic sleep studies and sleep disorder-related medical devices.  After DOJ intervened and filed an intervention complaint, defendants moved to dismiss on several grounds, including on the ground that DOJ’s implied certification claims failed adequately to plead materiality.  DOJ’s Intervention Complaint contained bare-bones allegations of materiality.

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