327 F. Supp. 3d 831
E.D. Pa.2018Background
- Relator Cathleen Forney (former Medtronic District Service Manager) sued under the False Claims Act (FCA), alleging Medtronic paid illegal kickbacks via free "device checks" and practice-management services (reimbursement guidance and administrative assistance); she later abandoned an implant-service theory.
- Medtronic moved for summary judgment invoking the FCA public-disclosure bar (31 U.S.C. § 3730(e)(4)(A)), arguing prior public qui tam complaints disclosed substantially the same allegations.
- Medtronic identified five prior qui tam matters; the court found two — Onwezen and Schroeder — were valid public disclosures because the United States intervened in those matters.
- The court found Onwezen and Schroeder publicly disclosed substantially the same fraud allegations except Forney’s separate credentialing-payment claim.
- Forney produced over 2,000 pages of documents she had provided to the government before filing suit; the court treated them as authentic and examined whether they made her an "original source."
- Applying Third Circuit precedent (Moore), the court held that Forney’s detailed documents materially added to the public disclosures (who/what/when/where/how) as to device checks, reimbursement guidance, and administrative assistance, so she qualifies as an original source; summary judgment was denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether prior public disclosures exist | Forney: prior complaints are not controlling; her detailed submissions matter | Medtronic: prior qui tam complaints (Onwezen, Schroeder, others) publicly disclosed same allegations | Onwezen and Schroeder qualify as public disclosures; others do not because government did not intervene |
| Whether prior disclosures revealed "substantially the same" allegations | Forney: her claims (device checks, practice-management services) are distinct in detail | Medtronic: Onwezen/Schroeder broadly alleged same schemes (follow-up care, billing advice, templates) | Onwezen/Schroeder disclosed substantially the same allegations except Forney's credentialing-payment allegation |
| Whether a qui tam relator is the Government's "agent" for §3730(e)(4)(A)(i) | Forney: relator is not government agent; government control is limited | Medtronic: relators act for the Government and thus make qui tam complaints triggers of the bar | Court: relators are not the government’s agent; agent implies principal control and fiduciary duties, which relators lack |
| Whether Forney is an "original source" (materially adds) | Forney: her documents (names, dates, manuals, coding worksheets) materially add who/what/when/where/how | Medtronic: prior disclosures were broad; Forney's details are cumulative/benign/old and not materially additive | Applying Moore standard, Forney materially added significant, corroborating details and thus is an original source for the barred claims (except credentialing) |
Key Cases Cited
- U.S. ex rel. Moore & Co., P.A. v. Majestic Blue Fisheries, LLC, 812 F.3d 294 (3d Cir. 2016) (defines "original source" materially adds standard: who/what/when/where/how)
- Universal Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (2016) (Supreme Court’s rigorous "materiality" discussion in FCA liability context; distinguished here)
- Vermont Agency of Natural Resources v. United States ex rel. Stevens, 529 U.S. 765 (2000) (discusses relator's statutory role and limits of agency/standing arguments)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard regarding genuine issues of material fact)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment burden-shifting principles)
- United States ex rel. Spay v. CVS Caremark Corp., 875 F.3d 746 (3d Cir. 2017) (materiality principles in the FCA context referenced)