4 Strategic Considerations in False Claims Act Lawsuits

A federal court has required a defendant named in a False Claims Act lawsuit to produce attorney-generated information to the whistle-blower who filed the claim, according to a National Law Review report.

United States ex rel. Garbe v. Kmart Corp., the defendant compiled its Medicare transaction data and delivered the information to HHS' Office of the Inspector General in response to a subpoena from the OIG. The defendant provided the information to the OIG in an "easier-to-understand" format to "obtain a more favorable outcome in the OIG investigation," according to the report.

When the defendant provided the Medicare data to the OIG, it was unaware it was already the subject of a FCA lawsuit, which had been filed under seal by a whistle-blower approximately a year before it received the subpoena from the OIG.

After the FCA lawsuit was unsealed, and the defendant became aware of the complaint filed against it, the whistle-blower requested the Medicare data the defendant had previously produced to the OIG. Because the defendant's attorney had reformatted the Medicare data before providing it to the OIG, the defendant argued it should not have to produce the information because it was protected under the attorney work product doctrine, according to the report.

The court disagreed with the defendant's argument. The court stated the defendant originally provided the Medicare data to obtain a "strategic advantage" in the OIG investigation, and the defendant could not "pick and choose" when it would like to waive the work product doctrine.

Based on the court's holding, below are four strategic considerations for healthcare organizations concerning FCA cases.

1. Because FCA investigations often involve more than one government enforcement agency, healthcare organizations should be aware of the possibility of an FCA lawsuit when disclosing information to any healthcare enforcement authorities.

2. Being cooperative with government enforcement agencies can be beneficial in obtaining a favorable resolution to an investigation, but healthcare organizations should always be aware documents they produce to any government enforcement agency may ultimately end up in the hands of another agency or a whistle-blower in an FCA lawsuit.

3. Healthcare organizations that choose to provide attorney work product to a government enforcement agency should always have a confidentiality agreement in place stating the work product protection is not waived.

4. Even with a confidentiality agreement in place, healthcare organizations should still utilize caution when preparing documents to respond to a subpoena from a government enforcement agency because it is still possible providing the documents could waive the work product protection.

More Articles on the False Claims Act:

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