On October 17, 2022, the Supreme Court declined to review a Seventh Circuit decision allowing vague, generalized, and speculative allegations to survive a motion to dismiss in False Claims Act (FCA) cases. The decision was a disappointment for WLF, which filed an amicus brief urging review in the case. As WLF’s brief explained, the decision below deepens an acknowledged circuit split over whether FCA plaintiffs must identify any specific fraudulent claim for payment at the pleading stage entrenched circuit split is untenable. Allowing the lower courts to abdicate their responsibility to apply Rule 9(b) as a check on FCA relators who allege no specific false claims with particularity gives a green light to abusive litigation. Defendants targeted by these dubious lawsuits will face hydraulic pressure to settle, yielding in terrorem settlements that are a deadweight loss to the economy.
Documents: