United States District Court, District of Columbia
UNITED STATES ex rel. LOTT, Plaintiff,
NOT-FOR-PROFIT HOSPITAL CORPORATION, et al., Defendants.
MEMORANDUM OPINION AND ORDER
P. MEHTA, UNITED STATES DISTRICT JUDGE
John Lott worked for about four months as the Chief
Compliance Officer of Defendant Not-For-Profit Hospital
Corporation, an entity created under District of Columbia law
that operates United Medical Center. Plaintiff alleges that
Defendant fired him for identifying and reporting a host of
problems at the hospital in violation of federal and state
laws. Defendant's Motion to Dismiss is now before the
court. For the reasons set forth below, the court dismisses
Plaintiffs federal claims and declines to exercise
supplemental jurisdiction over his remaining state law
claims. Defendant's Motion to Dismiss is therefore
granted. The court, however, will grant Plaintiff one more
opportunity to amend his pleading and therefore does not
dismiss this action.
District of Columbia created Defendant Not-for-Profit
Hospital Corporation in 2010 for the purpose of acquiring the
assets of the struggling, then-privately owned hospital,
United Medical Center, and ensuring its continued operation.
See D.C. Code § 44-951.01 et seq. The
legislation that created Defendant established it as "an
instrumentality of the District government, "
"which shall have a separate legal existence within the
District government." Id. § 44-951.02(a).
April 6, 2015, Plaintiff John Lott began work as the Chief
Compliance Officer at United Medical Center, the hospital
operated by Defendant Not-For-Profit Hospital Corporation.
Am. Compl., ECF No. 18 [hereinafter Am. Compl.], ¶¶
15-16. When Plaintiff was hired, Defendant advised him that
his term of employment would be at least six months long.
Id. ¶¶ 16, 18. Plaintiff, however, was
fired less than four months later on June 30, 2015.
Id. ¶ 1.
Chief Compliance Officer, Plaintiffs primary responsibility
was to ensure that the hospital complied with federal and
state laws. M¶¶l, 18. Almost immediately, Lott
began noticing problems at the hospital, ranging from
unlocked doors to unsecured patient files. Id.
¶¶ 17, 19-20; see also Id. ¶¶
24, 28, 31, 40. Lott told Defendant's CEO, David Small,
about many of the issues he spotted and e-mailed
Defendant's Board of Directors about the need for a
strong compliance program. Id. ¶¶ 37-38,
the issues that came to Plaintiffs attention was a harassment
complaint made by Sonia Edwards, a Human Resources employee,
concerning her manager. Id. ¶ 24. As a result
of the harassment, Edwards took leave from work as permitted
under the Family Medical and Leave Act ("FMLA"), 29
U.S.C. § 2601 et seq., and the companion leave
statute under District of Columbia law, but was fired for
"job abandonment" while on leave. Am. Compl. ¶
41. Plaintiff alleges that he told Small on June 8, 2015,
that Edwards's termination "maybe afoul" of
federal and District of Columbia laws, that Defendant has an
obligation to comply with the law, and that Defendant cannot
fire employees who are on FMLA leave or who complain of
harassment. Id. ¶ 42. Small agreed that
Edwards's firing might have been wrongful and directed
Plaintiff to contact Human Resources to have Edwards rehired
and promoted. Id. When Plaintiff spoke with the
department the next day, notwithstanding Small's
directive, the Executive Vice President of Human Resources
refused to rehire Edwards. Id. ¶ 43.
matter that came to Plaintiff s attention involved billing
irregularities to the federal Centers for Medicare &
Medicaid Services ("CMS"). On June 30, 2015,
Plaintiff advised Defendant's Board of Directors that
aspects of the hospital's billing practices did not
comply with federal Office of Inspector General
("OIG") guidelines. Id. ¶ 45.
Plaintiff estimates that Defendant's non-compliant
practices resulted in the improper billing of nearly $40, 000
per day to CMS. Id. ¶¶ 46, 62. In a
separate incident, on July 29, 2015, Plaintiff learned that
the hospital had been billing the federal government for
patient treatment by a Dr. Cyril Allen, even though Dr. Allen
no longer worked at the hospital. Id. ¶ 56.
Plaintiff alleges that he reported such conduct as billing
fraud, but he does not say to whom he made this disclosure.
Id. ¶ 57. Someone- Plaintiff does not identify
who-raised the billing matter with the hospital's Chief
Financial Officer and the District of Columbia Office of
Integrity and Oversight. Id. According to Plaintiff,
he "state[d] publicly"-he does not say when-that
Defendant's IT department should identify the person
responsible for entering Dr. Allen's name, presumably,
into the hospital's billing software. Id. The
District of Columbia later repaid the federal government the
amounts the hospital received for work billed under Dr.
Allen's name. Id.
months into Plaintiffs tenure, a colleague warned Plaintiff
that he might not last through his six-month probationary
period. On July 16, 2015, the Executive Vice President of
Human Resources, Jackie Johnson, told Plaintiff that he was
"not getting along with people and for that reason you
will not make your probation." Id. ¶ 51.
Plaintiff brushed off the criticism, contending that his job
was to ensure compliance rather than be a popular figure.
Id. The next day, Andrew Davis replaced Small as
Defendant's CEO. Id. ¶ 52. Plaintiff
subsequently met with Davis to discuss problems at the
hospital, at which time Davis told Plaintiff that he wanted
Plaintiff to remain in his post. Id. ¶ 53. Yet,
just two weeks later, on July 30, 2015, Davis fired Plaintiff
because he was "not a good fit" and his work was
"unsatisfactory." Id. ¶ 59.
filed this action against Defendant and the District of
Columbia on July 29, 2016. Compl., ECF No. 1. Because
Plaintiff asserted a claim under the False Claims
Act("FCA"), he filed his complaint under seal and
served it upon the United States alone, as the Act requires,
to afford it the opportunity to investigate the basis of his
claim and to decide whether to intervene. See 31
U.S.C. § 3730(b). Upon investigating Plaintiffs FCA
claim, the government decided not to intervene, leaving
Plaintiff alone to pursue the FCA claim on behalf of the
United States. See United States' Notice of
Election to Decline Intervention, ECF No. 5.
December 20, 2016, the court unsealed the Complaint and
ordered service upon both Defendants, Not-For-Profit Hospital
Corporation and the District of Columbia. See Order,
Dec. 20, 2016, ECF No. 6. Upon completing service, Plaintiff
amended his complaint on March 29, 2017, see Am. Compl.,
after which motions to dismiss followed from both Defendants,
see District of Columbia Mot. to Dismiss, ECF No. 22;
Not-For-Profit Hospital Corp. Mot. to Dismiss, ECF No. 23
[hereinafter Def's Mot.]. The court granted the District
of Columbia's motion on May 8, 2017, after Lott did not
oppose the District's dismissal. -See Minute Order, May
8, 2017; Pl's Opp'n to DC. Mot. to Dismiss, ECF No.
26. As a result, only Defendant Not-For-Profit Hospital's
Motion to Dismiss remains before the court.
Amended Complaint contains six counts. The first five allege
that Defendant retaliated against Plaintiff in violation of:
(1) the National Defense Authorization Act, 41 U.S.C
§4712; (2) the FCA; (3) the D.C. Human Rights Act, D.C.
Code § 2-1401.01 et seq.; (4) the FMLA; and (5)
the D.C. FMLA, D.C. Code § 32-501 et seq. See
generally Am. Compl. ¶¶ 64-101. Additionally,
in Count II, Plaintiff alleges a substantive violation of the
FCA, notwithstanding the United States' decision not to
intervene. See Am. Compl. ¶¶ 70-71.
Finally, Count VI alleges that Defendant breached its
contract with Plaintiff by firing him before completing his
sixth month of work. Id. ¶¶ 102-106.
Plaintiff withdrew Count I after Defendant noted that
Plaintiff had not exhausted his ...