On April 14, 2017, DOJ filed an amicus brief to weigh in on whether the Court should grant certiorari in a case involving interpretation of the False Claims Act’s public disclosure bar. The public disclosure bar has been the subject of a number of recent Court of Appeals decisions (as we reported here, here, and here), and the DOJ brief provides an insight into the Trump Administration’s views on this important area of the law.
In its amicus brief, DOJ argues that the Court should deny certiorari because there is not, as petitioner argued, a circuit conflict regarding what constitutes a public disclosure. Rather, DOJ argued that regardless of various circuits’ specific formulations for deciding when allegations are “substantially the same” as those that were publicly disclosed, the courts “generally have asked whether the disclosures put the federal government ‘on notice’ of a possible false claim.”
In the underlying case, U.S. ex rel. Advocates for Basic Legal Equality, Inc. vs. U.S. Bank, N.A, the relator alleged that defendant U.S. Bank violated the FCA by falsely certifying compliance with loss-mitigation requirements under HUD’s FHA mortgage insurance program. The Sixth Circuit affirmed the district court’s dismissal of the complaint under the public disclosure bar, because two documents – a consent order between U.S. Bank and the Office of the Comptroller of the Currency (“OCC”) and a federal interagency report by the Federal Reserve – contained information that was sufficient to “put the government (and everyone else) on notice that [respondent] allegedly had filed non-compliant documents — documents that could supply the foundation for a fraud claim.” (We previously reported on the district court’s dismissal of this action here).
Petitioner argued that there was a circuit conflict between the Sixth Circuit’s approach to determining whether there was a public disclosure and the approaches of the Seventh and Ninth Circuits (both of which analyze whether relators add “genuinely new and material” information to publicly disclosed allegations). In response, DOJ argued that regardless of the “various verbal formulations” articulated by different circuits to describe the applicable standard (ie. putting the Government “on notice”), the legal analyses by various circuits “are not materially different,” and that different outcomes in public disclosure cases are better explained as varying factual interpretations of different scenarios rather than varying legal standards. DOJ went on to imply that it may well have disagreed with some of the Sixth Circuit’s factual interpretations as to whether the cited documents amounted to a public disclosure in this case, but added that, nonetheless, “any need for this Court’s review is partially mitigated by the fact that the 2010 amendment authorizes the United States to determine whether an FCA complaint should proceed.”
A copy of DOJ’s amicus brief can be found here.