United States of America v. Rosenberg

Filing 51

OPINION AND ORDER: Martinez is DIRECTED to show cause no later than 8/25/2016 why this case should not be dismissed with prejudice for failure to prosecute. Signed by Chief Judge Philip P Simon on 7/27/2016. (lhc)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
UNITED STATES OF AMERICA,
ex rel. Teresa Martinez,
Plaintiff,
v.
DR. LINDA ROSENBERG,
HIGHLAND OPEN MRI,
LAKESIDE SURGERY CENTER,
NRI LABORATORIES, INC., and
DR. RAVI BHAGWAT,
Defendants.

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Cause No. 2:11-cv-273

OPINION & ORDER
Relator Teresa Martinez, a former employee of defendant Linda Rosenberg, filed
this case on behalf of the United States government under the False Claims Act, 31
U.S.C § 3729, and the Indiana False Claims and Whistleblower Protection Act, Ind. Code
§ 5-11-5.5. (DE 4.) She alleges that Rosenberg and the other defendants made false
records or statements and presented false or fraudulent Medicare and Medicaid claims
for payment to the United States government and the State of Indiana. Three of the
defendants—Linda Rosenberg, Highland Open MRI, and Ravi Bhagwat—have moved
to dismiss. (DE 38; DE 42; DE 47 at 27-29.) Two defendants—Lakeside Surgery Center
and NRI Laboratories—have not answered the suit. For the reasons below, Martinez is
ordered to show cause why this false claims action should not be dismissed with
prejudice for failure to prosecute.
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Discussion
The False Claims Act is an anti-fraud statute that imposes liability on anyone
who “knowingly presents, or causes to be presented, a false or fraudulent claim for
payment or approval” by the government. 31 U.S.C. § 3729(a)(1)(A). The statute allows
private citizens (called “relators”) to file “qui tam” actions in camera and under seal on
behalf of the U.S. government. After a qui tam case is filed, the government has to
decide whether to intervene and pursue the lawsuit itself. If the government does not
intervene, the relator’s complaint is unsealed and the relator can continue the case on
her own. Id. § 3730(b). The Indiana False Claims and Whistleblower Protection Act is
very similar to the federal False Claims Act and allows private citizens to file civil
actions on behalf of the State of Indiana. Ind. Code. §§ 5-11-5.5-2, 4.
The relator, Martinez, filed her qui tam complaint in camera and under seal in
2011. (DE 4.) On August 14, 2015, the United States declined to intervene in the action
and asked the Court unseal the complaint, so that Martinez could pursue the suit. (DE
27.) The complaint was unsealed on August 25, 2015, and, on September 16, 2015,
summonses were issued for the defendants. (DE 28; DE 31.)
Three defendants (Bhagwat, Rosenberg, and Highland Open MRI) have moved
to dismiss, among other reasons, on grounds that Martinez did not timely effect service
of process. (DE 38; DE 42; DE 47 at 28.) Under Federal Rule of Civil Procedure 4(m),
Martinez was required to effect service of process by January 14, 2016, but she still had
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not done so by January 20, 2016. (DE 33.) That prompted the Clerk of Court to notify her
of the missed deadline and warn her that the case could be dismissed if the defendants
were not served by February 4, 2016. (Id.) On January 29, 2016, Martinez returned
summonses for Lakeside Surgery Center and Highland Open MRI, but she has never
returned summonses for Rosenberg, NRI Laboratories, or Bhagwat. (DE 35; DE 36.)
There is no question that Martinez was dilatory in serving the defendants, and it
appears that she failed to serve several of them at all. On this ground alone, I could
dismiss some of her claims. See Williams v. Illinois, 737 F.3d 473, 476 (7th Cir. 2013) (“[A]
court has the discretion to dismiss for want of prosecution if the plaintiff’s delay in
obtaining service is so long that it signifies failure to prosecute.”) (citations omitted).
But there’s more: the deadlines for Martinez to respond to the pending motions to
dismiss by Bhagwat, Rosenberg, and Highland Open MRI were March 7th, March 8th,
and April 14th, 2016, respectively. Martinez has not responded to any of those motions,
and she also has not moved for default judgment against Lakeside Surgery, which was
served with process but did not file an answer or a motion to dismiss by the October 7,
2015 deadline or since. In short, it appears that Martinez has completely abandoned the
case, and I am inclined to dismiss the case with prejudice for failure to prosecute. See
Link v. Wabash R.R. Co., 370 U.S. 626, 629 (7th Cir. 1962) (“The authority of a federal trial
court to dismiss a plaintiff’s action with prejudice because of his failure to prosecute
cannot seriously be doubted.”).
That leaves the United States’ objection to Bhagwat’s motion to dismiss. (DE 44.)

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Although the government declined to intervene in the matter, it argues that under
31 U.S.C. § 3730(b)(1), I cannot dismiss the case with prejudice as to the United States
without the written consent of the Attorney General. (Id. at 3.) The government is
mistaken. The Attorney General’s consent is not required for involuntary dismissal of
False Claims Act cases. See Salmeron v. Enter. Recovery Sys., Inc., 579 F.3d 787, 797, n.5
(7th Cir. 2009); see also Minotti v. Lensink, 895 F.2d 100, 103 (2d Cir. 1990) (per curiam);
United States ex rel. Shaver v. Lucas W. Corp, 237 F.3d 932, 934 (8th Cir. 2001). If the
government fears that dismissal of this case with prejudice would harm its interests,
then it is free to move to intervene for good cause pursuant to 31 U.S.C. § 3730(c)(3).
Conclusion
Accordingly, Martinez is DIRECTED to show cause no later than August 25,
2016 why this case should not be dismissed with prejudice for failure to prosecute.
SO ORDERED.
ENTERED: July 27, 2016.
s/ Philip P. Simon
CHIEF JUDGE
UNITED STATES DISTRICT COURT

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