On November 30, 2018, the Solicitor General of the United States filed a long-awaited amicus brief in response to the U.S. Supreme Court’s request for the government’s view of the False Claims Act (FCA) case U.S. ex rel. Campie v. Gilead Sciences, Inc. (see here for previous analysis of the Ninth Circuit decision in the case, and here for discussion of the Supreme Court’s request).

In its brief, the Solicitor General states that the conclusion of the Ninth Circuit – that “the fact of continued government payments did not by itself require dismissal of [the relator’s FCA] claims at the pleading stage” – was “correct and consistent with decisions issued by other circuits in comparable circumstances” and as a result no further review is warranted. The Solicitor General’s brief appears to advocate for a more narrow reading of the Ninth Circuit decision than many commenters have undertaken, explaining that “the relevance of a governmental payment decision turns on whether the government had ‘actual knowledge’ of violations at the time of payment” but in this case it is disputed what the government knew about alleged violations and when it learned about such violations.
Continue Reading In Amicus Brief, Government Discourages Supreme Court Review of Pro-Relator Ninth Circuit FCA Decision, but Pledges to Seek Dismissal of Case Upon Remand

In late August, the U.S. Court of Appeals for the Ninth Circuit issued a long-awaited decision in U.S. ex rel. Rose v. Stephens Institute that interprets key aspects of the implied false certification theory of False Claims Act (FCA) liability under the Supreme Court’s 2016 Escobar decision. As the Ninth Circuit explains in its decision, Escobar “unsettled” Ninth Circuit law related to the standard for proving falsity and materiality in an FCA case. The Ninth Circuit therefore sought to reconcile its precedents with Escobar in Rose, which was before it on an interlocutory appeal from a denial of summary judgment sought by the defendant.
Continue Reading Ninth Circuit Issues Long-Awaited Interpretation of Escobar Two-Part Test

On September 11, 2017, the Ninth Circuit in US and State of Nevada ex rel. Welch v. My Left Foot Children’s Therapy, LLC, upheld the denial of the defendant’s motion to compel arbitration in a False Claims Act (FCA) relator case, holding that an employee-relator’s FCA claims did not fall within the scope of the arbitration agreement with her former employer.  The FCA claims were based on allegations that the employer had filed fraudulent Medicaid claims.

The Court first looked to the Federal Arbitration Act (FAA) in determining that interpretation of the arbitration agreement would generally be a matter of state law.  Nevertheless, the Court also applied certain guiding principles of the FAA, including the rule as interpreted by the U.S. Supreme Court  that “’questions of arbitrability must be addressed with a healthy regard for the federal policy favoring arbitration’” (quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)).

In issuing its ruling, however, the Court did not foreclose the potential for arbitration agreements to include FCA claims within their scope.


Continue Reading Ninth Circuit Denies Arbitration in a False Claims Act Case

On July 7, 2017, the U.S. Court of Appeals for the Ninth Circuit reversed a federal district court’s dismissal of a False Claims Act (FCA) whistleblower suit in United States ex rel. Campie v. Gilead Sciences, explaining that the district court did not have “the benefit of” the Supreme Court’s 2016 decision in Escobar at the time the suit was dismissed for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6).
Continue Reading Ninth Circuit Relies on Escobar to Revive False Claims Act Suit Against Pharmaceutical Manufacturer