Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States ex rel. Folliard v. Comstor Corp.

United States District Court, District of Columbia

March 31, 2018

THE UNITED STATES OF AMERICA, ex rel. BRADY FOLLIARD, Plaintiff,
v.
COMSTOR CORPORATION, et al., Defendants.

          MEMORANDUM OPINION

          BERYL A. HOWELL, Chief Judge

         The relator, Brady Folliard, initiated this lawsuit, pursuant to the qui tam provision of the False Claims Act (“FCA”), 31 U.S.C. § 3730(b)(1), seven years ago, against two defendants, Westcon Group, Inc. (“Westcon”) and one of its wholly-owned subsidiaries, Comstor Corporation (“Comstor”), alleging that the defendants, along with another wholly-owned subsidiary of Westcon, Westcon North America Inc. (“Westcon NA”), sold to the U.S. government “thousands of” mostly unspecified products made by Cisco Systems, Inc. (“Cisco”) that originated in non-designated countries in violation of the Trade Agreement Act (“TAA”), 19 U.S.C. §§ 2501 et seq. Rel.'s Third Am. Compl. (“TAC”) ¶¶ 1-2, 143, ECF No. 65. These allegations were initially predicated on the relator's “direct and independent knowledge” gained from his position as a Strategic Account Executive for Insight Public Sector Inc. (“Insight”), a company that partnered with the defendants “on multiple sales.” Compl. ¶ 10, ECF No. 1; TAC ¶ 5. After almost five years of investigation and the defendants' production of data documenting over $123 million in sales, as well as 49 charts, each of which “encompasses hundreds of pages” of Cisco's product information, see TAC ¶¶ 137-38; see also id., Ex. 17-17F, Defs.' Produced Sales Data, ECF Nos. 65-19-24; id., Ex. 18, Cisco Production Cover Letter (dated Apr. 19, 2013) (“Cisco Production Letter”), ECF No. 65-25, the United States declined to intervene, see U.S.'s Not. Election Decline Intervention (“U.S.'s Not.”) at 1, ECF No. 43. The operative Third Amended Complaint seeks treble damages and civil penalties of “not less than $5, 500 and not more than $11, 000 for each violation of” the FCA by the defendants “from 2005 and continuing to the present.” TAC ¶¶ 1, 182-99; id. 47-48. The defendants have moved to dismiss the Relator's Third Amended Complaint, pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), on grounds that: (1) the “claims are based on, and substantially similar to, prior public disclosures, ” for which the relator is not an “original source, ” and therefore are barred, under 31 U.S.C. § 3730(e)(4), Defs.' Mot. Dismiss Rel.'s TAC (“Defs.' Mot.”) at 1-2, ECF No. 67; and (2) the Third Amended Complaint fails to state a plausible claim for relief under the FCA or satisfy the particularity requirements of Federal Rule of Civil Procedure 9(b), id. at 2-3. For the reasons set forth below, the defendants' motion is granted, and this case is dismissed.[1]

         I. BACKGROUND

         The relator alleges that the defendants submitted false claims and false statements to the U.S. government under two Federal Supply Schedule (“FSS”) contracts awarded to the defendants by the General Service Administration (“GSA”) authorizing the defendants' sale to the federal government of information technology (“IT”) products. TAC ¶¶ 3, 7, 10, 37. Summarized below is the relevant factual history, as alleged in the Third Amended Complaint and its twenty attachments, followed by the procedural history of this litigation.

         A. Factual History

         1. The Defendants' Business with the Federal Government

         For over two decades, the defendants have used two FSS contracts to offer for sale to the federal government “thousands of” Cisco products. Id. ¶¶ 7-11, 143. These products are largely unidentified in the Third Amended Complaint, except for nineteen “representative” examples of purchase orders, reflecting 46 transactions for items delivered to the federal government between September 29, 2008, and December 12, 2013. Id. ¶¶ 116-35 (discussing two purchase orders), 145-81 (discussing seventeen additional purchase orders).[2] The first FSS contract at issue, designated as GS-35F-4389G, was entered in 1996, by defendant Comstor, which is “one of the primary distributors of Cisco products.” Id. ¶ 6, 41; id., Ex. 1, Comstor Contract GS-35F-4389G (“Comstor Contract”), ECF No. 65-2. Indeed, “almost all of Comstor's sales through” this contract “involve[d] Cisco products.” Id. ¶¶ 7-8. Prior to March 17, 2010, Comstor “was the sole authorized FSS contract holder for Cisco products, ” and, thus, “any GSA sales of Cisco products had to come from Comstor directly” or from a smaller vendor with which Comstor had partnered, or else “an unauthorized source.” Id. ¶¶ 45, 55. In 2010, Comstor “ceased to exist and simply became Westcon.” Id. ¶ 45 n.6.

         The second FSS contract at issue, designated as GS-35F-0563U, has been held by Westcon NA since 2008, and is the vehicle through which the defendants presently sell IT products, including Cisco products, either directly or through partners. Id. ¶¶ 10-11, 45; see also id., Ex. 2, Westcon Contract GS-35F-0563U (“Westcon Contract”), ECF No. 65-3. Based on data from 2006 through 2012 for both contracts, nearly $500 million of the defendants' $600 million dollars in GSA sales during the time period were attributable to Cisco products. Id. ¶ 12. As noted, those products are not identified in the Third Amended Complaint, but the “representative” examples include computer related materials and supplies, such as flash drives, routers, and switch ports. See id., Ex. 19, Source Documents (“Rel.'s Sales Source Docs.”), ECF No. 65-26; id, Ex. 20, Source Country-of-Origin Documents (“Rel.'s COO Source Docs”), ECF No. 65-27.

         The defendants' contracts are governed by the TAA, 19 U.S.C. §§ 2501 et seq., which “implements numerous multilateral and bilateral international trade agreements and other trade initiatives.” TAC ¶ 58; see also Westcon Contract at 9 (requiring compliance with TAA); Comstor Contract at 6 (same). Under the TAA and its implementing regulations, the Federal Acquisition Regulations (“FAR”), items sold through GSA FSS contracts must be “U.S.-made or designated country end products.” TAC ¶ 58. The FAR defines “end product” as “those articles, materials, and supplies to be acquired under the contract for public use.” Id. ¶ 59 (quoting FAR 52.225-5(a)). The FAR also provides a list of designated countries, including signatories to the World Trade Organization (“WTO”) Government Procurement Agreement (“GPA”) and to bilateral trade agreements with the U.S. See Id. ¶¶ 75-76 (citing FAR 52.225-5(a)). Countries such as China and Malaysia, which are not on the FAR list, are identified by exclusion as non-designated countries. Id. ¶¶ 75-76. For the purposes of the TAA, an end product is “U.S.-made” or from a “designated country” when the item was completely manufactured, grown, or produced, or else “substantially transformed” in the U.S. or a designated country. Id. ¶ 77 (citing 19 U.S.C. § 2518(4)(B); 19 C.F.R. § 177.22(a)).

         The FAR imposes on vendors, such as the defendants, a general obligation to sell under the FSS contract “only U.S.-made or designated country end products, ” id. ¶ 72 (citing FAR 52.225-5(b)), and a continuing obligation to certify that each end product sold through a FSS contract is TAA compliant, id. ¶ 67 (citing FAR 52.225-6(a) (“The offeror certifies that each end product, except those listed in paragraph (b) of this provision, is a U.S.-made or designated country end product, as defined in the clause of this solicitation entitled ‘Trade Agreements.'”)). Should the defendants seek to sell an end product that is not from a designated country, the defendants must identify the item to the GSA before offering the item for sale. Id. ¶ 69 (citing FAR 52.225-6(b) (“The offeror shall list as other end products those supplies that are not U.S.-made or designated country end products.”)).

         The defendants may also sell to the U.S. Government, without violating the TAA, “open market” items that are not included on the pricelists accompanying the FSS contracts, even when those items originate in non-designated countries. Id. ¶¶ 87-88 & n.10; see also Westcon Contract at 12 (allowing for sale of open market items, “also known as incidental items, noncontract items, non-Schedule items, and items not on [an FSS] contract”); Comstor Contract at 8-9 (same). The FAR permits vendors to procure these non-contract, “open-market” items in the interest of “administrative convenience, ” as long as specified requirements under FAR 8.402(f) are met, including requirements for publicizing proposed contract actions and engaging in competitive procedures. TAC ¶ 89-94.

         2. The Relator's Business with the Defendants

         At all times relevant to the instant litigation, the relator worked as a Strategic Account Executive at Insight, a “Value Added Reseller” (“VAR”) that has partnered with the defendants to sell IT products to federal agencies. Id. ¶ 5, 101-02. As a VAR, Insight “combine[s], configure[s], and sell[s] computer products manufactured by other companies in specifically-designed configurations to meet the needs of their customers.” Id. ¶ 103. In essence, VARs are “middle-men in the supply chain between the technology manufacturers and their ultimate customers.” Id. ¶ 104. The defendants partner with VARs and other smaller vendors to facilitate sales either through prime contractor/subcontractor agreements, in which the sub-contractor or “authorized dealer” is not required to maintain its own GSA schedule contract, or through Contractor Team Arrangements (“CTA”), in which both parties maintain GSA schedule contracts, although not necessarily for the same products. Id. ¶ 46-54. Here, the relator, “on numerous occasions, ” sold Cisco products through the defendants' FSS contracts, “both as an authorized dealer . . . and through CTAs with Defendants.” Id. ¶ 107.

         Through his work selling the defendants' products, the relator “routinely accessed” country-of-origin (“COO”) charts, which “Cisco regularly created, ” and “list[ed] product numbers and country-of-origin information for thousands of Cisco products.” Id. ¶ 108. Cisco provides these charts to vendors, including the relator's employer, Insight, so that the vendors may “check the Country of Origin to comply with government regulations in selling products to the government.” Id. ¶ 109. In reviewing such COO charts alongside the defendants' pricelists and the purchase orders processed by Insight under the defendants' FSS contracts, the relator began to suspect that the defendants were failing to comply with the TAA in two ways. Id. ¶ 111-13; see also id., Ex. 15, Decl. Brady Folliard, Strategic Account Exec., Insight Public Sector (“Folliard Decl.”), ECF No. 65-16 (explaining review process). First, he found the defendants “were including non-TAA-compliant products on their FSS contract pricelists, ” and that they “in fact sold” such products “to the United States Government by concealing the products' true COO information.” Id. ¶¶ 111-12. Second, the relator came to believe that the defendants “routinely circumvented their TAA-compliance obligations by marking certain end products from non- designated countries as ‘open market, ' but then selling those products outside the open market protocol outlined in FAR 8.402.” Id. ¶ 113.

         To illustrate the relator's discovery of the defendants' “misconduct, ” the Third Amended Complaint cites two example purchase orders that Insight placed under the defendant Weston's GSA FSS contract in 2010 and 2011. Id. ¶¶ 116-17, 126 (citing id., Ex. 14, Purchase Order (dated Sept. 24, 2010), ECF No. 65-15; id., Ex. 16, Purchase Order (dated July 28, 2011), ECF No. 65-17); Folliard Decl. Eight of the nine items identified in the Third Amended Complaint as sold through these two purchase orders were listed as “open market” items, and one item is described as an “end product.” See Id. ¶¶ 117-35. The relator alleges that he determined, upon review of Cisco COO charts, that the items had always originated in non-specified non-designated countries. Id. ¶¶ 122, 127-35. Based on the relator's understanding of the FAR's treatment of “open market” items of certain monetary values, the Third Amended Complaint claims that these eight items, along with the one identified end product, should have been TAA-compliant and that the defendants engaged in fraudulent activities by selling these items from non-compliant countries. Id. ¶¶ 95, 135 (citing FAR 8.405-1(b) (“micro-purchase threshold”)).

         B. Procedural History

         Before filing his original Complaint, on April 15, 2011, the relator disclosed to the United States the substance of his allegations that the defendants “are selling products to the United States Government that did not originate in designated countries under the [TAA], and therefore are making material false statements and presenting false claims to the United States Government for payment.” Compl. ¶ 9; TAC ¶ 136. While the complaint remained under seal, the United States investigated the relator's allegations, including by issuing a civil investigative demand (“CID”) to the defendants to obtain “sales data and supporting documentation for the relevant time period.” TAC ¶ 136. The government also requested COO charts from Cisco “for all products Cisco offered for sale since January 2000.” Id. ¶ 137. In response, the defendants provided data, from 2008 through 2011, for $123, 531, 232.29 in sales under the two GSA contracts, as well as 49 quarterly COO charts, covering most of the period between January 2000 and September 2012. Id. ¶ 136-37 & n.14. The government shared these materials with the relator, prompting the relator to amend his complaint for the first time on May 30, 2014. Id. ¶ 140; see generally First Am. Compl., ECF No. 27.

         On January 29, 2016, almost five years after the relator initiated his qui tam suit, the United States filed notice of its decision to decline intervention. U.S.'s Not. at 1. Thereafter, on March 4, 2016, both the relator's original Complaint and First Amended Complaint were unsealed. Order at 1, ECF No. 46. After the relator filed a Second Amended Complaint, see Second Am. Compl., ECF No. 48, the defendants moved to dismiss, and their motion was considered at a hearing on January 24, 2017, see Min. Order (dated Jan. 25, 2017). At the close of the hearing, the relator was allowed to amend his complaint a third time, resulting in the denial, as moot, of the defendants' then-pending first motion to dismiss. Id.

         The Third Amended Complaint, filed on February 23, 2017, asserts four claims against each defendant for violations of two versions of two provisions of the FCA, both before and after those two provisions were amended by the Fraud Enforcement Recovery Act (“FERA”), Pub. L. No. 111-21, 123 Stat. 1617 (2009). The first two counts allege in almost identical language that the defendants violated the FCA's “presentment provision” by “knowingly submitt[ing], and caus[ing] to be submitted” to the government “false or fraudulent claims for payment and reimbursement” that the government paid, “unaware of the falsity of the . . . claims made by the Defendants, ” regarding country-of-origin information. TAC ¶¶ 182-189. Count I alleges the FCA's presentment provision, in 31 U.S.C. § 3729(a)(1) (2008), was violated by defendants' claims submitted “before May 20, 2009, ” and Count II alleges the same for claims submitted “after May 20, 2009, ” in violation of 31 U.S.C. § 3729(a)(1)(A) (2009). See Id. Similarly, the remaining two counts assert virtually identical claims under pre- and post-FERA amendment versions of the FCA's “false statement clause.” Id. ¶¶ 190-99. Count III alleges that the defendants “knowingly made, used or caused to be made or used, material false statements to obtain” payments from the government for false claims made “before June 7, 2008, ” in violation of 31 U.S.C. § 3729(a)(2) (2008), and Count IV alleges the same for false claims made “after June 7, 2008, ” in violation of 31 U.S.C. § 3729(a)(1)(B) (2009). Id. ¶¶ 190-99. All four counts are based on allegations that the defendants sold non-TAA compliant end products, resulting in over $8 million in sales “attributable to fraud.” Id. ¶¶ 143, 184, 188, 193, 198. The relator alleges that the non-compliant products at issue fall into two categories: (1) products on the defendants' FSS pricelists for which the country-of-origin information was falsified, see Id. ¶¶ 56-86; and (2) products incorrectly marked “open market, ” which were not and should have been compliant with the TAA, see Id. ¶¶ 87-100.

         The defendants have again moved to dismiss these claims.[3]

         II. LEGAL STANDARD

         A. Federal Rule of Civil Procedure 12(b)(1)

         “‘Federal courts are courts of limited jurisdiction, ' possessing ‘only that power authorized by Constitution and statute.'” Gunn v. Minton, 568 U.S. 251, 256 (2013) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). Indeed, federal courts are “forbidden. . . from acting beyond our authority, ” NetworkIP, LLC v. FCC, 548 F.3d 116, 120 (D.C. Cir. 2008), and, therefore, have “an affirmative obligation ‘to consider whether the constitutional and statutory authority exist . . . to hear each dispute, '” James Madison Ltd. by Hecht v. Ludwig, 82 F.3d 1085, 1092 (D.C. Cir. 1996) (citation omitted).

         To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, the plaintiff bears the burden of establishing the court's jurisdiction by a preponderance of the evidence. See Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). When considering a motion under Rule 12(b)(1), the court must accept as true all uncontroverted material factual allegations contained in the complaint and “construe the complaint liberally, granting plaintiff the benefit of all inferences that can be derived from the facts alleged, . . . and upon such facts determine jurisdictional questions.” Am. Nat'l Ins. Co. v. FDIC, 642 F.3d 1137, 1139 (D.C. Cir. 2011) (internal quotation marks and citations omitted). Although the court is required “to take as true all well-pled factual allegations within [the] complaint, ” the court must “disregard any legal conclusions, legal contentions couched as factual allegations, and unsupported factual allegations within the complaint.” Gulf Coast Mar. Supply, Inc. v. United States, 867 F.3d 123, 128 (D.C. Cir. 2017). In evaluating subject matter jurisdiction, the court may look beyond the complaint to “undisputed facts evidenced in the record, or the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Banneker Ventures, LLC v. Graham, 798 F.3d 1119, 1129 (D.C. Cir. 2015) (quoting Herbert v. Nat'l Acad. of Scis., 974 F.2d 192, 197 (D.C. Cir. 1992)).

         B. Federal Rule of Civil Procedure 12(b)(6)

         To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the “complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Wood v. Moss, 134 S.Ct. 2056, 2067 (2014) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim is facially plausible when the plaintiff pleads factual content that is more than “‘merely consistent with' a defendant's liability, ” and “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556-57 (2007)); see also Rudder v. Williams, 666 F.3d 790, 794 (D.C. Cir. 2012). Although “detailed factual allegations” are not required to withstand a Rule 12(b)(6) motion, a complaint must offer “more than labels and conclusions” or “formulaic recitation of the elements of a cause of action” to provide “grounds” for “entitle[ment] to relief, ” Twombly, 550 U.S. at 555 (alteration in original), and “nudge[ ] [the] claims across the line from conceivable to plausible, ” id. at 570; see Banneker Ventures, 798 F.3d at 1129 (“Plausibility requires more than a sheer possibility that a defendant has acted unlawfully . . . .”) (internal quotation marks and citation omitted). Thus, “a complaint [does not] suffice if it tenders ‘naked assertion[s]' devoid of ‘further factual enhancement.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557) (second alteration in original).

         As when considering a motion to dismiss for lack of subject matter jurisdiction, the court must accept all factual allegations in the complaint as true for the purposes of the motion, “even if doubtful in fact, ” Twombly, 550 U.S. at 555; see also Harris v. D.C. Water & Sewer Auth., 791 F.3d 65, 68 (D.C. Cir. 2015), “but is not required to accept the plaintiff's legal conclusions as correct, ” Sissel v. U.S. Dep't of Health & Human Servs., 760 F.3d 1, 4 (D.C. Cir. 2014). In addition, courts “ordinarily examine” other sources “when ruling on Rule 12(b)(6) motions to dismiss, in particular, documents incorporated into the complaint by reference, and matters of which a court may take judicial notice.” Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007).

         C. Federal Rule of Civil Procedure 9(b)

         To withstand a motion to dismiss for failure to state a fraud claim, including a claim under the FCA, the plaintiff must meet the pleading standard set out in Federal Rule of Civil Procedure 9(b), which provides that “a party must state with particularity the circumstances constituting fraud or mistake.” Fed.R.Civ.P. 9(b); see also Universal Health Servs., Inc. v. United States ex rel. Escobar (“Escobar”), 136 S.Ct. 1989, 2004 n.6 (2016) (“False Claims Act plaintiffs must also plead their claims with plausibility and particularity under Federal Rules of Civil Procedure 8 and 9(b).”); United States ex rel. Totten v. Bombardier Corp. (“Totten I”), 286 F.3d 542, 551-52 (D.C. Cir. 2002) (“[B]ecause the False Claims Act is self-evidently an anti-fraud statute, complaints brought under it must comply with Rule 9(b).”). This heightened pleading standard is designed to “discourage[] the initiation of suits brought solely for their nuisance value, and safeguard[] potential defendants from frivolous accusations of moral turpitude, ” as well as “guarantee all defendants sufficient information to allow for preparation of a response.” United States ex rel. Heath v. AT & T, Inc. (“Heath”), 791 F.3d 112, 123 (D.C. Cir. 2015) (first alteration in original) (quoting United States ex rel. Williams v. Martin-Baker Aircraft Co., Ltd. (“Williams”), 389 F.3d 1251, 1256 (D.C. Cir. 2004)).

         The plaintiff must plead with sufficient particularity “the time, place and content of the false misrepresentations, the fact misrepresented and what was retained or given up as a consequence of the fraud.” Williams, 389 F.3d at 1256 (quoting Kowal v. MCI Commc'ns Corp., 16 F.3d 1271, 1278 (D.C. Cir. 1994)); see also United States ex rel. Shea v. Cellco P'ship (“Shea”), 863 F.3d 923, 936 (D.C. Cir. 2017). In other words, the plaintiff must provide the “who, ” “what, ” “when, ” and “where” with respect to the circumstances of the fraud, so that the defendant is put on “fair notice of the fraud of which it is accused.” See Heath, 791 F.3d at 124.

         III. DISCUSSION

         The defendants present three grounds for dismissing the relator's Third Amended Complaint. First, they argue that the Third Amended Complaint is barred, under 31 U.S.C. § 3730(e)(4), because the alleged fraud has been publicly disclosed previously, and the relator is not an original source. Defs.' Mem. Supp. Mot. Dismiss (“Defs.' Mem.”) at 8-17, ECF No. 67-1. Second, according to the defendants, the Third Amended Complaint fails to state a claim upon which relief can be granted, under either the FCA's presentment provision or the false statement provision, because the Third Amended Complaint lacks plausible allegations of falsity, materiality, and scienter. Id. at 18-33, 37 n.11. Finally, the defendants contend the Third Amended Complaint fails to plead facts of the alleged fraudulent scheme with the particularly required to put the defendants on notice under Rule 9(b). Id. at 33-40. These challenges are addressed seriatim.[4]

         A. The Public Disclosure Bar is Not Triggered

         The defendants contend that the Third Amended Complaint must be dismissed under the FCA' public disclosure bar because the allegations of fraud were disclosed in the relator's complaints in prior qui tam lawsuits and in the government's response to the relator's FOIA request. Defs.' Mem. at 9. Further, the defendants argue that the relator cannot overcome the bar because he has not demonstrated that he is “an original source.” Id. at 13. As explained below, after describing the framework for analyzing the public disclosure bar, the relator's claims are not barred on this basis.

         1. The Public Disclosure Bar Framework

         “The FCA encourages insiders to expose fraudulent conduct, but does not reward relators who seek to profit by bringing suits to complain of fraud that has already been publicly disclosed.” United States ex rel. Oliver v. Philip Morris USA Inc. (“Oliver I”), 763 F.3d 36, 39 (D.C. Cir. 2014); see also United States ex rel. Springfield Terminal Ry. Co. v. Quinn (“Springfield Terminal”), 14 F.3d 645, 651 (D.C. Cir. 1994) (“The history of the FCA qui tam provisions demonstrates repeated congressional efforts to walk a fine line between encouraging whistle-blowing and discouraging opportunistic behavior.”). To that end, the FCA contains a public disclosure bar, codified at 31 U.S.C. § 3730(e)(4)(A), that “limits the ability of a private party to bring a qui tam suit where the fraud is already publicly known, ” unless the claims are brought by the Attorney General or an “original source” of the information underlying the claims. Oliver I, 763 F.3d at 39; Shea, 863 F.3d at 927 (“The bar prohibits private parties from bringing suit based on a fraud already disclosed through identified public channels (unless the relator is ‘an original source of the information').” Thus, “[t]he FCA sets up a two-part test for determining jurisdiction.” United States ex rel. Findley v. FPC-Boron Emps.' Club, 105 F.3d 675, 681 (D.C. Cir. 1997). First, the court must determine whether the information underlying the allegations and transactions has been publicly disclosed through enumerated channels. See Springfield Terminal, 14 F.3d at 651. “If-and only if-the answer to the first question is affirmative, will the court then proceed to the original source inquiry.” Id. (internal quotation marks and citation omitted); see also Oliver I, 763 F.3d at 39 n.3 (“Because we conclude that the information supporting Oliver's claim had not been publicly disclosed, we do not reach the question whether Oliver was an ‘original source.'”).

         Section 3730(e)(4)(A) was amended, effective March 23, 2010, as part of the Patient Protection and Affordable Care Act, see Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 10104(j)(2), 124 Stat. 119, 901-02 (2010). The pre-amendment version of § 3730(e)(4)(A), enacted in 1986, provided:

No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government Accounting Office report, hearing, audit, or investigation, or from the news media, unless the action is brought by the Attorney General or the person bringing the action is an original source of the information.

31 U.S.C. § 3730(e)(4)(A) (1986). As amended, section 3730(e)(4)(A) currently provides:

The court shall dismiss an action or claim under this section, unless opposed by the Government, if substantially the same allegations or transactions as alleged in the action or claim were publicly disclosed-
(i) in a Federal criminal, civil, or administrative hearing in which the Government or its agent is a party;
(ii) in a congressional, Government Accountability Office, or other Federal report, hearing, ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.