Court Cuts Back FCA Coverage For Medicaid Fraud
Client Alert | 1 min read | 12.16.04
Following the lead of the D.C. Circuit in U.S. ex rel. Totten v. Bombardier Corp. (Aug. 27, 2004) [see C&M Bullet Point 9/16/2004), in U.S. ex rel. Atkins v. McInteer (Oct. 27, 2004), the Northern District of Alabama dismissed a qui tam complaint for lack of subject matter jurisdiction because, among other reasons, the complaint did not allege that the defendant health care providers “presented” claims to the federal Government for payment when making claims (or conspiring to make claims) to the Alabama Medicaid Agency, even though that agency receives 70% of its funding from the federal Government. Unwilling to wait for the then-pending (now-denied) motion for en banc rehearing of Totten, and staking out a position with far-reaching implications for contractors doing business with federal grantees, particularly Medicaid providers, the District Court broadly held: “If the Totten court is correct, fraud perpetrated upon a non-federal agency cannot form the basis for an FCA claim just because the non-federal agency thereafter presents a claim for payment to a federal official.”
Insights
Client Alert | 3 min read | 11.21.25
On November 7, 2025, in Thornton v. National Academy of Sciences, No. 25-cv-2155, 2025 WL 3123732 (D.D.C. Nov. 7, 2025), the District Court for the District of Columbia dismissed a False Claims Act (FCA) retaliation complaint on the basis that the plaintiff’s allegations that he was fired after blowing the whistle on purported illegally discriminatory use of federal funding was not sufficient to support his FCA claim. This case appears to be one of the first filed, and subsequently dismissed, following Deputy Attorney General Todd Blanche’s announcement of the creation of the Civil Rights Fraud Initiative on May 19, 2025, which “strongly encourages” private individuals to file lawsuits under the FCA relating to purportedly discriminatory and illegal use of federal funding for diversity, equity, and inclusion (DEI) initiatives in violation of Executive Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity (Jan. 21, 2025). In this case, the court dismissed the FCA retaliation claim and rejected the argument that an organization could violate the FCA merely by “engaging in discriminatory conduct while conducting a federally funded study.” The analysis in Thornton could be a sign of how forthcoming arguments of retaliation based on reporting allegedly fraudulent DEI activity will be analyzed in the future.
Client Alert | 3 min read | 11.20.25
Client Alert | 3 min read | 11.20.25
Client Alert | 6 min read | 11.19.25
