FCA NOW

Underwriter Failed to Meet Employer’s Expectations, and thus His FCA Retaliation Burden, at Least in the Eighth Circuit

Briana Al Taqatqa

On Monday, the U.S. Court of Appeals for the Eighth Circuit affirmed the Eastern District of Missouri’s dismissal of appellant’s retaliation claim under the False Claims Act, as well as his state law wrongful discharge claim and quasi-contract claims. The decision, Sherman v. Berkadia Commer. Mortg. LLC, No. 19-1373, 2020 U.S. App. LEXIS 11713 (8th Cir. Apr. 14, 2020), is yet another example of the...

Looking Ahead: Enforcement Actions for Fraud, Waste, and Abuse Related to COVID-19

John Marti

As the public health and economic responses to COVID-19 dominate the headlines and traditional government enforcement actions slow, anticipate a significant increase in government enforcement actions, internal investigations related to corporate fraud, and qui tam (whistleblower) actions in the coming months.  The CARES Act contains appropriations for tens of millions of dollars for agency inspector general enforcement.  Leaders in federal law enforcement are telling us...

$145 Million Settlement Shows the Depth of Government’s Effort to Combat Opioid Crisis and its Interest in Fraud Actions Against Electronic Health Records Companies

Vanessa J. Szalapski

Less than a year after United States Attorney Christina E. Nolan warned electronic health records (“EHR”) companies in a DOJ press release that they “should consider themselves on notice” following a $57.25 million FCA settlement with EHR software developer Greenway Health LLC, the DOJ announced in a recent press release a $145 million settlement with another EHR vendor, Practice Fusion, Inc.  The settlement includes $26...

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

Lindsey Schmidt

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...

DOJ’s Procurement Collusion Strike Force Priorities Highlighted By Bid-Rigging Qui Tam Settlement

Sam Bolstad

In an article published late last year, Dorsey reported on the Department of Justice’s announcement regarding the formation of a new Procurement Collusion Strike Force.  The Strike Force focuses on the nexus between antitrust and public procurement, with the stated aim of targeting antitrust crimes “such as bid-rigging conspiracies and related fraudulent schemes.”  If there was any question whether DOJ was serious about targeting such...

Justice Department Touts FY2019 False Claims Act Statistics as Evidence of Administration’s “High Priority” Against Fraud, but the Numbers Show Less of a Priority on Qui Tams

Kirk Schuler

Earlier this month, the United States Department of Justice issued a press release to announce recoveries of over $3 billion from False Claims Act cases in FY2019. In making the announcement, Assistant Attorney General Jody Hunt of the Civil Division emphasized, “The significant number of settlements and judgments obtained over the past year demonstrate the high priority this administration places on deterring fraud against the...

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...