A1 Procurement, LLC. et al v. Thermcor, Inc. et al
Filing
145
MEMORANDUM ORDER - This matter comes before the court on the Defendants' Motion to Amend Order to Allow Interlocutory Appeal Pursuant to 28 US C. § 1292 (b), and corresponding Brief in Support, both filed on February 12, 2016. ECF Nos. [134 ], 135 . The Relator filed its Brief in Opposition on February 23, 2016. ECF No. 136 . Further before the court is the Relator's Motion to Lift Stay, and corresponding Brief in Support, filed on February 23, 2016. ECF Nos. 137 , 138 . The De fendants responded to the Motion to Lift Stay on March 10, 2016, ECF No. 140 , and the Relator filed a Reply on March 16, 2016. ECF No. 142 . For the reasons stated herein (see order for specifics), the Defendants' Motion to Amend Order is DEN IED, and the Relator's Motion to Lift Stay is GRANTED. The parties are ORDERED to contact the Calendar Clerk to set a new scheduling conference. Copies distributed to all parties as directed. Signed by Chief District Judge Rebecca Beach Smith on 3/24/2016. (cchr)
FILED
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
Norfolk Division
MAR 2 4
CLERK. U.S. DiS'RlCT COURT
NQR^O-K. VA
UNITED STATES OF AMERICA ex
rel. A1 PROCUREMENT, LLC,
Plaintiff-Relator,
ACTION NO;
2:15cvl5
V.
THERMCOR,
INC.,
et al•
Defendants.
MEMORANDUM ORDER
This matter comes before
the
court on the Defendants'
Motion to Amend Order to Allow Interlocutory Appeal Pursuant to
28 U S C. § 1292(b) ("Motion to Amend Order"}, and corresponding
Brief in Support, both filed on February 12, 2016. ECF Nos. 134,
135.
The
Relator
filed
its
Brief
in
Opposition
on
February 23, 2016. ECF No. 136.
Further before the court is the Relator's Motion to Lift
Stay,
and
corresponding
Brief
in
Support,
filed
on
February 23, 2016. ECF Nos. 137, 138. The Defendants responded
to the Motion to Lift Stay on March 10, 2016, ECF No. 140, and
the Relator filed a Reply on March 16, 2016. ECF No. 142. The
matter is ripe for review. For the reasons set forth herein, the
Defendants'
Motion
to
Amend
Order
is
DENIED,
and
the
Relator's
Motion to Lift Stay is GRANTED.^
MOTION TO AMEND ORDER TO ALLOW INTERLOCUTORY APPEAL
PURSUANT TO 28 U.S.C.
The
Defendants
filed
a
Motion
Jurisdiction or Failure to State a
No.
87.
By Order of August
7,
referred to Magistrate Judge
On November 18,
Recommendation
Dismiss.
ECF
Responses,
("Order"),
2015,
this
1292(B)
to
Dismiss
for
Claim on July 17,
2015,
the
Lawrence
R.
116.
court
Lack
of
2015.
EOF
Motion to Dismiss
was
Leonard.
ECF No.
the Magistrate Judge issued a
("R&R"),
No.
§
100.
Report and
which recommended denying the Motion to
After
issued
the
an
parties
Order
filed
on
Objections
January
15,
and
2016,
adopting in full the findings and recommendations set
forth in the R&R and denying the Motion to Dismiss. ECF No. 126.
The Defendants now seek to amend the Order adopting the R&R
to certify the Order for an interlocutory appeal.
Br.
Supp.
at
2. This request for certification is based on two objections to
the R&R filed by the Defendants -
whether the filing and service
requirements of the False Claims Act
^ On March 4,
2016,
("FCA")
are jurisdictional,
the Defendants filed a notice with the
court requesting that their Motion to Amend Order be set for a
hearing. ECF No. 139. The Relator filed a Notice of Opposition
on March 11, 2016. ECF No. 141. The court finds that a hearing
is unnecessary, as the facts and legal arguments are adequately
presented,
and
the
decisional
process
would not
be
aided
significantly by oral argument. See Fed. R. Civ. P. 78(b); E.D.
Va.
Loc.
Civ.
R.
7(J).
and whether
the
FCA.
A
there
was
a
public
disclosure,
under
the
of
Id.
district
court
may
certify
an
order
as
immediately
appealable if i t states in writing "that such order
a
terms
controlling
substantial
immediate
question
ground
appeal
ultimate
for
law
[2]
as
difference
of
the
from
termination
of
may
of
order
the
to
[1]
which
opinion
and
28
there
[3]
materially
litigation."
involves
that
advance
U.S.C.
is
an
the
§ 1292(b).
The district courts have "circumscribed authority to certify for
immediate
appeal
debatable."
(1995).
Swint
This
v.
Chambers
authority
requirements
F.2d 125,
interlocutory
are
127
orders
Cty.
"should
be
Comm'n,
used
"strictly construed."
(4th Cir.
1989).
deemed
pivotal
514
U.S.
sparingly,"
Myles
In this way,
and
35,
46
the
Laffitte,
v.
and
881
courts do not upset
the policy limiting appeals to final judgments without a showing
of
exceptional
circumstances.
404 F. Supp. 2d 907,
In
the
instant
908
Difelice
case,
the
§ 1292(b)
that
ground
substantial
U.S.
Airways,
Inc.,
(E.D. Va. 2005).
the three 28 U.S.C.
a
v.
Defendants
are
requirements,
for
difference
unable
to satisfy
as they fail to show
of
opinion
exists.
A
substantial ground for difference of opinion arises only if the
disagreement
on
merely parties.
WL 4789838,
at
controlling
law
Cooke-Bates v.
*2
(E.D.
Va.
exists
between
Bayer Corp.,
Nov.
16,
2010) .
No.
courts,
not
3:10cv261,
2010
Furthermore,
"just
any
simple
disagreement
certification."
arise
if
Id.
there
between
A substantial
is
a
"novel
courts
ground
and
will
for
not
merit
disagreement
difficult
issue
of
may
first
impression," or if there is a circuit split and the controlling
circuit has not commented on the conflicting issue.
the mere fact that an issue is one of first
there is a
Wyeth V.
the
WL
governing
703 F.
circuit
at
cases
*3
do
impression or that
2d 508,
not
require
527
(E.D.
three
Va.
a
July
district
(E.D.N.C.
2010).
courts
outside
district
finding
Suffolk City Sch. Bd.,
n.l
from
Supp.
in opinion among
See Cross v.
2838180,
"four
Inc.,
differences
grounds.
However,
lack of unanimity is not enough to meet this prong.
Sandoz,
Moreover,
Id.
14,
No.
of
2:llcv88,
2011
(finding
that
2011)
courts
substantial
outside
the
Circuit do not persuade this court that there is a
Fourth
substantial
ground for difference of opinion").
The
ground
Defendants
for
first
disagreement
argue
regarding
filing and service requirements
The
Fourth
Circuit
796
"[t]he
including
its
seal
violation
of
those
dismissal.'"
Id.
the
of
commented
Clark/Smoot/Russell,
procedural
that
is
a
substantial
question of
the
on
F.3d 424
there
FCA are
the
whether
the
jurisdictional.
issue
in
Smith
v.
{4th Cir.
2015),
stating that
requirements
of
the
False
Claims
provision,
'are
not
jurisdictional,
requirements
at 430
does
not
per
Act,
and
se
require
(quoting United States ex rel.
Lujan v.
Hughes Aircraft Co.,
67 F.3d 242,
245
{9th Cir. 1995)). However,
the Defendants assert that this statement is dicta. Br. Supp. at
5. The Defendants further argue that there is a circuit split on
the
issue.
case.
287,
Id.
In support,
United States ex rel.
299
(6th Cir.
in United States
794
the Defendants cite a
F.3d 457
6380992
2010),
{Oct. 20,
Rigsby v.
2015),
2015)
LHC Grp.,
Inc.,
623
F.3d
and a petition for writ of certiorari
ex rel.
{5th Cir.
Summers v.
Sixth Circuit
State
Farm Fire
petition for cert,
{No. 15-513),
which
& Cas.
filed,
writ
the
Co.,
2015
WL
Supreme
Court has not yet granted. See Br. Supp. at 5. The Sixth Circuit
case
the
involves a
other
FCA
seal breach,
procedural
but could be construed to apply to
requirements.
Notably,
however,
the
petition for writ of certiorari deals only and specifically with
seal breaches and not with the other FCA filing and procedural
requirements.
Moreover,
petition for
writ
albeit
standard
related,
for
a
of
a
disagreement with one circuit and a
certiorari
question
substantial
are
that
not
ground
deals with a
enough
for
to
different,
meet
difference
of
the
high
opinion,
especially when the Fourth Circuit has already commented on the
issue.^
^ Regardless of whether the language in Smith is dicta,
the Defendants argue,
difference of opinion.
there
is no
The Defendants
as
substantial ground for
do not cite any Fourth
Circuit case that finds that the filing and service requirements
are jurisdictional.
The
ground
Defendants
for
disclosure
opinion,
the
difference
occurred.
they cite
possibility
("SBA")
next
protests
footnote,
the
of
of
Br.
to
argue
that
opinion
Supp.
footnote
at
through a
Magistrate
6.
is
to
To
(9)
Small
public
Judge
as
nine
accessing
there
a
provided
the issue and rejected the Defendants'
public
difference
of
regarding
Administration
request.
a
a
the R&R,
Business
records
substantial
whether
show
of
a
lengthy
position,
Id.
In that
analysis
of
after finding a
public disclosure did not occur here based on the specific facts
of
the case.
R&R at
30 n.9.
the Defendants
is a
of Farmington,
166 F.3d 853
Seventh Circuit case.
grounds by Qlaser v.
(7th
Cir.
United
2009) ,
States
Conservation
Dist.,
(7th Cir.
United States v.
1999),
Wound Care Consultants,
that
ex
The only other support provided by
rel.
777
conflicts
Wilson
F.3d
v.
691
with
a
(4th
overruled on other
Inc.,
Fourth
Graham
Bank
Cty.
Cir.
570
F.3d 907
Circuit
case.
Soil
Water
2015),^
&
and
the
Defendants' analogy to complaints in a civil suit, which has not
been applied by the courts. Br. Supp. at 6. A single case from a
different circuit and the Defendants'
own theory are not enough
to show a substantial ground for difference of opinion.
^ In Wilson,
the
Fourth Circuit held that
a
public
disclosure under the FCA requires an act of disclosure outside
of the government, ill F.3d at 697. In contrast, the court in
Bank of Farmington held that disclosure of information to a
public official qualifies as an FCA public disclosure. 166 F.3d
at
861.
As
there
opinion,
the
is
no
court
substantial
will
requirements of 28 U.S.C.
only
ground
briefly
§ 1292(b),
for
difference
discuss
the
of
other
namely that the issue be a
controlling question of law and that an appeal would materially
advance
the
the ultimate
issues
that
are
although
require
a
termination of
controlling
the
issues
thorough
the case.
questions
involve
review
of
of
law,
legal
the
Regarding whether
the
court
questions,
record,
notes
they
also
particularly
the
question of whether a public disclosure occurred. See LaFleur v.
Dollar Tree
(E.D.
Va.
question
Stores,
May 20,
of
law,
Inc.,
No.
2014)
if
it
2;12cv363,
2014
(stating that
would
require
an
the
study the record extensively"). Further,
an
interlocutory appeal
termination
example,
of
as
the
the
would
issue
2121721,
is
at
not
appellate
a
*2
pure
court
"to
it is uncertain whether
"materially advance
litigation."
Defendants
WL
28
U.S.C.
recognize,
the
the ultimate
§ 1292(b).
public
For
disclosure
question does not affect all the contracts at issue, and thus, a
difference
of
opinion
on
that
issue
would
result
in
only
a
partial dismissal of the case. Br. Supp. at 7.
Accordingly,
for the above reasons,
the Defendants
fail
meet the requirements to certify the Order of January 15,
for interlocutory appeal.
to
2016,
MOTION TO LIFT
On September 1,
Stay of Proceedings.
parties
discussed
2015,
the parties
ECF No.
their
STAY
filed a
Joint Motion for
109. To support their request,
efforts
to
resolve
the
discovery disputes
and noted that two Motions were currently before the court.
Id.
at l."* The court granted the Motion for Stay of Proceedings on
September
stay
2,
be
lifted,
accordingly,
Supp.
2015.
at
as
ECF
No.
the
110.
two
The
Relator
Motions
have
now
been
requests
denied,
the
and,
the grounds for the stay are no longer present.
1.
The
Relator
also
asks
this
court
to
permit
Br.
the
parties to set a supplemental scheduling conference to reset the
deadlines in the original scheduling order,
ECF No.
67,
as these
deadlines have now expired due to the stay. See Br. Supp. at 1.
The
stay,
Defendants
argue
that
the
court
should
even if the court denies the Defendants'
Order,
Dismiss
because
for
Failure
Defendants
rely
App'x 132,
137
resolving
Rule
streamlines
"
Subject
The
the
the
two
Matter
on
Defendants
to
State
Levey v.
(3d Cir.
Claim."
were
Jurisdiction,
lift
the
Motion to Amend
file
a
Br.
0pp.
Inv.
Grp.,
Motion
at
3-6.
LLC,
590
to
The
F.
in which the court discussed how
motions
litigation
motions
a
"to
Browns tone
2014),
12(b)(6)
intend
not
before
process,
the
to
Motion
ECF
No.
beginning
argue
to
87,
that
Dismiss
and
discovery
discovery
for
the
Lack
of
Motion
to
Revoke the Pro Hac Vice Admission of Derrick Storms. ECF No. 83.
The court has since ruled on both of these Motions. ECF No. 126.
8
should remain stayed while another Motion to Dismiss is prepared
and
filed.
See
Defendants'
a
Br.
Supp.
at
3-4.
The
court
does
not
find
the
reliance on an unpublished Third Circuit case to be
persuasive argument for extending the stay through the filing
of a
future Motion in a
case that has been pending before this
court for over a year.
Further,
as this court has already ruled on the two Motions
referenced in the Joint Motion to Stay Proceedings,
denying the Motion to Amend Order,
and as it is
the purpose of the stay has
been satisfied and continuing the stay is unnecessary.
court finds that the stay should be lifted,
should set a
Thus,
the
and that the parties
new scheduling conference with the Calendar Clerk.
An Amended Scheduling Order will be entered to include dates for
resolving discovery disputes
well
An
as
to
set
Amended
a
new
date
Scheduling
and
for
Order
for
trial
does
appropriate dispositive motions,
any
and
not
further discovery,
the
incidents
preclude
during or at
the
as
thereto.
filing
of
the conclusion of
discovery.
CONCLUSION
For
the
reasons
stated
Amend Order is DENIED,
GRANTED.
The
parties
herein,
the
Defendants'
Motion
to
and the Relator's Motion to Lift Stay is
are
ORDERED
to
contact
the
Calendar Clerk
to
set
forward
a
new
a
scheduling
copy
of
this
conference.
The
Clerk
Memorandum
Order
to
is
counsel
parties.
IT IS SO ORDERED.
/s/
Rebecca Beach Smith
Chief Judge
REBECCA
CHIEF
March
,
2016
10
BEACH
JUDGE
DIRECTED
SMITH
for
to
all
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