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United States Court of Appeals for the First Circuit
January 21, 2022, Decided
LIPEZ, Circuit Judge. In this case of first impression for our circuit, we consider the function of the hearing that is provided by statute when the government moves to dismiss a relator's qui tam action brought under the False Claims Act ("FCA") over the relator's objections. See 31 U.S.C. § 3730(c)(2)(A). The statute is silent as to the nature of that hearing, the government's burden in seeking dismissal, and the factors the district court should consider in evaluating the motion to dismiss. After considering the FCA as a whole and the various approaches that have been adopted by other circuits, we conclude that (i) although the government does not bear the burden [*2] of justifying its motion to the court, the government must provide its reasons for seeking dismissal so that the relator can attempt to convince the government to withdraw its motion at the hearing; and (ii) if the government does not agree to withdraw its motion, the district court should grant it unless the relator can show that, in seeking dismissal, the government is transgressing constitutional limitations or perpetrating a fraud on the court.
Applying these conclusions to the facts of this case, we determine that the district court did not err in dismissing the action and affirm.
A. Legal Background
] The FCA imposes civil liability on any person who "knowingly presents," "causes to be presented," or conspires to present "a false or fraudulent claim for payment or approval" to the United States government. 31 U.S.C. § 3729(a)(1)(A), (C). The Act not only authorizes the government to bring a civil action against anyone who violates the statute, id. § 3730(a), but also allows a private party -- a "relator" -- to bring what is known as a qui tam action "for the person and for the United States [g]overnment . . . in the name of the [g]overnment," id. § 3730(b)(1). See Kellogg Brown & Root Servs., Inc. v. United States ex rel. Carter, 575 U.S. 650, 653, 135 S. Ct. 1970, 191 L. Ed. 2d 899 (2015).
] When a relator brings a qui tam action, he must serve the government [*3] with a copy of the complaint and "written disclosure of substantially all material evidence and information" he possesses. 31 U.S.C. § 3730(b)(2). The complaint is filed under seal for at least sixty days (the government may seek extensions for good cause), and it may not be served on the defendant until the court so orders. Id. § 3730(b)(2), (3). Before the complaint is unsealed, the government has two options. It may "intervene and proceed with the action" itself, in which case it has "the primary responsibility for prosecuting" it, although the relator has "the right to continue as a party to the action"; or the government may notify the court that it declines to "take over the action," in which case the relator "shall have the right to conduct the action." Id. § 3730(b)(2), (b)(4), (c)(1).
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2022 U.S. App. LEXIS 1775 *; 24 F.4th 32
JOHN R. BORZILLERI, M.D., Relator, Plaintiff, Appellant, UNITED STATES, ex rel. JOHN R. BORZILLERI, M.D., Plaintiff, Appellee, STATE OF CALIFORNIA, et al., Plaintiffs, v. BAYER HEALTHCARE PHARMACEUTICALS, INC., et al., Defendants, Appellees, CATAMARAN CORPORATION, et al., Defendants.
Prior History: [*1] APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF RHODE ISLAND. Hon. William E. Smith, U.S. District Judge.
United States v. Bayer Healthcare Pharms., Inc., 2019 U.S. Dist. LEXIS 181418, 2019 WL 5310209 (D.R.I., Oct. 21, 2019)
qui tam, motion to dismiss, district court, courts, constitutional limits, allegations, diligence, transgressing, perpetrating, investigate, discovery, convince, government's decision, fraudulent, quotation, withdraw, reasons, marks, terms
Business & Corporate Compliance, False Claims Act, Remedies, Civil Penalties, Governments, Federal Government, Claims By & Against, Labor & Employment Law, Scope & Definitions, Qui Tam Actions, Civil Procedure, Parties, Intervention, Statutory Right to Intervene, Costs & Attorney Fees, Voluntary Dismissals, Court Order, Motions for Dismissal, Dismissal, Stipulations, Terms & Conditions of Dismissal, Public Contracts Law, Voiding Contracts, Fraud & Whistleblowing, Constitutional Law, Substantive Due Process, Scope, Fundamental Rights, Procedural Due Process, Scope of Protection, Judgments, Relief From Judgments, Fraud, Misconduct & Misrepresentation, Courts, Authority to Adjudicate, Labor & Employment Law, Employer Liability, False Claims Act, Writs, Common Law Writs, Mandamus, Appeals, Standards of Review, De Novo Review