As previously discussed as a part of our ongoing FCA Fundamentals series, the False Claims Act (FCA) is the federal government’s most important and most effective tool for fighting fraud. While Congress has substantially expanded the scope of the FCA since its inception during the Civil War, courts have recognized that the FCA was “not designed to reach every kind of fraud practiced on the Government” and is not intended to be a “vehicle for punishing garden-variety breaches of contract or regulatory violations.” Rather, the FCA applies only to false or fraudulent claims or omissions that are “material” to the government. So what is materiality?
Section 3729(b)(4) of the FCA defines materiality as “having a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property.” But for many years courts struggled to apply this definition in FCA litigation, and no consistent standard prevailed among the courts of appeals.
Then in 2016, the U.S. Supreme Court issued a groundbreaking and unanimous decision in Universal Health Servs., Inc. v. U.S. ex rel. Escobar that clarified the strength of the FCA’s materiality requirement and provided guidance on the materiality analysis. In Escobar, the Court held that a misrepresentation must meet the FCA’s “rigorous” and “demanding” materiality requirement to be a basis for liability. Using tort and contract law as a guide, the Court found that materiality “...
Prime Minister Narendra Modi on Friday strongly rejected reports claiming that the government was planning to impose restrictions or additional taxes on foreign travel. In a rare move, PM Modi per...