Justia Government Contracts Opinion Summaries

A qui tam relator, Sedona Partners LLC, alleged that several transportation service providers (TSPs) engaged in a fraudulent scheme to defraud a U.S. government shipping program. The TSPs were accused of submitting low-ball bids to win contracts and then falsely certifying the need for foreign flag vessel waivers, despite knowing that U.S. flag vessels were available. This allowed them to use cheaper foreign vessels, thereby increasing their profits while undercutting competitors who submitted legitimate bids.The United States District Court for the Southern District of Florida initially dismissed Sedona's first amended complaint without prejudice, citing a lack of specificity in the allegations. Sedona then filed a second amended complaint, which included new allegations based on information obtained during discovery. The defendants moved to dismiss this complaint and to strike the new allegations, arguing that they were derived from discovery and thus circumvented the heightened pleading requirements of Federal Rule of Civil Procedure 9(b). The district court agreed, struck the discovery-based allegations, and dismissed the second amended complaint with prejudice, concluding that without these allegations, Sedona failed to meet Rule 9(b)'s particularity requirement.The United States Court of Appeals for the Eleventh Circuit reviewed the case and reversed the district court's decision. The appellate court held that Rule 9(b) does not prohibit courts from considering allegations based on information obtained in discovery when deciding a motion to dismiss. The court emphasized that Rule 9(b)'s text does not restrict the source of information used to satisfy its requirements and that supplementing the rule with such a restriction would contravene the Supreme Court's guidance against adding pleading requirements on a case-by-case basis. The appellate court vacated the district court's order dismissing the complaint and remanded the case for further proceedings. View "Sedona Partners LLC v. Able Moving & Storage Inc." on Justia Law

Relators filed a qui tam action under the False Claims Act (FCA), 31 U.S.C. 3729-3733, alleging that defendants submitted claims to Medicare without adequate authorization from the relevant Medicare beneficiaries and claims that were the product of unsolicited telemarketing calls to Medicare beneficiaries. The Eleventh Circuit affirmed the district court's grant of summary judgment to defendants with one modification. The court explained that, although the district court applied an erroneous scienter standard, the evidence proffered by relators as to defendants' state of mind with respect to the assignment of benefits forms was insufficient to survive summary judgment under the proper standard. The district court did not err in granting summary judgment as to relators' claims that defendants violated Medicare's unsolicited telephone contact rules. View "Phalp v. Lincare, Inc." on Justia Law

Relators filed a qui tam suit against Keiser University under the False Claims Act (FCA), 31 U.S.C. 3729-3733, alleging that the University falsely certified compliance with a federal law banning incentive payments to university admissions counselors. After relators appealed a limited trial victory, the United States stepped in and settled the case with Keiser, securing a larger monetary recovery than relators did at trial. On appeal, relators challenged the district court's ruling as to the United States and the district court's subsequent award of reduced attorneys' fees and costs. The Eleventh Circuit affirmed the judgment, holding that the United States did not need to satisfy the good-cause intervention requirement for qui tam actions under 31 U.S.C. 3730(c)(3) because that subsection applies only when the government intervenes for the purpose of actually proceeding with the litigation—not when it is stepping in only for the purpose of settling and ending the case; the proposed settlement was fair, adequate, and reasonable; the district court did not err in declining to compel discovery in this case; and the district court did not abuse its discretion in awarding fees and costs. View "United States v. Everglades College" on Justia Law

Relator filed a qui tam action under the False Claims Act (FCA), 31 U.S.C. 3729-3733, claiming that Fresenius violated the FCA by billing the government for overfill that it received for no cost—allegedly a violation of the statutes governing Centers for Medicare and Medicaid Services (CMS) billing. The district court granted Fresenius's motion for summary judgment. Because the allegations that are the basis of this complaint were publicly disclosed and relator is not an original source, the court lacks jurisdiction to hear this case. The court did not reach the merits of the motion for summary judgment. Accordingly, the court reversed the district court's grant of summary judgment on the merits and remanded for entry of an order dismissing the case for lack of subject matter jurisdiction. View "United States ex. rel. Saldivar v. Fresenius Medical Care Holdings, Inc." on Justia Law