Successful Dismissal of a Multi-Million Dollar False Claims Act Suit
In November 2014, the firm secured a decision from the U.S. Court of Appeals for the Third Circuit affirming summary judgment for our client, a Fortune 500 medical device manufacturer, in a significant False Claims Act (“FCA”) suit. The relator filed a qui tam action accusing our client of fraudulently omitting discounts that had been extended to other commercial customers in its bids to sell ultrasound, magnetic resonance imaging, and other medical equipment to the U.S. Department of Veterans Affairs. After transferring venue to the Eastern District of Pennsylvania and narrowing the case on a motion to dismiss, the firm prevailed on all claims at summary judgment. The relator appealed the decision to the Third Circuit, which held that “the District Court correctly concluded that [the relator] could show none of the required elements” of his FCA claim, and specifically, that “no reasonable juror could conclude that [our client] made knowingly false statements to the VA.”
FCA Win for Pharmaceutical Client at Fourth Circuit
The firm represented a global pharmaceutical company in a False Claims Act (“FCA”) case in which an employee alleged that the company engaged in off-label marketing in connection with one of its products. In a January 2013 decision addressing the pleading demands for complaints filed under the FCA, the U.S. Courts of Appeals for the Fourth Circuit rejected the relator’s request to apply a more lenient pleading requirement in cases in which a relator is unable to show that actual false claims were submitted for government reimbursement. The Fourth Circuit held that the FCA requires allegations of specific false claims where a scheme merely alleges that such claims were possible. This decision is likely to have a significant impact on FCA cases pending in the Fourth Circuit, and will give FCA defendants nationwide a clear, well-reasoned decision to cite in support of motions to dismiss claims for failure to plead actual false claims with particularity. A full Patterson Belknap Alert on the FCA decision is available here.