It is often stated that the sine qua non (the indispensable and essential action) of a violation of the False Claims Act (FCA) is the submission of a false or fraudulent claim. This principle has been recognized and cited in federal courts throughout the country. A recent case that was decided in the United States District Court for the Southern District of Georgia, U.S. ex rel. Lawson v. Aegis Therapies, Inc., provided further confirmation of this principle. In Lawson, summary judgment was granted in the defendants’ favor because neither the Relator nor the Government was able to conduct any allegation of purported wrongdoing by the defendants to the submission of any specific false claim for payment by the Government.
Lawson involved claims that were brought against skilled nursing facilities by William Lawson, who had previously been employed by defendant Aegis as a staff physical therapist. The federal Government intervened in the litigation. Lawson alleged that the defendants had engaged in schemes of wrongdoing by attempting to maximize their reimbursement from the Government by assigning the highest levels of rehabilitative therapy to patients and by providing group therapy “without regard to outcome, performance, or medical benefit.” Despite making these allegations and providing general information regarding his observations of certain patient care, Lawson “could not identify a single patient who was kept in therapy so a higher RUG category than was medically necessary could be billed” and he also could not “identify a single patient who he witnessed receiving medically unnecessary services.”
The defendants filed a motion for summary judgment and argued, in part, that there was no evidence of any specific false claims that were presented to the Government. The Court considered certain schemes that had been alleged — such as an allegation of unnecessary therapy that had purportedly been provided to a single patient and allegations of improper group therapy — and found that those allegations had not been connected to any particular claims that had been submitted to the Government. As the Court explained, “Plaintiffs have not come forward with admissible evidence of a single claim and said ‘this one is objectively false.’” Accordingly, the Lawson court found that summary judgment for the defendants was appropriate.
The Lawson court also considered the allegations that evidence of wrongdoing could be found in the benchmarks that the defendants had purportedly used in connection with the therapy levels. The court found that there was no evidence that these benchmarks had been used in a wrongful manner that was intended to cause most patients to be billed at the highest therapy level. Rather, the Lawson court found that the benchmarks “were simply a business metric” that allowed for monitoring of the facility’s operations. Thus, the court rejected the assertion that these benchmarks demonstrated that the defendants were acting with knowledge that false claims were being submitted to the Government.
It is oft-stated that a relator must link allegations of wrongdoing to specific false claims that were actually submitted to the Government. The Lawson case further confirmed this principle by granting summary judgment in the defendants’ favor where the relator and the Government were unable to adduce evidence of any specific false claims that had actually been submitted by the defendants.