Supreme Court Considers Whether to Weigh In on Rule 9(b)’s Particularity Requirement and Constitutionality of the FCA’s Qui Tam Provisions

As we previously reported, in U.S. ex rel. Polukoff v. St. Mark’s Hospital, 895 F.3d 730 (10th Cir. 2018), the Tenth Circuit reversed a district court’s dismissal of qui tam claims, reasoning that the relator’s allegations satisfied Rule 9(b). In so holding, the Tenth Circuit “excuse[d] deficiencies that result from the plaintiff’s inability to obtain information within the defendant’s exclusive control.” Earlier this year, Defendant Intermountain Health Care filed a petition for a writ of certiorari, and the Supreme Court recently requested a response from Relator and the United States.

Intermountain’s petition urges the Supreme Court to review two questions. First, Intermountain contends that the Court’s intervention is necessary to resolve a “deep” circuit split on whether Rule 9(b)’s particularity requirement can be relaxed where a defendant exclusively holds the information necessary to state a claim. Intermountain argues that, by relaxing the particularity requirement, the Tenth Circuit’s opinion threatens to undermine the core purpose of the FCA’s qui tam provisions: “to incentivize insiders to expose fraud they have observed.” “[A] relator who cannot particularly describe a fraud is no such insider.” Intermountain’s petition is supported by amici The American Hospital Association and Federation of American Hospitals, which argue that Rule 9(b)’s particularity requirement averts qui tam relators’ costly “fishing expedition[s]” in the healthcare industry.

The second issue that Intermountain urges the Court to address is whether the FCA’s qui tam provisions violate the Appointments Clause. That clause provides that only the President, Courts of Law, and Heads of Departments have authority to appoint “officers.” Intermountain contends that “the FCA’s qui tam provisions violate the Appointments Clause because (1) relators are officers; or, alternatively, (2) the FCA impermissibly vests a core function of officers—civil law enforcement—in nonofficer relators.”

Relator and the United States implore the Supreme Court to reject Intermountain’s cert petition. Relator’s brief in opposition focuses on the first question presented and argues that Rule 9(b) expressly provides “knowledge” “may be alleged generally.” According to Relator, the Tenth Circuit merely held that, “when missing details are within a defendant’s sole possession, a complaint can survive Rule 9(b) without that information if it otherwise alleges enough to enable the defendant to prepare a defense.” Relator disputes that a clear split exist on this issue. Every circuit applies a flexible, case-by-case approach to Rule 9(b), according to Relator. The Government does not take a position on the first issue, but Relator relies on the Government’s invitation brief in another matter before the Court, which took a similar position: that realtors need not plead the “details of particular false claims,” and a contrary rule would “undermine[] the FCA’s effectiveness as a tool to combat fraud.”

In response to the Supreme Court’s request to weigh in on Intermountain’s cert petition, the United States only addresses the second question presented: whether the FCA’s qui tam provisions violate the Appointments Clause. The Government argues that qui tam relators are not “officers,” nor do they discharge “core officer function[s].” According to the Government, the First Congress enacted similar “informer” statutes and did not view qui tam relators as “officers.” Additionally, the Government argues, a qui tam relator lacks the “practical indicia” of an “officer” because the “role is limited in time and scope, confined to a particular case, and fundamentally personal in nature.” Unlike federal “officers,” qui tam relators do not enforce public law. “A qui tam relator is more aptly analogized . . . to a plaintiff who asserts a private right of action under a federal statute.” Relator’s brief in opposition largely defers to the Government’s arguments on this point, and agrees that the Supreme Court should decline to review the Appointment Clause issue.

We expect to know soon whether Intermountain’s cert petition persuaded the Court to weigh in on one (or both) of the questions presented, or whether the Court will abstain—at least for now. The parties’ briefs can be found here.