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Update: U.S. Ex Rel. Able V. U.S. Bank: The Supreme Court Denies Petition For Writ Of Certiorari In Public Disclosure Case

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  • Posted on: Jun 29 2017

Last year, this Blog wrote about a qui tam action that was dismissed by the Sixth Circuit because of the application of the public disclosure bar (here). In United States ex rel. Advocates for Basic Legal Equality v. U.S. Bank, 816 F.3d 428 (6th Cir. 2016), the Sixth Circuit held that prior public disclosures are “substantially the same” for purposes of the public disclosure bar if they “encompass” the allegations in the subject qui tam action even though the prior disclosures do not reveal the specific fraud alleged.

Following the dismissal, ABLE filed a petition for a writ of certiorari with the Supreme Court.

In its petition, ABLE argued that Sixth Circuit’s definition of “substantially the same” differed materially from that of the Seventh and Ninth Circuits. In that regard, ABLE contended that the Seventh and Ninth Circuits had considered and rejected the Sixth Circuit’s “broad-brush approach,” holding that “a complaint that is similar [to a public disclosure] only at a high level of generality” does not “trigger[] the public disclosure bar.” United States ex rel. Mateski v. Raytheon Co., 816 F.3d 565, 575 (9th Cir. 2016); United States ex rel. Goldberg v. Rush Univ. Med. Ctr., 680 F.3d 933, 936 (7th Cir. 2012). Instead, only disclosures alleging “that a particular [defendant] had committed a particular fraud in a particular way” trigger the bar. Goldberg, 680 F.3d at 935.

In its opposition, U.S. Bank argued that there was no substantive split because the courts applied the same legal standard: “The Sixth, Seventh, and Ninth Circuits all apply the same overarching rule: public disclosures bar a given complaint when they reveal allegations or transactions that are substantially the same as those presented in the complaint and so suffice to put the government on notice of its allegations.” Brief in Opposition at 24 & n.8 (noting that the First, D.C. and Tenth Circuits are each in accord).

On October 3, 2016, the United States Supreme Court invited the U.S. Solicitor General to express the U.S. Government’s views on the issue. On April 14, 2017, the Solicitor General did so, arguing, in language substantively similar to the argument advanced by U.S. Bank, that “a writ of certiorari should be denied.”

The [Sixth Circuit’s] approach is consistent with decisions from other courts of appeals. The different outcomes in those cases do not result from the application of competing legal standards, but simply reflect the fact that many applications of the public disclosure bar will depend upon a close examination of the relevant facts.

The Solicitor General also argued that, from a practical perspective, there was nothing in the decisions at issue that interfered with the government’s authority to control the cases that get dismissed – a primary purpose of the public disclosure bar.

A further, practical reason exists to decline review. The FCA empowers the United States either to dismiss or to prevent the dismissal of any complaint that is potentially subject to the public disclosure bar. Because the bar is designed to protect the government’s interest in preventing parasitic lawsuits, the government’s authority to control which cases are dismissed is generally sufficient to vindicate the primary purpose of the public disclosure bar.

At the time of the post last October, this Blog believed, like ABLE, that there was a split among the circuits that required resolution by the Supreme Court. That belief was misplaced.

On May 22, 2017, the Court denied ABLE’s petition.

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