Case Information
*2 Before: RENDELL, FUENTES and SMITH, Circuit Judges. *3 (Filed January 28, 2005) Ian Stuart (ARGUED)
1700 Market Street, Suite 2632
Philadelphia, PA 19103
Counsel for Appellants
Cheryl H. Picker
443 Northfield Avenue
West Orange, NJ 07052
William R. Keller
Latona and Keller
8 West Market Street
930 Citizens Bank Center
Wilkes-Barre, PA 18701
Counsel for Appellant Stephen R. Paranich Andrew J. Giorgione
200 Locust Street, Suite 400
Harrisburg, PA 17101
Marianne C. Koepf Stephen Kaus (ARGUED)
Cooper, White & Cooper, LLP 201 California Street
San Francisco, CA 94111
Counsel for Appellee
OPINION OF THE COURT RENDELL, Circuit Judge.
Doctor Stephen Paranich brought this qui tam action against Irwin Leasing Corporation, formerly Affiliated Capital Corporation, a company that finances the purchase of equipment, under the False Claims Act (“FCA” or “Act”), 31 U.S.C. § 3729 et seq. Paranich alleges that Irwin fraudulently induced him to file false Medicare reimbursement claims for chiropractic treatments in which he used a medical device called the Matrix. Irwin has consistently denied liability for any false Medicare claims and further contends that Paranich is not a proper relator in a qui tam action because the allegations he now asserts had been publicly disclosed before his suit and because he is not an original source as defined by the FCA. [1] On Irwin’s motion for summary judgment, the District Court agreed with Irwin on both points and dismissed the complaint for lack of subject matter jurisdiction. Although our reasoning differs somewhat from that of the District Court, we will affirm its dismissal because we conclude that Paranich is not a proper relator under the FCA because his allegations were based on public disclosures and he does not qualify as an “original source.”
I. Factual Background
Matrix Biokinetics, Inc. is a Nevada corporation that sold medical devices throughout the United States. On or about January 1, 1994, Matrix began marketing and selling electrical nerve stimulation devices known as the Matrix Pro Elec DT and the Matrix Pro Elec DT2 (referred to collectively and severally as the “Matrix device”). CERA International, Inc. is a research and technical organization that conducted sales conferences for the Matrix device. After attending a sales conference in late 1996, Paranich decided to acquire a Matrix device for the treatment of patients at his medical clinic, Comprehensive Medical Network (“CMN”). CMN subsequently arranged with an independent sales representative to finance the purchase of the device through leases with Irwin. On December 19, 1996, and March 12, April 4, and June 10, 1997, CMN and Irwin entered into four separate written agreements to lease four Matrix devices.
The Matrix device works by pulsating electricity to the nerves of a patient at various frequencies through electrodes attached to the patient’s body. According to materials published by CERA, when the Matrix device is used at high frequencies, it operates as a neuron blockade, or “nerve block.” This electric nerve block functionality has been viewed as an alternative to a traditional chemical injection nerve block.
By June 1994, the U.S. Food and Drug Administration had approved both models of the Matrix device for marketing and sale in the United States. Ultimately, the FDA granted clearance for sale of the devices under Section 510(k) of the *6 Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. § 360(k), however, the devices were never approved for sale as nerve block devices.
In January 1997, Paranich began submitting claims to Medicare for reimbursement for procedures involving the Matrix device. Under the Medicare system, claims for reimbursement are submitted under standard uniform codes set by the American Medical Association’s Current Procedural Terminology (“CPT”) manual. Paranich was submitting claims for treatments involving the Matrix device under the CPT code for “nerve block injections,” which Medicare reimbursed at rates of $150 to $350 per procedure. [2] Although reimbursement for procedures submitted under the codes for “electronic stimulation” was at rates of $35 to $80 per procedure, Paranich alleged that he was advised by Matrix and CERA to submit claims for nerve block injections to maximize the reimbursement. Medicare purportedly reimbursed Paranich at the rates for nerve block injections.
In June 1997, Dr. Deborah McMenamin, a former employee of CMN, contacted Special Agent Charles Hydock of the U.S. Federal Bureau of Investigation to report that Paranich was overbilling Medicare for M atrix device procedures. *7 Hydock then began an investigation of Paranich and CMN. On October 22, 1997, Paranich was served with a grand jury subpoena requiring CMN to produce, inter alia, all documents relating to the Matrix devices, specifically including billing documents. Paranich stopped billing under the nerve block codes in February 1998.
After being served with the subpoena, Paranich’s lawyer, Kenneth Haber, began investigating the Matrix device. During an extensive investigation, which Haber conducted with limited participation from Paranich, Haber discovered that Transamerica Occidental Life Insurance Company, the carrier and administrator for the Medicare program in Southern California, had published a bulletin advising its providers not to bill Matrix device procedures under the CPT codes for nerve block injections. [3] He also learned that in mid-1998, Transamerica held hearings to determine the proper billing code and attendant reimbursement rates for electrical nerve blocks. Haber learned about the bulletin and hearings by October 1998, and, shortly thereafter, he requested a report of the Transamerica hearings from the government under the Freedom of Information Act (“FOIA”).
Throughout the investigation, Haber was notably cooperative with the government. He communicated with the *8 FBI and U.S. Attorneys’ offices, writing letters to each to provide updates on the progress of the response to the subpoena. In a letter to the U.S. Attorneys’ office dated April 3, 1998, he outlined the alleged fraud perpetrated by Matrix and affiliated companies as his investigation began to disclose this information. The response to the subpoena included seventy (70) boxes of billing records and other materials that were turned over to the FBI.
On May 20, 1998, during the time Haber was conducting his investigation and preparing a response to the subpoena, a group of doctors in Southern California filed a suit against Matrix alleging fraud with respect to billing codes that Matrix had allegedly recommended to those doctors. This state court fraud action, Heifets v. Matrix Electromedical, No. BC-191317 (Ca. Super. 1998), named Irwin as a defendant; however, summary judgment was eventually entered in Irwin’s favor after the Court concluded that Irwin was not responsible for Matrix’s activities. Irwin was also named as a defendant in a similar suit, Rubanenko v. Matrix Biokinetics, Inc., No. BC-196145 (Ca. Super. 1998). Rubanenko was voluntarily dismissed in August 1998.
II. Procedural History
On December 21, 1998, Paranich filed the original
complaint in this action. See United States ex rel. Paranich v.
Sorgnard,
The District Court analyzed whether it had subject matter
jurisdiction under the jurisdictional constraints of the FCA. See
United States ex rel. Fine v. MK -Ferguson Co.,
III. Jurisdiction and Standard of Review Paranich now appeals the District Court’s decision, complaining that the Court erred in its finding that he was not an “original source” of the information regarding the alleged fraud under the FCA. We have jurisdiction to review this final decision of the District Court under 28 U.S.C. § 1291. We will be deemed to be admitted unless controverted by the non- moving party. See id.
The District Court noted that Paranich’s statement of
facts did not respond to Irwin’s statement and was “replete with
unsupported factual assertions.” Paranich,
exercise plenary review of a dismissal for lack of subject matter
jurisdiction. See United States ex rel. Stinson, Lyons, Gerlin &
Bustamante, P.A. v. Prudential Ins. Co.,
IV. Discussion
A. Introduction
We have, on several prior occasions, engaged in
extensive reviews of the history and background of the False
Claims Act. See, e.g., United States ex rel. Dunleavy v. County
of Del.,
In broad strokes, the FCA imposes penalties on persons
who knowingly submit fraudulent claims to the government. To
encourage the ferreting out of fraud against the government, the
FCA incentivizes private individuals aware of such fraud to
bring civil actions as relators against those submitting such
claims by allowing relators to collect a percentage of any
recovery. Prior to filing such a civil action, known as a qui tam
action, the relator must disclose the information regarding the
fraud to the government. The government then has sixty days to
intervene and take over the action. See 31 U.S.C. § 3730(b). If
the government does not do so, the relator may continue with the
to a party not under a court imposed limitation as to its use was
a public disclosure); id. at 1162-76 (Scirica, J., dissenting)
(arguing for a narrower interpretation of public disclosure
focusing on public accessibility); see also Mistick,
action unless the FCA’s jurisdictional bar provision is triggered.
The jurisdictional bar provision operates to exclude qui tam
actions based upon allegations of fraud or fraudulent
transactions that have been publicly disclosed prior to their
filing. The provision was “designed to preclude qui tam suits
based on information that would have been equally available to
strangers to the fraud transaction had they chosen to look for it
as it was to the relator.” Stinson,
The text of the jurisdictional bar provision reads: (A) No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government [General] Accounting Office report, hearing, audit, or investigation, or from the news media, unless the action is brought by the Attorney General or the person bringing the action is an original source of the information.
(B) For purposes of this paragraph, “original source” means an individual who has direct and independent knowledge of the information on which the allegations are based and has voluntarily provided the information to the Government before filing an action under this *14 section which is based on the information.
31 U.S.C. § 3730(e)(4). As enumerated elements, this section divests courts of subject matter jurisdiction where:
(1) there was a “public disclosure”; (2) “in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government [General] Accounting Office report, hearing, audit, or investigation, or from the news media”; (3) of “allegations or transactions” of the fraud; (4) that the relator’s action was “based upon”; and (5) the relator was not an “original source” of the information.
Cf. Dunleavy,
B. Public Disclosure
Corresponding to the first two elements in our catalog, to
qualify as a public disclosure under the FCA, a disclosure must
(1) issue from a source or occur in a context specifically
recognized by the Act, and (2) be sufficient to support the
*15
conclusion that the information contained therein is now public
within the meaning of the Act. See Mistick,
We agree with the District Court’s conclusion that “Irwin
has established public disclosure of the alleged fraud.”
Paranich, 286 F. Supp. 2d at 451. Under our precedent, the
Heifets and Rubanenko complaints and the FOIA report
undoubtedly qualified as public disclosures. In Stinson, we held
that Section 3730(e)(4)(A)’s class of “criminal, civil, or
administrative hearings” should be broadly interpreted to
include criminal, civil, or administrative
litigation,
“encompass[ing] the full range of proceedings in a civil
lawsuit.” See Stinson, 944 F.2d at 1156, 1157. More
specifically, we held that the disclosure of discovery material to
a party who is not under any court imposed limitation as to its
use constituted a public disclosure within the context of a
criminal, civil, or administrative hearing. See id. at 1158.
Although this view is not universally held, see id. at 1168-69
(Scirica, J., dissenting) (arguing that public disclosure refers to
availability of information to the general public at the time of
disclosure); see also Mistick, 186 F.3d at 390 (Becker, C.J.,
dissenting) (decrying Stinson’s definition of public disclosure
for including discovery material given to a single person in
*17
litigation between two private parties and not otherwise filed
with a court), the issue of whether a complaint in a civil action
qualifies as a public disclosure is potentially much less
controversial. Unlike discovery material, a complaint, if it is to
be operative, is necessarily filed with the court and, except in
rare instances, available and accessible to the public. These two
characteristics,
filing with
the court and public
availability/accessibility, would persuade even those in
disagreement with Stinson that a complaint is a public disclosure
under the FCA. See id. at 391 (Becker, C.J., dissenting)
(championing actual, not potential, public accessibility of court
files for public disclosure determination); Stinson,
As to the FOIA report obtained by Paranich’s counsel,
pursuant to Mistick, “the disclosure of information in response
to a FOIA request is a ‘public disclosure.’”
Upon a determination that there has been a public
disclosure within the meaning of Section 3730(e)(4)(A), the next
The next step in our analysis, corresponding with the
fourth element in our catalog, is a determination of whether the
current action is “based upon” the public disclosure of the
allegations or transactions of fraud. We have held, consistent
with the majority of our sister courts of appeals, that the term
“based upon” means “supported by” or “substantially similar
to,” not “actually derived from.” Mistick,
Regarding the complaints in the California cases, we have noted above that the allegations contained in those complaints concerned Matrix’s allegedly fraudulent billing policy. Specifically, the Heifets complaint alleged that the defendants:
[I]nduced Plaintiffs and other class members to acquire the MATRIX Bioelectric Treatment System and Device known as PRO ElecDT or some other name, by misrepresenting to the class members that MEDICARE will pay for treatments given patients with this device. . . . In truth MEDICARE now claims that the billings for treatments rendered by the device were erroneous and in violation of MEDICARE Law.
Complaint ¶ 6, Heifets v. Matrix Electromedical, No. BC- 191317 (Ca. Super. 1998) The Rubanenko complaint asserted similar allegations. Complaint ¶¶ 6-10, Rubanenko v. Matrix Biokinetics, Inc., No BC-196145 (Ca. Super. 1998) Both complaints named Irwin (formerly known as Affiliated Capital Corporation) as a defendant. [9] Considering that these complaints and Paranich’s action set out the same allegations against a common defendant, we believe there is enough similarity to *21 conclude that Paranich’s action was “substantially similar” to the Heifets and Rubanenko complaints and, therefore, that the action was “based upon” them.
We conclude, therefore, that at least with respect to the complaints, all of the elements of the FCA’s jurisdictional bar provision are present. Thus, the District Court was without subject matter jurisdiction to hear the merits of Paranich’s action unless he qualifies as an original source under Section 3730(e)(4)(B).
E. Original Source
Under Section 3730(e)(4)(B), for Paranich to be an original source he must have had (1) direct and (2) independent knowledge of the information on which the allegations are based and (3) have voluntarily information to the Government before filing the action. Because we ultimately find that Paranich fails on the “voluntary” requirement, we do not need to discuss the “direct” and “independent” requirements to resolve this matter. We will, however, comment on these requirements because we believe the District Court erred in focusing on Paranich’s limited involvement in his attorney’s investigation and its finding that Paranich’s knowledge was categorically not direct and independent.
1. Direct
The first requirement for Paranich to qualify as an
original source is that his knowledge of the fraudulent conduct
must have been “direct.” We have interpreted direct to mean
*22
“‘marked by absence of an intervening agency, instrumentality,
or influence: immediate.’” Stinson,
The District Court concluded that Paranich did not qualify as an original source because his knowledge, derived from an investigation conducted by his attorney, was not his own and, therefore, not direct. The Court reasoned further that, because Haber’s information came after learning about the Heifets and Rubanenko suits and Transamerica’s investigation, Paranich’s knowledge was clearly derivative of these prior public disclosures and not direct and independent. [10]
We disagree with the District Court’s application of the
“direct” knowledge requirement because it failed to consider
one very important fact: Paranich did have direct knowledge of
*23
the billing scheme because he was involved in it. The first real
question, therefore, is did Haber’s investigation, which
uncovered most of the fraudulent aspects of the scheme, detract
from the “directness” of Paranich’s own information? See
generally Wang,
2. Independent
The second requirement for Paranich to qualify as an
original source is that his knowledge of the fraudulent conduct
must have been “independent.” We have interpreted this
requirement to mean that knowledge of the fraud cannot be
merely dependent on a public disclosure. See Hafter, 190 F.3d
at 1160 (“[A] relator who would not have learned of the
information absent public disclosure d[oes] not have
‘independent’ information within the statutory definition of
‘original source.’”); accord Findley, 105 F.3d at 683
(“Independent knowledge is ‘knowledge that is not itself
dependent on public disclosure.’”) (quoting Quinn,
on it. [12]
Unlike the District Court, we do not find Paranich’s knowledge to have been derived exclusively from the public disclosures. Instead, as we have pointed out above, his initial knowledge was, from his own experience, independent of such disclosures. And Haber’s efforts were similarly independent of the public disclosures. As early as April 1998, subsequent to the October 22, 1997 serving of the subpoena but prior to the filing of the California lawsuits, the issue of the Transamerica hearing report, and Paranich and Haber’s awareness of the March 1998 Medicare bulletin, Haber wrote letters to the FBI and the U.S. Attorneys’ offices outlining the alleged fraud perpetrated by Matrix and affiliated companies. The letters are proof that Paranich and Haber’s knowledge of the alleged fraud was independent of the California lawsuits for the simple fact that these letters predated the filing of those suits. Their knowledge similarly predated and was therefore independent of the FOIA report; Haber did not even request the FOIA report until October [12] Bear in mind that our interpretation of “independent” in the original source exception is consistent with its common denotation–“not dependent” or “not requiring or relying on something else : not contingent.” Merriam Webster On-Line Dictionary, at http://www.merriamwebster.com. Our interpretation of this word is not affected by the type of statutory construction we have applied to our interpretation of “based upon.” See supra Part IV.D (interpreting “based upon” to mean “supported by” or “substantially similar to,” not “actually derived from”).
7, 1998, six months after he wrote the letters. Finally, the letters seem to have predated Paranich and Haber’s awareness of the March 1998 Medicare bulletin; the record suggests that Paranich and Haber were not aware of this bulletin until in or around October 1998. [13] Even had Haber known of the *27 bulletin prior to writing the letters, the bulletin did not contain any allegations that Matrix and other parties engaged in deliberate misrepresentations; the bulletin merely explained that the use of the Matrix should not be billed as nerve block injections. Accordingly, we conclude that Paranich’s knowledge of the fraudulent conduct was independent of the public disclosures.
3. Voluntary
The last requirement for Paranich to qualify as an original of it by then. In the deposition, Haber never clearly indicated when he learned about the bulletin. Furthermore, the fax itself is from Suffoletta to Paranich; it indicates only that Paranich was made aware of the bulletin on October 23, 1998 (and that Suffoletta was aware of the bulletin at least by this date), but does not date Haber’s awareness. Informed as we are by the record, we can guess that Haber was most likely not aware of the bulletin when he wrote the April letter, which was at most a month after the bulletin was published; it would not make much sense for him to have been aware of it and not cite it in the letter or, at the very least, for him to hold on to that information for six months before having a colleague fax it to his client. Although this reasoning appears sensible, it is, fundamentally, supposition, which is not an appropriate basis for our analysis. However, while this detail is material to a determination of whether Haber’s knowledge of the alleged fraud was independent of the bulletin, fortunately, this determination is not critical to resolution of this issue.
source is that he must have “voluntarily” provided information
to the government before filing the action. Although our courts
have previously commented on the temporal requirement of
providing information to the government before the qui tam
action is filed, see, e.g., Stinson,
To reach that conclusion, the majority relied on a dictionary definition of “voluntary” supporting a common-sense reading of the term: “‘[a]cting, or done, of one’s own free will without valuable consideration; acting or done without any present legal obligation to do the thing done or any such obligation that can accrue from the existing state of affairs.’” Id. at 744 (quoting Webster’s Third New International Dictionary 2564 (1981) (definition 1(g))). Under this definition, the majority determined that the relator was not a volunteer because he acted in return for valuable consideration, i.e., his salary, and under an employment-related obligation to do the very acts he claimed were voluntary. See id. at 743-44 (noting that “[the relator] no more voluntarily provided information to the government than we, as federal judges, voluntarily hear arguments and draft dispositions”).
The relator, citing a floor statement by Senator Grassley, the principal sponsor of the 1986 amendments to the FCA, argued that the provision of information to the government should be held to be voluntary unless compelled by a subpoena. See id. The statement by Senator Grassley is provided below: In the definition of “original source,” the *30 requirement that the individual “voluntarily” informed the Government or news media is meant to preclude the ability of an individual to sue under the qui tam section of the False Claims Act when his suit is based solely on public information and the individual was a source of the allegations only because the individual was subpeonaed [sic] to come forward. However, those persons who have been contacted or questioned by the Government or the news media and cooperated by providing information which later led to a public disclosure would be considered to have “voluntarily” informed the Government or media and therefore considered eligible qui tam relators.
132 Cong. Rec. 20,536 (Aug. 11, 1986). The majority rejected
the relator’s narrow interpretation of this statement, finding that
the statement did “not purport to describe the only situation in
which the voluntary disclosure requirement would bar a qui tam
suit following a public disclosure.” Fine,
*32
In United States ex rel. Barth v. Ridgedale Electric, Inc.,
Id.
Lastly, in United States ex rel. Stone v. AmWest Savings
Association, 999 F. Supp. 852, 857 (N.D. Tex. 1997), the
District Court for the Northern District of Texas, citing both
Fine and Barth, interpreted voluntary to mean “uncompensated”
or “unsolicited,” not “uncompelled.” The Court concluded that
the relator in that case did not voluntarily provide information
to the government because he did so (1) seven months after
leaving employment with the defendant as its president and
CEO and (2) only after securing criminal immunity for
providing statements about the defendant’s questionable
business dealings in the course of a government fraud
investigation of the defendant. See Stone,
As applied to the instant case, once Paranich was served with a subpoena, his cooperation with the government and further investigation of any fraudulent conduct on the part of Irwin was simply not voluntary. Although Paranich was not compelled by the subpoena to outline or research Matrix’s fraud, his investigation was initiated by the subpoena and motivated by a desire to shift the focus of the fraud investigation from himself to another party (i.e., Irwin). (See Haber Dep. 220:10-20) Indeed, to this end, Paranich has at several points during this litigation highlighted the fact that in response to the government’s “vague and non-targeted” subpoena he produced *35 “seventy (70) boxes of billing records.” Paranich no doubt stresses this point in these terms both to display his enthusiastic cooperation with the government’s investigation and to prove that his discovery of the fraud was all his own, unassisted by the subpoena. While this shading of the facts is well suited to steer us away from the conclusion that the subpoena was a public disclosure or that Paranich’s action was based upon the information contained therein, it also serves to steer us toward our conclusion that Paranich was not a voluntary originator of this investigation. This conclusion is solidified by counsel’s admission at oral argument that each of the seventy boxes was submitted in response to the subpoena and none was voluntarily provided to the government based on Paranich’s own further investigation. Paranich simply cannot acknowledge that everything he turned over to the government was pursuant to the subpoena and then, in the same breath, persuasively argue that his provision of information to the government was voluntary.
The materials produced by Haber’s further investigation and supplied in Haber’s two letters to the government stand on no better footing. While the letters were clearly not in response to the subpoena, as such, they were produced as a result of the government’s focus on Paranich and in an attempt to obtain a favorable outcome, as Haber himself specifically stated in his deposition. [15] In short, while it may be an appropriate legal *36 strategy for the subject of a subpoena in a fraud investigation to cooperate with the government and provide additional information in an attempt to shift attention to a properly implicated third party, it is contrary to the policies underlying qui tam actions to allow that individual, already conscripted into aiding the government, to be with clothed with the imprimatur of being an “original source,” with a potential of pecuniary gain, as against the third party.
V. Conclusion
In sum, we conclude that the jurisdictional bar of the FCA applies in this case because Paranich does not qualify as Keller; correct?
A [Mr. Haber]: That’s correct.
Q: And it says in paragraph two, [“]Stephen also probably did not explain that developing this case on his behalf was part of our strategy to avoid his prosecution by the government[.] In doing so[,] we made him more valuable to the government as a relator than as a defendant[.”] First of all you said that; right?
A: That’s correct.
Q: Second of all, you meant it; right?
A: Yes, I did.
(Haber Dep. 220:10-20)
an original source because his provision of information to the government was not voluntary within the meaning of Section 3730(e)(4)(B). Consequently, the District Court was without subject matter jurisdiction to hear Paranich’s action.
For the reasons set forth above, we will AFFIRM the order of the District Court dismissing Paranich’s action as jurisdictionally barred.
Notes
[1] A qui tam plaintiff is commonly referred to as a “relator.”
See Hutchins v. Wilentz, Goldman, & Spitzer,
[2] The relevant CPT codes, 64400-64450, are labeled “Introduction/Injection of Anesthetic Agent (Nerve Block), Diagnostic or Therapeutic.” Paranich also occasionally billed for Matrix device treatments under a code for “unlisted procedures.”
[3] Citing Irwin’s statement of facts (discussed at infra note 5), the District Court found that Transamerica published the bulletin in October 1997. According to the record, the bulletin was actually dated March 1998.
[4] Default judgments were entered against Defendants Matrix Biokinetics, Richard Sorgnard, and CERA International for failure to answer or otherwise plead. Irwin Equipment Finance Corporation and Irwin Finance Corporation successfully moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(6).
[5] Under the local rules for the U.S. District Court for the Middle District of Pennsylvania, a party moving for summary judgment must attach to the motion “a separate, short and concise statement of the material facts, in numbered paragraphs, as to which the moving party contends there is no genuine issue to be tried.” M.D. Pa. L.R. 56.1. The non-moving party is required to submit a statement of facts to respond to the numbered paragraphs set forth in the moving party’s statement, noting those facts “as to which it is contended that there exists a genuine issue to be tried.” Id. Both statements must reference the record for support, and the moving party’s statement of facts
[6] See, e.g., United States ex rel. Mistick PBT v. Hous. Auth.,
[7] Accord United States ex rel. Doe v. John Doe Corp., 960
F.2d 318, 323 (2d Cir. 1992); United States ex rel. Williams v.
NEC Corp.,
[8] See United States ex rel. McKenzie v. Bellsouth Telcoms., 123 F.3d 935, 939 (6th Cir. 1997) (“‘Public disclosure’ also includes documents that have been filed with a court, such as discovery documents and a plaintiff’s complaint.”); Fed. Recovery Servs. v. United States, 72 F.3d 447, 450 (5th Cir. 1995) (“‘Any information disclosed through civil litigation and on file with the clerk’s office should be considered a public disclosure of allegations in a civil hearing for purposes of section 3730(e)(4)(A).’ . . . This includes civil complaints.”) (quoting United States ex rel. Siller v. Becton Dickinson & Co.,
[9] The Heifets complaint was amended to add Irwin as a defendant.
[10] Although the District Court discussed the direct and independent elements together, we will treat them as two separate inquiries.
[11] We note that the cases the District Court relied on, and our precedent in this area, are distinguishable in that here Paranich did have some firsthand experience with the billing scheme in that he actually billed Medicare for treatments involving the machine and his attorney conducted the investigation on his behalf, whereas in Mistick, the relator had only strictly secondhand information of a fraud it did not directly observe, and in Stinson, the attorneys were not directly involved in the fraudulent activity and, rather, sought to be relators in their own right based on information gained in the representation of a
[13] We must point out that the record is not entirely precise on
dating Haber’s awareness of the March 1998 Medicare bulletin.
The District Court’s fact finding regarding the bulletin and the
Transamerica hearings is imprecise. As discussed at supra note
3, the District Court incorrectly dated the bulletin as being
published in October 1997. See Paranich,
[14] Besides the majority opinion, Fine generated one dissent
and three concurrences. The dissenting opinion argued that
there was nothing in the FCA or its legislative history suggesting
that a federal employee, or, specifically, an Inspector General,
could not bring a qui tam action. See Fine, 72 F.3d at 749
(Leavy, J., dissenting). The dissent further argued that the
majority’s view that the provision of information when one has
a legal duty to do so renders the performance of that duty
nonvoluntary was contorted because a legal duty does not affect
one’s choice to perform. See id. at 750 (Leavy, J., dissenting).
That this interpretation of voluntary relied too much on the
actor’s state of mind, a highly unusual and objectively
unverifiable factor on which to hinge a federal court’s subject
matter jurisdiction, was pointed out in one of the concurring
opinions. See Fine,
[15] Haber stated the following in his January 10, 2003 deposition: Q [Mr. Kaus]: This is a letter dated January 30, 2001 from M r. Haber to M r. Latona and Mr.