Supreme Court Acts in 2 FCA Cases
Attorney Jennifer Thomas (Hyman, Phelps & McNamara) says the Supreme Court took steps this week in two False Claims Act (FCA) cases. Writing in her firm’s FDA Law Blog, Thomas says the court first invited the Solicitor General to submit a brief outlining the government’s views on a petition from Gilead asking the court to hear its appeal of the 9th Circuit Court of Appeal’s decision that would allow FCA cases to proceed based on FDA regulatory infractions, because the government would have the option not to pay a claim based on the noncompliance, and even if FDA’s response to the infractions indicated that it did not view the regulatory issue as material. In taking this stance, Thomas says, the 9th Circuit set itself apart from other appeals courts’ interpretation of the Supreme Court’s Escobar decision.
“When the Supreme Court calls for the Solicitor General’s views on a petition for certiorari,” she writes, “it often acts in accordance with the Solicitor General’s recommendations (with respect to whether to grant certiorari, not necessarily with respect to the merits of the case)…. The Supreme Court may be inclined to grant certiorari in Gilead to address the 9th Circuit’s misreading of Escobar and the FCA materiality standard.” Thomas says it often takes the Solicitor General months to file a brief in response to a Supreme Court request, so it could be some time until the government’s position is known.
In a separate FCA case, the high court declined to hear an appeal in a DuPuy Orthopedics FCA case relating to the pleading standards. Thomas says the court’s refusal to take the appeal leaves in place a 1st Circuit Court of Appeals ruling that applied a relaxed pleading standard to a FCA complaint that alleged indirect submission of false claims. She says the 1st Circuit took the position that it was possible for a plaintiff to adequately plead against a defendant based on a statistical certainty that false claims were submitted as a result of the defendant’s alleged actions, rather than alleging the specifics of any actual false claims.