The Supreme Court , in a unanimous decision, rejected a challenge by corporate pharmacy defendants, to the intent requirement in a Medicaid and Medicare over-billing False Claims Act case. Justice Clarence Thomas, who has established himself as the lead justice concerning False Claims Act cases, wrote the unanimous opinion.

The defendants, SuperValu and Safeway, claimed that thier alleged overbilling did not meet the intent requirements under the False Claims Act because they adopted a reasonable reading of an ambiguous standard for billing for drugs, despite the evidence that suggested their interpretation may not be legal.

The Supreme Court clarified that the prohibited intent standard is met when a defendant has “actual knowledge and[/or] subjective beliefs that they are violating a statute. The Supreme Court specifically rejected the defendant’s argument that the intent requirement should be based on an objective reasonableness standard regarding what a person may have known or believed.

In rejecting the defendants’ arguments, the Supreme Court reversed two decisions from the Seventh Circuit that whistleblowers claimed would undermine the FCA’s coverage and protections in the face of clever defense claims to rationalize a defendant’s post hoc defenses based on an objective standard.

Justice Thomas specifically explained that the intent analysis “is not, as the defendants would have it, on post hoc interpretations that might have rendered their claims accurate,” but...

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