Court of Appeals panel rules use of statistical sampling is inappropriate for interlocutory appeal, leaving FCA litigants without any direct appellate court guidance.

In the closely watched case United States ex rel. Michaels v. Agape Senior Cmty., Inc., the U.S. Court of Appeals for the Fourth Circuit declined to address a key issue for False Claims Act (FCA) litigants — whether plaintiffs may use statistical sampling and extrapolation to establish the extent of liability and/or damages in FCA cases. The use of extrapolation is hotly contested among FCA defendants and plaintiffs (which can either be the Department of Justice or private individuals known as relators) in cases involving a large number of claims or transactions. This controversial method allows FCA plaintiffs to “prove” liability or damages only for those claims in a sample, thus avoiding the burden of establishing liability for what could be thousands of other similar claims on a claim-by-claim basis. While beneficial for plaintiffs, this approach strips defendants of the power to contest allegations concerning claims outside the sample.