FCA NOW

Second Circuit Holds that the FCA Applies to Regional Federal Banks

Nathan Ebnet

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...

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

Siena Caruso

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...

Dorsey Alert: HHS Regulatory Sprint May Impact FCA Enforcement Trends

Alex Hontos

The False Claims Act (“FCA”) is an ever-present concern among health care providers and counsel, which is why it is no surprise that the Department of Health and Human Services’ (HHS) recent “Regulatory Sprint to Coordinated Care” may impact FCA enforcement trends.  Dorsey’s Health Law Blog team has been closely monitoring the “Regulatory Sprint,” including the sweeping set of proposed regulations issued by the HHS...

Second Circuit Emphasizes Heightened Pleading Standard for Qui Tam FCA Suits

Jack Huerter

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...

The Granston Memo in Tension: Third Circuit Allows DOJ’s Dismissal of FCA Claim without a Hearing; Sen. Grassley Wants DOJ to Pump the Brakes

Sam Bolstad

The Department of Justice can move to dismiss a whistleblower’s claim under the False Claims Act without first holding an in-person hearing, the Third Circuit recently ruled in Chang v. Children’s Advocacy Center of Delaware, No. 18-2311 (3d Cir. Sept. 12, 2019). The FCA requires that a qui tam relator have “an opportunity for a hearing” if the DOJ moves to dismiss. 31 U.S.C. § 3730(c)(2)(A)....

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

Benjamin Greenberg

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,...

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

Andrew Brantingham

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....

Granston Memo in Action: Eighth Circuit Affirms Government Dismissal of FCA Claims Related to Minnesota Bridge Collapse

Caitlin Hull

Just days after the twelfth anniversary of the Minnesota 35W bridge collapse, the Eighth Circuit summarily affirmed the dismissal of a False Claims Act case alleging that Minnesota government officials conspired to submit false claims and obtain $250 million in federal funding. United States ex rel. Davis v. Hennepin Cty., No: 19-2298 (8th Cir. Aug. 14, 2019). Focused on the aftermath of the 35W bridge...

False Claims Act: New Developments for an Old Law

Alex Hontos

The past 18 months have been a (relatively) wild time for the False Claims Act — on the books since 1863. In FY2018 the Department of Justice obtained more than $2.8 billion in settlements and judgments from cases involving fraud and false claims against the United States government. Add to this staggering statistic the fallout of the Supreme Court’s decision in Universal Health Services Inc....

Software Provider and DOJ Reach $8.6M Settlement for FCA Case Involving Alleged Cyber Security Shortcomings

Jack Huerter

Amid increased public and government attention to cyber security, a qui tam plaintiff’s lawsuit has resulted a large settlement for a government contractors’ purported misrepresentations regarding compliance with government cyber security standards. In what is believed to be the first-of-its-kind settlement of an FCA claim premised upon cyber security misrepresentations, Cisco Systems recently agreed to pay $8.6 million to the federal and state governments. The...