Suppressed v. Suppressed

Filing 167

MEMORANDUM Opinion and Order Written by the Honorable Gary Feinerman on 9/19/2013.Mailed notice.(jlj)

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
UNITED STATES OF AMERICA ex rel. CATHY
WILDHIRT AND NANCY MCARDLE, and STATE
OF ILLINOIS ex rel. CATHY WILDHIRT AND
NANCY MCARDLE,

Relators/Counter-Defendants,
vs.
AARS FOREVER, INC., and THH ACQUISITION
LLC I,
Defendants/Counter-Plaintiffs.

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09 C 1215
Judge Feinerman

MEMORANDUM OPINION AND ORDER
Relators Cathy Wildhirt and Nancy McArdle brought this qui tam action on behalf of the
United States and the State of Illinois, alleging that AARS Forever, Inc. (“AARS”) and THH
Acquisition LLC 1 (“Acquisition”) violated the False Claims Act, 31 U.S.C. § 3729 et seq.
(“FCA”), and the Illinois Whistleblower Reward and Protection Act, 740 ILCS 175/1 et seq.
(“IWRPA”). The court granted Defendants’ motion to dismiss the original complaint and gave
Relators a chance to replead. 2011 WL 1303390 (N.D. Ill. Apr. 6, 2011). Relators filed an
amended complaint, Defendants moved to dismiss the amended complaint, and the court denied
that motion. 2011 WL 5373985 (N.D. Ill. Nov. 4, 2011). Defendants answered the amended
complaint and counterclaimed. Doc. 109 at pp. 68-80 (Acquisition’s counterclaims); Doc. 110 at
pp. 74-88 (AARS’s counterclaims). Relators have moved to dismiss the counterclaims pursuant
to Federal Rule of Civil Procedure 12(b)(6). Doc. 118. The motion is granted in part and denied
in part.
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Background
In considering Relators’ motion to dismiss, the court assumes the truth of the
counterclaims’ factual allegations, though not their legal conclusions. See Munson v. Gaetz, 673
F.3d 630, 632 (7th Cir. 2012). The court also must consider “documents attached to the
[counterclaims], documents that are critical to the [counterclaims] and referred to in [them], and
information that is subject to proper judicial notice,” along with additional facts set forth in
Defendants’ brief opposing dismissal, so long as those facts “are consistent with the pleadings.”
Geinosky v. City of Chicago, 675 F.3d 743, 745 n.1 (7th Cir. 2012). The following facts are set
forth as favorably to Defendants as these materials allow. See Gomez v. Randle, 680 F.3d 859,
864 (7th Cir. 2012). Familiarity with the factual backdrop of this litigation, which is set forth in
the courts’ prior opinions, is assumed. 2011 WL 1303390, at *1-2; 2011 WL 5373985, at *3-4.
Relators were employed by Defendants from July 2007 through September 2008. Doc.
109 at ¶¶ 6-7; Doc. 110 at ¶¶ 6-7. (All citations to Docs. 109 and 110 are to Defendants’
counterclaims, not to their answers.) During that time, Relators were bound by an Employee
Confidentiality, Non-Compete, and HIPAA Agreement. Doc. 109 at ¶ 11; Doc. 110 at ¶ 9.
McArdle signed the Agreement on July 11, 2007, and Wildhirt did so on April 6, 2008. Doc.
109 at ¶ 11; Doc. 110 at ¶ 9. The Agreement provides in relevant part:
4.

I acknowledge that in my employment I am or will be making use
of, acquiring or adding to Company’s Confidential Information … .
[I]n order to protect Company’s Confidential Information and to
protect other employees who depend on Company for regular
employment, I agree as follows:
1.

I will not during or after the term of my employment in any
way utilize any of said Confidential Information, except with
permission and in connection with my employment by
Company, and I will not copy, reproduce or take with me the
original or any copies of said Confidential Information, and I
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will not disclose any of said Confidential Information to
anyone. Furthermore, I will not disclose the content of any
company related verbal communications to anyone.
2.

I shall indemnify and hold Company harmless from any loss,
claim or damages, including without limitation all
reasonable attorney’s fees, costs and expenses, arising out of
or relating to the unauthorized disclosure of Confidential
Information or other proprietary information of the
Company, the Company’s customers or principals by the
Employee, directly or indirectly or alone or in concert with
others, which indemnification shall be in addition to, and not
in lieu of, all other remedies the Company may have
hereunder, under applicable laws or in equity.

5.

I agree to comply with the Company patient confidentiality policies
regarding the Health Insurance Portability and Accountability Act
(HIPAA). I have read the Company’s Employee Education
document and policy, and understand if I violate these policies I will
hold the Company harmless and accept full responsibility.

6.

I agree that I cannot receive any monetary reimbursement for
involvement or assistance in a Qui Tam or Whistleblower action
against the Company. If I am awarded such directly or indirectly, I
will immediately disclose it to the Company and turn it over to the
Company immediately. Furthermore, I agree that I am in violation
of this agreement if I release company information that reveals
suspect practices or investigations or if I use knowledge of such
information to harm the Company reputation or damage
relationships with the Company’s referral sources of anyone else. I
agree that the company cannot be responsible for suspect practices
that it would otherwise be unaware if not made specifically aware of
them by staff. I agree to notify the Company in writing immediately
if I suspect practices that may be of concern. I agree that if I file
any suit against the company including with the EEOC and lose said
suit, I will reimburse Company for all expenses incurred.
*

10.

*

*

Termination of employment for any reason will not terminate or
modify in any way the responsibilities to Company hereunder of
Employee and his or her representatives or assigns. I understand
that actions in violation of this agreement may result in immediate
dismissal and possible legal action. If I file a lawsuit or any other
action or EEOC filing against the Company and lose that action, I
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agree to reimburse Company including but not limited to monetary
damages, pain and suffering, attorney’s fees, and other litigation
costs and expenses.
Doc. 109-4 at 2-3.
On January 25, 2008, McArdle signed an acknowledgment form regarding her HIPAA
responsibilities. Doc. 109 at ¶ 16; Doc. 110 at ¶ 14. The form states:
In summary, I understand the rights and responsibilities of Total Home
Health, Inc. Protected Health Information Confidentiality Policy that I, as
an employee of Total Home Health, Inc., must comply with and implement.
Further, I understand that if I violate any of the policy terms, I may be
subject to disciplinary action, including discharge, loss of privileges,
termination of contract, legal action for monetary damages or injunction, or
both, or any other remedy available to Total Home Health, Inc.
Doc. 109-6 at 2. In addition, Relators signed “Confidential Acknowledgment of No Known
Suspect Practices” statements. Doc. 109 at ¶ 18; Doc. 110 at ¶ 16. Each statement provides:
I sign this statement attesting to the fact that I am unaware of any suspect
business practices conducted by Total Home Health, Inc., and its staff other
than any issue I may have turned in a “Notification of Suspect Practices”
form for. If I am aware of any type of suspect practice, the Company has
informed me that I must complete the available “Notification of Suspect
Practices” form. I agree that the company cannot be responsible for suspect
business practices that it would otherwise be unaware of if not made
specifically aware of them by staff.
Docs. 109-7, 109-8. Relators did not report any alleged suspect practices to AARS or
Acquisition management before filing this action. Doc. 109 at ¶ 24; Doc. 110 at ¶ 25.
Unbeknownst to Defendants and against their policies and procedures, McArdle took
home and retained Defendants’ confidential and HIPAA-covered documents during her period of
employment. Doc. 109 at ¶ 20; Doc. 110 at ¶ 19. McArdle admitted that she haphazardly and
for no particular purpose brought home documents containing HIPAA information, and then
failed to return those documents after leaving her job. Doc. 119 at 6. McArdle had no intention

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of filing a qui tam suit when she took these documents, ibid., and she acknowledged that she
should have returned the documents to Defendants when her employment terminated, Doc.
109 at ¶ 21; Doc. 110 at ¶ 20. McArdle disclosed those documents to her counsel, the
government, and the public. Doc. 110 at ¶ 35.
Relators also disclosed to third parties the contents of company-related verbal
communications. Doc. 109 at ¶ 23; Doc. 110 at ¶¶ 22, 34, 41. After her employment concluded,
McArdle made disparaging remarks to the Veterans Administration (“VA”) about Acquisition
and its business practices. Doc. 109 at ¶ 28; Doc. 110 at ¶ 27. McArdle called the VA to say
that she resigned from Acquisition because of the “remarks that were made to [her] about patient
care,” and she told John Orsenage of the VA that she “was really sorry that [she] had to leave but
[she] could not work there any longer under those circumstances, and [she] said, ‘Just watch
close, John, what’s going on. Competencies aren’t being done like they are supposed to be.’”
Doc. 109-3 at 18. Defendants allege that this statement was false, and that McArdle made
further false statements to the VA, the State of Illinois, and private payors about Defendants’
compliance with the VISN 12 Agreement and their other agreements with the VA. Doc. 109
at ¶ 59; Doc. 110 at ¶ 58; Doc. 119 at 18. McArdle has admitted that she brought this suit
because Acquisition threatened to sue her for having disparaged it. Doc. 119 at 5. For her part,
Wildhirt falsely told the VA that Defendants provided care that did not meet the contract terms,
gave patients the wrong equipment, did not provide patients with the education to which they
were entitled or with necessary supplies. Doc. 109-9 at 6-7; Doc. 119 at 18. Wildhirt made
similarly false statements to private payors and the State. Doc. 109-9 at 8; Doc. 119 at 8.
Relators made the aforementioned statements even though they worked for Defendants
for only a short time and had no knowledge of Defendants’ general billing practices or the
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specific requirements of the VISN 12 Agreement. Doc. 109 at ¶ 30; Doc. 110 at ¶ 29. For
McArdle, see Doc. 109-3 at 9 (“Q. During the time you worked for Total Home Health,
regardless of the ownership, what role did you have in billing the VA? A. None.”), at 10
(admitting to never having seen the contract between AARS and the VA), at 11-13 (admitting to
being unaware of any performance standards in the VISN 12 Agreement and to disregarding any
such performance standards in favor of her own view that 100% performance was required at all
times), at 27-29 (describing her role in billing, stating that “I wasn’t responsible for anything,”
and that she could not describe the VA auditing process of billing documents). For Wildhirt, see
Doc. 109-9 at 5 (admitting to only knowing the clinical aspects of the VA contract), at 11-12
(denying having seen any documents indicating what was necessary for Acquisition to carry out
the VISN Agreement), at 13-15 (admitting to not having ever seen the VISN 12 Agreement: “I
haven’t read the contract”), at 16 (“I did not do billing. Q. Not only did you not do billing, you
never saw any billing documents, correct? A. Correct. I was in the clinical field.”), at 17-18 (“Q
… [Y]ou have never seen any billing documents that went to or from the VA? A. Right. I did not
do billing.”), at 19-20 (admitting to having no knowledge of Acquisition’s custom or practices
regarding billing, stating “I wasn’t involved in billing”). Prior to and in filing and prosecuting
this suit, Relators made these false statements and released confidential information to harm
Defendants and to interfere with Defendants’ relationships with third parties, including the VA,
the State of Illinois, and private payors. Doc. 109 at ¶¶ 29, 58; Doc. 110 at ¶¶ 28, 58.
Discussion
AARS and Acquisition each filed six counterclaims, all under Illinois law. AARS’s
counterclaims are materially identical to Acquisition’s. Counts I and II allege that Relators
breached the Agreement through the unauthorized disclosure of confidential information outside
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the company; Count III seeks indemnification under the Agreement for damages suffered as a
result of those disclosures; Count IV alleges that Relators breached the Agreement by failing to
report suspect practices to Defendants before filing this lawsuit; Count V claims that Relators
committed tortious interference with prospective economic advantage by making false
statements to third parties about Defendants’ practices; and Count VI seeks reimbursement under
the Agreement for legal costs and expenses should Defendants prevail in this lawsuit. Relators
make three arguments to support dismissing the counterclaims, which are addressed in turn.
I.

Public Policy Defense to Counts I-IV and VI
Relators argue that Counts I-IV and VI should be dismissed because the provisions of the

Agreement they are alleged to have violated are contrary to public policy and thus
unenforceable. In support, Relators cite Town of Newton v. Rumery, 480 U.S. 386, 392 (1987),
for the proposition that “a promise is unenforceable if the interest in its enforcement is
outweighed in the circumstances by a public policy harmed by enforcement of the agreement.”
Doc. 118 at 4. Relators submit that the policy interest at stake as “the detection and exposure of
potential fraud against the United States,” and argue that “private agreements that would thwart
that interest are not enforceable for reasons of public policy.” Id. at 5. According to Relators,
the Agreement thwarts that interest by chilling would-be qui tam relators from coming forward
with evidence of fraud, thereby hindering government investigations. Id. at 5-6.
There is a well-developed jurisprudence that addresses these policy interests in the
context of counterclaims brought against relators in FCA litigation. The law was ably
summarized by Judge Lambreth in United States ex rel. Miller v. Bill Harbert Int’l Constr., Inc.,
505 F. Supp. 2d 20 (D.D.C. 2007). As an initial matter, “[t]he unavailability of contribution and
indemnification for a defendant under the False Claims Act now seems beyond peradventure.”
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Id. at 26 (citing cases); see also United States v. Omnicare, Inc., 2013 WL 381967, at *19 (N.D.
Ill. July 23, 2013) (“a claim by an FCA defendant which requires for its success a finding that
the FCA defendant is liable is barred by the FCA”) (quoting Harbert, 505 F. Supp. 2d at 28)
(alterations omitted). Thus, “an FCA defendant found liable of FCA violations may not pursue a
counterclaim that will have the equivalent effect of contribution or indemnification.” Miller, 505
F. Supp. 2d at 26; see also Mortgages, Inc. v. U.S. Dist. Ct. for the Dist. of Nev., 934 F.2d 209,
212-13 (9th Cir. 1991). However, “a qui tam defendant may maintain a claim for independent
damages; that is, a claim that is not dependent on a finding that the qui tam defendant is liable.”
Miller, 505 F. Supp. 2d at 26; see also Cell Therapeutics, Inc. v. Lash Grp., Inc., 586 F.3d 1204,
1209 (9th Cir. 2009). Such independent claims fall in two categories. “The first … is where the
conduct at issue is distinct from the conduct underlying the FCA case. This can be so even
where there is a close nexus between the facts, so long as there is a clear distinction between the
facts supporting liability against relator and the facts supporting liability against the FCA
defendant. … These causes of action are truly independent of the FCA claims because none of
them require as an essential element that the FCA defendant was liable—or not liable—in the
FCA case.” Miller, 505 F. Supp. 2d at 27 (citing cases); see also Cell Therapeutics, 586 F.3d at
1209. “The second category … is where the defendant’s claim, though bound up in the facts of
the FCA case, can only prevail if the defendant is found not liable in the FCA case. … These
claims have surfaced in the form of libel, defamation, malicious prosecution, and abuse of
process—claims that succeed upon a finding that the relator’s accusations were untrue.” Miller,
505 F. Supp. 2d at 27-28 (emphasis omitted). Because Defendants have pleaded facts that place
their counterclaims comfortably in at least one of the two categories, the counterclaims cannot be
dismissed on the pleadings as contrary to public policy.
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Count I alleges that McArdle violated the Agreement by taking home, retaining, and
disclosing confidential and HIPAA-protected documents—documents that she had no intention
of using in this qui tam suit until after Acquisition threatened to sue her for breaching the
Agreement. Doc. 109 at ¶¶ 35-36; Doc. 110 at ¶¶ 34-35; Doc. 119 at 11. Count II alleges that
Wildhirt breached the Agreement by disclosing to others the content of confidential and HIPAAprotected information. Doc. 109 at ¶ 42; Doc. 109-9 at 6-9; Doc. 110 at ¶ 41. Drawing a
reasonable inference in Defendants’ favor, the court will assume at the Rule 12(b)(6) stage that
Relators’ retentions and disclosures went beyond the scope of those necessary to pursue their qui
tam suit. As for damages, Defendants allege that they have incurred “costs and expenses in
defending against this lawsuit, and in ensuring that their Confidential Information and
HIPAA-protected information is not further improperly disclosed.” Doc. 109 at ¶¶ 37, 43; Doc.
110 at ¶¶ 36, 42.
These counterclaims are independent of the FCA claim because, particularly given the
extremely broad scope of documents and communications that Relators are alleged to have
retained and disclosed, the counterclaims’ success does not require as an essential element that
Defendants are liable (or not liable) under the FCA. See United States ex rel. Cafasso v. Gen.
Dynamics C4 Sys., Inc., 637 F.3d 1047, 1062 (9th Cir. 2011) (holding that the public policy
doctrine “would not cover [the relator’s] conduct given her vast and indiscriminate appropriation
of [the defendant’s] files,” given that the relator could not explain “why removal of the
documents was reasonably necessary to pursue an FCA claim”). The counterclaims’ allegation
that Defendants were damaged due to having to incur “costs and expenses in defending against”
the qui tam lawsuit is problematic to the extent it could be read to seek indemnification or
contribution in the event Defendants are found liable under the FCA. Defendants admit that
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“they cannot prevail on the counterclaims if Relators ultimately prevail” on their qui tam suit, so
Counts I and II are dismissed to the extent they seek such indemnification or contribution.
Count III seeks indemnification from Relators under the Agreement for losses incurred
by Defendants as a result of Relators’ alleged breaches. Doc. 109 at ¶¶ 47-49; Doc. 110 at
¶¶ 46-48. Count VI seeks reimbursement from Relators under the Agreement in the event
Defendants prevail on the qui tam claims. Doc. 109 at ¶¶ 63-64; Doc. 110 at ¶¶ 62-63. The
Agreement’s indemnification provision states in relevant part that Relators will “indemnify and
hold [Defendants] harmless from any loss, claim or damages, including without limitation all
reasonable attorney’s fees, costs and expenses, arising out of or relating to the unauthorized
disclosure of Confidential Information or other proprietary information of the Company, the
Company’s customers or principals by the Employee.” Doc. 109-4 at 2-3. As with Counts I and
II, Count III is dismissed to the extent it could be read to seek indemnification or contribution in
the event Defendants are found liable. But Count III may proceed to the extent that Defendants
seek damages not directly connected with this litigation. And Counts III and VI may proceed
with respect to Defendants’ attorney fees and legal expenses in the event they prevail on the
merits, particularly if Defendants proceed to maintain that Relators’ claims were frivolously
pursued given their alleged lack of relevant knowledge of the relevant VA contracts and
Defendants’ performance thereunder. See 31 U.S.C. § 3730(d)(4) (“If the Government does not
proceed with the action and the person bringing the action conducts the action, the court may
award to the defendant its reasonable attorneys’ fees and expenses if the defendant prevails in
the action and the court finds that the claim of the person bringing the action was clearly
frivolous, clearly vexatious, or brought primarily for purposes of harassment.”); Mikes v. Straus,
274 F.3d 687, 705 (2d Cir. 2001). The court is not suggesting that any such counterclaim would
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be meritorious; that will depend on the outcome of the qui tam suit and, if Defendants prevail, on
the grounds Relators had for bringing their claims.
Count IV alleges that Relators breached the Agreement and “Confidential
Acknowledgment of No Known Suspect Practices” statements “by representing that they were
not aware of any suspect practices by [Defendants], failing to report any suspect practices to …
management, and then filing this lawsuit claiming facts to the contrary even though neither ever
informed [Defendants] of these alleged suspect practices.” Doc. 109 at ¶ 54; Doc. 110 at ¶ 53.
As a result of these breaches, the counterclaim alleges, Defendants were deprived of the
opportunity to “properly investigate and remedy any alleged issues,” resulting in damages. Doc.
109 at ¶ 55; Doc. 110 at ¶ 54. As with Counts I-III and VI, if Defendants are found liable, Count
IV must be dismissed. However, if Defendants prevail on the qui tam claims and can show a
causal relationship between Relators’ failure to report and their filing of the qui tam action,
Count IV may proceed for the same reason that Counts III and VI may proceed. See United
States ex rel. Stephens v. Prabhu, 1994 WL 761237, at *1 (D. Nev. Dec. 14, 1994)
(“[Defendants] bring counterclaims for libel, trade libel, abuse of process, malicious
prosecution[, and] … emotional distress. [Defendants] concede that these counterclaims arise
from the Relators ‘allegations of submission of false Medicare reimbursement claims.’ If those
allegations are proved true, [Defendants] … counterclaims can be dismissed on the ground that
they will have the effect of providing for indemnification or contribution. Conversely, if
[Defendants] are found not liable, their right to pursue these counterclaims must be preserved.”)
(internal quotation marks omitted).

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II.

Pleading Challenge to Count V
Count V, which sounds in tortious interference with prospective economic advantage,

alleges that Relators intentionally interfered with Defendants’ relationship with the VA, the State
of Illinois, and private payors by making false statements about Defendants’ performance of
their contractual duties. Doc. 109 at ¶¶ 56-60; Doc. 110 at ¶¶ 55-59. To state a claim under
Illinois law for tortious interference with prospective economic advantage, a plaintiff must allege
“(1) [a] reasonable expectation of entering into a valid business relationship; (2) the defendant’s
knowledge of the plaintiff’s expectancy; (3) purposeful interference by the defendant that
prevents the plaintiff's legitimate expectancy from ripening into a valid business relationship;
and (4) damages to the plaintiff resulting from such interference.” Botvinick v. Rush Univ. Med.
Ctr., 574 F.3d 414, 417 (7th Cir. 2009).
Relators focus on the third element, arguing that “Defendants fail to identify any false
statements allegedly made by the Relators and also fail to identify any person or entity to whom
the Relators allegedly made false statements.” Doc. 118 at 15. That argument is incorrect.
Defendants have alleged the nature of Relators’ misrepresentations, to whom they were made,
and the basis for alleging they were false. Doc. 109 at ¶ 59 (alleging that Relators “ma[de] false
statements about [Defendants’] compliance with the April 2008 VISN Agreement and [their]
subsequent agreements with the VA and about [Defendants’] handling of Illinois Medicaid
business”); Doc. 110 at ¶ 58 (same); Doc. 109-3 at 17-18 (McArdle deposition testimony
regarding the time and content of her statements); Doc. 109-6 at 6-10 (Wildhirt deposition
testimony regarding the time and content of her statements). These allegations suffice to plead
the third element of the tortious interference claim. See Delloma v. Consolidation Coal Co., 996

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F.2d 168, 172 (7th Cir. 1993) (“Frequently, [tortious interference] cases depend on statements
alleged to be false or defamatory.”) (collecting cases).
III.

Absolute Privilege Defense to Counts I-III and V
Finally, Relators contend that Counts I-III and V of the counterclaims are barred by

absolute privilege under Illinois law for statements related to, made preliminary to, or made in
the course of judicial proceedings. Doc. 118 at 13-14. “Illinois like other states recognizes an
absolute privilege for statements in testimony or pleadings in a judicial proceeding.”
MacGregor v. Rutberg, 478 F.3d 790, 791 (7th Cir. 2007). The privilege applies to
“communications preliminary to a proposed judicial proceeding, or in the institution of or during
the course and as a part of, a judicial proceeding if the matter has some relation to the
proceeding.” Kurtz v. Hubbard, 973 N.E.2d 924, 928 (Ill. App. 2012) (internal quotation marks
and alterations omitted). “[F]or a statement to qualify as a made in communications preliminary
to a proposed judicial proceeding, the proposed proceeding must be contemplated in good faith
and under serious consideration.” Medow v. Flavin, 782 N.E.2d 733, 743 (Ill. App. 2002); see
also Horowitz v. Animal Emergency & Treatment Ctrs. of Chi., LLC, 2012 WL 3598807, at *4
(N.D. Ill. Aug. 20, 2012) (same).
Significant here, the privilege is an affirmative defense, see Kurtz, 973 N.E.2d at 928,
and thus need not be anticipated in a complaint or counterclaim. See Richards v. Mitcheff, 696
F.3d 635, 638 (7th Cir. 2012) (“Judges should respect the norm that complaints need not
anticipate or meet potential affirmative defenses.”). At this stage of the case, and for the reasons
stated in Section I, supra, it is impossible to say at this point whether Relators’ qui tam suit was
“contemplated in good faith and under serious consideration.” Medow, 782 N.E.2d at 743.
Accordingly, dismissal under Rule 12(b)(6) on absolute privilege grounds would be
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inappropriate. See Horowitz, 2012 WL 3598807, at *5 (“because plaintiffs are not required to
plead facts that anticipate and defeat affirmative defenses, the Court denies Defendants’ motion
to dismiss based on the absolute litigation privilege”); cf. Villagrana v. Vill. of Oswego, 2005
WL 2322808, at *5 (N.D. Ill. Sept. 22, 2005) (denying motion to dismiss based on absolute
immunity because “[t]he degree to which the alleged defamatory statements were made within
the scope of the Officers’ official duties cannot be sufficiently assessed from the face of the
Complaint”).
Conclusion
For the foregoing reasons, Relators’ motion to dismiss Defendants’ counterclaims is
granted in part and denied in part. The counterclaims are dismissed with prejudice to the extent,
if any, they seek recovery from Relators in the event Relators prevail over Defendants on the qui
tam claims. Relators shall answer the counterclaims by October 4, 2013.

September 19, 2013
United States District Judge

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