By Stephen A. Wood, a partner with Chuhak & Tecson, P.C. in Chicago, IL who serves as the WLF Legal Pulse’s Featured Expert Contributor on the False Claims Act.
Summary: The U.S. Supreme Court’s denial of certiorari in Bristol-Myers Squibb Co. v. State of New Mexico ex rel. Balderas, leaves unresolved an important question regarding the application of principles of res judicata to a False Claims Act qui tam suit in which the government has not intervened. In the underlying federal lawsuit, the relator’s claims were dismissed for failure to plead materiality, a necessary element of the plaintiff’s proof in any FCA case, after several pleading attempts. Although such a disposition is almost universally deemed to be “on the merits” for res judicata purposes, the defendants’ subsequent motion to dismiss a parallel New Mexico state court suit was denied, though New Mexico was a real party in interest in the dismissed federal case.
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