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Jeff Gibson has extensive experience representing clients in complex civil litigation and government investigations across diverse industries, including healthcare, financial services, energy and technology. In addition to maintaining a business litigation practice, he defends individuals and companies facing quasi-criminal civil fraud claims, white collar criminal charges, and compliance violations.

The Department of Justice (DOJ) recently released its report detailing the settlements and judgments obtained in 2019 from civil cases involving fraud and abuse claims.  As in years past, the substantial majority of these settlements and judgments—$2.1 billion of the $3 billion total—were the result of qui tam whistleblower lawsuits filed under the False Claims Act (FCA).

Following the government’s intervention decision, the first test for many of these qui tam lawsuits is surviving a motion to dismiss.  Because FCA suits allege fraud against the government, they must be pleaded with particularity as required by Rule 9(b) of the Federal Rules of Civil Procedure.  This post discusses recent developments to those standards from 2019.

Courts have held that to satisfy Rule 9(b), FCA complaints must include a detailed description of the alleged fraud scheme and facts to show the scheme resulted in a request for reimbursement from the government.  A failure on either account will result in dismissal.

Continue Reading Recent Developments in False Claims Act Pleading Standards

In two prior posts [Government Files Amended FCA Complaint Against Private Equity Firm and its Portfolio Company and DOJ Intervention in Healthcare Fraud Case Highlights Potential Risks for Private Equity Firms], we wrote about the Department of Justice’s (DOJ) decision to intervene in a False Claims Act (FCA) case against a compounding pharmacy and its private equity backer.

The case, Medrano v. Diabetic Care Rx, LLC, was the first time we had seen the DOJ name a private equity firm in a FCA case involving allegations of wrongdoing by one of its portfolio companies, and we noted that this should be a wake-up call to private equity firms who are actively engaged in the management and control of healthcare companies in which they invest.

The alarm rang once again in September 2019, as the DOJ announced that it reached a $21.36 million settlement with Patient Care America (PCA), the compounding pharmacy at issue in the case, two of the company’s executives and, most notably, the private equity firm Riordan, Lewis & Haden Inc. (RLH) that managed PCA on behalf of its investors.  The settlement was reached on ability to pay grounds.

Continue Reading Private Equity Firm Settles FCA Case

I recently provided comments for an article in Hospice News detailing the False Claims Act case against hospice provider, Heartland Hospice, that also details the government’s focus within this broader long-term care industry. The qui tam case against Heartland recently was dismissed with prejudice by a federal judge.

“Overall, qui tam cases continue to be

This is the second post of a two-part discussion of FCA pleading standards and discusses the pleading requirements for connecting a fraudulent scheme to the submission of false claims.  Read our previous post on the requirements for pleading the details of a fraudulent scheme.

Pleading Submission of False Claims

Most courts require FCA plaintiffs to round out their FCA pleadings with allegations that false claims were submitted to the government as a result of the alleged fraud scheme.  Some courts require plaintiffs to identify specific representative examples, while others permit the pleading of “reliable indicia” leading to a “strong inference” that claims were actually submitted.

Pleading Actual Claims  

The U.S. District Court for the District of Massachusetts recently laid out the level of detail generally expected for pleading the submission of actual false claims.  In U.S. ex rel. Wollman v. General Hospital Corporation, it held the relator made insufficient allegations of actual claims submitted as part of a fraudulent billing scheme involving overlapping surgeries when the complaint included “no dates, identification numbers, amounts, services, individuals involved, or length of time” for any of the surgeries at issue.

Continue Reading Recent Developments in FCA Pleading Standards – Part Two

This is the first post of a two-part discussion of FCA pleading standards and discusses the requirements for pleading the details of a fraudulent scheme. Read our post on the pleading requirements for connecting a fraudulent scheme to the submission of false claims.

The False Claims Act (FCA) continues to be the federal government’s primary civil enforcement tool for imposing liability on healthcare providers who defraud federal healthcare programs.  A significant portion of FCA litigation is initiated through the filing of sealed qui tam complaints by relators on behalf of the United States.  When these complaints are unsealed, whether the government intervenes or not, their first hurdle is often surviving a motion to dismiss.  Because actions under the FCA allege fraud against the government, courts require allegations sufficient to satisfy Rule 9(b) of the Federal Rules of Civil Procedure.

Determining whether an FCA complaint satisfies Rule 9(b) turns on two related questions: Does it contain an adequate description of the alleged fraud scheme? If so, does it connect that scheme to false claims submitted to the government?

This post discusses the requirements for adequately pleading a fraudulent scheme.  We have also written a follow-up post discussing the requirements for connecting that scheme to the submission of actual false claims.  To follow our discussion of recent developments in FCA pleading standards, subscribe to this blog.

Pleading Details of a Fraudulent Scheme

Generally speaking, courts agree that in order to pass muster, FCA complaints must include all of the details one would expect to find in the first paragraph of a newspaper article—that is, the “who, what, when, where and how” of the alleged fraud.  While meeting this standard may seem simple enough, courts continue to grapple with the nuances and difficulties associated with pleading fraud with the requisite specificity.

Continue Reading Recent Developments in FCA Pleading Standards – Part One

Greenway Health LLC, a Tampa-based developer of electronic health records (EHR) software, recently agreed to pay $57.25 million to resolve False Claims Act (FCA) allegations that it overstated the capabilities of and failed to correct known errors with its EHR software.  In a complaint filed in the United States District Court for the District of Vermont, the United States alleged that Greenway caused its users to submit false claims to the government by, among other things, misrepresenting the capabilities of its EHR product “Prime Suite” and providing unlawful remuneration to users to induce them to recommend the product.

EHR Companies Must Be HHS Certified

The American Recovery and Reinvestment Act of 2009 established the Medicare and Medicaid EHR Incentive Program to encourage healthcare providers to adopt EHR technology and demonstrate its “meaningful use.”  To obtain certification for their product, EHR companies are required to demonstrate that their product satisfies all applicable U.S. Department of Health and Human Services (HHS) certification criteria.  This requires that developers do the following two things:

  1. Pass testing performed by an independent, accredited testing laboratory authorized by HHS.
  2. Obtain and maintain certification by an independent, accredited certification body authorized by HHS.


Continue Reading Electronic Health Records Company Pays High Price for Software Shortcomings

In recent years, healthcare providers have increasingly faced civil and criminal enforcement actions premised on the allegation that services billed to government healthcare programs were not medically necessary. As a result, those claims allegedly have constituted fraud in violation of the civil False Claims Act (FCA) and/or various criminal statutes.

These actions – whether brought by the government in civil or criminal proceedings or qui tam relators in civil FCA cases – pose significant issues for providers. Often, disputing clinical judgments related to care or services provided many years in the past can be particularly challenging when efforts are made by the government or relators to use statistical sampling to establish civil liability and/or damages across a vast universe of claims. Given the risks associated with these cases, it is not surprising that there have been a number of high-dollar civil settlements involving medical necessity allegations against providers, including hospitals, physicians and providers of hospice, home health and therapy services. In criminal cases, the government likewise has secured a number of high-profile convictions and guilty pleas in cases challenging billing associated with allegedly unnecessary medical procedures.

Continue Reading FCA Medical Necessity Cases May Stand on Firmer Footing After Recent Appellate Decisions

Jeff Gibson co-authored an article for the American Bar Association (ABA) outlining some of the tools a company may use in response to a False Claims Act (FCA) investigation. Jeff co-authored the article with Greg Russo, managing director at Berkeley Research Group, for the ABA’s Health Law Section. As the authors point out, the government has been very successful in recent years in pursuing allegations against healthcare companies accused of submitting false claims under the FCA.

Continue Reading Jeff Gibson Outlines Investigative Tools in FCA Cases

As highlighted in a previous post, the $348 million judgment against the owners and operators of skilled nursing facilities in U.S. ex rel. Ruckh v. Genoa Healthcare, LLC, made serious waves in the FCA world.  The judgment, which included a trebling of the jury’s damages verdict and fines of $5,500 for each of over 400 claims, far surpassed any settlement or judgment previously entered in a long-term care or skilled nursing case.  However, on January 11, 2018, nearly a year after entering the landmark judgment, the Middle District of Florida overturned it.  In doing so, the court reiterated some of the more stringent requirements a relator must meet in order to prevail on an FCA claim.

Continue Reading Ruckh Court Overturns $350 Million False Claims Act Judgment

The Department of Justice’s recent decision to intervene in a False Claims Act case against not only a compounding pharmacy but also the private equity firm that owns a controlling stake in it, underscores the potential risks private equity firms face when operating in the highly regulated healthcare space.  On February 16, 2018, the United States filed a complaint in intervention in Medrano v. Diabetic Care Rx, LLC, Case No. 15-62617-CIV-BLOOM, alleging the compounding pharmacy, Patient Care America (“PCA”), paid illegal kickbacks to marketing firms who targeted military members and their families for prescriptions for compounded drugs the pharmacy then created not to meet individual patient needs, but rather to maximize reimbursement from Tricare, the federal military health care program.  In a somewhat unique move, the government also named as a defendant the private equity company Riordan, Lewis & Haden Inc. (“RLH”), which manages and controls PCA through a general partner.

Continue Reading DOJ Intervention in Healthcare Fraud Case Highlights Potential Risks for Private Equity Firms