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Keywords

defendantjurisdictionappealhearingsummary judgment
defendantjurisdictionsummary judgment

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United States ex rel. Barron v. Deloitte & Touche, LLP, Not Reported in Fed. Supp., 2009 WL 10670806

Facts

Relators Toni Barron and Vicky Scheel, independent therapists, filed a qui tam suit alleging that NHIC and MCST caused school districts to bill Medicaid for services that were not medically necessary. They claimed that NHIC failed to monitor the accuracy of submitted claims and that both defendants knowingly submitted false claims in violation of the FCA. The case was initially dismissed for lack of jurisdiction but was later reversed on appeal, allowing the Relators to proceed with their claims.

Relators Toni Barron and Vicky Scheel, independent therapists, filed a qui tam suit alleging that NHIC and MCST caused school districts to bill Medicaid for services that were not medically necessary.

Issue

The main legal issues were whether the Relators qualified as original sources of the information and whether the defendants knowingly submitted false claims under the FCA.

The main legal issues were whether the Relators qualified as original sources of the information and whether the defendants knowingly submitted false claims under the FCA.

Rule

Under the FCA, a relator must have direct and independent knowledge of the information on which the allegations are based and must have voluntarily provided that information to the government before filing the action. Courts must determine if there has been a public disclosure of the allegations and if the qui tam action is based upon such disclosures.

Under the FCA, a relator must have direct and independent knowledge of the information on which the allegations are based and must have voluntarily provided that information to the government before filing the action.

Analysis

The court analyzed whether the Relators had direct and independent knowledge of the alleged fraudulent activities. It found that while Relator Scheel had some direct knowledge from her work at a school district, she lacked sufficient knowledge regarding the processing of claims. The court concluded that the allegations made by the Relators were based on publicly disclosed information from Senate hearings, which undermined their claim of original source status.

The court analyzed whether the Relators had direct and independent knowledge of the alleged fraudulent activities.

Conclusion

The court granted summary judgment in favor of NHIC and MCST, concluding that the Relators did not meet the original source requirement and that their claims were based on publicly disclosed information, thus lacking subject-matter jurisdiction.

The court granted summary judgment in favor of NHIC and MCST, concluding that the Relators did not meet the original source requirement and that their claims were based on publicly disclosed information, thus lacking subject-matter jurisdiction.

Who won?

National Heritage Insurance Company (NHIC) and Medicaid Claim Solutions of Texas, Inc. (MCST) prevailed because the court found that the Relators failed to establish their status as original sources and did not provide sufficient evidence of knowingly false claims.

National Heritage Insurance Company (NHIC) and Medicaid Claim Solutions of Texas, Inc. (MCST) prevailed because the court found that the Relators failed to establish their status as original sources and did not provide sufficient evidence of knowingly false claims.

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