The Supreme Court on Thursday reopened a pair of whistleblower lawsuits charging that Safeway and SuperValu pharmacies overcharged Medicare and Medicaid hundreds of millions of dollars for prescription drugs.

Driving the news: Justices unanimously overturned a 7th Circuit Court of Appeals ruling that the chains didn't "knowingly" violate the False Claims Act when they offered cash-paying customers extended discounts on generic drugs while charging the government full price.

• The justices said the lower court applied the wrong standard and that companies could not claim a lack of knowledge they were violating the law as a defense.
• "What matters for an FCA case is whether the defendant knew the claim was false," Justice Clarence Thomas wrote.
• Safeway and SuperValu did not immediately respond to a request for comment.

What they're saying: "The Supreme Court put to bed a defense which had been gaining traction in lower courts for much of the last decade: that a defendant’s reasonable but post hoc interpretation of an ambiguous legal requirement can provide defendants with a "get out of jail free card" under the FCA," said Alexander Owens, an attorney from Pietragallo Gordon Alfano Bosick & Raspanti, who represents the whistleblowers.

The whistleblowers will get another chance to challenge Safeway and SuperValu.

• That will involve opening up a discovery process to parse what knowledge company officials might have had that they were running afoul of the law — before...

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