District of Massachusetts Rejects Per Se AKS Liability for Commissioned, Independent Contractor Sales Representatives But Allows FCA Claims to Proceed

On October 21, 2026, Judge Patti B. Saris of the District of Massachusetts granted in part and denied in part a medical device company’s (“Defendant”) motion for summary judgment in United States ex rel. Langer v. Zimmer Biomet Holdings, Inc., No. 21-cv-11293-PBS (D. Mass. Oct. 21, 2026). Relator alleged that Defendant’s commission-based payments to independent contractor sales representatives violated the Anti-Kickback Statute (“AKS”) and thereby the False Claims Act (“FCA”). The court rejected Relator’s broad reading of the AKS but held that a jury could still find that the Defendant violated the statute. It then allowed the FCA claims to proceed under the AKS’s “resulting from” pathway but not on a false certification theory.

AKS – Intent to Induce

The central question was whether paying commissions to independent contractor sales representatives reflects the intent to induce referrals that the AKS requires. Relator, joined at oral argument by DOJ (which declined to intervene), urged the court to follow the Fourth Circuit’s holding that an intent to induce exists whenever a payor of remuneration intends to influence use of the products its representatives promote. The court rejected that position. With no First Circuit precedent, it adopted the approach of the Fifth, Seventh, and Ninth Circuits, which distinguishes the “intent to induce ‘referrals,’ which is illegal, and the intent to compensate advertisers, which is permissible.” Central to that reasoning, no AKS violation occurs when, as the Seventh Circuit put it, physicians have “ultimate control over their patients’ healthcare choices and appl[y] independent judgment in exercising that control.” A prohibited intent under the AKS exists therefore only when payments reflect an effort to improperly influence physicians’ decision-making, not simply to increase sales.

AKS – Evidence of Intent to Induce

Although it largely agreed with Defendant on the legal standard, the court found a triable issue on intent. On one hand, much of Relator’s evidence showed only a lawful intent to compensate marketing that drives sales: commissions incentivized sales, Defendant set quotas, and it moved to independent contractors partly to boost sales through greater autonomy.

On the other hand, the court identified additional facts supporting an inference of improper intent. In weighing them, it looked to guidance from HHS-OIG, which has identified “suspect characteristics” of arrangements with independent sales agents. Treating that guidance as offering “useful guideposts” rather than binding authority, as Loper Bright requires, the court cited the following as supporting an inference of improper intent:

• near-exclusive commission pay and direct contact with ordering surgeons;
• presence in the operating room, a position of “exceptional influence,” and occasional patient contact;
• “upselling” top-of-the-line products simply because they cost more; and
• private jet travel, travel expenses, meals, and dinners for surgeons.

AKS – Willfulness

Turning to willfulness, the Defendant argued that the Government’s knowledge of its use of independent contractors, through SEC filings and its predecessor’s 2007 corporate integrity and deferred prosecution agreements, negated willfulness. The court agreed all of that cut against willfulness but found it insufficient to warrant summary judgment. Quoting the Seventh Circuit, it explained that “merely showing some government knowledge” is not enough without “explicit approval.” Defendant did not show the Government knew of the specific aspects raising influence concerns.

Against that backdrop, the court turned to Relator’s evidence of three warnings: Defendant’s predecessor’s 1990s litigation arguing that a commissioned distributor’s payments violated the AKS, Relator’s own 2015-2016 internal complaints, and a 2018 misclassification suit arguing the commissions were kickbacks. Although nothing showed Defendant agreed with the warnings, their cumulative weight allowed a jury to find willfulness.

FCA – Liability

Having found triable AKS issues, the court turned to FCA liability. Citing United States v. Regeneron Pharmaceuticals, Inc., 128 F.4th 324 (1st Cir. 2025), the court explained that an AKS violation can lead to a false claim under the FCA through two pathways. Under the “resulting from” pathway, in the First, Sixth, and Eighth Circuits, the plaintiff must show that the kickback was the but-for cause of a submitted claim. Under the false certification pathway, a claim is false because there was a certification of compliance with the AKS that was material to the government.

The court allowed Relator’s “resulting from” theory to proceed because Relator offered evidence of improper influence by representatives, which, combined with a “common-sense inference” that surgeons would not buy the products without them, sufficed to survive Defendant’s summary judgment motion. The court granted summary judgment on Relator’s false certification theory, however, because Relator offered no evidence of what any provider actually certified.

FCA – Public Disclosure Bar

Defendant renewed its argument that the FCA’s public disclosure bar requires dismissal because Relator is not an “original source.” The court had previously found the bar triggered by public disclosures of Defendant’s use of commissioned contractors, but held that Relator is an original source whose independent knowledge materially added to them.

At summary judgment, Defendant argued that Relator’s pre-filing disclosure to the Government omitted details he later alleged. The court found no authority requiring a disclosure to include everything a relator later relies on. His disclosure of an internal complaint and the commission structure independently and materially added to the public record enough to qualify him as an original source.

A copy of the opinion can be found here.

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