In Short
The Situation: Health care providers, medical device manufacturers, pharmaceutical companies, government contractors, and, indeed, anyone receiving government funds can face potentially ruinous liability under the False Claims Act ("FCA") for regulatory violations—even when the regulations are complex and ambiguous.
The Result: In United States ex rel. Sheldon v. Allergan Sales, LLC, the Fourth Circuit held that a defendant cannot be liable under the FCA if its conduct comports with an objectively reasonable interpretation of the applicable law, and if it has not been warned away from that interpretation by authoritative guidance. Notably, the Fourth Circuit enforced this principle to affirm the dismissal of an FCA complaint on the pleadings.
Looking Ahead: The Fourth Circuit has now joined five other circuits in applying this standard to the FCA, strengthening defendants' arguments for dismissal of FCA lawsuits. But recent dissents in these cases suggest that the issue is not yet settled.
Health care industry participants frequently operate under nuanced legal frameworks that apply to the receipt of government funds. A breach of these regulations can open the door to draconian liability under the FCA even when the law is unclear. But in U.S. ex rel. Sheldon v. Allergan Sales, LLC, a divided panel of the Fourth Circuit issued the latest appellate decision holding that a defendant cannot act "knowingly" under the FCA—and thus cannot be liable—"if it bases its...
PHOTOS: COMPETITION AND CONSUMER COMMISSION OF SINGAPORE SINGAPORE – Three online retailers have been caught using misleading features to influence shoppers by Singapore’s consumer and competition...