In US ex rel. Martin v. Hathaway, the US Court of Appeals for the Sixth Circuit joined the US Court of Appeals for the Eighth Circuit in requiring False Claims Act (FCA) plaintiffs to establish a direct causal relationship between alleged kickbacks and specific healthcare claims. This decision widens an existing circuit split between the Eighth Circuit and the Third Circuit on the standard for causation in FCA cases.
The Sixth Circuit opinion is also one of the first to consider the contours of the term "remuneration" under the Anti-Kickback Statute (AKS). In Martin, the court narrowly interpreted the term remuneration to include only payments and other transfers of value - rejecting the broad "anything of value" interpretation.
While the appellants claim that en banc review is warranted based on the circuit split and questions of exceptional importance, the appellees have urged the Sixth Circuit to deny rehearing. If the panel decision stands, it provides a powerful argument for defendants moving forward against an increasingly aggressive relators' bar, and marks an important step in curbing government overreach in FCA litigation. By establishing a higher standard of causality and narrowing what constitutes remuneration under the AKS, this well-reasoned decision sets limits (at least within the Sixth Circuit) on the potential scope of FCA liability based on the plain language of the statute - a welcome development for FCA defendants.
Background
The FCA is the government's...
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