Executive Summary

Decided on the same day, United States ex rel. Sheldon v. Allergan Sales, LLC and United States ex rel. White v. Gainwell Technologies LLC are two district-court opinions applying the Supreme Court’s landmark False Claims Act (FCA) scienter decision, United States ex rel. Schutte v. SuperValu Inc., 598 U.S. 739 (2023). Schutte held that the FCA’s “knowing” requirement is subjective: it turns on what the defendant actually knew or believed, not on what an objectively reasonable person would have understood. The Sheldon court applied that standard to move a twelve-year-old Medicaid drug-rebate case — that had previously been dismissed on the theory that the manufacturer’s reading of an ambiguous statute was objectively reasonable — to discovery. In contrast, in White, the same subjective standard was not enough to save the relators, whose complaint against a Medicaid fiscal agent failed to plead non-conclusory facts about that defendant’s own knowledge, and the case was dismissed with prejudice. Read together, the two decisions show that Schutte‘s holding denies FCA defendants the “reasonable interpretation” shield, but it does not relieve relators of pleading concrete, plausible facts about the particular defendant’s state of mind.

Why It Matters

For anyone advising healthcare providers, drug manufacturers, pharmacy-benefit managers, and claims processors, these cases are examples of where the FCA scienter battle now takes place. After Schutte, a defendant can no longer win dismissal simply by showing that its reading of an ambiguous legal requirement was objectively reasonable — the question is what the defendant subjectively believed, which is rarely resolvable on the pleadings. That raises the litigation and settlement exposure of any FCA defendant relying on an “everyone read it that way” defense, as Sheldon vividly shows. At the same time, White confirms that the subjective standard is not a free pass for relators: conclusory allegations that a defendant “knew” or “recklessly disregarded” the truth will still be dismissed, especially against downstream intermediaries whose role is processing someone else’s claims. For settlement counsel and neutrals, the practical upshot is that valuing an FCA case now turns less on the reasonableness of the legal position and more on the strength of the evidence of the specific defendant’s knowledge — a fact-intensive inquiry that rewards early, candid evaluation.

Detailed Discussion of the Facts

These cases are good examples of how the district courts are applying Schutte v. SuperValu Inc., where the Supreme Court construed the FCA’s scienter element — “actual knowledge,” “deliberate ignorance,” or “reckless disregard” of the truth or falsity of a claim. The Court held that this standard is subjective, referring to “the defendant’s knowledge and subjective beliefs — not to what an objectively reasonable person may have known or believed.” Schutte thereby abrogated the widely used defense — drawn from Safeco Insurance Co. of America v. Burr — that a defendant who adopted an objectively reasonable interpretation of an ambiguous requirement could not have acted “knowingly,” regardless of its actual beliefs.

Sheldon is a qui tam action under the Medicaid Rebate Statute alleging that Allergan misreported its drug “Best Price” — omitting price concessions — to reduce the rebates it owed state Medicaid programs. The case has a long history. The district court originally dismissed it, and the Fourth Circuit affirmed (Sheldon II, 24 F.4th 340 (2022)), holding that Allergan’s interpretation of the ambiguous Best Price requirement was objectively reasonable and therefore defeated scienter. After Schutte, the Supreme Court vacated that judgment and remanded; on remand the Fourth Circuit (Sheldon VII, 170 F.4th 227 (2026)) applied the subjective standard and revived the case, holding that statutory ambiguity does not defeat scienter where a defendant may have subjectively known its reading was wrong. Back in the district court — now in the case’s twelfth year — Allergan asked, under Rule 54(b), for leave to file a third motion to dismiss.

White is a qui tam action against Gainwell Technologies, the private fiscal agent that processes Medicaid claims for Rhode Island. The relators alleged that Gainwell facilitated a years-long scheme by Eleanor Slater Hospital (ESH) — a Rhode Island state hospital — to submit false and inflated Medicaid bills. The United States declined to intervene. The court had dismissed the first amended complaint and allowed a single narrow theory to proceed on amendment; on the second amended complaint it had earlier found the relators plausibly alleged reckless disregard, while noting that “the facts point to the state of Rhode Island, not Gainwell, as the source of ESH’s fraud.” Gainwell again moved to dismiss.

Legal Analysis

Applying Schutte‘s subjective standard, the two courts reached opposite conclusions — a contrast that maps the post-Schutte terrain:

• The subjective standard is the common ground. Both courts applied Schutte‘s rule that FCA scienter turns on the defendant’s own knowledge and beliefs. The question is no longer whether a hypothetical reasonable person could have read the requirement the defendant’s way, but whether this defendant actually knew, was deliberately ignorant of, or recklessly disregarded the truth.
• Sheldon: ambiguity no longer ends the case at the pleadings. Because Schutte removed the objective-reasonableness shield, whether Allergan subjectively believed its Best Price reporting was correct is a fact question that cannot be resolved on a motion to dismiss. The court denied Allergan’s Rule 54(b) request to file a third motion to dismiss, holding that a twelve-year-old case should proceed to discovery rather than absorb another round of pre-discovery motion practice, and declined to let Allergan re-litigate Rule 9(b) falsity at this late stage.
• White: the subjective standard still demands particularized facts. The relators’ complaint “failed to plausibly allege that Gainwell possessed the requisite scienter under the subjective standard established by the Supreme Court in SuperValu.” It pleaded no non-conclusory facts about Gainwell’s subjective knowledge of the adequacy of the hospital’s billing, and no particularized facts showing a scheme to defraud by Gainwell rather than by the hospital or the State.
• Causation compounds the problem for intermediaries. As the recipient and processor of the hospital’s claims — with no substantive input into them — Gainwell could not have “knowingly caused” the submission of false claims. The scienter and causation inquiries converged: without facts showing Gainwell’s own culpable state of mind, there was no basis to hold the fiscal agent liable for the hospital’s fraud.
• Opposite procedural outcomes. Sheldon proceeds to discovery, its scienter question preserved for a factual record; White was dismissed with prejudice, the relators having neither sought nor warranted further amendment.
• The synthesis — Schutte focuses on facts. Post-Schutte, the decisive FCA question has migrated from “was the defendant’s interpretation reasonable?” — a legal issue courts could resolve on the pleadings — to “what did this defendant actually know or believe?”, a fact-specific inquiry. That migration makes ambiguity-based dismissals far harder for defendants, but it puts a premium on the relator’s ability to plead the specific defendant’s knowledge with particularity.

Holding

In Sheldon, the court denied Allergan’s Rule 54(b) motion and refused to permit a third motion to dismiss, holding that under Schutte the subjective-scienter question could not be resolved on the pleadings and the case should proceed to discovery. In White, the court held that the second amended complaint failed to plausibly allege that Gainwell acted with the subjective scienter Schutte requires — or that it knowingly caused the submission of false claims — granted the motion to dismiss, and entered judgment dismissing the case with prejudice.

John Libby is a mediator and arbitrator focused on healthcare and commercial disputes, including False Claims Act, Stark Law, and Anti-Kickback matters. This summary is offered for general informational purposes and does not constitute legal advice.

Executive Summary

In United States ex rel. Kyer v. Thomas Health System, Inc., the Fourth Circuit Court of Appeals affirmed the dismissal of a qui tam False Claims Act (FCA) suit brought by a former hospital nurse against a nonprofit health system, its two hospitals, its employed-physician group, and a former executive. The relator alleged that the defendants submitted Medicare claims tainted by violations of the Stark Law and the Anti-Kickback Statute (AKS), so that the system’s certifications of compliance rendered those claims false. Reviewing an 83-page amended complaint supported by roughly 30 pages of billing tables, the court held that the complaint failed to plead fraud with the particularity Rule 9(b) requires. At the heart of the decision is a clean legal line: paying physicians for their own productivity — measured in work relative value units (wRVUs) for services they personally perform — is not the same as paying them for referrals, and does not, by itself, create the prohibited financial relationship the Stark Law requires.

Why It Matters

This decision is a meaningful win for health systems, employed-physician groups, and the compliance teams that advise them. It confirms that widely used wRVU productivity compensation does not, standing alone, create Stark Law exposure, because the statute excludes a physician’s personally performed work from the definition of a “referral.” The ruling also cabins the Fourth Circuit’s landmark Tuomey decision — distinguishing ordinary productivity pay from a “collections” formula that captured the hospital’s facility fees — and it reaffirms rigorous Rule 9(b) gatekeeping: a relator cannot dump thousands of billing codes into an appendix and ask the court to find the fraud, but must connect those codes to Medicare’s “designated health services” and to a concretely pleaded self-referral or kickback scheme. For settlement counsel and neutrals, it is a useful marker of how pleading-stage vulnerabilities drive the realistic value of a healthcare FCA case.

Detailed Discussion of the Facts

Thomas Health System, Inc. is a nonprofit corporation in South Charleston, West Virginia, that owns two hospitals — Thomas Memorial Hospital and St. Francis Hospital — and controls THS Physician Partners, Inc. (THSPP), a multi-specialty group employing physicians and nonphysician providers such as physician assistants and nurse practitioners (who, under West Virginia law, generally must practice under physician supervision). The hospitals participate in Medicare and, on enrollment and in annual cost reports, must certify compliance with the Stark Law and the Anti-Kickback Statute. The relator, Liesa Kyer, was a former nurse at Thomas Memorial.

THSPP paid its physicians based on their wRVU totals — a work-based measure of the time, skill, and effort a procedure requires — with a minimum target to earn a base salary and a bonus that scaled with wRVUs above the target; some physicians also received credit for a share of the wRVUs generated by nonphysicians they supervised, and a handful were paid at or above the 90th percentile of national benchmarks. In early 2015, the system adopted a “provider-based billing” structure, converting certain physician offices into hospital departments. That change “unbundled” billing so that THSPP billed the professional-services component while the hospital separately billed a higher facility fee, leaving THSPP to run operating losses that the parent backfilled through transfers — while the integrated system captured more Medicare revenue overall.

Kyer filed her qui tam complaint under seal in November 2020; the government obtained five seal extensions over nearly three years before declining to intervene. Her March 2024 amended complaint asserted four counts — presenting false claims, false statements material to false claims, conspiracy, and a reverse false claim. Rather than sue to recover any overcharges itself, she pursued the claims on the government’s behalf. The district court (S.D. W. Va., Judge Goodwin) dismissed the complaint under Rule 9(b) and denied post-judgment vacatur and leave to amend; Kyer appealed both rulings, which the Fourth Circuit reviewed together as a single judgment.

Legal Analysis

The district court dismissed the complaint for failing to plead fraud with the particularity Rule 9(b) requires — a standard that, where FCA liability hinges on an underlying Stark or Anti-Kickback violation, demands that the underlying scheme itself be pleaded with particularity. The relator’s billing tables established the who, what, where, and when, but not the “how,” or indeed “whether,” any claim was actually false. Affirming, the Fourth Circuit detailed several key points:

• wRVU productivity is not referral-based compensation. The dispositive Stark element was the “financial relationship.” An indirect compensation arrangement requires physician pay that “varies with, or takes into account, the volume or value of referrals,” and wRVU compensation rewards the physician’s own personally performed work — which the statute expressly excludes from the definition of a “referral.” A formula “takes into account” referrals only if it includes referrals as a variable; a wRVU formula contains no such input.
• Distinguishing Tuomey. In Tuomey II, the unlawful formula was based on “collections” that included the hospital’s facility fees, tying physician pay directly to referral revenue. wRVUs, by contrast, track only the physician’s labor — so Tuomey does not sweep in ordinary productivity pay.
• Supervision credit and high pay did not bridge the gap. Crediting a physician for supervising nonphysicians rewards the physician’s own (legally required) work, not referrals. Pay above the 90th percentile, standing alone, does not show variation with referrals — by definition, ten percent of physicians exceed it — distinguishing Bookwalter, where compensation ran two-to-three times that benchmark with other red flags.
• The Anti-Kickback theories failed. The hospitals’ transfers covering THSPP’s operating deficit were at least as consistent with lawful explanations — maintaining unprofitable service lines or the accounting consequence of provider-based billing — as with a kickback, and facts equally consistent with lawful and unlawful conduct do not survive Rule 9(b). A $5,000 marketing stipend cut the other way entirely: it induced THSPP physicians to attract patients to their own practices, making them the inducers of outside referrals rather than parties induced to refer to the hospitals.
• The derivative counts collapsed. Because no claim was rendered false, there was no unlawful agreement to support the conspiracy count, and the reverse-false-claim count necessarily failed as well.
• Denial of leave to amend was no abuse of discretion. Having filed in 2020, amended in 2024 with the benefit of more than 500,000 pages of pre-amendment discovery and the roadmap of a motion to dismiss, and still offered no proposed cured complaint, the relator gave the district court ample basis to deny another round for undue delay and repeated failure to cure.

Holding

The Fourth Circuit affirmed, holding that the complaint failed to plead FCA fraud with Rule 9(b) particularity: it alleged neither a Stark Law violation — because wRVU-based productivity compensation is not compensation tied to the volume or value of referrals — nor a plausible Anti-Kickback Statute violation. The derivative conspiracy and reverse-false-claims counts failed with the substantive claims, and the district court did not abuse its discretion in denying post-judgment vacatur and leave to amend. The judgment was affirmed.

John Libby is a mediator and arbitrator focused on healthcare and commercial disputes, including False Claims Act, Stark Law, and Anti-Kickback matters. This summary is offered for general informational purposes and does not constitute legal advice.

Here are the updated case summaries split into three separate quarterly documents, categorized by statutory provision. The requested Westlaw citations, courts, and dates of opinion have been added after each case name in the specific format you requested.

2025Q3 (July 1 – September 30, 2025)

31 U.S.C. § 3729(a)(1)(A) and (B) — Liability for False Claims and Statements

• United States ex rel. Gomez v. Koman Construction, LLC 2025 WL 2437197 (U.S.D.C., W.D. Texas August 22, 2025): The court discussed how factually false claims misrepresent the goods or services provided, while legally false claims involve an express or implied false certification of compliance with legal or contractual obligations.
• United States ex rel. Streck v. Eli Lilly and Company 2025 WL 2618821 (U.S.C.A, Seventh Circuit, September 11, 2025): The court evaluated drug pricing calculations submitted to Medicaid, determining that excluding subsequent price increases from Average Manufacturer Price calculations contradicted the plain text of statutes, rendering the claims false as a matter of law.
• United States ex rel. O’Laughlin v. Radiation Therapy Services, P.S.C. 2025 WL 2417089 (U.S.C.A, Sixth Circuit, August 21, 2025): The court analyzed the “false certification” theory of liability. The relator alleged that the defendants billed Medicare for radiation services without the required supervision of a qualified physician. The court dismissed the claims because the relator failed to prove that compliance with state-level supervision requirements was a material prerequisite to obtaining payment from Medicare.
• United States ex rel. Folse v. Napper 2025 WL 2585680 (U.S.D.C., M.D. Tennessee September 5, 2025): This case examines how violations of the Anti-Kickback Statute (AKS) predicate FCA liability. The court emphasized the “resulting from” requirement of the statute, interpreting it as a strict but-for causation standard—meaning the submitted false claims must have actually resulted from the underlying AKS violation.

31 U.S.C. § 3729(a)(1)(C) — Conspiracy

• United States ex rel. Gomez v. Koman Construction, LLC 2025 WL 2437197 (U.S.D.C., W.D. Texas August 22, 2025): The court outlined the two requirements to state a conspiracy claim: an unlawful agreement to obtain payment for a false claim, and an overt act in furtherance of it.
• United States ex rel. O’Laughlin v. Radiation Therapy Services, P.S.C. 2025 WL 2417089 (U.S.C.A, Sixth Circuit, August 21, 2025): The court noted that the only evidence pleaded in support of the conspiracy claim was that all defendants committed FCA violations. Because the relator failed to provide sufficient proof of underlying false claims, the derivative conspiracy claim was also dismissed.
• United States ex rel. Leslie Carico v. Veterans Guardian VA Claim Consulting, LLC 2025 WL 2588895 (U.S.D.C., M.D. North Carolina September 8, 2025): The court found that a relator failed to allege any circumstances constituting fraud on the part of the defendants with respect to a conspiracy to fraudulently obtain a PPP loan.

31 U.S.C. § 3729(a)(1)(G) — Reverse False Claims

• Island Industries, Inc. v. Sigma Corporation 2025 WL 2422455 (U.S.C.A, Ninth Circuit, August 21, 2025): The court confirmed that an importer becomes liable for antidumping duties as soon as goods arrive, creating an actionable “obligation” to the government under the FCA even before the exact amount is fixed. It also held that the FCA’s reverse false claims provision can coexist alongside the Tariff Act.

31 U.S.C. § 3729(b) — Definitions of “Knowing” (Scienter) and “Material”

• United States ex rel. Streck v. Eli Lilly and Company 2025 WL 2618821 (U.S.C.A, Seventh Circuit, September 11, 2025): Evaluating scienter, the court emphasized that Congress intended to reach the “ostrich” type situation where an individual buries their head in the sand. Regarding materiality, the court found that the government’s continued payment after learning of the fraud is “evidence of immateriality” but is not on its own “dispositive”.
• Island Industries, Inc. v. Sigma Corporation 2025 WL 2422455 (U.S.C.A, Ninth Circuit, August 21, 2025): The court rejected an objective reasonableness defense to scienter, reaffirming that the FCA focuses on whether the defendant acted with actual knowledge, deliberate ignorance, or reckless disregard, not what a hypothetical reasonable person might have believed.
• United States ex rel. Gomez v. Koman Construction, LLC 2025 WL 2437197 (U.S.D.C., W.D. Texas August 22, 2025): The court interpreted the scienter standard to conclude that the relators successfully alleged that the defendants acted with actual knowledge when they submitted bids knowing they would pass the work through to non-compliant entities to illegally secure set-aside contracts.

31 U.S.C. § 3730(b) — Actions by Private Persons (Qui Tam)

• United States v. Gilead Sciences, Inc. 2025 WL 2627686 (U.S.D.C., E.D. Pennsylvania September 11, 2025): The court addressed a constitutional challenge to the FCA’s qui tam provisions. It rejected the argument that relators violate the Appointments Clause of Article II, noting that relators lack the tenure, duration, and continuous duties required to be considered “Officers of the United States”.
• Joel Mahl v. City of New York 2025 WL 2696441 (U.S.D.C., E.D. New York September 22, 2025): The court noted that because a relator brings an action on behalf of the United States, a non-attorney layperson cannot proceed pro se under the FCA.
• Michael Buxbaum v. Walt Disney Co. 2025 WL 2676487 (U.S.D.C., S.D. New York September 18, 2025): Reaffirmed that because a relator brings an action on behalf of the United States, a non-attorney pro se litigant cannot prosecute a qui tam action.
• United States ex rel. STF, LLC v. True Health Diagnostics, LLC 2025 WL 2600012 (U.S.D.C., E.D. Texas September 5, 2025): The court utilized 31 U.S.C. § 3730(b)(1), which dictates that a qui tam action may only be dismissed if the court and the Attorney General give written consent to approve a joint stipulation of dismissal.
• In re Webb 2025 WL 2629846 (U.S.D.C., N.D. Ohio September 12, 2025): The court rejected a Rule 27 petition to preserve evidence for an anticipated qui tam action, noting that the petitioner failed to identify any actionable fraudulent demand for payment that injured the federal government.

31 U.S.C. § 3730(d) — Award to Qui Tam Plaintiff

• United States ex rel. Scott v. Humana Inc. 2025 WL 2603057 (U.S.D.C., W.D. Kentucky September 9, 2025): The court analyzed a prevailing relator’s petition for attorneys’ fees and expenses following a settlement, determining it was reasonable to award out-of-town specialist rates due to the highly specialized nature of the litigation.

31 U.S.C. § 3730(e)(4) — The Public Disclosure Bar

• United States ex rel. Smith v. Odom 2025 WL 2424425 (U.S.C.A, Eleventh Circuit, August 22, 2025): The court elaborated on the “original source” exception, finding that a relator does not “materially add” to public disclosures by merely supplying background information or details that contextualize the core fraud hypothesis already available in the news media.
• United States ex rel. Sorgi v. Jazz Pharmaceuticals 2025 WL 2701928 (U.S.D.C., D. Massachusetts September 23, 2025): It barred the relator’s suit, finding that the relator lacked insider knowledge, relied entirely on information in the public domain, and merely added “color” to previously disclosed facts.

31 U.S.C. § 3730(h) — Relief From Retaliatory Actions

• Evans v. Individual Advocacy Group, Inc. 2025 WL 2651242 (U.S.D.C., District of Columbia September 16, 2025): The court interpreted the elements of a retaliation claim, holding that an employee who refused to backdate training documents to prevent her employer from defrauding a government agency had plausibly engaged in protected preventative activity.
• Reinhardt v. Guidehouse Inc. 2025 WL 2603688 (U.S.D.C., District of Columbia September 9, 2025): Discussing the scope of claims subject to mandatory arbitration, the court confirmed that employment-related whistleblower retaliation claims brought under the FCA are arbitrable.
• United States ex rel. Gomez v. Koman Construction, LLC 2025 WL 2437197 (U.S.D.C., W.D. Texas August 22, 2025): The court held that to satisfy the “protected activity” element of a retaliation claim, the relator’s conduct must raise a “distinct possibility” of an FCA action or otherwise seek to stop fraud against the government.

2025Q4 (October 1 – December 31, 2025)

31 U.S.C. § 3729(a)(1)(A) and (B) — Liability for False Claims and Statements

• United States ex rel. Arehart v. U.S. Medical Management, LLC 2025 WL 3677743 (U.S.D.C., E.D. Wisconsin December 18, 2025): The court reaffirmed that an FCA presentment claim requires pleading with particularity, dismissing the complaint for providing no details on when, how many, or by whom specific false claims were actually submitted.
• Jensen v. Genesis Laboratory Management, LLC 2025 WL 3763951 (U.S.D.C., D. New Jersey December 30, 2025): The court found that while the relators adequately pled when the fraud occurred, they failed to plead how it occurred with “reliable indicia” that false claims were actually submitted to the government.
• Natasha Dixon v. Volunteers of America 2025 WL 3244391 (U.S.D.C., W.D. Louisiana November 20, 2025): The court allowed a presentment claim to survive, noting the relator identified specific supervisors who instructed employees to falsify Medicaid assessments to ensure coverage, providing reliable indicia of fraud.
• Jevarien Z. Dunlap v. Bay Area Rapid Transit 2025 WL 3146412 (U.S.D.C., N.D. California November 11, 2025): The court identified the four general elements necessary to state a claim under § 3729(a)(1)(A)-(B).
• United States ex rel. Breslow v. JP Pharma, LLC 2025 WL 3640892 (U.S.D.C., W.D. Virginia December 16, 2025): The court found the relator adequately pled falsity regarding a patient inducement scheme where claims were submitted for medically unnecessary treatments tainted by kickbacks.
• United States ex rel. Souza v. Embrace Home Loans, Inc. 2025 WL 3072653 (U.S.D.C., D. Rhode Island November 4, 2025): The court noted that FCA liability under these sections may arise where a defendant falsely certifies compliance with a material requirement of a federal statute or regulation.
• United States ex rel. Devarapally v. Ferncreek Cardiology, P.A. 2025 WL 3565506 (U.S.D.C., E.D. North Carolina December 12, 2025): The court evaluated the “implied certification theory” for medically unnecessary laboratory tests and testimony from physicians regarding their belief of medical necessity at the time they engaged in the treatment and billing.
• United States ex rel. Thomas v. Premier Home Health Care Services, Inc. 2025 WL 3002967 (U.S.D.C., S.D. New York October 27, 2025): The court evaluated the “more relaxed” Rule 9(b) pleading standard concluding that a relator without access to specific bills must still make plausible allegations that the invoices were uniquely within the defendant’s control.
• United States ex rel. Relator, LLC v. iLink Employers Company 2025 WL 3066301 (U.S.C.A, Ninth Circuit, November 3, 2025): The court reversed a dismissal, finding the relator plausibly alleged with particularity that the defendants made false statements and submitted false certifications on federal Paycheck Protection Program (PPP) loan applications.
• United States ex rel. Gentry v. Encompass Health Rehabilitation Hospital 2025 WL 3063921 (U.S.C.A, Fifth Circuit, November 3, 2025): The court dismissed false presentment and false records claims because the relator failed to accompany conclusory allegations with details of an actually submitted false claim.

31 U.S.C. § 3729(a)(1)(C) — Conspiracy

• United States ex rel. Arehart v. U.S. Medical Management, LLC 2025 WL 3677743 (U.S.D.C., E.D. Wisconsin December 18, 2025): The court dismissed a conspiracy claim because the relator failed to adequately allege an underlying FCA violation.
• Jensen v. Genesis Laboratory Management, LLC 2025 WL 3763951 (U.S.D.C., D. New Jersey December 30, 2025): The court reiterated that without an underlying violation of the FCA, there can be no derivative liability for conspiracy.
• Natasha Dixon v. Volunteers of America 2025 WL 3244391 (U.S.D.C., W.D. Louisiana November 20, 2025): The court dismissed a conspiracy claim because it requires at least two legally distinct actors, and after one defendant was dismissed for lack of jurisdiction, no second conspirator remained.

31 U.S.C. § 3729(a)(1)(G) — Reverse False Claims

• Natasha Dixon v. Volunteers of America 2025 WL 3244391 (U.S.D.C., W.D. Louisiana November 20, 2025): The court held that potential penalties falling within a discretionary range cannot serve as the basis for an “obligation” under a reverse false claim theory.
• Christopher A. Feduccia v. I.C.E. Services, Inc. 2025 WL 3251221 (U.S.D.C., D. Alaska November 21, 2025): The court dismissed a reverse false claim related to the retention of PPP loan funds because the relator failed to plead with specificity exactly how the defendant knowingly concealed or avoided its obligation to return the funds.
• United States ex rel. Thomas v. Premier Home Health Care Services, Inc. 2025 WL 3002967 (U.S.D.C., S.D. New York October 27, 2025): The court dismissed reverse false claims because they mirrored the relator’s direct false claims, noting that reverse false claims cannot be premised on the same conduct.

31 U.S.C. § 3729(b) — Definitions of “Knowing” (Scienter) and “Material”

• United States ex rel. Schutte v. SuperValu Inc. 2025 WL 3048985 (U.S.D.C., C.D. Illinois October 31, 2025): The court reaffirmed the Supreme Court’s standard that “knowingly” focuses on subjective beliefs—whether the defendant actually knew, intentionally avoided learning, or submitted claims despite a substantial and unjustifiable risk of falsity.
• United States of America and State of Minnesota ex rel. Ashley Mothershed v. Mayo Clinic Ambulance 2025 WL 3043342 (U.S.D.C., D. Minnesota October 31, 2025): The court emphasized that a relator must show the defendant acted knowingly with respect to the particular false claim at issue.
• United States ex rel. Breslow v. JP Pharma, LLC 2025 WL 3640892 (U.S.D.C., W.D. Virginia December 16, 2025): Reaffirming Schutte, the court reiterated that the scienter element refers to defendants’ subjective beliefs, not an objectively reasonable person.
• United States ex rel. Souza v. Embrace Home Loans, Inc. 2025 WL 3072653 (U.S.D.C., D. Rhode Island November 4, 2025): The court noted that materiality is a “fact-intensive and context-specific inquiry”.
• United States ex rel. Omni Healthcare Inc. v. MD Spine Solutions LLC 2025 WL 3442574 (U.S.C.A, First Circuit, December 1, 2025): The court evaluated the scienter requirement for laboratories performing “medically unnecessary” tests, holding that a laboratory can generally rely on a doctor’s order to show that a test is medically necessary.

31 U.S.C. § 3730(b) — Actions by Private Persons (Qui Tam)

• United States ex rel. Goebel v. Anchorage SNF, LLC 2025 WL 2898087 (U.S.D.C., D. Maryland October 10, 2025): Interpreting the first-to-file bar, the court held that an earlier-filed lawsuit that alerts the government to the essential facts of a fraudulent scheme completely bars a later action, even if the new action names entirely different defendants.
• Ronetta Smith v. Respiro, LLC 2025 WL 3140610 (U.S.D.C., N.D. Illinois November 10, 2025): The court ruled that a relator’s complete failure to comply with the procedural requirements of § 3730(b)(2)—by filing on the public docket and failing to serve the government—inherently harms the government and mandates dismissal with prejudice.
• Jevarien Z. Dunlap v. Bay Area Rapid Transit 2025 WL 3146412 (U.S.D.C., N.D. California November 11, 2025): Reaffirmed that a non-attorney pro se litigant cannot prosecute a qui tam action.
• United States ex rel. Gentry v. Encompass Health Rehabilitation Hospital 2025 WL 3063921 (U.S.C.A, Fifth Circuit, November 3, 2025): Touched on constitutional issues with unaccountable private actors exercising core executive power.
• Michael Hunter v. Doctor Haas 2025 WL 2830261 (U.S.D.C., D. South Dakota October 6, 2025): Non-attorney pro se litigant cannot prosecute a qui tam action.
• Terasa DeMarinis v. Southern New Hampshire University 2025 WL 3012854 (U.S.D.C., D. Massachusetts October 28, 2025): Non-attorney pro se litigant cannot prosecute a qui tam action.
• United States ex rel. Relator LLC v. Pape (The Articom Group) 2025 WL 3707557 (U.S.D.C., N.D. California December 22, 2025): Discussed constitutional and public disclosure limits on private actions.

31 U.S.C. § 3730(d) — Award to Qui Tam Plaintiff

• United States ex rel. Jahr v. Tetra Tech EC, Inc. 2025 WL 3124335 (U.S.D.C., N.D. California November 7, 2025): The court noted that arguments regarding the extent to which relators “substantially contributed to the prosecution of the action” under § 3730(d)(1) must be made claim-by-claim with specific evidentiary support.
• BNSF Railway Company v. The Center for Asbestos Related Disease 2025 WL 3004741 (U.S.D.C., D. Montana October 27, 2025): Following a jury finding that the defendant committed 337 violations of the FCA, the court awarded the relator 25% of the total proceeds.

31 U.S.C. § 3730(e)(4) — The Public Disclosure Bar

• Christopher A. Feduccia v. I.C.E. Services, Inc. 2025 WL 3251221 (U.S.D.C., D. Alaska November 21, 2025): Confirmed that data hosted on federal websites regarding PPP loans constitute “federal reports” that trigger the public disclosure bar.
• United States v. William Allan Jones 2025 WL 3240804 (U.S.D.C., N.D. California November 20, 2025): Consistently confirmed that data hosted on federal websites regarding PPP loans constitute “federal reports” that trigger the public disclosure bar.
• United States ex rel. Relator LLC v. Pape (The Articom Group) 2025 WL 3707557 (U.S.D.C., N.D. California December 22, 2025): Evaluated whether the Small Business Administration’s website disclosing a company’s PPP loan triggered the bar, concluding it did not because the website only disclosed the misrepresented facts.

31 U.S.C. § 3730(h) — Relief From Retaliatory Actions

• United States ex rel. Thomas v. Premier Home Health Care Services, Inc. 2025 WL 3002967 (U.S.D.C., S.D. New York October 27, 2025): Distinguished retaliation claims from substantive fraud claims, holding that an FCA retaliation claim need not be plead with particularity.
• United States v. Alabama Psychiatry LLC 2025 WL 3213480 (U.S.C.A, Eleventh Circuit, November 18, 2025): Affirmed a grant of summary judgment in favor of a former employer regarding an FCA retaliation claim.

2026Q1 (January 1 – March 31, 2026)

31 U.S.C. § 3729(a)(1)(A) and (B) — Liability for False Claims and Statements

• United States ex rel. Sedona Partners LLC v. Able Moving & Storage, Inc. 2026 WL 492402 (U.S.D.C., S.D. Florida February 23, 2026): Interpreted the presentment claim requirement, ruling that a relator must offer indicia of reliability or actual submission of a false claim.
• Mary Bixler Wood v. Siemens Medical Solutions USA, Inc. 2026 WL 504530 (U.S.C.A, Second Circuit, February 24, 2026): Dismissed FCA claims because the relator failed to plead under Rule 9(b) that the allegedly malfunctioning medical devices were actually sold to or paid for by the government.
• United States ex rel. Camburn v. Novartis Pharms. Corp. 2026 WL 864529 (U.S.D.C., S.D. New York March 30, 2026): Ruled that a relator successfully pled fraud with particularity by utilizing a representative sample exhibit detailing specific doctors, the exact number of tainted claims, and exact Medicare reimbursement amounts resulting from illegal kickbacks.
• Calvin Andrews v. Spokane Housing Authority 2026 WL 851989 (U.S.D.C., E.D. Washington March 27, 2026): Briefly defined a false or fraudulent claim for payment as the imposition of civil liability on anyone who knowingly presents or uses a false record or statement material to a claim to the United States government.
• United States ex rel. Scarbrough v. Alabama Cancer Care, LLC 2026 WL 208627 (U.S.D.C., N.D. Alabama January 27, 2026): Elaborated that presentment requires specific information about the submission of claims.
• United States ex rel. Adventist Health System of West v. AbbVie Inc. 2026 WL 743495 (U.S.C.A, Ninth Circuit, March 17, 2026): Held that a relator adequately stated claims by alleging drug manufacturers fraudulently inflated drug prices in violation of the Section 340B Program.
• Adam Josephs v. Amentum Services Inc. 2026 WL 183543 (U.S.D.C., D. Maryland January 23, 2026): Addressed an interlocutory appeal request over pleading an implied false certification claim.

31 U.S.C. § 3729(a)(1)(G) — Reverse False Claims

• United States v. LabQ Clinical Diagnostics, LLC 2026 WL 787460 (U.S.D.C., S.D. New York March 20, 2026): Determined that the Affordable Care Act’s requirement that a provider report and return overpayments imposes an immediate, self-executing obligation sufficient to support a reverse false claim action.
• United States ex rel. Frey v. Health Management Systems, Inc. 2026 WL 637725 (U.S.C.A, Fifth Circuit, March 6, 2026): Evaluated reverse false claims allegations, finding the summary-judgment record did not contain evidence that the defendant actually failed to bill even a single claim under its contracts.

31 U.S.C. § 3729(b) — Definitions of “Knowing” (Scienter) and “Material”

• United States ex rel. Scarbrough v. Alabama Cancer Care, LLC 2026 WL 208627 (U.S.D.C., N.D. Alabama January 27, 2026): Interpreted the FCA’s “scienter” requirement—demanding actual knowledge, deliberate ignorance, or reckless disregard—and found it adequately alleged.
• United States ex rel. Sheldon v. Allergan Sales, LLC 2026 WL 706428 (U.S.C.A, Fourth Circuit, March 13, 2026): Applying the subjective scienter standard, the court noted that the ambiguity of a statute does not defeat scienter if the defendant was subjectively aware of a substantial risk that the government interpreted the statute differently.

31 U.S.C. § 3730(b) — Actions by Private Persons (Qui Tam)

• United States ex rel. Adventist Health System of West v. AbbVie Inc. 2026 WL 743495 (U.S.C.A, Ninth Circuit, March 17, 2026): Evaluating the purpose of the qui tam provision, emphasized that a relator uses the FCA as an independent mechanism, not barred by the 340B statute lacking a private right of action.
• United States v. Lockheed Martin Corporation (Ferguson) 2026 WL 656046 (U.S.C.A, Fifth Circuit, March 9, 2026): Distinguishing the first-to-file bar, ruled it does not apply if the later complaint alleges a different mechanism or scheme of perpetrating the fraud, rather than merely adding details or new locations.
• Alana Sullivan v. Murphy Medical Center 2026 WL 657192 (U.S.D.C., E.D. Tennessee March 9, 2026): Clarified that when the government intervenes on only some claims within an action, the relator is not precluded from independently proceeding with the non-intervened claims.
• Michael J. Izquierdo v. United States 2026 WL 626731 (U.S.D.C., N.D. Ohio March 6, 2026): Reaffirmed that because a relator brings an action on behalf of the United States, a non-attorney pro se litigant cannot prosecute a qui tam action.
• Adam Josephs v. Amentum Services Inc. 2026 WL 183543 (U.S.D.C., D. Maryland January 23, 2026): Addressed an interlocutory appeal regarding constitutionality.
• Corey Spaulding v. Pamela Bondi 2026 WL 189488 (U.S.D.C., D. Massachusetts January 23, 2026): Dismissed a pro se plaintiff’s FCA complaint entirely because the plaintiff failed to comply with statutory relator procedures.

31 U.S.C. § 3730(d) — Award to Qui Tam Plaintiff

• United States ex rel. David Perry v. First Psychiatric Planners, Inc. 2026 WL 412327 (U.S.D.C., D. Massachusetts February 13, 2026): Interpreted § 3730(d)(3) to mean that if a relator is convicted of criminal conduct arising from his role in the underlying FCA violation, he is barred from recovering any share.

31 U.S.C. § 3730(e)(4) — The Public Disclosure Bar

• United States ex rel. Scarbrough v. Alabama Cancer Care, LLC 2026 WL 208627 (U.S.D.C., N.D. Alabama January 27, 2026): Applied the public disclosure bar to dismiss claims against a doctor because his status and Medicare billing history were publicly disclosed on the CMS database.
• United States ex rel. St. Paul’s Foundation v. Timothy Wipperman 2026 WL 622771 (U.S.D.C., M.D. Tennessee March 5, 2026): Noted that following the 2010 amendments to the FCA, the public disclosure bar is no longer a jurisdictional hurdle, and must be evaluated under Rule 12(b)(6).
• United States ex rel. Relator LLC v. David O’Rourke 2026 WL 799601 (U.S.D.C., E.D. New York March 23, 2026): Confirmed that data hosted on federal websites regarding PPP loans constitute “federal reports” that trigger the public disclosure bar.

31 U.S.C. § 3730(h) — Relief From Retaliatory Actions

• United States ex rel. Quintin J. Schwartz Sr. v. Document Reprocessors 2026 WL 795590 (U.S.D.C., W.D. New York March 23, 2026): Analyzed the 2009 amendments to the FCA, concluding that the deletion of the word “employer” did not expand retaliation liability to include individual supervisors; liability may only be imposed on the employer entity.
• United States ex rel. Sargent v. Collins 2026 WL 171536 (U.S.C.A, First Circuit, January 22, 2026): Held that the FCA does not contain an express waiver of federal sovereign immunity for retaliation claims, meaning a federal employee cannot sue the United States government for retaliation under this section.

Why It Matters: The decision is a significant victory for healthcare providers participating in the 340B program. It affirms that the FCA remains a potent, independent tool to remedy fraud involving 340B drug pricing, even when the relator is a covered entity that would otherwise be forced to use the program’s administrative dispute resolution process to recover its own losses. The ruling holds that, while covered entities cannot sue drug makers directly for breach of contract over 340B overcharges, they can serve as qui tam relators and stand in the shoes of the government to recover taxpayer funds under the FCA.

The Facts: Adventist Health System of West operates hospitals and medical clinics and qualifies as a “covered entity” under the Public Health Service Act’s Section 340B Program. The defendants are drug manufacturers who opted into the 340B Program by signing Pharmaceutical Pricing Agreements (PPAs) with the government, legally subjecting them to price ceilings for drugs sold to covered entities.

Adventist alleged that the defendants engaged in a long-running fraudulent scheme by knowingly charging “materially false, unlawfully inflated prices” that ignored the statutory formula. According to the complaint, the manufacturers’ prices suddenly plummeted to $0.01 per unit shortly after January 2019, when the Health Resources and Services Administration (HRSA), which administers the 340B programs, issued a new final rule that imposed hefty civil penalties for non-compliance with the 340B ceiling price formula.

Rather than proceeding administratively to recover the overcharges it paid out of its own pocket, Adventist filed a qui tam action under the FCA. It alleged that the manufacturers’ inflated prices caused the federal and state governments to wrongly pay hundreds of millions of dollars through Medicaid, Medicare (due to critical access hospitals billing at 101% of their drug costs), and government-funded clinics.

Legal Analysis: The district court originally dismissed Adventist’s complaint with prejudice, relying heavily on the Supreme Court’s decision in Astra USA, Inc. v. Santa Clara County, 563 U.S. 110 (2011). In Astra, the Supreme Court held that 340B covered entities cannot sue drug manufacturers for overcharges under a breach-of-contract claim, but must instead use the program’s Administrative Dispute Resolution (ADR) process. Applying this logic, the district court reasoned that Adventist’s FCA claims were essentially an impermissible attempt to enforce Section 340B, which lacks a private right of action.

The Ninth Circuit disagreed and reversed the lower court, making several key points in its legal analysis:

First, the court explained that the absence of a private right of action under Section 340B is immaterial when a relator brings an FCA claim. Adventist was not suing for compensatory damages to recover its own losses as a covered entity; rather, it was standing in the shoes of the government to remedy financial losses to the public fisc. It is “irrelevant” that Adventist happened to be a covered entity. As a relator, it played a separate role in using the FCA as an independent legal avenue.

Second, the Ninth Circuit distinguished Astra, which barred common law breach-of-contract suits intended to enforce 340B PPAs directly. Adventist’s FCA action, by contrast, sought statutory penalties and treble damages under a separate federal fraud statute, meaning it was not “in essence a suit to enforce” Section 340B.

Third, the court stressed that barring the claim would undermine the broad, remedial purpose of the FCA. Because Congress did not write a specific exception into the FCA for 340B claims, the court refused to imply one, noting that there is no “positive repugnancy” between the FCA and Section 340B.

Finally, the Ninth Circuit also rejected the defendants’ argument that Adventist failed to plead “falsity” for claims pre-dating the 2019 final rule. The court found the allegations plausible because the plain text of the statutory formula and a 2011 formal written guidance from the government already established the “penny pricing” policy for situations where the statutory formula resulted in a negative ceiling price.