On June 1, the U.S. Supreme Court issued an unanimous decision in U.S. ex rel. Schutte v. SuperValu Inc.. The Court revived qui tam whistleblower lawsuits against pharmaceutical companies who allegedly overbilled Medicare and Medicaid.
The decision overturns U.S. Court of Appeals rulings which allowed fraudulent companies to escape liability under the False Claims Act if they could prove their fraudulent actions could be based on a “reasonable interpretation of the law” regardless of whether or not the company intended to commit fraud.
The Supreme Court ruling determined that subjective intent to commit fraud was a relevant factor which the Appeals courts overlooked. The decision, authored by Justice Clarence Thomas, clarifies that the focus is on “what the defendant thought when submitting the false claim – not what the defendant may have thought after submitting it.”
The result of the case is being heralded by whistleblower advocates as a major victory for whistleblowers.
“This is a milestone victory for whistleblowers and their ability to report fraud against the taxpayer,” said Stephen M. Kohn, a founding partner at Kohn, Kohn, and Colapinto and author of Rules for Whistleblowers: A Handbook for Doing What’s Right.
“The lower courts had created an exception that swallowed the common sense rules against fraud,” Kohn said. “Those decisions have been reversed, and the False Claims Act can remain America’s number one fraud-fighting law.”
Kohn was the principal author of ...
Unfortunately, Gregg Phillips’ claims that he was twice teleported from one place to another aren’t the biggest problems for this top government official with a long history of shady deals, charit...