841 F. Supp. 2d 523
D. Mass.2012Background
- Relator (Estate of Robert Cunningham) sues Millennium for FCA violations and similar state-law claims; the public disclosure bar governs jurisdiction.
- The FCA public disclosure bar precludes qui tam suits unless the government opposes or the relator is an original source; 2010 amendment narrowed scope for state court disclosures.
- The California suit against Calloway by Millennium describes Millennium’s billing practices and emails suggesting potential fraud; this constitutes a prior public disclosure.
- Cunningham filed the original complaint in 2009; after his death, his estate was substituted; US declined to intervene; several states declined as well.
- The issue is whether the 2009 public disclosure bars preclude jurisdiction over the 2011 First Amended Complaint, and whether the amendment can cure jurisdiction.
- Court concludes the 2009 public disclosure bar (as it existed) precludes jurisdiction; dismissal with prejudice of Count I (FCA) and dismissal without prejudice of state-law claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the FCA public disclosure bar barred the suit at filing | Cunningham argues amended bar applies retroactively | Bar in place at filing governs jurisdiction | Bar precludes jurisdiction; dismissal with prejudice |
| Whether the original-source exception applies | Relator contests lack of original source status | No viable original source status | Original-source exception not satisfied; not needed due to bar |
| Which public disclosure bar applies—2006 vs 2010 version | Current version should apply retroactively | Time-of-filing version controls | 2006 version governs jurisdiction at filing; amended version not retroactive |
| Whether amendment after filing can cure lack of jurisdiction | Amendment should cure jurisdictional defect | Amendment cannot create jurisdiction | Amendment cannot cure jurisdiction; dismissal appropriate |
| Whether pendent state-law claims survive after FCA dismissal | State claims should proceed | Decline jurisdiction over pendent claims | State-law claims dismissed without prejudice per pendent-jurisdiction prudence |
Key Cases Cited
- Rockwell Int’l Corp. v. United States, 549 U.S. 457 (U.S. 2007) (public disclosure bar operates as a jurisdictional bar)
- Graham Cnty. Soil and Water Conservation Dist. v. United States ex rel. Wilson, 130 S. Ct. 1396 (U.S. 2010) (public-disclosure analysis requires four-part test)
- Schindler Elevator Corp. v. United States ex rel. Kirk, 131 S. Ct. 1885 (U.S. 2011) (public-disclosure analysis applied; substantial similarity standard)
- Newman v. Burgin, 930 F.2d 955 (1st Cir. 1991) (jurisdictional analysis for federal claims and pendent claims)
- United States ex rel. Ondis v. City of Woonsocket, 587 F.3d 49 (1st Cir. 2009) ('based upon' prior disclosures when substantially similar)
- McKesson Corp., 649 F.3d 322 (1st Cir. 2011) (relator’s allegations substantially similar to prior disclosures)