Category

Granston Memo

24 June 2022

Supreme Court Grants Certiorari to Resolve Circuit Split on the Government’s Authority to Dismiss FCA Cases Over Relators’ Objections

On June 21, 2022, the Supreme Court granted certiorari to resolve a Circuit split on the standard for evaluating the government’s authority to dismiss a qui tam over the relator’s objection.  As we have previously written (see here and here), various Circuits have adopted different standards.  The Supreme Court has agreed to review a decision of the Third Circuit affirming a district court’s grant of the United States’ motion to dismiss a qui tam. (more…)

SHARE
EmailShare
02 February 2022

First Circuit Joins Circuit Split on FCA Dismissal Authority, Finds Government Has Broad Authority to Dismiss FCA Cases

On January 21, 2022, the First Circuit affirmed the government’s request for dismissal of a whistleblower complaint alleging that several pharmaceutical companies had colluded to defraud Medicare Part D. The government, after declining to intervene, requested dismissal based on its finding that: (1) the suit would require “substantial expenditure of government resources”; (2) “many key aspects of [the relator’s] allegations [we]re not supported”; and (3) “allegations that [the relator] used the qui tam process to leverage his financial interests through securities trading .  . . convince[d] the [g]overnment that [the relator was] not an appropriate advocate of the United States’ interests.” (more…)

SHARE
EmailShare
08 November 2021

Third Circuit Adopts the Seventh Circuit’s Voluntary Dismissal Standard for Evaluating Granston Motions to Dismiss

On October 28, 2021, the Third Circuit affirmed a district court’s grant of the United States’ motion to dismiss—over the relator’s objection—a qui tam alleging that the defendant had caused hospitals to submit false claims.  Adopting the Seventh Circuit’s approach, the court determined that in evaluating the government’s motion to dismiss over a relator’s objection in a declined qui tam, courts should apply the standards for voluntary dismissals contained in Federal Rule of Civil Procedure 41(a).

(more…)

SHARE
EmailShare
09 August 2021

Proposed FCA Amendments Blocked from Senate Infrastructure Bill

The recently proposed amendments to the False Claims Act have stalled out for now.  As discussed here and here, these bipartisan proposed amendments—led by Senator Grassley—would have made four changes to the FCA, and most notably, would have radically altered the burden of proof for establishing materiality.

But after making a sudden appearance on Friday in the Senate infrastructure bill, last night those amendments were excluded.  This means that the amendments’ proponents will need to consider other vehicles, particularly “must pass” bills such as the budget resolution.  The Senate is expected to consider amendments to the budget resolution later this week.

We will continue to monitor developments regarding this proposed legislation.

SHARE
EmailShare
06 August 2021

FCA Amendments Resurface in Senate Infrastructure Bill

As discussed further here, a bipartisan group of senators, led by Senators Grassley (R-IA), Leahy (D-VT), Wicker (R-MI), Durbin (D-IL), and Kennedy (R-LA), recently introduced proposed amendments to the False Claims Act. Those amendments have now been incorporated into the infrastructure bill currently being debated in the Senate. (more…)

SHARE
EmailShare
26 July 2021

Bipartisan Legislation Introduced To Overhaul FCA To Further Hamstring Defendants

A bipartisan group of senators, led by Senators Grassley (R-IA), Leahy (D-VT), Wicker (R-MI), Durbin (D-IL), and Kennedy (R-LA), has introduced the False Claims Amendments Act of 2021.  This legislation is worth watching not just because it would significantly amend the FCA, but because Senator Grassley has a successful track record of shepherding through to passage legislation reversing gains made by defendants in FCA cases.

(more…)

SHARE
EmailShare
20 July 2021

Fifth Circuit Affirms DOJ’s Broad Authority to Dismiss Qui Tams Over Relators’ Objections, but Adds Teeth to “Hearing” Requirement

On July 7, 2021, the Fifth Circuit affirmed a district court’s grant of the United States’ motion to dismiss—over the relator’s objection—two qui tams that challenged pharmaceutical patient support programs.  While the court’s decision is consistent with those of other courts of appeal that have confirmed DOJ’s broad authority to dismiss qui tams over relators’ objections, the Fifth Circuit appears to add some teeth to the requirement that the relator be provided with a “hearing” before such a dismissal may be granted.

(more…)

SHARE
EmailShare
09 June 2021

DOJ Opposes Supreme Court Review of Granston Dismissal Standard

On May 21, 2021, the Department of Justice filed a brief in opposition to a petition for writ of certiorari filed by the relator in U.S. ex rel. Cimznhca, LLC v. UCB, Inc.  The petition challenges the Seventh Circuit’s decision reversing the district court’s denial of the government’s motion to dismiss over the relator’s objection.  In reversing, the Seventh Circuit determined that, so long as relators have an opportunity to be heard under 31 U.S.C. § 3730(c)(2)(A), the government may dismiss qui tams when it satisfies the standard contained in Federal Rule of Civil Procedure 41(a)(1)(A)(i).  That rule provides that a plaintiff may dismiss an action by serving notice of dismissal any time before the opposing party serves either an answer or a motion for summary judgment.

(more…)

SHARE
EmailShare
09 March 2021

Grassley Letter to AG Nominee Garland Previews Legislation To Curtail DOJ Dismissal Authority and Materiality Requirement

Senator Charles Grassley, who supported the nomination of Merrick Garland for Attorney General, sent the then-nominee a letter on February 24 to ask the Department of Justice to work to “further clarify and strengthen the False Claims Act.”  As we reported in previous posts (here, here, and here), Senator Grassley has publicly criticized DOJ’s position that its authority to dismiss FCA suits over relators’ objections is virtually unfettered, and has criticized the materiality standard established by the Supreme Court in Escobar as lending undue weight to role of government conduct (or lack thereof) in response to allegations of fraud.  The letter discloses that Senator Grassley is working with “a cadre of bipartisan Senate colleagues” to “strengthen” and “improve” the False Claims Act by narrowing the materiality requirement, and by requiring a court to assess the merits of a qui tam in deciding whether to grant a motion to dismiss filed by DOJ.  We will continue to monitor and report on any such legislation that may ultimately be proposed.

SHARE
EmailShare
XSLT Plugin by BMI Calculator