On July 26, 2022, the United States Court of Appeals for the Eighth Circuit issued a decision that creates a new circuit split on the question of what evidence is needed to prove that a violation of the Anti-Kickback Statute (AKS) renders a claim false or fraudulent under the False Claims Act (FCA). The Eighth Circuit held that a plaintiff "must prove that a defendant would not have included particular items or services but for the illegal kickbacks."1 The decision, adopting a position expressly rejected by the Third Circuit in 2018, is a clear win for defendants in the Eighth Circuit. What follows will be questions surrounding what evidence is sufficient to meet this "but-for" standard, and watching whether other circuits take the opportunity to align with either side of this split—or perhaps develop alternative interpretations.
The Eighth Circuit case involves a neurosurgeon, who used spinal implants to treat various spinal conditions, and his fiancé, who owns the distributorship from which he purchased the spinal implants he used in his procedures. According to the court's opinion, (fraud and abuse suspicions were raised because) the neurosurgeon was his fiancé's only large customer, yet the fiancé made $1.3 million in commissions from one manufacturer alone in a single year. The neurosurgeon, in turn, was offered company stock from the same manufacturer. The relators raised concerns regarding the neurosurgeon's high-volume implant use and his financial...
Athena Construction Group Inc. must pay about $1 million for violating the False Claims Act by making misrepresentations about its eligibility to receive contracts set aside for HUBZone companies,...