A document called the Granston memo is meant as a guide to weeding out frivolous False Claims Act cases, as it advises the government to be more selective about what cases are being brought in its name. Since it was promulgated in early 2018, there have been approximately 45 government motions to dismiss FCA cases, Smith said. That’s a fairly significant increase, considering that it has been historically rare for the government to move to dismiss an FCA suit brought by a whistleblower, he said.
But in a probe’s early stages, strategy varies by jurisdiction. Some investigators issue broad requests as they “fish” for anomalies, others use a more focused approach. “Some have a scorched-earth approach where they request everything related to a matter,” said Robert Salcido, an Akin Gump partner.
Since the COVID-19 pandemic hit, Salcido said he has seen both extremes. In one case, the jurisdiction involved had a strong political mandate to get to the bottom of whether nursing homes took adequate precautions to protect residents and staff. That placed onerous demands on prosecutors, who had to deal with a large quantity of documents and an expedited time period, he said.
In a case alleging price gouging for personal protective equipment, the government investigator recognized the time and expense of getting the documentation for every PPE vendor, so they asked the provider for a subset of data as soon as realistically possible, Salcido said.
“There’s a perception that at times the political appointees feel a great deal of pressure to say they held the industry accountable, particularly during these tough times when a lot of people have had adverse health impacts,” he said.
While there aren’t specific guidelines about how much documentation investigators can ask for, there is an implicit limitation, Salcido said. If subpoenas or civil investigative demands are overly burdensome and defendants successfully push back, it could build a negative body of case law, which could give other providers incentives to follow suit, he said.
The False Claims Act gives investigators a lot of leeway, and it doesn’t seem that the government has any motivation to change it, given the significant return on investment, said Neville Bilimoria, partner at Duane Morris.
“Certainly healthcare providers can fall victim to overly burdensome document requests, subpoenas or civil investigative demands and get taken on a fishing expedition,” he said, adding that there has been an uptick in the scope of the documentation requests. “The only thing to do is work with the government to try to limit those.”
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