Currently, providers have different risks of potential False Claims Act (“FCA”) liability depending on where they are geographically located due to the difference in the standards required by the U.S. Courts of Appeals regarding the level of specificity when relators (whistleblowers) plead FCA violations. The FCA imposes civil liability on any person requesting government funds or property who “knowingly presents . . . a false or fraudulent claim for payment or approval.” 31 U.S.C. § 3729(a)(1)(A). A pleading, “alleging fraud or mistake . . . must state with particularity the circumstances constituting fraud or mistake.” Fed. R. Civ. P. 9(b) (emphasis added). And the Circuits of the U.S. Courts of Appeals are split on what information is required in a relator’s FCA complaint under Rule 9(b) to avoid a dismissal of the complaint. The U.S. Supreme Court may resolve the difference in the standards if it grants certiorari in Johnson, et al. v. Bethany Hospice & Palliative Care of Ga., LLC.
The Circuit Split
Two circuit courts have concluded there should be a high threshold of “particularity” for FCA pleadings under Rule 9(b) because of the potential criminal consequences and treble damages for an FCA violation. The Eleventh and Sixth Circuit Courts of Appeals agree that an FCA complaint should include an example of a specific fraudulent claim made to the U.S. government. Johnson, et al. v. Bethany Hospice & Palliative Care of Ga., LLC, 853 F. App’x 496, 501 (11th Cir....
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