The False Claims Act ("FCA") requires a materiality to establish a claim for liability, and defines "material" as a natural tendency or capability to influence a bribe. Earlier this year, the Third Circuit applied a stricter materiality standard in United States ex rel. Petratos v. Genentech Inc. ("Petratos"), 855 F.3d 481 (3d Cir. 2017). The Third Circuit ruled that plaintiffs failed to show that the defendant's alleged noncompliance with the Food and Drug Act ("FDA") regulations had an impact on the government's payment decisions, and thus, the alleged conduct was not materially noncompliant. The Court noted that, after the plaintiffs disclosed the defendant's alleged "campaign of disinformation" toward the FDA, the FDA still maintained its approval of the defendant's drug, Avastin, which was at the center of the dispute. Additionally, the government did not stop reimbursement payments for prescriptions of the drug.
U.S. District Judge Mary S. Scriven dismissed a suit brought against HealthMarkets Inc. ("HealthMarkets" or the "Company") by an anonymous whistleblower ("John Doe" or "Doe") on May 23, 2017, after the federal government declined to intervene and John Doe dropped the suit.
Medicare is a national social insurance program that provides health insurance to Americans who are aged 65 or older, younger people with disabilities, and people with end-stage renal disease and amyotrophic lateral sclerosis. As a social insurance program, it is largely funded by payroll taxes on employers and workers, and accounts for about 17% of the 2016 proposed Federal budget. The program contracts with regional insurance companies to process fee-for-service claims per year in order to provide health insurance options for eligible Medicare patients.
The Department of Justice ("DOJ") entered into a False Claims Act ("FCA") suit against a defense contractor that allegedly caused false claims to be made to the U.S. Government. Inchcape Shipping Services Holdings Ltd. ("Inchcape" or the "Company") is accused of overcharging the U.S. Government for port services around the world.