The False Claims Act is a fraud statute; therefore, False Claims Act complaints must be pled with particularity, identifying “the who, what, when, where, and how of an actual false claim” submitted to the government. Whistle-blowers without evidence of specific claims have tried to circumvent the rule with statistics, showing a likelihood that false claims were submitted to the government. The courts have repeatedly rejected these attempts, saying, e.g.:
Rule 9(b) does not permit a False Claims Act plaintiff merely to describe a private scheme in detail but then to allege simply … that claims requesting illegal payments must have been submitted, were likely submitted or should have been submitted.”
In 2013, it appeared the First Circuit Court of Appeals might have cracked opened the door to the use of statistical evidence in False Claims Act cases. In In re Neurontin Marketing and Sales Practices Litigation, the court allowed a statistical expert to testify on the issue of causation, to offer his opinion that Pfizer’s marketing of Neurontin for off-label uses led to increased improper use of the drug.
In 2017 the First Circuit Court of Appeals slammed the door on a whistle-blower who tried to sneak through the crack left by the Neurontin cases.
In United States ex rel. Booker et al. v. Pfizer, Inc., the whistle-blowers had no evidence of actual false claims submitted to the government, but they argued that they could prove the case statistically, citing the Neurontin cases for support. The court rejected the comparison. It said the Neurontin cases did not stand for the proposition that the existence of false claims could be proven through statistics. Rather:
in those cases, we held that plaintiffs could use aggregate data together with strong circumstantial evidence to overcome summary judgment on the distinct issue of whether there was a causal link between fraudulent marketing and demonstrated off-label prescriptions in the distinct context of a civil RICO case — not that such proof could be used to demonstrate the existence of false claims in an FCA case.
The court’s clarification and limitation of the statistical discussion in the Neurontin cases should come as a welcome relief to government contractors, including healthcare providers, who face under-informed bounty hunters hoping to strike it rich with the False Claims Act.