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FCA Relator and U.S. Weigh in on Defendants' Argument that the FCA is Unconstitutional

As part of our ongoing discussion of the Polukoff False Claims Act (FCA) qui tam case (involving allegations that certain heart procedures performed by a cardiologist, and billed for by two hospital defendants, were not medically necessary), we reported in February that some defendants filed a petition for a writ of certiorari with the United States Supreme Court.  In their Petition, Intermountain Health Care, Inc. and IHC Health Services, Inc. d/b/a Intermountain Medical Center (Intermountain) raised two issues:

  1. Whether a court may create an exception to Federal Rule of Civil Procedure 9(b)’s particularity requirement when the plaintiff claims that only the defendant possesses the information needed to satisfy that requirement; and

  2. Whether the FCA’s qui tam provisions violate the Appointments Clause of Article II of the Constitution.

Following Intermountain’s filing in January, the Supreme Court issued a Request for Response in February.  Two weeks ago, both the relator, Dr. Gerald Polukoff, and the United States filed Briefs in Opposition, urging the high court to reject Intermountain’s Petition.

In his brief, the relator addresses both issues raised by Intermountain’s Petition, arguing that:

  1. Circuit courts are not clearly split on the interpretation of Rule 9(b) and that this issue is “not especially important” in part because “[t]he mere fact that defendants sometimes have to proceed to discovery is not an issue of national importance”; and

  2. The Appointments Clause question does not warrant the Supreme Court’s review because “[t]here is not even an arguable circuit split and none is asserted;" moreover, because this “question will arise in literally every FCA case in which the government does not intervene, Intermountain should have to present a compelling argument for why this case is a uniquely good vehicle to consider it” and fails to do so.

In its brief, the United States addresses only the Appointments Clause issue, as it intervened in this case for the limited purpose of defending the constitutionality of the FCA’s qui tam provisions.  The United States argues that all courts of appeal that have considered Appointments Clause challenges to the FCA have rejected these challenges and also contends that this case is an unsuitable vehicle for this challenge because Intermountain “failed to raise the argument in district court, and the court of appeals accordingly declined to address it.”  The United States argues that Intermountain, therefore, has forfeited this argument.

The United States also argues that the case on which Intermountain relies to formulate its Appointments Clause argument, Vermont Agency of Natural Resources v. United States ex rel. Stevens, does not even address the Appointments Clause.  Instead, in Stevens, the Supreme Court held that qui tam relators have Article III standing to pursue actions under the FCA, but did not decide whether the qui tam provisions comport with the Appointments Clause.  The United States also asserts that in Stevens, the Court “expressly declined to rely on the theory that a private relator sues as ‘an agent of the United States’” and instead observes that a relator’s entitlement to share of any recovery creates a personal stake in the outcome and that the FCA essentially assigns a portion of the Government’s damages claim to the relator.  The Stevens Court also states that actions pursued by relators are “‘private suit[s]’ brought by ‘private parties.’” 

In addition to distinguishing the Stevens case, the United States also contends that qui tamrelators do not possess “the practical indicia of federal officers,” including tenure, duration, emolument, and duties, but instead of private parties pursuing civil litigation in their own personal interest.

As always, we will continue to follow this case with interest and report on any additional updates.  It will be particularly interesting to see whether the Supreme Court takes this case, given that the high court recently denied a petition for certiorari in another FCA case, as we described last month.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume IX, Number 129


About this Author

Samantha P. Kingsbury Associate Health Care Compliance, Fraud & Abuse, and Regulatory Counseling

Samantha’s practice focuses on health care enforcement defense matters. These matters often involve criminal and administrative actions brought against health care providers and companies by state and federal governmental and regulatory agencies. She also has experience in assisting clients with internal investigations of potential violations of the federal anti-kickback statute, the Stark law, and the False Claims Act, among other statutes and regulations. Samantha also has experience preparing self-disclosures and other reports relating to such enforcement matters, as well as developing...

Brian P. Dunphy, Pharmaceutical Attorney, Mintz Levin, Anti-Kickback Lawyer,Health Care Enforcement & Investigations Health Care Compliance, Fraud & Abuse, and Regulatory Counseling Complex Commercial Litigation

Brian has handled a wide range of health care litigation matters, government investigations, and voluntary disclosures for an array of health care providers, life sciences companies, and private equity funds and their portfolio companies. He defends clients against allegations of false claims for payment to the government, in SEC investigations and enforcement proceedings, and represents clients in complex business disputes. Brian also counsels clients on health care regulatory issues, including telemedicine laws, compliance with the federal Physician Payments Sunshine Act and analogous state laws, and trains marketing and sales forces on compliance with these laws.

Brian is also committed to pro bono work. He has successfully represented an asylum seeker in removal proceedings, and a disabled student seeking a residential educational placement. Brian advises a nonprofit organization dedicated to researching and preventing traumatic brain injuries. As a result of his pro bono work, Brian was selected to participate in the Boston Bar Association’s Public Interest Leadership Program.

Before joining Mintz Levin, Brian worked for Accenture, a management and technology consulting firm. There, he was a project manager and provided consulting services to several large asset management firms.

During law school, he co-chaired the Grimes Moot Court Competition and was a member of the Frederick Douglass Moot Court team.