Materiality Rules: Escobar Changes the Game
Client Alert | 1 min read | 05.15.17
On May 1, 2017, the Third Circuit affirmed the district court’s dismissal of a relator’s claims in United States ex rel. Petratos, et al. v. Genentech Inc. in a False Claims Act (FCA) case in which the relator alleged that pharmaceutical manufacturer Genentech had suppressed data about a cancer drug’s side effects. Applying the materiality analysis from the Supreme Court’s decision in Universal Health Servs., Inc. v. United States ex rel. Escobar, the Third Circuit “join[ed] the many other federal courts that have recognized the heightened materiality standard after [Escobar]” and found that the relator failed to allege that Genentech made misrepresentations that were material to government’s decision to pay claims. The Third Circuit’s decision in Petratos is just one of the nearly 100 court opinions that have cited Escobar in the eleven months since the Court’s landmark ruling on the on the implied-certification theory of liability. In a “Feature Comment” published in The Government Contractor, C&M attorneys analyze some of the key cases and explore the developing trends in the wake of Escobar.
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On August 19, 2026, the Federal Trade Commission (FTC) announced a proposed Enforcement Policy Statement on personalized pricing — the practice of companies using consumers’ personal data to set individualized prices, discounts, coupons, or other incentives. The proposed statement, which is open for public comment for 30 days following publication in the Federal Register, marks a major step up in the FTC’s focus on data-driven pricing strategies and puts businesses across industries on notice that undisclosed or inadequately disclosed personalized pricing will not be tolerated. Importantly, while the proposed statement is not a binding legal requirement and does not create new legal obligations, it serves as an enforcement warning that the FTC is prepared to use its existing enforcement authority under Section 5 of the FTC Act (Section 5) and is also a potential harbinger of rulemaking. Businesses that engage in — or are considering — personalized pricing should carefully assess their disclosure practices and data collection procedures against the standards articulated in this statement.
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CMS’s Final Rule Bans Federal Medicaid Funding for Youth Gender-Affirming Care
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