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Category: Persons subject to FCA

Healthcare / Overpayments / Penalties / Persons subject to FCA / Settlements

13 Oct, 2022

Massachusetts Follows Several Other States in Settling with Medicaid Managed Care Giant

On September 29, 2022, Massachusetts Attorney General Maura Healey announced that Medicaid managed care and pharmacy benefits giant Centene Corporation agreed to pay $14 million to resolve claims that it overcharged MassHealth, the Massachusetts Medicaid program.  This latest settlement comes shortly after Centene struck similar deals in other states, including a $33 million deal to end a False Claims Act (“FCA”) suit in Washington. Centene...

Fraud-in-the-Inducement / Persons subject to FCA / Settlements

13 May, 2020

$4.47 Million False Claims Act Settlement Targets Set-Aside Contractors, Affiliates, and Even Third-Party Bonding Company

Over three years after the filing of the initial sealed complaint, a New York-based construction company and several affiliates—including its bonding company—have agreed to pay a combined $4.47 million to settle a False Claims Act case alleging a decade-long scheme to fraudulently obtain federal contracts set aside for Service-Disabled Veteran-Owned Small Business Concerns (“SDVOSBCs”) and small businesses operating in Historically Underutilized Business Zones (“HUBZones”). United...

Persons subject to FCA

13 Dec, 2019

Second Circuit Holds that the FCA Applies to Regional Federal Banks

On November 21, 2019, the Second Circuit held that allegedly fraudulent loan requests presented to one or more of the Federal Reserve System’s twelve Federal Reserve Banks are “claims” within the meaning of the FCA. The court clarified that while personnel of those Federal Reserve Banks are not officers or employees of the United States, the Federal Reserve Banks themselves are agents of the United...

Persons subject to FCA / Pleading Standards

4 Mar, 2019

Tribal Employees Cannot Shake FCA Claims Pleaded with Particularity When Sued in Their Personal Capacities

Seven years after filing their initial complaint, a Montana federal court ruled that plaintiffs’ FCA action—at least on some claims and against some defendants—may finally proceed. Cain v. Salish Kootenai Coll., Inc., No. CV-12-181-M-BMM, 2019 U.S. Dist. LEXIS 26955 (D. Mont. Feb. 20, 2019). In 2012, plaintiffs, as relators in a qui tam action, alleged that a tribal college, its board of directors, and various...

False Statement / Persons subject to FCA

4 Sep, 2017

Eighth Circuit Rejects Sovereign Immunity Defense to FCA Qui Tam Action

Last month the Eighth Circuit considered and rejected an Eleventh Amendment sovereign immunity defense to a qui tam action under the False Claims Act.  In United States ex rel. Fields v. Bi-State Development Agency, No. 16-3783, 2017 U.S. App. LEXIS 13925 (8th Cir. August 1, 2017), a former employee of Bi-State alleged that the defendant interstate compact entity raised funds and required its employees to...

Overpayments / Persons subject to FCA / Reverse False Claims

20 May, 2016

Construction Subcontractor Settles FCA Allegations for $2.8 Million

A recent settlement illustrates the broad reach of the FCA and the substantial liability that “mere retention” of an overpayment can impose on contractors several steps removed from a government contract.  The dispute involved alleged overpayments made to Bartlett Holdings Inc. (d/b/a BHI Energy/Sun Technical Services) during its performance as a subcontractor on a Federal project.  Bartlett is a supplier of radiological protection services and...

False Statement / Persons subject to FCA

26 Feb, 2016

Ninth Circuit holds that Fannie Mae and Freddie Mac are not officers, employees, or agents of the United States under 31 U.S.C. § 3729(b)(2)(A)(i) of the False Claims Act

On February 22, the Ninth Circuit affirmed the dismissal of an FCA claim brought by relators alleging that various lenders and loan servicers made false certifications to Fannie Mae and Freddie Mac, concluding that claims presented to Fannie Mae or Freddie Mac could not give rise to liability under § 3729(b)(2)(A)(i) of the FCA. See U.S. ex rel. Adams v. Aurora Loan Servs., Inc., No....

Persons subject to FCA

31 Jan, 2016

University of Massachusetts Medical School Not a “Person” Under FCA; 1st Circuit Adopts “Arm-of-the-State” Test

In an opinion issued on January 27, 2016, the United States Court of Appeals for the First Circuit affirmed the dismissal of a qui tam lawsuit against the University of Massachusetts, holding that the University was “indistinguishable” from a state agency and, therefore, not a “person” subject to potential liability under the False Claims Act, 31 U.S.C. 3729(a)(1)(A). Relator Michael Willette, an employee of the University’s...

Persons subject to FCA

14 Dec, 2015

Sixth Circuit Joins Sister Circuits In Using Arm-Of-The-State Analysis To Define “Person” Under The False Claims Act

The FCA imposes liability on “any person” that makes a false statement in violation of the Act, 31 U.S.C. § 3729(a)(1).  Although the Act itself does not define “person,” the Supreme Court has said only that a person cannot include a state or state agency.   See Vermont Agnecy of Natural Resources v. Stevens, 529 U.S. 765, 784-85, 788 (2000) (observing that § 3733(l)(4) defines person...

False Statement / Persons subject to FCA

26 Sep, 2015

Judge Dismisses FCA Claim Against City of Chicago; Concludes that “Subsequent Nonperformance of a Future Commitment” Was Not a Falsehood Under FCA

On September 16, 2015, the U.S. District Court for the Northern District of Chicago dismissed a False Claims Act (FCA) case against the City of Chicago, because the qui tam complaint did not satisfy the relevant pleading standard.   In an opinion issued by District Judge Andrea Wood, the court found that the complaint failed to allege facts with particularity as required under Federal Rule of...