LONGACRE v. AB HOME HEALTH CARE LLC

Filing 80

MEMORANDUM DECISION AND ORDER ON DISCOVERY DISPUTE - By MAGISTRATE JUDGE JOHN H. RICH III. (mnw) Modified on 11/16/2018 to switch to opinion (nrg).

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE

REBEKAH LONGACRE,
Plaintiff-Relator
v.
AB HOME HEALTH CARE, LLC,
Defendant

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No. 2:16-cv-00279-NT

MEMORANDUM DECISION AND ORDER ON DISCOVERY DISPUTE
Following a discovery hearing, the parties submitted simultaneous letter briefs addressing
the proper temporal scope of plaintiff-relator’s discovery requests in this qui tam action brought
by the defendant’s former supervisor and alleging that it fraudulently billed MaineCare (the
Medicaid program in the state of Maine) for services rendered by unqualified individuals. While
I reject defendant, AB Home Health Care, LLC’s (“AB Home”), argument that, as a matter of law,
discovery in this qui tam action should be limited to the period spanning Longacre’s term of
employment (January 21, 2014, through June 2, 2015), see Letter Brief of AB Home dated Aug.
17, 2018 (“AB Home Brief”) (ECF No. 65) at 1; Plaintiff’s First Amended Complaint (“FAC”)
(ECF No. 38) ¶ 7, I conclude that, even as voluntarily narrowed in her letter brief, two of
Longacre’s three categories of discovery remain overbroad under Rule 26’s proportionality test.
See Letter Brief of Rebekah Longacre dated Sept. 13, 2018 (“Longacre Brief”) (ECF No. 74) at 13.1
The three categories of requests are (i) documentation regarding AB Home’s failure to comply with preconditions
for MaineCare payment (enrollment and completion of training) (Plaintiff’s Requests for Production (“RFP”) Nos. 79, 12), (ii) documentation and information regarding AB Home’s practices for ensuring compliance with preconditions
for MaineCare payment (enrollment and completion of training) (Plaintiff’s Interrogatory No. 4; RFP Nos. 16-23, 25),
and (iii) communications between AB Home and the Maine Department of Health and Human Services (“DHHS”)
regarding compliance with preconditions for MaineCare payment (enrollment and completion of training) (RFP Nos.
26-29, 31). See Longacre Brief at 1-3. Longacre originally sought this discovery for the 10-year period from April
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Treating the instant discovery dispute as a motion to compel production in response to
Longacre’s RFP Nos. 7-9, 12, 16-23, 25-29, and 31 and Interrogatory No. 4, and for the reasons
that follow, I grant it in part, to the extent that I order AB Home to produce, within 21 days hereof,
documents and information responsive to the first two categories of requests for the period from
January 17, 2012, through the suspension of defendant’s ability to bill MaineCare effective
November 2017 and documents responsive to the third category for the period from March 6, 2011,
through the suspension of defendant’s ability to bill MaineCare effective November 2017, and
otherwise deny it.
I. Plaintiff’s Allegations
AB Home is a home-healthcare provider based in Portland, Maine, and owned by
Abdulfatah Ali. FAC ¶¶ 10-11. DHHS has licensed AB Home to provide services under
MaineCare. Id. ¶¶ 17-18, 22. This license allows AB Home to seek reimbursement from
MaineCare for services that it provides to eligible MaineCare members.

Id. ¶ 24.

The

requirements for reimbursement under MaineCare are set out in the MaineCare Benefits Manual,
a set of rules promulgated by DHHS. Id. ¶¶ 3, 27.
Healthcare providers such as AB Home may seek reimbursement for personal care services
performed by personal support specialists. Id. ¶¶ 30-31. In order for a provider to be eligible for
reimbursement, a personal support specialist must meet certain training and examination
requirements. Id. ¶¶ 40-41. If a personal support specialist has not met the training and
examination requirements, he or she “must enroll in a certified training program within sixty (60)

2008 through April 2018, but narrowed her request to the period from March 6, 2011, when AB Home was
incorporated, through November 2017, when DHHS suspended AB Home’s ability to bill for MaineCare services.
See id. at 2. With regard to the first category of requests, Longacre originally sought the court’s assistance with regard
to RFP 12 but not 13 & 14, which she added in her brief; I decline this expansion since AB Home did not have an
opportunity to address it subsequent to Longacre’s brief.

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days of hire and complete training and examination requirements within nine (9) months of
employment[.]” Id. ¶ 33. If a personal support specialist does not pass the required examination
within nine months of employment, his or her “services . . . must stop until such time as the training
and examination requirements are met.” Id. Providers are prohibited from seeking reimbursement
for personal support specialist services rendered by “persons who do not meet the qualification
requirements of the Regulation.” Id. ¶ 34.
Longacre worked for AB Home from January 21, 2014, until June 2, 2015, first as a nurse
supervisor and later as director of nursing. Id. ¶¶ 7, 48, 56. Longacre alleges that, when she was
hired, Ali told her that AB Home’s personal support specialists would not receive a paycheck if
the cost of their services was not reimbursed by MaineCare. Id. ¶ 49. Shortly thereafter, Longacre
observed that, although some of AB Home’s personal support specialists had worked for AB Home
for more than nine months without completing their training requirements, those employees were
receiving their paychecks. Id. ¶¶ 50-53. Longacre, therefore, believed that AB Home was
submitting requests for reimbursement for services rendered by the unqualified employees. Id.
¶ 62. Longacre has identified eight AB Home employees who, between January 2014 and June
2015, (i) “were unqualified for purposes of the MaineCare regulations[,]” (ii) were scheduled to
provide personal care services and did so, and (iii) received paychecks. Id. ¶¶ 105-07.
II. Discussion
A. Qui Tam Discovery Limitations
“Congress has amended the FCA [False Claims Act] several times to walk a fine line
between encouraging whistle-blowing and discouraging opportunistic behavior.” United States ex
rel. Duxbury v. Ortho Biotech Prods., L.P. (“Duxbury I”), 579 F.3d 13, 16 (1st Cir. 2009) (citation
and internal quotation marks omitted). To that end, AB Home cites authority for the general

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proposition that “courts have rejected a relator’s attempt to open wide-ranging discovery that
exceeds the complaint’s allegations.” AB Home Brief at 1 (citing United States ex rel. Spay v.
CVS Caremark Corp., Civil Action No. 09-4672, 2013 WL 4525226, at *3-4 (E.D. Pa. Aug. 27,
2013) (declining “to allow . . . a fishing expedition into potential fraudulent claims beyond 2007
absent some particularized pleading that any such claims occurred”) (footnote omitted); United
States ex rel. Powell v. Am. Intercontinental Univ., Inc., CIVIL CASE NO. 1:08-CV-2277-RWSLTW, 2013 WL 12114445, at *5 (N.D. Ga. Feb. 22, 2013) (declining to permit discovery for
period prior to January 1, 2005, when plaintiffs did “not plead with particularity fraud with respect
to compliance with [applicable] standards prior to 2005”)).
AB Home argues that the instant case is similar to Spay in that Longacre’s complaint lacks
particularized allegations that fall outside the dates of her employ. See id. at 2. It acknowledges
that Longacre takes the position that discovery beyond the period of her employment is critical to
prove that AB Home either knew that the claims it was submitting were fraudulent or recklessly
disregarded whether they were. See id. at 2. However, it observes that, in United States ex rel.
Jacobs v. CDS, P.A., Case No. 4:14-cv-00301-BLW, 2016 WL 4146077 (D. Idaho Aug. 3, 2016),
the court declined to broaden the scope of discovery beyond the period of the relator’s employment
despite the relator’s argument that broader discovery was justified “to help demonstrate
‘knowledge and intent.’” Id. (quoting Jacobs, 2016 WL 4146077, at *3).
AB Home further asserts that “[t]he First Circuit has expressly endorsed limiting discovery
to only those claims that satisfy [Federal] Rule [of Civil Procedure] 9(b)’s particularity
requirement.” Id. at 3 (citing United States ex rel. Duxbury v. Ortho Biotech Prods., L.P.
(“Duxbury II”), 719 F.3d 31, 39 (1st Cir. 2013)).

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AB Home’s main concern appears to be that Longacre seeks “to investigate every nook
and cranny of AB Home’s provision of PSS [personal support specialist] services for a decade, in
a search to support potential false claims.” Id. at 2. It asserts that “discovery in a False Claims
Act case is not a ‘roving commission to investigate all financial dealings of the defendants[,]’” id.
(quoting United States ex rel. Oughatiyan v. IPC The Hospitalist Co., No. 09 C 5418, 2015 WL
4249195, at *3 (N.D. Ill. July 14, 2015) (internal quotation marks omitted), noting that, in United
States ex rel. Bane v. Breathe Easy Pulmonary Servs. Inc., No. 8:06-CV-40-T-24MAP, 2008 WL
4057549 (M.D. Fla. Aug. 27, 2008), the court limited discovery to the time periods and providers
alleged in the complaint, see id. (citing Bane, 2008 WL 4057549, at *1).2 It warns that, if
“discovery that vastly exceeds [the] allegations in the complaint” is permitted, there will be little
to “discourage ‘strike suits,’ and to prevent the filing of suits that simply hope to uncover relevant
information [during] discovery.’” Id. at 5 (quoting United States ex rel. Karvelas v. MelroseWakefield Hosp., 360 F.3d 220, 226 (1st Cir. 2004)).
I am unpersuaded that there is, or ought to be, a general rule in qui tam actions against the
allowance of discovery for periods either outside the time frame of a relator’s employment or
beyond time frames alleged with particularity pursuant to Rule 9(b) in a relator’s complaint.
First, I perceive no reason why the concerns raised by AB Home cannot be addressed
through the application of the discovery principles set forth in Rule 26(b)(1), which permits
discovery of nonprivileged matters “relevant to any party’s claim or defense and proportional to
the needs of the case[.]” Fed. R. Civ. P. 26(b)(1).

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But see United States ex rel. McCartor v. Rolls-Royce Corp., No. 1:08-cv-00133-WTL-DML, 2013 WL 5348536, at
*2, 5-6 (S.D. Ind. Sept. 24, 2013) (declining to follow Bane’s reasoning that “discovery in qui tam actions must be
limited and tailored to the specificity of the complaint”; applying “the discovery rules and principles provided by the
Federal Rules of Civil Procedure” in determining “[w]hat discovery [wa]s reasonably necessary for the relators’
pursuit of their claims in this case”) (citation and internal quotation marks omitted).

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Second, as Longacre argues, see Longacre Brief at 5, Duxbury II does not support a
wholesale limitation on discovery beyond the particularized allegations of a relator’s complaint.
The First Circuit’s “endorsement” of this limitation was hardly full-throated. Instead, it merely
ruled that the district court’s tailoring of the scope of discovery to the particularized allegations
was “reasonable[,]” that the “district court was not required to expand the scope of discovery based
upon the amended complaint’s bald assertions that the purported kickback scheme continued after
Duxbury’s termination or that it was ‘nationwide’ in scope[,]” and that the “result was entirely
consistent with the district court’s considerable latitude in assessing the proper scope of discovery
and did not amount to an abuse of discretion.” Duxbury II, 719 F.3d at 38-39 (citations omitted).
Third, as Longacre notes, see Longacre Brief at 4, caselaw from other jurisdictions is not
monolithic, with courts declining to limit discovery in qui tam actions to the particularized
allegations of the complaint pursuant to Rule 9(b), including the period of a relator’s employment,
see, e.g., United States ex rel. Rigsby v. State Farm Fire & Cas. Co., 794 F.3d 457, 466-67 (5th
Cir. 2015) (“Applying Rule 9(b) [after a motion to dismiss is denied] presents a square peg/round
hole problem. . . . Rule 9(b) is not meant to supplant discovery.”) (citation and internal quotation
marks omitted); United States ex rel. Walker v. R&F Props. of Lake Cty., Inc., 433 F.3d 1349,
1358-59 (11th Cir. 2005) (holding that district court committed reversible error when it
“misconstrued the False Claims Act” in “limit[ing] discovery to the term of Walker’s
employment”); United States ex rel. Bibby v. Wells Fargo Bank, N.A., 165 F. Supp.3d 1340, 1354
& n.15 (N.D. Ga. 2015) (denying defendant’s motion for a protective order to the extent defendant
sought geographic or temporal limits on discovery; noting that the “temporal cutoff decision is . . .
one that must be made on a case-by-case basis”); United States ex rel. Fiederer v. Healing Hearts
Home Care, Inc., No. 2:13-cv-1848-APG-VCF, 2014 WL 4666531, at *2, 6 (D. Nev. Sept. 18,

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2014) (allowing discovery over a six-year period when relator worked for defendant for only 28
days).
Fourth, and finally, this case is materially distinguishable from Jacobs on the basis of the
quality of the showing made in support of Longacre’s bid for temporal expansion of the bounds of
discovery to help demonstrate knowledge and intent. The Jacobs court noted that the plaintiff
spoke “in broad generalities,” simply positing that physician recruitment agreements predating the
time period in question would illustrate changes in the law and the defendants’ knowledge of them.
Jacobs, 2016 WL 4146077, at *3. The court ruled that “these arguments are not specific enough
to be persuasive[,]” observing that, “[a]mong other things, plaintiff should have further explained
how and when the law changed, why it changed, and how the relevant agreements might be
expected to change.” Id.
In this case, by contrast, Longacre asserts that AB Home disputes that it “knowingly” billed
MaineCare for untrained employees, taking the position that, during Longacre’s employment, she
was responsible for ensuring that AB Home’s personal support specialists were properly trained
and supervised as required by MaineCare. Longacre Brief at 1. Against that backdrop, she
supplies evidence that AB Home has indicated that five of the eight personal support specialists
employed during her tenure were hired in 2012-13, prior to her hire, and that AB Home has been
able to locate and provide certification of completed training for only two of those eight. See id.
& Exh. 1 thereto.3 She adds that information supplied by AB Home indicates that at least one
personal support specialist who remained employed by AB Home after her departure continued to
provide those services without any evidence of the required training/certification, at least through
the date that she filed the instant complaint in October 2016. See id. at 1-2.

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The earliest date of hire for the set of employees Longacre identifies as unqualified is January 17, 2012. See Attach.
A to Exh. 1 to Longacre Brief at Page ID # 408.

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This constitutes a strong showing of the need to expand discovery to periods predating and
postdating Longacre’s employment with AB Home. Taking at face value Longacre’s assertion
that AB Home has claimed that she was responsible for ensuring its compliance with MaineCare’s
training requirements during the term of her employment, see id. at 1, a limitation of discovery to
the dates of her employment would hamper her ability to demonstrate that AB Home’s asserted
compliance problems predated and/or postdated her own employment, bearing on its knowledge
of, or reckless indifference to, any noncompliance during her period of employment.
While AB Home correctly notes the importance of striking the right balance “between
encouraging whistle-blowing and discouraging opportunistic behavior[,]” Duxbury I, 579 F.3d at
16 (citation and internal quotation marks omitted), that principle does not undercut the obvious
implications of Longacre’s allegations.
Finally, Longacre argues that communications between AB Home and DHHS regarding
compliance with preconditions for MaineCare payment (enrollment and completion of training)
are relevant to AB Home’s knowledge of the materiality of its alleged noncompliance. See
Longacre Brief at 3. She asserts that AB Home has taken the position that DHHS’s precondition
of training for personal support specialists was optional and, hence, any failure to comply with that
precondition was not material. See id. She represents that emails produced by AB Home included
a contract between AB Home and DHHS for the provision of different services than those at issue
stating that, as “consideration of the payments” made by DHHS, AB Home “shall supply all staff
training as required by [DHHS][.]” Id. (internal quotation marks omitted). She presumes that
agreements regarding the provision of personal support specialist services would contain similar
language, shedding light on whether the precondition was material and, if so, whether AB Home

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knew or should have known that it was. See id. This is a fair assumption, which Longacre should
be permitted to test through the crucible of discovery.
Longacre further asserts, and it stands to reason, that relevant agreements may have been
created not only during the brief term of her employment but also outside of it; for example, any
time between March 6, 2011, when AB Home was incorporated, and January 2014, when she
began work there. See id.
Taking at face value, once again, Longacre’s contentions, Longacre’s discovery requests
do not fall into the realm of “opportunistic behavior.” Rather, they are tailored to discover material
information related to her allegations, which have survived a motion to dismiss. See ECF No. 24.
Nonetheless, for the reasons discussed below, pursuant to Federal Rule of Civil Procedure
26(b)(1), I narrow the temporal scope of two of Longacre’s three discovery categories beyond
those voluntarily limited in her letter brief.
B. Rule 26(b)(1) Analysis
For the foregoing reasons, the instant discovery dispute is properly resolved through the
application of Rule 26(b)(1). Pursuant to that rule, “[p]arties may obtain discovery regarding any
nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs
of the case[.]” Fed. R. Civ. P. 26(b)(1). Rule 26 sets forth six factors relevant to the evaluation of
proportionality: (i) “the importance of the issues at stake in the action,” (ii) “the amount in
controversy,” (iii) “the parties’ relative access to relevant information,” (iv) “the parties’
resources,” (v) “the importance of the discovery in resolving the issues,” and (vi) “whether the
burden or expense of the proposed discovery outweighs its likely benefit.” Id.

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1. Importance of the Issues at Stake in the Action
AB Home concedes that the “discovery sought goes to a core element of this action,
namely, knowledge of falsity[,]” adding that, “[v]iewed singularly as an ‘issue,’ whether AB
Home’s submission of claims for PSS services was knowingly or recklessly false is important.”
AB Home Brief at 3. This factor weighs in favor of Longacre.
2. Amount in Controversy
AB Home concedes that the amount in controversy is “inherently substantial.” Id. This
factor weighs in favor of Longacre.
3. The Parties’ Relative Access to Relevant Information
AB Home argues that there is “almost no information disparity concerning AB Home’s
provision of PSS services during the timeframe of the allegations of the complaint.” Id. Yet, this
argument assumes an order cabining discovery to the dates of Longacre’s employ. See id.
Because, as discussed above, Longacre makes a persuasive showing of her need for documentation
and information predating and postdating her dates of employment, this factor tilts in her favor.
4. The Parties’ Resources
AB Home represents that its resources are “scarce[,]” noting that its “Maine operations
remain suspended for the better part of a year.” Id. at 4. This weighs in AB Home’s favor, despite
the fact that its Massachusetts operations apparently remain active.

See id.

Nonetheless,

Longacre’s willingness to bear the cost of inspecting and copying personnel files, which she
represents are now maintained in storage, see Longacre Brief at 2, mitigates some of the burden of
the requested discovery, and I order that she do so.

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5. Importance of the Discovery in Resolving the Issues
AB Home argues that the discovery sought is “far removed from the key facts of this case”
and unlikely to be important to the resolution of the issues because Longacre’s personal knowledge
from the time span of her employment is far more central than “time-removed facts from years
ago[.]” AB Home Brief at 4. This argument again assumes an order cabining discovery to the
dates of Longacre’s employ. See id. Because, for the reasons discussed above, I decline to do so,
this factor tilts in Longacre’s favor.
6. Whether the Burden or Expense Outweighs the Likely Benefit
AB Home argues that, because the requested discovery is of “marginal” relevance at best,
its “burden and expense far outweighs any putative benefit.” Id. It notes that it “has already
produced almost 8,000 pages of electronic information[,]” that, “[e]xpanding discovery by even a
year would result in making at least a thousand more electronic documents potentially relevant[,]”
and that the expansion of the scope of discovery “would magnify paper discovery, which has not
yet occurred.” Id.
For the reasons discussed above, I conclude that Longacre has shown that the requested
discovery, as voluntarily narrowed from a 10-year to a six-and-a-half-year period, see Longacre
Brief at 2, is highly, rather than marginally, relevant to her case. Further, Longacre has offered to
assume the cost of inspecting and copying personnel files, mitigating some of the burden and
expense. See Longacre Brief at 2.
Nonetheless, with respect to the first two categories of discovery, I decline to order the
production of documents or information from March 6, 2011 forward. Those two categories,
seeking documentation or information regarding AB Home’s failure to comply with preconditions
for MaineCare (enrollment and completion of training) and practices for ensuring compliance with

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those preconditions, see id. at 2, implicate Longacre’s allegations that, while employed at AB
Home, she personally observed eight employees provide personal support specialist services who
were unqualified to do so pursuant to relevant MaineCare regulations. See FAC §§ 105-07. Yet,
the earliest date of hire for those eight employees was January 17, 2012. See Attach. A to Exh. 1
to Longacre Brief at Page ID # 408. Thus, I order that documents and information related to those
two categories of discovery requests be produced only from that date through the suspension of
defendant’s ability to bill MaineCare effective November 2017.4
By contrast, in her third category of requests, the plaintiff appropriately seeks documents
for the period from March 6, 2011, the date of AB Home’s incorporation, through the suspension
of defendant’s ability to bill MaineCare effective November 2017. For the reasons discussed
above, communications between AB Home and DHHS throughout that period regarding
compliance with preconditions for MaineCare payment (enrollment and completion of training)
reasonably could be expected to shed light on whether, during the period of Longacre’s
employment, the training precondition was material and, if so, AB Home knew or should have
known that it was.
III. Conclusion
For the foregoing reasons, Longacre’s request to compel the production of discovery is
GRANTED in part, and otherwise DENIED, to the extent that I ORDER AB Home to produce
to Longacre, no later than December 6, 2018, the following documents or information:

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Longacre’s representation that she has information indicating that at least one personal support specialist who
remained employed by AB Home after her departure continued to provide those services without any evidence of the
required training/certification, at least through the date that she filed the instant complaint in October 2016, see
Longacre Brief at 1-2, suffices to warrant discovery of the first two categories of documents and information through
November 2017, the date that DHHS suspended AB Home’s ability to bill MaineCare.

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1.

Documentation regarding AB Home’s failure to comply with preconditions for

MaineCare payment (enrollment and completion of training) (Plaintiff’s Requests for Production
(“RFP”) Nos. 7-9, 12-14) for the period from January 17, 2012, through the suspension of
defendant’s ability to bill MaineCare effective November 2017;
2.

Documentation and information regarding AB Home’s practices for ensuring

compliance with preconditions for MaineCare payment (enrollment and completion of training)
(Plaintiff’s Interrogatory No. 4; RFP Nos. 16-23, 25) for the period from January 17, 2012, through
the suspension of defendant’s ability to bill MaineCare effective November 2017; and
3.

Communications between AB Home and DHHS regarding compliance with

preconditions for MaineCare payment (enrollment and completion of training) (RPD Nos. 26-29,
31) for the period from March 6, 2011, through the suspension of defendant’s ability to bill
MaineCare effective November 2017.
I further ORDER that, without objection, Longacre assume the costs of inspecting and
copying relevant portions of AB Home’s personnel files. See Longacre Brief at 2.
Finally, upon issuance of this order, the clerk of court is directed to schedule a telephonic
scheduling conference with the parties, at which the remaining pretrial deadlines shall be reset.
NOTICE
In accordance with Federal Rule of Civil Procedure 72(a), a party may serve and file an
objection to this order within fourteen (14) days after being served with a copy thereof.
Failure to file a timely objection shall constitute a waiver of the right to review by the
district court and to any further appeal of this order.
Dated this 15th day of November 2018.
/s/ John H. Rich III
John H. Rich III
United States Magistrate Judge
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