Last Week in the FCA

From October 1 through October 12, 2014, there were 14 federal cases reported that mentioned the False Claims Act. One was previously discussed in the September 2014 FCA Update. Eight more only tangentially discussed the False Claims Act.

Five cases might be of interest to parties and counsel in a False Claims Act suit. US ex rel. May v. Purdue Pharma L.P. was the most interesting case. Defendants were permitted to depose relators’ attorneys, who represented an earlier relator in a dismissed FCA case on the same issues, to explore relators knowledge in a public disclosure challenge.

In US ex rel. Cestra v. Cephalon, Inc., a jurisdiction challenge based upon the first-to-file bar, the court stated that the complaint to be used for comparison was the second relator’s original complaint, not any subsequently amended complaints.

Two cases, US ex rel. Kelly v. Serco, Inc. and US ex rel. Smith v. Boeing Co., reiterated the oft-stated rule that the FCA is not to be used for regulatory compliance. In Boeing, the court went a step further, noting that the FAA had expertise, remedial powers and congressional oversight, and where it had opined on the regulatory question, the court could consider same in ruling on a motion for summary judgment.

In the final case, U.S. ex rel. Graves v. Plaza Medical Centers Corp., the court dismissed claims that failed to plead specific claims against all individual defendants without prejudice and dismissed a conspiracy allegation that failed to allege an agreement among defendants with prejudice.

If you have any questions or would like more information on this topic, please contact David B. Honig at (317) 977-1447 or or your regular Hall Render attorney.