U.S. Supreme Court Agrees to Review False Claims Act Case Involving Scope of DOJ’s Ability to Dismiss Qui Tams

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On June 21, 2022, the United States Supreme Court granted certiorari in United States, ex rel. Polansky v. Executive Health Resources, Inc., et al. The Supreme Court will review the Third Circuit’s October 2021 opinion in which the Third Circuit decided that the government is required to intervene before moving to dismiss a qui tam and that its motion must meet the standard of Federal Rule of Civil Procedure 41(a).

The relator filed the qui tam at issue in 2012. His complaint remained under seal for two years while the government investigated and eventually decided not to intervene. The relator continued to pursue the case. Following several years of litigation, in 2019, the government filed a motion to dismiss after, among other things, the District Court ordered the government to produce withheld documents in response to Executive Health Resources’ discovery requests. The District Court granted the government’s motion to dismiss, and the relator appealed to the Third Circuit.

The Third Circuit’s opinion addressed a circuit split as to whether the government must intervene to be able to move to dismiss a qui tam. See Polansky v. Executive Health Resources, Inc., 17 F.4th 376 (3d Cir. 2021). On one side of the circuit split are the D.C., Ninth, and Tenth Circuits, which interpreted 31 U.S.C. § 3730(c) as allowing the government to move for dismissal at any point in the litigation regardless of whether it has intervened. The Third Circuit sided with Sixth and Seventh Circuits in deciding the government must move to intervene before moving to dismiss but it can seek leave to intervene at any point in the litigation upon a showing of good cause. The opinion also addressed another circuit split—what standard should apply to the government’s motion to dismiss. The Third Circuit adopted the Seventh Circuit’s approach, which is to apply the Federal Rules of Civil Procedure, specifically Rule 41(a) which governs voluntary dismissals. In adopting the Rule 41(a) standard, the Third Circuit stated it was deciding against the D.C. Circuit’s approach, which provides the government an “unfettered right” to dismiss, and against the “rational relation” standard adopted by the Ninth and Tenth Circuits.

The relator filed a petition for a writ of in January 2022 asking that the Supreme Court review the Third Circuit’s decision. In its brief in opposition to certiorari, the Department of Justice argued that the differences among the standards used by the various circuits are “modest” and should very rarely if ever be outcome determinative.

The Supreme Court docket and the parties’ briefs are available here.

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