In its May 4, 2020 Opposition to the Petition for Writ of Certiorari in United States ex rel. Schneider v. JPMorgan Chase NA, the Department of Justice (“DOJ”) advocated a reading of the FCA that preserves the Executive Branch’s unfettered discretion to dismiss a qui tam, absent “extraordinary circumstances.” DOJ’s power to dismiss derives from FCA Section 3730(c)(2)(A), which provides that the Government “may dismiss” a relator’s action if the relator “has been notified by the Government of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion.” Since the revealing of the Granston Memo, which we have addressed here and here, DOJ has more frequently sought to use this statutory power. In hopes of doing so in an unrestricted manner, DOJ presented the Supreme Court with the following question in its Opposition: “Whether the United States’ decision to dismiss a relator’s FCA claim under Section 3730(c)(2) is subject to judicial review where the relator does not allege that the government’s dismissal decision was a fraud on the court.”
On May 13, 2019, the United States Supreme Court unanimously held that the False Claims Act’s (“FCA”) alternative 10-year statute of limitations applies to non-intervened actions. As previously reported here, Cochise Consultancy, Inc. v. United States ex rel. Hunt, presented two main issues: whether relators are entitled to invoke the FCA’s 10-year statute of limitations set forth in 31 U.S.C. § 3731(b)(2), and whether relators are considered “official[s] of the United States” whose knowledge is relevant for determining when the 10-year limitations period applies. Writing for the unanimous Court, Justice Thomas ruled favorably for relators on both questions.
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.
On March 19, 2019, the Supreme Court heard oral argument in Cochise Consultancy v. United States ex rel. Hunt, a case that appears likely to resolve a circuit split on an issue of critical importance: in non-intervened FCA cases – which comprise the vast majority of FCA cases – are relators entitled to invoke the FCA’s alternative 10 year statute of limitations set forth in 31 U.S.C. § 3731(b)(2)? That provision provides for a ten year statute of limitations if the action is brought no more than three years after “the official of the United States charged with responsibility to act” knows, or should know, the material facts of the violation. While an opinion is not expected until later this year, the tenor and content of the Justices’ questions suggest that the Court’s answer to that question is likely to be yes.
On November 16, the Supreme Court agreed to resolve a percolating circuit split on an issue of critical importance under the FCA: are relators in non-intervened cases entitled to invoke the FCA’s alternate 10 year statute of limitations? The grant of certiorari in Cochise Consultancy, Inc. v. United States ex rel. Hunt, 887 F.3d 1081 (11th Cir. 2018) makes it the third Supreme Court case in recent years addressing the False Claims Act’s limitations periods. (more…)
With Judge Brett Kavanaugh seemingly headed toward confirmation to replace Justice Anthony Kennedy on the Supreme Court, readers of this blog may be interested in his prior cases addressing the False Claims Act. A judge on the United States Court of Appeals for the D.C. Circuit for over a decade, Judge Kavanaugh has been described as a conservative textualist and a “stalwart originalist,” more in line with the late Justice Antonin Scalia than swing vote Justice Kennedy, for whom Kavanaugh clerked alongside recently appointed Justice Neil Gorsuch in 1993-1994, and whom he would replace if confirmed. (more…)
The Solicitor General recently filed a brief in the United States Supreme Court stating that “the required remedy for a first-to-file violation is dismissal.” U.S. Br. 10 (emphasis added).
The brief was filed in the context of the long-running case that produced the Court’s opinion a few years ago in Kellogg Brown & Root Servs., Inc. v. United States ex rel. Carter, 135 S. Ct. 1970 (2015). On remand, the petitioner, Benjamin Carter, maintained that the intervening dismissals of two earlier-filed cases “cured” any first-to-file defect with his case, such that dismissal and re-filing of Carter’s complaint was unnecessary. The district court and the Fourth Circuit disagreed. Carter then sought certiorari, and the Supreme Court invited the Solicitor General to weigh in. (The government recommended against certiorari, and the Court denied the petition on June 25, 2018.) (more…)
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.
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.
On December 6, 2016 the Supreme Court ruled that violation of the FCA’s seal provisions does not mandate dismissal of a relators’ complaint. Rather, while Section 3730(b)(2) requires relators to file under seal, the text of the statute is silent as to the remedy for violating this requirement. The Court left to the District Court’s discretion to determine the appropriate remedy for violations of the seal provision. Slip Op. at 10.