Tag Archives: False Claims Act (FCA)

Alston & Bird Partners Secure Dismissal from Delaware Qui Tam Suit

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On Friday, April 21, Alston & Bird obtained the dismissal of claims against two publicly traded retail companies, Ralph Lauren and Ruth’s Hospitality, from a qui tam lawsuit the State of Delware had intervened in. The retailers, along with nearly a dozen others, were named in State of Delaware v. Card Compliant, et al., pending in the Superior Court of the State of Delaware. The state was alleging violations of the Delaware False Claims and Reporting Act resulting from alleged noncompliance with Delaware’s Escheats Law involving unused gift card balances. In Friday’s ruling, Superior [...]Read more

Circuit Court Signals Potential Impacts of Escobar

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Lower courts have begun grappling with the implications of the U.S. Supreme Court’s decision in Universal Health Services, Inc. v. United States ex rel. Escobar. In U.S. ex rel. Sheet Metal Workers International Association v. Horning Investments, LLC, a union filed a qui tam lawsuit against Horning Investments, LLC. Horning, a roofing company, was acting as a subcontractor for a construction project for the U.S. Department of Veterans Affairs. The union claimed that Horning violated the False Claims Act by failing to pay union workers in accordance with the Davis-Bacon Act. Under the Davis-Bacon [...]Read more

The Supreme Court Weighs In on the Implied Certification Theory of False Claims Act Liability

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The Supreme Court has handed the Department of Justice and qui tam relators a bigger hammer to wield against government contractors with its opinion in Universal Health Services, Inc. v. United States ex rel. Escobar, confirming the viability of the implied certification theory of False Claims Act (FCA) liability. In this case, the relators filed a qui tam action alleging that a provider of mental-health services in Massachusetts violated the FCA when it submitted Medicaid reimbursement claims that included representations about the services provided, but failed to disclose that the service [...]Read more

Supreme Court Hears Oral Arguments in Significant False Claims Act Case

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Our colleagues Jackie Baratian and Jason Popp summarize here the oral argument for Universal Health Services v. United Sates ex rel. Escobar heard by the U.S. Supreme Court on Tuesday, April 19th, laying out the various arguments presented by counsel and addressed by the Justices.  As they note, much of the argument focused on the Restatement of Contracts, as a source of “fraud” in contracting common law, to help draw a distinction between an implied promise and an immaterial unspoken performance detail.  The Justices also took note of the decision in Halper, in which the Supreme Court in [...]Read more

Is the False Claims Act Becoming a Catch-All Penalty for Any and Every Contractual Breach?

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A recent Department of Justice (DOJ) settlement announcement suggests that the government intends to continue to use the False Claims Act (FCA), rather than more traditional breach of contract or tort claims or regulatory authority, to administer its contracts. On March 7, 2016, the DOJ announced its $3 million settlement with ArmorSource LLC to resolve FCA allegations against the company. ArmorSource contracted with the U.S. Army in 2006 to provide ballistic helmets for combat. In 2010, the Army recalled the helmets after rounds of failed ballistic safety tests. The government alleged that from [...]Read more

Supreme Court to Rule on the Implied Certification Theory

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The U.S. Supreme Court has scheduled oral arguments in a case that will have significant implications for cases brought under the False Claims Act (FCA). In Universal Health Services v. United States ex rel. Escobar, No. 15-7, the Court will hear argument on two important questions. First, whether the “implied certification” theory of legal falsity is viable under the FCA, a question on which the circuit courts of appeal are divided. If the Court concludes the implied certification theory is viable, then the second issue it will consider is whether government contractors’ reimbursement claims [...]Read more

Andy Howard and Jessica Sharron on “The False Claims Act: Recent Trends and Hot Topics” – A Webinar

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On January 27, 2016, Alston & Bird’s Andy Howard and Jessica Sharron presented a live webinar titled “The False Claims Act: Recent Trends and Hot Topics” in connection with Lorman Education Services. In this 90-minute session, the attorneys covered recent developments in False Claims Act (FCA) law; the state of attorney-client privilege in FCA whistleblower (“qui tam”) lawsuits; the growing use of civil investigative demands (CIDs) and how to survive CID audits and investigations, workforce training, and FCA claim mitigation techniques; and the disagreement in various federal appeals [...]Read more

A Summary of the Department of Justice’s 2015 False Claims Act Review

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The False Claims Act (FCA) again proved itself to be the government’s primary tool to combat procurement fraud. According to the Department of Justice, in 2015 alone, the government recovered more than $3.5 billion from FCA settlements and judgments for the fourth year in a row, bringing the total recovery since January 2009 to $26.4 billion. Of the $3.5 billion recovered last year, roughly $1.1 billion came from settlements and judgments in cases alleging false claims for payment under government contracts, raising the total recovery for government contracts and procurement fraud settlements [...]Read more

Reasonable Interpretations of Statutes May Prevent Liability Under the False Claims Act

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As a recent case from the District of Columbia Circuit demonstrates, the knowledge requirement of the False Claims Act (FCA) often creates the largest impediment for those looking to hold defendants liable for their false certifications to the government. In United States ex. rel. Purcell v. MWI Corp., No. 14-5210, 2015 WL 7597536 (D.C. Cir. Nov. 24, 2015), the United States brought a civil action under the FCA against MWI Corporation. The government alleged that MWI made false certifications to the Export-Import Bank to secure loans for financing the sale of water pumps to Nigeria. Under the terms [...]Read more