{"id":79,"date":"2016-06-17T06:02:00","date_gmt":"2016-06-17T06:02:00","guid":{"rendered":"http:\/\/blogs.luc.edu\/compliance\/?p=79"},"modified":"2016-06-17T06:02:00","modified_gmt":"2016-06-17T06:02:00","slug":"supreme-court-weighs-in-on-implied-false-certification-theory","status":"publish","type":"post","link":"https:\/\/blogs.luc.edu\/compliance\/?p=79","title":{"rendered":"Supreme Court Weighs in on Implied False Certification Theory"},"content":{"rendered":"<p><em>Ryan Meade<br \/>\n<\/em><em>Editor-in-Chief<br \/>\n<\/em><em> Director of Regulatory Compliance Studies at Loyola University Chicago School of Law<\/em><strong><em><br \/>\n<\/em><\/strong><\/p>\n<p>&nbsp;<\/p>\n<p>The Supreme Court&#8217;s decision yesterday in \u00a0<a href=\"http:\/\/www.supremecourt.gov\/opinions\/15pdf\/15-7_a074.pdf\">Universal Health Services, Inc. v. U.S. ex rel Escobar (&#8220;UHS&#8221;)<\/a>\u00a0has had some strange initial summaries suggesting this is a gloom and doom opinion for actors who submit claims to the United States. \u00a0I think these are missing the mark. \u00a0While UHS has endorsed the &#8220;implied false certification theory&#8221;\u00a0under the False Claims Act, in practice it is considerably narrow. \u00a0And although the Court also seems to have brushed aside the up-until-now handy distinction in FCA liability that had been growing in the lower courts\u00a0between\u00a0non-compliance with conditions of participation (unlikely exposure) and non-compliance with conditions of payment (likely exposure). \u00a0The Court introduces &#8220;materiality&#8221; as the hinge upon whether an error or omission in a claim gives rise to FCA liability. \u00a0That is, liability will not attached unless\u00a0the error was material in that the United States (or its agent) would not have paid if it had the correct information. \u00a0Merely having the authority or <em>option<\/em> not to have paid if it knew the real information is not sufficient grounds to assert FCA liability under the implied false certification theory.<\/p>\n<p>Writing with a unanimous court behind him, Justice Thomas sets out succinctly that &#8220;[a]\u00a0misrepresentation about compliance with a statutory, regulatory, or contractual requirement must be material to the Government\u2019s payment decision in order to be actionable under the False Claims Act. We clarify below how that rigorous materiality requirement should be enforced.&#8221;<\/p>\n<p>Justice Thomas concludes with a line that should help manage Compliance Officer anxiety for a little while: &#8220;We emphasize, however, that the False Claims Act is not a means of imposing treble damages and other penalties for insignificant regulatory or contractual violations.&#8221;<\/p>\n<p>There is much more to be analyzed in this opinion and watch for future posts on this blog.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ryan Meade Editor-in-Chief Director of Regulatory Compliance Studies at Loyola University Chicago School of Law &nbsp; The Supreme Court&#8217;s decision yesterday in \u00a0Universal Health Services, Inc. v. U.S. ex rel Escobar (&#8220;UHS&#8221;)\u00a0has had some strange initial summaries suggesting this is a gloom and doom opinion for actors who submit claims to the United States. \u00a0I &#8230;<br \/><a class=\"read-more-link btn btn-outline-secondary\" href=\"https:\/\/blogs.luc.edu\/compliance\/?p=79\">Read more<\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[753,806,1116,1294,2053],"class_list":["post-79","post","type-post","status-publish","format-standard","hentry","category-fraud-abuse","tag-escobar","tag-fca","tag-implied-false-certification","tag-materiality","tag-unitedhealthservices"],"_links":{"self":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts\/79","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=79"}],"version-history":[{"count":0,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts\/79\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=79"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=79"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=79"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}