LOTT v. NOT-FOR-PROFIT HOSPITAL CORPORATION
MEMORANDUM OPINION AND ORDER granting Defendant's 23 Motion to Dismiss. See the attached Memorandum Opinion and Order for additional details. Signed by Judge Amit P. Mehta on 11/8/2017. (lcapm2)
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 1 of 17
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
CORPORATION, et al.,
UNITED STATES ex rel. LOTT,
Case No. 16-cv-1546 (APM)
MEMORANDUM OPINION AND ORDER
Plaintiff 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
Plaintiff’s 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
The 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
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 2 of 17
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).
On 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.
As Chief Compliance Officer, Plaintiff’s primary responsibility was to ensure that the
hospital complied with federal and state laws. Id. ¶¶ 1, 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, 45.
One of the issues that came to Plaintiff’s 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
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 3 of 17
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.
Another 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.
Three months into Plaintiff’s 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
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 4 of 17
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.
Plaintiff 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 Plaintiff’s 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.
On 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 D.C. Mot. to Dismiss, ECF No. 26. As a result, only Defendant Not-For-Profit Hospital’s
Motion to Dismiss remains before the court.
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 5 of 17
Plaintiff’s 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–
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 administrative remedies. See Pl.’s Opp’n to Def.’s
12(b)(6) Motion, ECF No. 25, [hereinafter Pl.’s Opp’n], at 1–2. Therefore, the FCA and FMLA
counts—Counts II and IV—are Plaintiff’s sole remaining federal claims.
The court evaluates these claims under the familiar pleading standard in Rule 12(b)(6) of
the Federal Rules of Civil Procedure. To survive Defendant’s motion, the complaint must “contain
sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
570 (2007)). The court “construe[s] the complaint ‘in favor of the plaintiff, who must be granted
the benefit of all inferences that can be derived from the facts alleged.’” Hettinga v. United States,
677 F.3d 471, 476 (D.C. Cir. 2012) (quoting Schuler v. United States, 617 F.2d 605, 608 (D.C.
Cir. 1979)). If the facts as alleged fail to establish that a plaintiff has stated a claim upon which
relief can be granted, then a court must grant the defendant’s Rule 12(b)(6) motion. See Am.
Chemistry Council, Inc. v. U.S. Dep’t of Health & Human Servs., 922 F. Supp. 2d 56, 61 (D.D.C.
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 6 of 17
With these principles in mind, the court now turns to the merits of Defendant’s Motion.
False Claims Act Claim
Defendant argues Plaintiff’s FCA claims should be dismissed because: (1) Defendant is
not an entity that can be held liable under the FCA’s qui tam provision due to its legal status as an
“instrumentality of the District government,” D.C. Code. § 44-951.02(a); and (2) Plaintiff has not
alleged the required elements of a FCA fraud claim. The court refrains from deciding, at this
juncture, whether Defendant is subject to qui tam liability under the FCA, but concludes that
dismissal is warranted because of Plaintiff’s failure to allege a claim with the requisite specificity.
Whether Defendant is a “person” subject to liability under the qui tam
provision of the FCA
Defendant’s first argument for dismissal concerns whether Defendant is subject to suit
under the FCA’s qui tam provision. The FCA provides that a private party may bring a qui tam
action—that is, an action on behalf of the United States and himself—against “any person who
. . . knowingly presents, or causes to be presented” to the United States government “a false or
fraudulent claim for payment or approval.”
31 U.S.C. § 3729(a) (emphasis added); see id.
§3730(b). This section of the FCA, however, does not define the term “person.” Consequently,
the text of the statute does not answer whether the District of Columbia and its related entities can
be the subject of a qui tam action.
Supreme Court precedent fills the definitional void, at least in part. In Vermont Agency of
Natural Resources v. United States ex rel. Stevens, the Court held that neither States nor their
agencies are “persons” for purposes of the qui tam provision of the FCA. 529 U.S. 765, 787–88
(2000). The Court explained that a textual reading of the FCA and its legislative history make clear
that Congress did not intend for the qui tam provisions of the FCA to reach States and their agencies.
Id. at 780–87. Stevens, however, left unanswered how to determine whether an entity is a state
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 7 of 17
agency that is not within the FCA’s reach. In the absence of guidance from the Supreme Court,
lower courts unanimously have borrowed the “arm of the state” test used in the sovereign immunity
context as a sorting mechanism. See, e.g., United States & Commonwealth of Mass., ex rel. Willette
v. Univ. of Mass, Worcester, 812 F.3d 35, 39 (1st Cir.) (citing cases), cert. denied, 137 S. Ct. 617
(2017). Whether an entity is an arm of the state rests on the relationship between the entity and
the state. Cf. Regents of the Univ. of Cal. v. Doe, 519 U.S. 425, 429 n.5 (1997) (stating that, in the
sovereign immunity context, whether an entity is an arm of the state “can be answered only after
considering the provisions of state law that define the agency’s character”). The D.C. Circuit
considers three factors to determine whether an entity is an arm of the state: “(1) the State’s intent
as to the status of the entity, including the functions performed by the entity; (2) the State’s control
over the entity; and (3) the entity’s overall effects on the state treasury.” P.R. Ports Auth. v. Fed.
Mar. Comm’n, 531 F.3d 868, 873 (D.C. Cir. 2008). Taken together, these three factors focus the
arm-of-state inquiry on the “nature of the entity created by state law” and whether the State
“structured” the entity to share in the State’s immunity from suit. Id. (citation omitted).
In asking this court to conclude that Defendant is immune from FCA qui tam liability ,
Defendant argues for a straightforward application of Stevens and the arm-of-the-state test. This
argument presumes the District of Columbia is a “state” and assigns significant weight to
Defendant’s authorizing statute, which defines Defendant as an “instrumentality” of the District
of Columbia government that has a “separate legal existence within the District government.”
D.C. Code § 44–951.02(a) (emphasis added).
In responding, Plaintiff does not address the
applicability of the arm-of-the-state test or its three factors to support his position that Defendant
is subject to suit under the FCA. Instead, Plaintiff contends that because Defendant is capable of
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 8 of 17
being “sued in its corporate name,” D.C. Code § 44-951.06, it lacks sovereign immunity and
therefore is subject to FCA liability, see Pl.’s Opp’n, at 7.
Both arguments miss the mark. First, Plaintiff fails to explain why sovereign immunity is
relevant to the “person”-hood inquiry at issue, i.e., whether Defendant is a “person” for purposes of
qui tam liability under the FCA. To the extent Plaintiff is raising sovereign immunity because of
Stevens, he is misguided. Stevens held that states are immune from qui tam FCA actions because
the statutory term “person” did not include states, and expressly reserved deciding whether the
Eleventh Amendment would provide an independent basis for shielding states and their agencies
from FCA qui tam claims. 529 U.S. at 787 (“We . . . express no view on the question whether an
action in federal court by a qui tam relator against a State would run afoul of the Eleventh
Amendment, but we note that there is ‘a serious doubt’ on that score.” (citation omitted)). Thus,
under Stevens, a state entity’s amenability to suit due to a general waiver of sovereign immunity does
not answer whether such entity is a “person” for purposes of the FCA’s qui tam provision.
Defendant’s argument also is flawed. If the District of Columbia is a “state” under the FCA’s
qui tam provision, the straightforward application of Stevens and the arm-of-the-state test, as
advocated for by Defendant, might be appropriate. But whether Stevens applies is far from clear
because the District of Columbia is not a state; the District is organized by statute as a “body
corporate for municipal purposes” and possesses all the “powers of a municipal corporation.”
D.C. Code § 1-102. The District’s status as a municipal corporation complicates the inquiry into
Defendant’s potential FCA liability because the Supreme Court has held in that municipalities and
municipal corporations, unlike states and their agencies, are subject to FCA liability. See Cook
Cty. United States ex rel. Chandler, 538 U.S. 119, 122 (2003). If the District is to be treated as a
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 9 of 17
municipal corporation here, a straightforward application of Chandler would lead to the conclusion
that Defendant is subject to qui tam liability.
But whether Chandler governs in this case also is unclear. Although organized as a
municipality, the “government of the District is not just another municipal corporation.” Feaster
v. Vance, 832 A.2d 1277, 1287 (D.C. 2003). The District has a “unique status” that is “truly sui
generis in our governmental structure.” District of Columbia v. Carter, 409 U.S. 418, 432 (1973).
Sometimes it is likened to and treated as a state. See, e.g., Firemen’s Ins. Co. of Washington, D.C.
v. Washington, 483 F.2d 1323, 1328 (D.C. Cir. 1978) (“In many respects the District is more akin
to a state than to a municipality.”); Ruffin v. United States, 76 A.3d 845, 857 (D.C. 2013)
(“Although the District of Columbia has been constituted ‘as a body corporate for municipal
purposes’ . . . [it] has been variously compared to or described as a state, territory, or municipality ,
and sometimes it has simply been called ‘unique.’” (citation omitted)); see also Parker v. District
of Columbia, 478 F.3d 370, 406 (D.C. Cir. 2007) (observing that courts “have consistently held
that several constitutional provisions explicitly referring to citizens of ‘States’ do not apply to
citizens of the District,” but that “the District can parallel a ‘State’ within the meaning of [other]
constitutional provisions”). Ultimately, however, “[w]hether the District of Columbia constitutes
a ‘State or Territory’ within the meaning of any particular statutory or constitutional provision
depends upon the character and aim of the specific provision involved.” Carter, 409 U.S. at 420.
No court has decided whether the District of Columbia is a “state” or a “municipality” for purposes
of a qui tam action under the FCA. 1
In United States ex rel. Settlemire v. District of Columbia, the D.C. Circuit refrained from deciding whether the FCA
qui tam provision applies to the District of Columbia. 198 F.3d 913, 921 (D.C. Cir. 1999). It has not revisited the
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 10 of 17
While the threshold question of whether the District of Columbia is subject to the qui tam
provision of the FCA squarely presents itself in this case, the court declines to answer it in the
case’s present posture. Neither party addresses the important distinction between “state” and
“municipality” in its pleadings. Defendant assumes without discussion that the District is a “state”
and does not even cite Chandler, while Plaintiff does not even acknowledge the issue and merely
counters by citing a single qui tam action against the District, in which the District’s “personhood”
was not discussed. See Pl.’s Opp’n at 2 (citing United States ex rel. Davis v. District of Columbia,
793 F.3d 120 (D.C. Cir. 2015)). Moreover, neither the District of Columbia nor the United States
Attorney’s Office for the District of Columbia has had an opportunity to express its views. In light
of the limited briefing and the significance of this issue, the court believes that it is inappropriate
to decide the question of the District’s status under the FCA’s qui tam provision at this juncture.
Instead, the court proceeds to the alternative ground on which Defendant seeks dismissal.
Whether Plaintiff has adequately pleaded FCA claims
Defendant argues that Plaintiff’s FCA claims—both his substantive and retaliation
claims—must be dismissed because Plaintiff has not alleged sufficient facts concerning
Defendant’s allegedly fraudulent reimbursement submissions to support those claims. The court
agrees. The court first addresses the sufficiency of Plaintiff’s substantive FCA claim and then
turns to his retaliation FCA claim.
The substantive FCA claim
Substantive FCA claims, like common law fraud claims, must satisfy the heightened
pleading standard of Rule 9(b). See United States ex rel. Totten v. Bombardier Corp., 286 F.3d
542, 551–52 (D.C. Cir. 2002). That rule provides that, “[i]n alleging fraud . . . , a party must state
with particularity the circumstances constituting fraud.” Fed. R. Civ. P. 9(b). The circumstances
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 11 of 17
constituting fraud include the time, place, and contents of the false representations, as well as the
identity of persons involved in the alleged fraudulent conduct. See Totten, 286 F.3d at 552; United
States ex rel. Williams v. Martin-Baker Aircraft Co. Ltd., 389 F.3d 1251, 1257–58 (D.C. Cir.
2004). So, in order to satisfy Rule 9(b), Plaintiff must offer a “detailed description of the specific
falsehoods that are the basis for his suit.” Totten, 286 F.3d at 552.
Plaintiff’s FCA claim proceeds under what is known as the “implied false certification
theory” of liability.
See Pl.’s Opp. at 8. Under that theory, FCA liability may attach when a
defendant misrepresents or omits information about its noncompliance with certain conditions of
payment. See Universal Health Servs., Inc. v. United States ex. rel. Escobar, 570 U.S. __, __, 136
S. Ct. 1989, 1995, 2001 (2016). To state an implied false certification claim, a plaintiff must allege
that: (1) the defendant not only made a request for payment but also made specific representations
about the goods or services provided, and (2) the defendant “fail[ed] to disclose noncompliance
with material statutory, regulatory,
or contractual requirements
[which made] those
representations misleading half-truths.” Id. at 2001 (emphasis added). Consistent with Rule 9(b),
those two conditions must be stated “with particularity.” Fed. R. Civ. P. 9(b).
There are two independent reasons to dismiss Plaintiff’s substantive FCA claim. First,
Plaintiff fails to satisfy Rule 9(b)’s particularity requirement. Plaintiff’s substantive FCA claim
alleges that Defendant “violated the Federal False Claims Act by submitting claims for
reimbursement from federal healthcare programs, including Medicare and Medicaid,” despite
knowledge that Defendant was ineligible for reimbursement because it was not in compliance with
“the Office of Inspector General guidelines and other federal laws regarding healthcare facilities
and nursing programs.” Am. Compl. ¶ 70. 2 This general accusation is not, however, supported
Plaintiff does not assert that his substantive FCA claims rest on Defendant’s alleged billing for phantom services
performed by Dr. Allen. Cf. Am. Compl. ¶ 70.
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 12 of 17
by specific factual allegations contained elsewhere in the Amended Complaint.
does not, for instance, “identify . . . who precisely was involved in the fraudulent activity” and
their roles in the fraudulent scheme. Williams, 389 F.3d at 1257. Worse, Plaintiff fails to identify
the precise OIG guidelines or federal laws that Defendant allegedly violated when submitting
claims for reimbursement and consequently does not allege the “fact[s] misrepresented” that form
the basis of his substantive FCA claim. Id. The Amended Compliant therefore alleges none of
the “circumstances constituting fraud” with particularity, as required by Rule 9(b).
Second, the Amended Complaint does not allege facts that satisfy either of the two
requirements to plead an implied false certification theory of liability. Plaintiff does not aver the
“specific representations about the goods or services” that Defendant provided that form the basis of
his fraud claim. Universal Health Servs., 136 S. Ct. at 2001. The closest Plaintiff comes to any such
detail is the assertion that Defendant billed CMS “for the skilled nursing facility and hospital,” Am.
Compl. ¶ 62, but such an allegation is not nearly “specific” enough, cf. Universal Health Servs., 136
S. Ct. at 2000 (noting that the plaintiff’s complaint alleged the specific types of treatment and
therapies that formed the basis for his claim, as well as the corresponding payment and other codes
presented for reimbursement). Nor has Plaintiff alleged facts that would support the materiality of
Defendant’s non-compliance. As noted, Plaintiff does not specify the OIG guidelines or federal laws
as to which Defendant failed to disclose its alleged noncompliance. See generally Am. Compl. ¶¶ 62,
70. Plaintiff makes some effort to bring clarity in his Opposition, claiming that Defendant violated
“HIPAA, and other federal and state regulations, including . . . the Affordable Care Act,” Pl.’s Opp’n
at 9, but this allegation, even if Plaintiff had made it in his complaint, also lacks specificity, see
Universal Health Servs., 136 S. Ct. at 2002 (noting that “billing parties are often subject to thousands
of complex statutory and regulatory provisions”). Thus, lacking any allegation about the particular
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 13 of 17
laws or regulations Defendant allegedly violated, Plaintiff cannot—and does not—allege that
Defendant’s compliance with any rule was a material condition of reimbursement. See id. at 2001.
Plaintiff’s substantive FCA claim, as presently pleaded, therefore fails.
The retaliation FCA claim
Plaintiff’s FCA retaliation claim meets the same fate. The whistleblower provision of the
FCA’s qui tam section grants a cause of action to persons who are retaliated against for their “lawful
acts . . . in furtherance of an action under this section or other efforts to stop 1 or more violations of
this subchapter.” 31 U.S.C. § 3730(h)(1). This claim requires the employee show that “(1) he
engaged in protected activity . . . ; and (2) he was discriminated against ‘because of’ that activity.”
United States ex rel. Yesudian v. Howard Univ., 153 F.3d 731, 736 (D.C. Cir. 1998). The second
element requires the employee establish that the employer “had knowledge the employee was
engaged in protected activity,” and the employer’s retaliation was motivated, at least in part, by the
employee’s protected activity. Id. (citation omitted).
Plaintiff has not alleged facts that support an FCA retaliation claim. For starters, it is not at
all clear what protected activity Plaintiff claims to have engaged in under the FCA. Plaintiff cites an
email that he sent to the Board of Directors, see Am. Compl. ¶ 45, however that email does not
identify any particular violation of the FCA that Plaintiff sought to prevent. In addition, Plaintiff
fails to plead facts that would show Defendant knew that Plaintiff had engaged in protected activity,
whatever that activity might have been. According to Plaintiff’s pleading, when he first met with
Defendant’s new CEO on July 20, 2015, Plaintiff claims to have advised him about a number of
problems at the hospital, but fraudulent billing was not among them. Cf. Id. ¶ 53. The new CEO
fired Plaintiff ten days later, yet there is nothing in the Amended Complaint that plausibly alleges
either the CEO or anyone that might have advised the CEO knew about any activity by Plaintiff
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 14 of 17
protected under the FCA. As a result of these pleading deficiencies, Plaintiff’s FCA retaliation claim
also is dismissed.
Family Medical Leave Act Claim
The court now turns to Plaintiff’s other federal claim under the FMLA. Plaintiff’s FMLA
claim accuses Defendant of retaliating against him, by firing him, after he “requested that
[Defendant] reinstate Sonia Edwards, whom [Defendant] terminated for taking FMLA leave.”
Am. Compl. ¶ 84; see also 29 U.S.C. § 2615(a)(2) (prohibiting employers from discharging
individuals for opposing unlawful practices). Defendant maintains that Plaintiff’s remarks to
Small about Edwards’s termination was “nothing more than his daily fulfillment” of his
compliance officer position and thus is outside of the protections of the FMLA. Def.’s Mot. at 24.
Plaintiff urges the court to take a different course. He argues that supervisory employees are not, by
virtue of their positions and responsibilities, excluded from protection against retaliation under the
FMLA. Instead, he asks the court to focus on whether the employee engaged in oppositional
conduct, without regard to the employee’s job duties. Pl.’s Opp’n at 10–11.
Defendant’s argument—sometimes referred to as the “manager rule”—stems from case law
interpreting the anti-retaliation provisions of the Fair Labor Standards Act (“FLSA”) and Title VII.
See McKenzie v. Renberg’s Inc., 94 F.3d 1478, 1485–87 (10th Cir. 1996); Brush v. Sears Holdings
Corp., 466 Fed. App’x 781, 787 (11th Cir. 2012); see also Littlejohn v. City of New York, 795 F.3d
297, 317 n.16 (2d Cir. 2015) (describing the “manager rule” used in other circuits). As to those
statutes, some courts have held that an employee is not protected from retaliation for reporting
concerns about an employer’s potential violations of the law, if the employee is acting pursuant to
her job duties. McKenzie, 94 F.3d at 1485–87. Instead, the employee must “take a position adverse
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 15 of 17
to her employer or assert [a] right[ ] under the [law].” Id. at 1487. The D.C. Circuit, however, has
yet to embrace this framework in the FLSA, Title VII, or FMLA contexts.
This court need not decide whether an employee’s mere fulfillment of job duties, when
those duties involve reporting wrongdoing, may constitute “protected activity” under the FMLA,
because Plaintiff’s claim fails even under his own conduct-focused theory. Plaintiff relies on the
Fourth Circuit’s decision in DeMasters v. Carilion Clinic, a Title VII case, to support his argument
that an employee acting in fulfillment of his duties may be protected from retaliation, provided
that the employee opposed his employer’s practice or action. See 796 F.3d 409, 422–23 (4th Cir.
2015). DeMasters rejected the application of the “manager’s rule” and held that a consultant
whose job was to counsel employees asserting claims of discrimination could himself bring a claim
of retaliation under Title VII because the consultant had engaged in protected activity by
undertaking a continuous course of oppositional conduct that conveyed to the employer the
consultant’s belief that the employer was violating the law. See id. at 418, 421–22. In adopting
an “expansive” view of an employee’s protected activity, the court explained that such activity
“encompasses utilizing informal grievance procedures as well as staging informal protests and
voicing one’s opinions in order to bring attention to an employer’s discriminatory activities”
regarding an unlawful employment practice. Id. at 413, 417. But DeMasters also emphasized the
need to consider the “employee’s course of conduct as a whole,” and suggested that sustained
opposition—rather than an isolated act—was necessary to state a claim. Id. at 413, 418.
Plaintiff’s claimed protected action falls short of the DeMasters definition of oppositiona l
conduct. Plaintiff alleges only a single protected activity—that he once told Defendant’s CEO,
Small, during a meeting “that [Edwards’s firing] maybe [ran] afoul of the FMLA, the D.C. FMLA
& DCHRA laws,” and that the hospital needed to comply with federal and District of Columbia
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 16 of 17
laws. Am. Compl. ¶ 42 (emphasis added). Even viewing that allegation in the light most favorable
to Plaintiff, as this court must, Plaintiff did no more than offer a half-hearted opinion—he qualified
his view of a law violation with the word “maybe”—about Defendant’s potential liability for firing
Edwards and gave rather obvious advice that Defendant had to comply with the law. After the
Executive Vice President of Human Resources refused Small’s order to reinstate Edwards, Plaintiff
does not allege that he undertook any oppositional action, such as filing a formal grievance, revisiting
the matter with Small, reporting the action to an independent entity, or otherwise calling attention to
the action. Cf. DeMasters, 796 F.3d at 417. Plaintiff’s single expression of a qualified opinion of
potential liability is a far cry from the type of full-throated opposition DeMasters contemplated as
qualifying for protection. Accordingly, Plaintiff has failed to state a plausible claim of retaliation
under the FMLA. 3
District of Columbia Statutory and Common Law Claims
Having dismissed Plaintiff’s federal law claims, the court declines, at this juncture, to
exercise jurisdiction over Plaintiff’s remaining claims that arise under District of Columbia law.
See 28 U.S.C. § 1367(c); Anderson v. Holder, 647 F.3d 1165, 1174 (D.C. Cir. 2011) (permitting
district court to decline to exercise supplemental jurisdiction when it has dismissed all claims over
which it has general jurisdiction). Accordingly, the court does not address Defendant’s arguments
for dismissing Plaintiff’s state law claims.
There exists another ground for dismissal. Plaintiff does not allege that Defendant’s agent who actually terminated
Plaintiff—Small’s replacement, Davis—was aware of Plaintiff’s opinion about Edwards’s firing. See Clark Cty. Sch.
Dist. v. Breeden, 532 U.S. 268, 273 (2001) (holding an alleged discriminating official’s knowledge of prior protected
activity must precede the official’s contemplating adverse action). Plaintiff alleges that he told Davis about “matters
effecting [sic] [the hospital] in this case, unsecured medical or patient records, theft or misplacement of patient
property, questionable patient deaths and wrongful terminations,” but says nothing about Edwards’s firing which, at
that point, was more than a month old. Am. Compl. ¶ 53. Because Plaintiff fails to allege that the person who
terminated him was aware of his defense of Edwards, his retaliation claim falters for that independent reason.
Case 1:16-cv-01546-APM Document 30 Filed 11/08/17 Page 17 of 17
For the foregoing reasons, Defendant’s Motion to Dismiss is granted. Plaintiff’s FCA
(Count II) and FMLA (Count III) claims are dismissed without prejudice. Plaintiff’s District of
Columbia statutory and common law (Counts IV through VI) claims likewise are dismissed
The court will not, however, dismiss Plaintiff’s action at this time. The court will give
Plaintiff one more opportunity to amend his complaint to plead his federal claims. If Plaintiff
chooses to amend, he shall file a motion for leave to amend, along with a proposed Second
Amended Complaint and a redline comparison to the Amended Complaint, no later than November
Dated: November 8, 2017
Amit P Mehta
United States District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?