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Category: Pleading Standards

Dismissal Standard / Pleading Standards / Procedure / Relators / Retaliation Claims

20 Dec, 2022

Third Circuit Confirms Expansion of Anti-Retaliation Standard Under the False Claims Act

On November 30, 2022, the Third Circuit Court of Appeals vacated dismissal of a retaliation action brought by Don Ascolese (“Ascolese”) under the False Claims Act (“FCA”).  See United States ex rel. Don Ascolese v. Shoemaker Constr. Co., No. 21-2899, ECF No. 30 (3d Cir. 2022) (“3d Cir. Opinion”). In the complaint before the lower court, Ascolese alleged that Shoemaker Construction Co., McDonough Bolyard Peck...

Healthcare / Pleading Standards / Procedure

4 Nov, 2022

Supreme Court Declines to Weigh In on Latest Dispute Over Pleading Standard for Causes of Action Brought Under the False Claims Act

The Supreme Court recently denied three petitions for writs of certiorari, opting not to clarify the heightened pleading requirements for allegations of fraud under the False Claims Act (“FCA”). The cases for which certiorari was denied are Molina Healthcare of Illinois v. Prose, No. 21-1145; United States ex rel. Owsley v. Fazzi Associates, Inc., No. 21-936; and Johnson v. Bethany Hospice LLC, No. 21-462. For...

Falsity / Healthcare / Intervention / Pleading Standards / Procedure / Relators

16 Jun, 2021

Eight Years Later: “Speculative” and “Straightforward” FCA Allegations Against Walmart Dismissed

Walmart successfully ended eight years of protracted litigation under the False Claims Act (“FCA”) on June 4, 2021, when the Sixth Circuit affirmed dismissal of Medicare and Medicaid fraud allegations against the major retailer.  The case was first filed in February 2013.  See United States ex rel. Sheoran v. Wal-Mart Stores E., No. 13-10568, 2019 U.S. Dist. LEXIS 140710, at *2 (E.D. Mich. Aug. 20,...

Enforcement / Healthcare / Intervention / Pleading Standards / Relators

1 Apr, 2021

Omnicare and CVS’s “Novel” Argument Fails to Defeat FCA Claims

On March 19, 2021, a Southern District of New York judge denied a motion to dismiss a False Claims Act (“FCA”) suit alleging that Omnicare—a subsidiary of CVS Health Corp.—“dispensed drugs based on invalid prescriptions to potentially tens of thousands of individuals living at more than 3,000 residential facilities.” See United States ex rel. Bassan v. Omnicare, Inc., No. 1:15-cv-4179 (CM), 2021 U.S. Dist. LEXIS...

Healthcare / Pleading Standards / Public Disclosure / Relators

17 Feb, 2020

Triggering the Public Disclosure Bar: It’s in the Details

On February 5, the U.S. District Court for the Eastern District of Pennsylvania rejected a defendant’s public disclosure bar defense, allowing the relators to proceed with their qui tam action under the False Claims Act. Sturgeon, et al., v. PharMerica Corp, No. 15-cv-6829, 2020 WL 586978, at *1 (E.D. Pa. Feb. 5, 2020).  In denying defendant PharAmerica’s motion to dismiss, the Court explained why the...

Pleading Standards

10 Dec, 2019

Escobar in Action: Physician-owners’ fraud claims against hospital defeated in Fifth Circuit appeal for lack of materiality

Following the passage of the Affordable Care Act (“ACA”), which placed new limits on physician-owned hospitals, St. Luke’s Health System (“System”) took action to change one of its hospital’s ownership structures through a buy-out of the physicians’ partnership interests pursuant to the Texas Securities Act (“TSA”). The TSA allows rescission for the original price paid for a security, plus interest, in exchange for a release...

Pleading Standards

19 Nov, 2019

Second Circuit Emphasizes Heightened Pleading Standard for Qui Tam FCA Suits

The Second Circuit Court of Appeals recently emphasized the heightened pleading standard that a relator in a qui tam False Claims Act (“FCA”) suit must satisfy to avoid dismissal under Rule 12(b)(6). United States ex rel. Gelbman v. City of New York, Case No. 18-3162, 2019 U.S. App. LEXIS 30889 (2d Cir. Oct. 17, 2019). In Gelbman, the relator, a former information specialist for the...

Pleading Standards / Retaliation Claims

3 Oct, 2019

D.C. Circuit Weighs in on the FCA’s Anti-Retaliation Statute

Last month, the D.C. Circuit revived a False Claims Act (“FCA”) retaliatory discrimination claim by a former employee of Howard University contending that she was fired by the University for objecting both internally and externally to the University’s alleged failure to maintain the humane laboratory animal living conditions on which the University’s receipt of federal funding was conditioned. See Singletary v. Howard University, No. 18-7158 (D.C. Cir. Sept. 20,...

Pleading Standards

12 Sep, 2019

Relator Failed to Sufficiently Plead its FCA Action by Relying on Big Data Alone, Resulting In Big Dismissal

In early August, the U.S. District Court for the Western District of Texas granted a hospital system’s motion to dismiss a False Claims Act case that illustrates the increasing intersections in FCA litigation between data analytics and health care providers’ efforts to increase revenue through aggressive management of coding and billing practices. United States ex rel. Integra Med Analytics, LLC v. Scott et al., No....

7th Circuit / Enforcement / False Statement / Healthcare / Insurance Coverage / Overpayments / Pleading Standards

14 Mar, 2019

Another Qui Tam Suit Alleging a Scheme to Defraud by Reporting Inflated Drug Prices Survives Motion to Dismiss

Within the last five years, district courts in the Seventh Circuit have repeatedly denied motions to dismiss qui tam lawsuits brought under the FCA that allege a scheme to defraud government health programs by reporting inflated “usual and customary” prices for prescription drugs. By contrast, at least one district court in the Sixth Circuit recently granted such a motion under Rule 9(b). On March 7,...