Cases & Deals

National retailer/pharmacy obtains Ninth Circuit affirmance of False Claims Act dismissal based on Public Disclosure Bar

Clients Large national retailer and pharmacy

Jones Day persuaded the Ninth Circuit to affirm the Alaska District Court's dismissal of a False Claims Act case against multiple defendants including Jones Day's national pharmacy client, based on the Public Disclosure Bar. Plaintiff alleged that the State of Alaska Medicaid program and numerous doctors, medical facilities, and pharmacies had presented or caused to be presented Medicaid claims for off-label, allegedly unapproved uses of psychiatric medications for pediatric patients. Plaintiff claimed that the claims were false because, according to plaintiff's interpretation of the Social Security Act, Medicaid did not intend to cover off-label claims not listed as supported in certain compendia. Jones Day, taking the lead on the motion to dismiss, the appellate briefing and appellate argument, argued that, while plaintiff's complaint could be dismissed for failure to plead fraud with particularity or to state actionable relief, the district court lacked subject matter jurisdiction under the False Claims Act's Public Disclosure Bar. Plaintiff appealed the dismissal, arguing that the public document did not disclose the names of the particular defendants and that allegations of industry-wide fraud are insufficient under the Public Disclosure Bar. Defendants argued that the main components of the complaint were publicly disclosed, and any additional information was readily available to the government through Medicaid claims data. At oral argument, Jones Day's Eric Berlin added: "What we have is an advocacy group run by plaintiff's counsel, with no insider information, seeking to accomplish, through the False Claims Act, what he was unable to accomplish through his more direct state court case, which is to stop the use of psychiatric drugs in adults and children." The Ninth Circuit affirmed, with Chief Judge Kozinski writing the memorandum opinion.

Law Project for Psychiatric Rights v. Matsutani et al., No. 10-35887 (9th Cir. 2011)