D'Anna v. Capstone Medical Resources LLC
2:19-cv-00391
| N.D. Ala. | Mar 17, 2025Background
- Nancy D’Anna and Valerie Paige Zeiger, as qui tam relators, sued Capstone Medical Resources, LLC and Dr. Sharon Waltz under the False Claims Act (FCA) for allegedly submitting false Medicaid claims.
- Dr. Waltz, founder of Capstone, provided psychological evaluation services and later added therapeutic services, billing Medicaid for both.
- The relators alleged fraudulent billing practices while employed at Capstone; after their complaint was filed, Dr. Waltz was criminally charged and ultimately pleaded guilty to health care fraud involving the same conduct.
- In the FCA civil case, Dr. Waltz admitted in deposition, for herself and Capstone, to knowingly submitting false Medicaid claims and receiving federal funds for them.
- The relators moved for summary judgment as to liability; Capstone and Waltz argued procedural and legal defenses, including the public disclosure bar and the effect of Dr. Waltz’s intent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Public Disclosure Bar | Complaint was filed before criminal case; relators are original source | Relators are not original source, so claim barred | Not barred – relators are original source |
| Form of Summary Judgment Motion | Brief sufficiently functions as a motion | No formal motion—lack of notice and prejudice | Brief accepted as a proper motion |
| Preclusive Effect of Criminal Conviction | Dr. Waltz’s guilty plea estops her from denying False Claims Act elements | Prior criminal conviction shouldn’t preclude relitigation, especially intent | Guilty plea estops Dr. Waltz on FCA elements |
| Evidence of Capstone’s Scienter | Dr. Waltz’s deposition binds Capstone as entity | Deposition statements insufficient; no knowing intent | Capstone bound by Waltz’s representative admissions |
Key Cases Cited
- Universal Health Servs., Inc. v. United States, 579 U.S. 176 (FCA imposes penalties for submitting false or fraudulent claims to the government)
- United States v. Killough, 848 F.2d 1523 (criminal conviction estops defendant from relitigating identical issues in subsequent civil case)
- Gose v. Native Am. Servs. Corp., 109 F.4th 1297 (elements of FCA liability)
- White v. Beltram Edge Tool Supply, Inc., 789 F.3d 1188 (summary judgment standard — evidence viewed in favor of non-movant)