Ambrosecchia v. Alaven Pharmaceutical, LLC et al
MEMORANDUM AND ORDER IT IS HEREBY ORDERED that Defendants' Motion to Dismiss Relator's Second Amended Complaint (ECF No. 47 ) is GRANTED as follows, consistent with this Memorandum and Order: Relator's claims under the False Claims Act (Counts I-IV) are DISMISSED with prejudice based upon the False Claims Act Public Disclosure Bar. Relator's claims for Common Fund and Common Law Qui Tam (Counts XXXI-XXXII) are DISMISSED without prejudice. Relator's State Claims (Counts V-XXX) are DISMISSED without prejudice Dated this 23rd day of September, 2015.. Signed by District Judge Ronnie L. White on 09/23/2015. (KCB)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
UNITED STATES OF AMERICA
ex rel. SHARA AMBROSECCHIA,
PAD DOCK LABO RA TORIES, LLC, and
PERRIGO COMPANY plc,
No. 4:12CV2164 RLW
MEMORANDUM AND ORDER
This matter is before the Court on Defendants Paddock Laboratories, LLC and Perrigo
Company plc' s Motion to Dismiss Relator' s Second Amended Complaint 1 (ECF No. 56). The
motion is fully briefed and ready for disposition.
Relator, Shara Ambrosecchia, a former employee of Paddock Laboratories, LLC
("Paddock"), brings this action on behalf of the United States of America and 25 separate States
and the District of Columbia. According to the Second Amended Complaint, Relator alleges that
Defendants Paddock and Perrigo Company plc ("Perrigo") violated the federal False Claims Act
("FCA") and analogous state statutes by submitting false classification information at the Centers
for Medicare and Medicaid Services ("CMS") with respect to ten drugs allegedly not approved
by the U.S. Food and Drug Administration ("FDA"). Relator claims that the submission ofthis
On April 6, 2015, the Court granted Relator' s Motion to Correct Misnomer, thus substituting
Perrigo Company, plc for the non-entity Defendant Perrigo Company, Inc. The Court fails to
find any entry of appearance for the Defendant Perrigo Company, a Michigan corporation, and
thus does not deem that company a party to this action. Instead, Perrigo Company is mentioned
in the subtext as the owner of subsidiary Defendant Paddock Laboratories, LLC. However,
because Perrigo Company, plc is a proper party, the Court will allow it to join the Motion to
Dismiss, which request was timely made after the Court ruled on Relator's motion to amend the
Second Amended Complaint to correct the misnomer.
false classification information caused false claims for reimbursement to be submitted to
Medicare and Medicaid by third-parties. Specifically, Relator contends that Defendants violated
the FCA by making or using false records material to make false claims (Count I); causing false
records to be used (Count II); causing the presentation of false claims for payment to Medicare
and Medicaid (Count III); causing presentation of false claims for payment to the U.S. (Count
IV); violated analogous statutes in California, Colorado, Connecticut, Delaware, District of
Columbia, Florida, Georgia, Hawaii, Illinois, Indiana, Louisiana, Massachusetts, Michigan,
Minnesota, Montana, Nevada, New Jersey, New Mexico, New York, North Carolina, Oklahoma,
Rhode Island, Tennessee, Texas, Virginia, and Wisconsin (Counts V-XXX) ; common fund
claims regarding States without analogous statutes (Count XXXI); and common law qui tam
claims against States without qui tam statutes (Count XXXII). Neither the United States of
America nor any of the named States or District of Columbia has elected to intervene in the suit.
On February 4, 2015, Defendants filed a Motion to Dismiss Relator's Second Amended
Complaint arguing that Relator' s FCA claims are barred by the FCA' s public disclosure bar
because Relator' s theory of liability is substantially identical to that alleged in United States ex
rel. Conrad v. Abbott Labs, Inc. ("Conrad'). Further, Defendants maintain that Relator' s
Medicare Program allegations reflect a fundamental misunderstanding of the government
programs and regulatory scheme at issue. Defendants also assert that Relator' s claims with
respect to two of the drug are false, as they were FDA approved for the relevant period.
Additionally, Defendants claim that Relator' s allegations pertaining to third-party submission of
claims for reimbursement lack particularity sufficient to satisfy Fed. R. Civ. P. 9(b). With regard
to the State law claims, Defendant argues that those claims should be dismissed under each
respective State' s public disclosure bars, Rule 12(b)(6), and Rule 9(b). Finally, Defendants
argue that Relator' s claims under common fund and common law qui tam theories ofliability are
not actionable, and the Court lacks jurisdiction over non-qui tam States.
Public Disclosure Bar
The qui tam provisions of the FCA allow "private persons acting on behalf of the
government [to] sue those who defraud the government and share in any proceeds ultimately
recovered." Costner v. URS Consultants, Inc., 153 F.3d 667, 675 (8th Cir. 1998). "In the FCA,
Congress included what is nicknamed a ' public disclosure bar' which prevents qui tam relaters
from suing for fraud against the government when that fraud is already publicly known." US ex
rel. Paulos v. Stryker Corp. , 762 F.3d 688, 692 (8th Cir. 2014). The FCA'sjurisdictional
scheme encourages private citizen involvement in revealing fraud committed against the
government while also preventing "'parasitic suits by opportunistic late-comers who add nothing
to the exposure of the fraud."' Costner, 153 F.3d at 675-76 (quoting US ex rel. Rabushka v.
Crane Co., 40 F.3d 1509, 1511 (8th Cir. 1994)). Under the FCA:
(A) The court shall dismiss an action or claim under this section, unless opposed
by the Government, if substantially the same allegations or transactions as alleged
in the action or claim were publicly disclosed (i) in a Federal criminal, civil, or administrative hearing in which
the Government or its agent is a party;
(ii) in a congressional, Government Accountability Office, or other
Federal report, hearing, audit or investigation; or
(iii) from the news media,
unless the action is brought by the Attorney General or the person bringing
the action is an original source of the information.
31 U.S.C. § 3730(e)(4)(A). The original source exception applies where the relater:
either (1) prior to a public disclosure under subsection (e)(4)(A), has voluntarily
disclosed to the Government the information on which allegations or transactions
in a claim are based, or (2) who has knowledge that is independent of and
materially adds to the publicly disclosed allegations or transactions, and who has
voluntarily provided the information to the Government before filing an action
under this section.
31 U.S.C. § 3730(e)(4)(B). "Dismissal under the public disclosure bar is thus required if (1) the
defendant has shown public disclosure under§ 3730(e)(4)(A), and (2) the relator does not fit§
3730(e)(4)(B)'s definition of 'original source. "' Paulos, 762 F.3d at 692.
In the instant case, Defendants argue that dismissal is warranted under the public
disclosure bar because the Government was aware of the allegations underlying Relator' s claims
in 2002. Specifically, Defendants assert that substantially the same information giving rise to the
allegations was disclosed in a prior lawsuit, United States ex rel. Conrad v. Abbott Labs., Inc. ,
No. 02-11738-RWZ (D. Mass 2002). Defendants also maintain that identical information was
disclosed in federal reports. Further, Defendants argue that Relator has not materially added to
the information already known to the Government and is therefore not an original source.
Relator, on the other hand, contends that her claims do not meet the requirements of
"substantially the same" contained in§ 3730(e)(4)(A) because the prior litigation involved
different allegations and transactions. Additionally, Relator asserts that she is an "original
source" such that the public disclosure bar does not apply.
Relator argues that a motion to dismiss is not the proper avenue to bring a claim that
public disclosure bars a lawsuit and that Defendants were required to raise the public disclosure
bar as an affirmative defense. Neither is true. Plaintiff overlooks recent case law from the
Eighth Circuit declining to address whether the public disclosure bar must be raised as an
affirmative defense and finding, " [e ]ven if public disclosure were an affirmative defense,
' technical failure to comply with Rule 8(c) is not fatal ' when the defense ' is raised in the trial
court in a manner that does not result in unfair surprise."' US. ex rel. Kraxberger v. Kansas City
Power & Light Co., 756 F.3d 1075, 1082 (8th Cir. 2014) (quoting First Union Nat '/ Bank v.
Pictet Overseas Trust Corp. , Ltd. , 477 F.3d 616, 622 (8th Cir. 2007) (internal quotation
omitted)). Further, a motion to dismiss is the appropriate vehicle to assert a claim under the
public disclosure bar of§ 3730(e)(4), and courts may consider alleged public documents in its
dismissal. Kraxberger, 756 F.3d at 1083 ("Since the FCA requires a court to dismiss a claim
based on public disclosure, a court necessarily considers the alleged public documents in its
Here, Defendants allege that the Conrad litigation and other prior allegations and notices
provided the Government with notice of the potential wrongdoing. Relator bears the burden of
establishing the inapplicability of the public disclosure bar. US. ex rel. Ketroser v. Mayo
Foundation, 729 F.3d 825, 828 (8th Cir. 2013).
The Conrad complaints were unsealed and became public record on November 17, 2010,
prior to the date Relator filed her original Complaint. (Mem. in Support of Mot. to Dismiss, Ex.
I p. 14, Electronic Order of 11117/ 10 Granting Mot. to Unseal, ECF No. 48-9) Relator filed her
Complaint on November 20, 2012, two years later. In Conrad, Relator claimed that "Defendants
submitted false records or statements to the United States through the federal Center for
Medicare and Medicaid Services ("CMS") and thereby caused false claims for payment to be
made through state Medicaid programs for unapproved or ineffective drugs, or for products that
are not drugs at all." (Defs. ' Ex. H, Conrad Eighth Am. Compl. ii 1, ECF No. 48-8) Further, the
Conrad complaint asserts that the "false information corrupted CMS ' s list of Medicaid
reimbursable drugs, caused claims for ineligible products to be submitted to state Medicaid
programs, led state programs to pay for and in turn seek reimbursement from CMS for such
ineligible drugs, and thereby caused CMS to pay false claims .. . ." (Id. at ii 3) The alleged FCA
violations included "knowingly submitting false information concerning 'New Drugs ' that have
not been FDA approved ... [and] knowingly causing to be presented false claims by the
submission of the false information described herein." (Id. at ii 4)
The allegations in Relator' s original Complaint state that numerous drug manufacturers,
including Defendant Paddock initially, "reported false information to CMS regarding the
regulatory status of these products, representing that they were 'safe and effective ' in order to
make them ostensibly eligible for Medicare reimbursement, as well as for reimbursement
through other government-funded healthcare programs." (Compl. ii 1, ECF No. 1) Moreover,
Relator contends that the "false information corrupted CMS's list ofreimbursement-eligible
drugs, which caused claims for ineligible products to be submitted to Medicare and other
government-funded healthcare programs, through CMS, and led CMS to improperly pay
reimbursement for such ineligible drugs." (Id. at ii 2) Relator claims that the Defendant drug
manufacturers violated the FCA "by knowingly and/or recklessly submitting false classification
information concerning drugs which have not been FDA approved ... [and] by knowingly
and/or recklessly causing the presentation of false claims by submitting the false information
described herein." (Id. at ii 3) Relator essentially repeats these allegations in her Second
Amended Complaint. (Second Am. Compl.
Further, Conrad 's Fourth Amended Complaint alleged that defendants made fraudulent
misrepresentations to CMS by reporting false Drug Efficacy Study Implementation ("DESI")
codes for unapproved new drugs and non-drugs indicating that they were covered under
Medicaid and other government healthcare programs. (Defs.' Ex. F, Conrad Fourth Am. Compl.
iii! 46-48, ECF No. 48-6)
Conrad also maintained that the misrepresentations led to
reimbursement under Medicaid and other government healthcare programs. (Id. at ii 46) In
addition, the Eighth Amended Complaint alleged that defendants submitted "false FDA approval
dates and false DESI status for their Illegal Drugs; and false FDA approval dates and rogue NDC
numbers for their Non-Drugs. This false information made their ineligible products appear to be
Covered Outpatient Drugs." (Defs.' Ex. H, Conrad Eighth Am. Compl.
if 49, ECF No. 48-8)
Further, the Conrad relator relied on data contained in CMS Quarterly Reports, CMS Drug Data
Reports, the FDA Approved Drug Products and Therapeutic Equivalence Evaluations ("Orange
Book"), the FDA National Drug Code Directory, and Federal Register Notices. US. ex rel.
Conradv. Abbott Laboratories, Inc., No. 02-11738-RWZ, 2013 WL 682740, at *3 (D. Mass.
Feb. 25, 2013). In Conrad, the listed drugs included Hydrocortisone Acetate Suppositories,
Hyoscyamine Sulfate, and Bisacodyl Suppositories. (Defs.' Ex. G, Conrad Fifth Am. Compl.
15Q, Ex. Q, ECF No. 48-7; Defs. ' Ex. E, Conrad Compl.
ECF No. 48-5)
In Relator' s Second Amended Complaint in the case now before this Court, Relator
alleges that "when Defendants submitted false FDA approval dates, NDC numbers and false
DESI status codes for their unapproved drugs, the false information made their ineligible
products appear to be eligible for reimbursement through Medicare, Medicaid and other
government-funded healthcare programs." (Second Am. Compl.
42, ECF No. 29) Likewise,
Relator maintains that "CMS and the State Governments relied on the false information
contained in the CMS data base and unwittingly paid claims for ineligible drugs." (Id.
In addition, Relator relies upon the Orange Book, CMS Quarterly Reports, and Federal Register
Notices to support her claims. (Id.
31 , 37, 43) Relator further lists Hydrocortisone Acetate
Suppositories, Hyoscyamine Sulfate, and Bisacodyl Suppositories in her list of products that
Defendants' allegedly falsely classified. (Id.
43b, 43c, and 43h)
Review of the allegations contained in the Conrad Complaints and Relator
Ambrosecchia' s Complaints shows that Relator raises "substantially the same" allegations as
those in Conrad. Without presenting case law in support, Relator argues that Defendants' theory
that allegations made against different drug companies in a different case involving a similar
series of drugs constitute public disclosure is "ridiculous." However, Defendants correctly note
that the FCA' s public disclosure bar has a "generally broad scope." Schindler Elevator Corp. v.
US. ex rel. Kirk, 563 U.S. 401 , 131 S. Ct. 1885, 1891 (2011). Indeed, the purpose of the public
disclosure bar is "'to strike a balance between encouraging private persons to root out fraud and
stifling parasitic lawsuits. "' Id. at 1894 (quoting Graham Cty. Soil and Water Conservation Dist.
v. US. ex rel. Wilson , 559 U.S. 280, 295 (2010)). Public disclosure includes a ''federal criminal,
civil, or administrative hearing in which the Government is a party[,]" as well as congressional,
GAO or any other federal report, hearing, or investigation. US. ex rel. Paulos v. Stryker Corp.,
No. 11-0041-CV-W-ODS, 2013 WL 2666346, at *3 (W.D. Mo. June 12, 2013).
Here, not only was Defendant Paddock named as a defendant in the original Conrad
complaint, but amended versions of the complaint included some of the same drugs that are the
subject ofRelator Ambrosecchia' s Complaints. Further, Relator acknowledges that the Conrad
case alleged industry-wide conduct. (Relator' s Mem. in Opp. 12, ECF No. 56) "Industry-wide
public disclosures bar qui tam actions against any defendant who is directly identifiable from the
public disclosures." US. ex rel. Gear v. Emergency Med. Assoc. of Ill., Inc., 436 F.3d 726, 729
(7th Cir. 2006) (rejecting relator' s argument that public disclosure only occurs where the specific
defendants named in the lawsuit had been identified in the public records); see also US. ex rel.
Zizic v. Q2Administrators, LLC, 728 F.3d 228, 238 (3d Cir. 2013) (finding that, although
defendants weren't named in the previous litigation, they were directly identifiable from that
public disclosure). In addition, the fraudulent scheme alleged by Relator is substantially the
same as those alleged in the Conrad litigation against numerous drug manufacturers. See Gear,
436 F.3d at 729 (finding that public disclosing industry-wide abuses and investigations regarding
the fraudulent billing of Medicare implicated defendants).
Moreover, Relator specifically mentions that she relied on government reports from the
FDA Orange Book, CMS data files, FDA reports, and Federal Register notices as the basis for
her claims. In Conrad, the district court ultimately found that these same sources publicly
disclosed the fraud alleged in relator' s complaint. US. ex rel. Conrad v. Abbott Labs., Inc. , No.
02-11738-RWZ, 2013 WL 682740, at *4 (D. Mass. Feb. 25, 2013).
Relator relies upon Leveski v. ITT Educ. Servs. , Inc. to support her claim that the
allegations in her complaint are not "substantially the same" as those previously disclosed. 719
F.3d 818 (7th Cir. 2013). In Leveski, the court held that the relator' s allegations were different
enough from the allegations raised against the defendant in a prior FCA suit to bring relator' s
suit outside the FCA' s public disclosure bar. Id. at 730-31 . In that case, the Relator alleged a
different scheme and violations than a previous case, and the Leveski court found that "viewing
FCA claims ' at the highest level of generality ... in order to wipe out qui tam suits that rest on
genuinely new and material information is not sound."' Id. at 831 (quoting US. ex rel. Goldberg
v. Rush Univ. Med. Ctr., 680 F.3d 933 , 936 (7th Cir. 2012)).
The Court finds the Relator's reliance on Leveski is misplaced. Here, Relator fails to
demonstrate that her suit rest on new and material information. Her allegations may add some
new details and mention different drugs, but the allegedly fraudulent scheme is substantially the
same as the scheme in Conrad, as are the sources of public information relied upon by Relator.
The public disclosure bar is triggered where the allegations merely add some color but ultimately
target the same fraudulent scheme. US. ex rel. Poteet v. Bahler Med., Inc., 619 F.3d 104, 115
(1st Cir. 2010). As found in Conrad:
[Defendants] argue instead that if relator' s allegations are true, then both the
misrepresented facts and the true facts would have been disclosed by the five
public sources listed above. The misrepresented facts would be disclosed by
CMS ' s drug product data files and state drug utilization data files; the former files
would show any false statement that defendants' products were covered outpatient
drugs and any false DESI codes, while the latter would show that state Medicaid
programs had relied on those misrepresentations. The true facts would be
disclosed by the Orange Book, which lists all FDA-approved drugs (making
defendants' unapproved drugs and non-drugs conspicuous by their absence); the
Federal Register notices, which would list any DESI determinations about
defendants' drugs (or about drugs identical, related, or similar to defendants' );
and the NDC Directory, which provides enough information to show whether two
drugs are identical, related, or similar.
Relater concedes that these sources were publicly available, but argues that they
do no raise any inference of fraud . . . . In this case, ... , both sets of facts were
apparently publicly available. Ifrelator' s allegations are true, the CMS data files
would show defendants claiming their products were covered outpatient drugs
with appropriate DESI codes, while the other sources would show the products
were not approved drugs and/or had ineligible DESI codes. That contradiction in
the publicly available information is enough to "lead to a plausible inference of
fraud. " Ondis, 587 F.3d at 54.
Conrad, 2013 WL 682740, at *4.2
Here, not only did Relater rely on the same public information that the Conrad court
found led to a plausible inference of fraud,3 but the Conrad litigation, which is public record,
directly alleged substantially the same fraudulent scheme described by Relater. These
disclosures of fraudulent practices by drug manufacturing companies "sufficiently alerted the
government to the likelihood" that the named Defendants in this suit may also engage in such
practice. US. ex rel. Fine v. Sandia Corp., 70 F.3d 568, 571 (10th Cir. 1995). Thus, the Court
finds that Relator' s FCA claims are precluded by the public disclosure bar, and the Court lacks
jurisdiction to afford the Relater relief under the FCA. Paulos, 762 F.3d at 693 ; U S. ex rel.
Newell v. City ofSt. Paul, Minn., 728 F.3d 791 , 795 (8th Cir. 2013).
B. Original Source
Relater argues that because the Conrad case pertained to pre-amendment of the relevant FCA
provision regarding the public disclosure bar, its reasoning is inapplicable. The Court disagrees.
In Paulos, relator' s claims arose both before and after the public disclosure bar was amended.
2013 WL 2666346, at *4. The court found that, although the two versions of the public
disclosure bar employed different language, the analysis was essentially the same. Id. Further,
on appeal, the Eighth Circuit Court of Appeals assumed, without deciding, that the current
version of the FCA applied, and affirmed the lower court' s decision finding that the public
disclosure was sufficient to bar relator' s claims. Paulos, 762 F.3d 688, 692 n.7.
For example, Relater claims that "All FDA approved drugs are listed on the FDA' s website ..
. as well as within The Orange Book, which contains the agency' s public listing. Drugs that are
not listed in either of those places are not approved by the FDA." (Second Am. Compl. ~ 31 ,
Because the public disclosure bar applies in this case, Relator's claims may succeed only
if she is an original source. Id. at 694. Relator "qualifies as an ' original source' if (1) before the
public disclosures, he 'voluntarily disclosed to the Government the information on which' his
claims' 'allegations or transactions ... are based,' or (2) he 'has knowledge that is independent
of and materially adds to the publicly disclosed allegations or transactions, and ... has
voluntarily provided the information to the Government before filing [this] action. "' Id. (quoting
31 U.S.C. § 3730(e)(4)(B)).
Here, Relator maintains that she has sufficiently alleged she is an original source because
she was personally aware of the conduct by seeing the conduct with her own eyes, reading
reports and documents generated by Defendants, and participated in conversations with
Defendants regarding the subjects of the lawsuit. (Second Am. Compl. ii 14, ECF No. 29) She
further asserts that she did not rely on any publicly discloses sources in pleading the Amended
Complaint and relied instead on direct and independent knowledge, which she relayed to the
United States prior to filing the Amended Complaint. 4 (Id.) Relator alleges her knowledge
supplements and materially adds to any information existing in the public domain. (Id.)
Finally, Relator claims that she has worked for both Defendants and acquired knowledge of their
practices during her tenure with Defendant companies. (Id. at ii 16)
Defendants, however, argue that Relator is not an original source because her information
is based on her review of the same public reporting that led to the dismissal of the Conrad
Relator cannot show, nor does she argue in her Memorandum in Opposition to Defendants'
Joint Motion to Dismiss, that prior to a public disclosure she "voluntarily disclosed to the
Government the information on which allegations or transactions in a claim are based." 31
U.S.C. § 3730(e)(4)(B). As previously stated, the Conrad litigation became public record in
2010, and the other information upon which Relator relies was also available before Relator filed
her Complaint in 2012. Further, Relator does not allege that she provided the information to the
Government before filing her FCA action. Instead, she claims that she informed the United
States prior to filing her Second Amended Complaint on October 22, 2014. (Second Am.
Compl. ii 14, ECF No. 29)
complaint and because her allegations are not independent of, nor do they materially add to, the
public disclosures. The Court agrees with Defendants and finds that Relater does not qualify as
an original source to overcome the public disclosure bar.
"Where the [relater] fails to provide the district court with ' specific facts showing that
she had direct and independent knowledge of the [information] upon which she bases her FCA
claims,' dismissal for lack of subject-matter jurisdiction is appropriate." U S. ex rel. Schubert v.
All Children 's Health Sys., Inc., 941 F. Supp. 2d 1332, 1336 (M.D. Fla. 2013) (citing Battle v.
Bd. of Regents for Georgia, 468 F.3d 755, 762 (11th Cir. 2006)). Relater fails to point to any
specific facts in her Second Amended Complaint supporting her claim that she is an original
source. Relater merely argues that by virtue of her position with Defendant companies, she has
sufficiently pled information that was not publicly known prior to Perrigo' s 2014 Annual Report
and not subject to any prior public discloser, thus adding materially to the prosecution of the
case. Relator' s contention that she satisfies the "original source" requirement is merely a legal
conclusion, not entitled to the presumption of truth. Ashcroft v. Iqbal, 556 U.S. 662, 686 (2009)
("But the Federal Rules do not require courts to credit a complaint' s conclusory statements
without reference to its factual content.").
Instead, the record shows that Relater' s Second Amended Complaint relies upon reports
and information found to be subject to the FCA' s public disclosure bar. See Conrad, 2013 WL
682740, at *4. Further, she provides only conclusory allegations with no factual support for her
assertion that her knowledge is independent and would materially add to the publicly disclosed
information regarding Defendants' sci enter. Such failure to support these claims is fatal to
Relator' s case. See Paulos, 762 F.3d at 695-96 (finding that relator' s personal insight did not
contribute much more than tangentially relevant information to the fraud claim and that relater' s
warnings to the manufacturer did not significantly add to the scienter issue where public reports
already revealed the alleged fraud) ; Kraxberger, 756 F.3d at 1080 (concluding that the relator' s
information about his false-rate claim did not materially add to the publicly disclosed
information about rates, even assuming relator' s knowledge was independent). Therefore, the
Court finds that Relator is not an "original source," and her FCA claims should be dismissed
under the public disclosure bar.5 Paulos, 762 F.3d at 691.
Relator's State Claims
The remaining counts in Relator' s Second Amended Complaint arise under various State
statutes similar to the federal False Claims Act. 6 (Second Am. Compl. iii! 67-196, ECF No. 29)
Defendant requests that the Court decline to exercise supplemental jurisdiction over the State law
claims should the Court dismiss the federal FCA claims. The Court finds that the State tribunals
should determine the sufficiency of Relator' s claims under the applicable State statutes.
Therefore, the Court will decline to exercise supplemental jurisdiction under 28 U.S.C. § 1367
and will instead dismiss the State law claims without prejudice. Goughnour v. REM Minnesota,
Inc., No. 06-1601PAM/RLE, 2007 WL 4179354, at *5 (D. Minn. Nov. 20, 2007) (declining to
exercise supplemental jurisdiction over State law claim after dismissing relator' s FCA claims).
Although Relator has not filed a motion to file yet another amended complaint, she does make
such request in her Memorandum in Opposition, should the Court find the Second Amended
Complaint deficient. (Relator' s Mem. in Opp. 28, ECF No. 56) The Court notes that Relator has
already been allowed to amend her Complaint twice, and she has not filed a proper motion under
Fed. R. Civ. P. 15(a) or indicated how another Amended Complaint would give this Court
jurisdiction over her FCA claims foreclosed by the public disclosure bar. Therefore, the Court
will deny Relator leave to amend and dismiss her FCA claims with prejudice. Misischia v. St.
John 's Mercy Health Sys., 457 F.3d 800, 806 (8th Cir. 2006); see also Zizic, 728 F.3d at 243
(affirming dismissal of relator' s FCA complaint pursuant to the public disclosure bar with
prejudice and finding court did not abuse its discretion in denying relator' s improper request for
leave to amend his complaint).
In her Memorandum in Opposition, Relator states that she does not oppose the dismissal of her
claims in Counts XXXI and XXXII pertaining to common fund and common law qui tam. The
Court will accordingly dismiss those counts.
IT IS HEREBY ORDERED that Defendants' Motion to Dismiss Relator's Second
Amended Complaint (ECF No. 47) is GRANTED as follows, consistent with this Memorandum
Relator's claims under the False Claims Act (Counts I-IV) are DISMISSED with
prejudice based upon the False Claims Act Public Disclosure Bar.
Relator' s claims for Common Fund and Common Law Qui Tam (Counts XXXI-XXXII)
are DISMISSED without prejudice.
Relator' s State Claims (Counts V-XXX) are DISMISSED without prejudice
Dated this 23rd day of September, 2015.
RONNIE L. WHITE
UNITED STATES DISTRICT JUDGE
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