Scarbrough v. Alabama Cancer Care LLC, 1:22-cv-01533

Dr. Todd Scarbrough, a former radiation oncologist with Alabama Cancer Care (ACC), filed a qui tam action under the False Claims Act (FCA) against ACC and physicians Dr. Sanford and Dr. Sengar.
Scarbrough alleges three fraudulent schemes: (1) Billing Medicare for radiation treatment management services not provided, (2) Billing for CT diagnostic services not reviewed as required, using falsified physician signatures, and (3) Billing for IMRT (intensity-modulated radiation therapy) services performed without required patient-specific safety checks.
The alleged conduct occurred between 2016 and 2020 while Scarbrough was employed at ACC, and he bases his knowledge both on personal observations and internal communications/billing data.
Defendants moved to dismiss, arguing the complaint fails to meet Rule 12(b)(6) and 9(b) specificity standards required in FCA fraud claims.
The court partially granted and partially denied the motions, dismissing claims against Sengar for radiation management and IMRT, all IMRT claims, and the reverse false claims count—but gave Scarbrough leave to amend.
Surviving claims include those against Sanford and ACC for radiation treatment management and ACC for improper image-guided radiation therapy billing.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether complaint alleges submission of false claims for FCA purposes	Scarbrough alleged particular details, billing data, and direct knowledge for certain claims	Defendants argue insufficient detail or mere inference, especially as to Sengar and IMRT	Allegations sufficient for Sanford/ACC radiation mgmt. & ACC CT billing, insufficient as to Sengar/IMRT
Whether claims for IMRT services are plausibly false under FCA	ACC’s procedures blatantly violate Medicare QA requirements for IMRT	ACC’s use of software QA may be permissible; requirements not clear or universally accepted	Court found Scarbrough’s allegations too conclusory and lacking support from broader medical consensus, dismissed IMRT claims
Whether radiation treatment management fraud properly pleaded	Provided factual detail on lack of face-to-face patient visits and internal admissions at ACC	Claims based on rumors or non-specific evidence; scope limited to certain time periods	Claims well-pleaded as to Sanford/ACC; not merely rumors; not time-limited as argued
Whether reverse false claims allegation sufficiently pleaded	Defendants had obligation to return Medicare overpayments after learning of fraud	Obligation duplicative of direct FCA claims, no specific allegations of knowing retention	Allegations too vague under Rule 9(b); reverse false claims dismissed

Ashcroft v. Iqbal, 556 U.S. 662 (pleading standard for plausibility)
Hishon v. King & Spaulding, 467 U.S. 69 (construing facts in favor of plaintiff on motion to dismiss)
United States ex rel. Clausen v. Lab. Corp. of Am., 290 F.3d 1301 (Rule 9(b) standards for FCA submissions)
Walker v. R & F Props. of Lake Cnty., Inc., 433 F.3d 1349 (direct personal knowledge suffices for FCA complaints)
United States v. AseraCare, Inc., 938 F.3d 1278 (plausibility and objectivity in FCA falsity)
Matheny v. Medco Health Solutions, Inc., 671 F.3d 1217 (well-pleaded FCA facts suffice, direct knowledge not always required)
Corsello v. Lincare, Inc., 428 F.3d 1008 (submission of a false claim cannot just be inferred)