In United States ex rel. Liesa Kyer v. Thomas Health System, Inc. (4th Cir. June 4, 2026), relator Liesa Kyer—a former nurse at Thomas Memorial Hospital—brought a qui tam action under the False Claims Act (FCA) against a hospital system (Thomas Health System, Inc., two hospitals, a physician group, and an executive). She alleged that, from 2013–2022, the defendants submitted federally reimbursed claims that were “false” because they were allegedly tainted by violations of the Stark Law (physician self-referral restrictions) and the Anti-Kickback Statute (AKS).
The central issues on appeal were pleading issues: whether the amended complaint satisfied Rule 9(b)’s heightened particularity requirement for FCA fraud, and whether the district court properly denied post-judgment vacatur and leave to amend.
The Fourth Circuit affirmed dismissal under Rule 12(b)(6) for failure to plead fraud with particularity under Rule 9(b), and also affirmed denial of post-judgment vacatur and leave to amend on prejudice grounds.
Although the relator attached extensive tables of billed claims and pointed to annual cost-report certifications of Stark/AKS compliance, the Court held she failed to plead how any particular claim (or any necessary pattern of conduct) was fraudulent. The Court...
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