By

Meredith Toole Reiter

08 August 2017

Ninth Circuit Dismisses Qui Tam Appeal as Untimely

On July 25, 2017, the Ninth Circuit dealt a harsh blow to two relators in their appeal of a False Claims Act judgment, dismissing it for lack of jurisdiction as untimely.

In the underlying case, U.S. ex rel. Hoggett v. University of Phoenix, the relators alleged that the University of Phoenix had continued to falsely certify compliance with the Higher Education Act’s “incentive compensation ban” following a prior False Claims Act settlement on the same issue. The district court dismissed their case with prejudice pursuant to the public disclosure bar.  Following dismissal of the case, the relators moved under Rule 59(e) to alter or amend the judgment, requesting a stay pending the decision in a similar case before the Ninth Circuit.  (more…)

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15 May 2017

DOJ Weighs in on Materiality Standard Post-Escobar

In a May 8, 2017 statement of interest, DOJ made a bold attempt to strip the heightened materiality standard articulated in Escobar (previously reported here) of all of its meaning.  DOJ’s statement was filed in support of relator’s Rule 59(e) motion to alter or amend the judgment dismissing the underlying declined qui tam case, which took exception to the court’s determination that the government’s continued payment of defendant’s claims “despite its actual knowledge that certain requirements were violated” was “very strong evidence that those requirements are not material.” United States ex rel. Kolchinksy v. Moody’s Corp., – F.Supp.3d –, 2017 WL 825478, at *6 (S.D.N.Y. March 2, 2017) (citing Escobar).  DOJ took aim at the court’s conclusion, arguing that “an agency’s continued payment of claims to a potential FCA defendant who faces public allegations of fraud is insufficient – by itself – to establish that the alleged fraud is immaterial.” (more…)

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01 May 2017

DOJ Articulates Views on Public Disclosure Bar In Urging Supreme Court To Deny Cert

On April 14, 2017, DOJ filed an amicus brief to weigh in on whether the Court should grant certiorari in a case involving interpretation of the False Claims Act’s public disclosure bar.  The public disclosure bar has been the subject of a number of recent Court of Appeals decisions (as we reported here, here, and here), and the DOJ brief provides an insight into the Trump Administration’s views on this important area of the law.

(more…)

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03 February 2017

What Might A Justice Gorsuch Portend For False Claims Act Enforcement?

On January 31, 2017, President Donald Trump nominated Judge Neil Gorsuch to the Supreme Court.  Currently a judge on the United States Court of Appeals for the Tenth Circuit, Judge Gorsuch has been described as an originalist with a judicial philosophy similar to that of Justice Antonin Scalia, whose vacancy in the Court he has been nominated to fill.  While Judge Gorsuch has participated in only a few appeals of False Claims Act cases, his views regarding the appropriateness (or lack thereof) of deference to agency interpretations suggests that companies and individuals who find themselves the subject of FCA suits based on allegations that they violated overbroad, confusing, or ambiguous agency regulations may find a sympathetic ear.

(more…)

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11 August 2016

Eighth Circuit Holds That A Reasonable Interpretation of an Ambiguous Statute Does Not Give Rise to FCA Liability

On August 8, 2016, the Eighth Circuit affirmed the dismissal of a FCA complaint against the University of Minnesota Medical Center (“UMMC”) alleging that UMMC improperly characterized the children’s unit of its hospital as a “children’s hospital”– a term not defined in the relevant statute – in order to avoid a decrease in Medicaid reimbursements under a recent statutory amendment.  The Court held that UMMC’s lobbying efforts with the Minnesota Department of Human Services (“MDHS”) to classify itself as a “children’s hospital” under that amendment, and corresponding claims for Medicaid reimbursement, could not be characterized as “false” under the FCA.

(more…)

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