The 9th Circ.'s Expansive Reading Of Escobar In Gilead
By Sean Hartigan, Iris Bennett and Lidiya Kurin ( July 26, 2017, 1:20 PM EDT) -- The U.S. Supreme Court's June 2016 decision in Universal Health Services Inc. v. United States ex rel. Escobar provided guidance on when an implied certification can be the basis of liability under the civil False Claims Act.[1] Specifically, Escobar held that an implied certification theory can succeed when (1) "the claim does not merely request payment, but also makes specific representations about the goods or services provided;" (2) "the defendant's failure to disclose noncompliance with … statutory, regulatory, or contractual requirements makes those representations misleading half-truths;" and (3) the misrepresentation is material to the government's payment decision.[2] Although Escobar set out these requirements, questions have remained as to how they would be interpreted at the trial court level, including what constitutes "specific representations about the goods or services provided," when an omission makes these representations "misleading half-truths," and how precisely to analyze materiality. A recent opinion, which reinstated a case dismissed for failure to state a claim prior to the Escobar decision's issuance, sheds light on the Ninth Circuit's expansive interpretation of each of these factors....
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