June 20, 2018

20 June 2018

Sixth Circuit’s Split Decision In Prather Highlights Persistent Questions About the Pleading Standard for Materiality After Escobar

Last week, the Sixth Circuit again resurrected the relator’s case in United States ex rel. Marjorie Prather v. Brookdale Senior Living Communities, Inc. (a discussion of the Sixth Circuit’s previous opinion is available here.  In a 2-1 decision, the majority held that the relator’s materiality and scienter allegations sufficed under Universal Health Services, Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (2016).  The majority issued the decision over a vigorous dissent by Judge McKeague.  The gulf between the majority and the dissent reflects persistent questions about how Escobar applies at the pleading stage (see discussion here). (more…)

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