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FCA Qui Notes
May 27, 2022

Nothing to See Here: Solicitor General Recommends That SCOTUS Deny Cert. in Eleventh Circuit Case on Rule 9(b)

Qui Notes: Unlocking the False Claims Act

On May 24th—a little over a week after the Supreme Court of the United States called for the views of the Solicitor General (“SG”) in US ex rel. Owsley v. Fazzi Associates, Inc., a Sixth Circuit case raising the question of the appropriate Federal Rule of Civil Procedure 9(b) standard in FCA cases—the SG filed its brief responding to the Court’s identical call from January in a different case, out of the Eleventh Circuit, that also implicates the Rule 9(b) debate.

In its amicus filing in US ex rel. Johnson v. Bethany Hospice, the SG recommends that the Court deny cert., arguing that the circuit split on the Rule 9(b) issue is less stark now than it was nearly a decade ago when the government filed a similar, invited amicus brief in US ex rel. Nathan v. Takeda Pharmaceuticals North America, Inc., 572 US 1033 (2014). The government’s brief in Nathan opposed “a per se rule that a relator must plead the details of particular false claims—that is, the dates and contents of bills or other demands for payment—to overcome a motion to dismiss.” In recent years, the SG now argues, “the courts have largely converged on an approach that allows relators either to identify specific false claims or to plead other sufficiently reliable indicia supporting a strong inference that false claims were submitted to the government,” and thus SCOTUS intervention is not warranted. The SG’s brief proceeds to describe the approaches of circuit courts on the Rule 9(b) issue and, notwithstanding the variability it outlines, asserts that the standards have become more refined and “largely” convergent in their retreat from necessarily requiring details of individual false claims in all circumstances. The SG describes the divergent opinions of various courts on the level of particularity required at the pleading stage not as a function of inconsistent legal standards or “evidence of disarray,” as petitioner Johnson had characterized it, but as “simply [a] reflect[ion of the] courts’ application of a fact-intensive standard to a range of different types of allegations.” And, the SG argues, the Court’s intervention likely would not result in “greater uniformity or materially clarify the Rule 9(b) pleading standard for FCA complaints” in any event.

Of note, the SG opines that, even if the Rule 9(b) issue were cert-worthy, Johnson is not the right vehicle for the Court’s review, as the case implicates not only the issue of particularity under Rule 9(b) but also the adequacy of this relator’s AKS allegations, the combination of which would complicate the Court’s consideration of the issues. Curiously, the SG’s brief says nothing about two other cases under cert. consideration by the Court that also tee up the Rule 9(b) debate: Owsley (in which the Court just last week called for the SG’s views) and Molina Healthcare of Illinois, Inc. v. US ex rel. Prose (a case from the Seventh Circuit that is set for hearing on June 2), leaving the reader to guess whether the SG views either—or neither—case as a more appropriate vehicle for clarification of the particularity standard, should the Court choose to weigh in on the issue altogether.

FCA practitioners can debate the merits of the SG’s characterization of the state of play among the circuits and whether the government’s recommendation against cert. is motivated, at least in part, by a concern that the Court would endorse a more demanding pleading standard for FCA plaintiffs. Regardless, it will be interesting to see whether the SG telegraphs any additional views leading up to the June 2 conference in Molina, and whether the SG’s views in Johnson are enough to dissuade the Court from what is the more statistically likely outcome—i.e., granting cert. after a Call for the Views of the Solicitor General, notwithstanding the SG’s recommended denial.

We will stay tuned and keep our readers updated.

© Arnold & Porter Kaye Scholer LLP 2022 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.