Supreme Court could limit FCA breadth without complete override

After last week's opening arguments in the "implied certification" case before the Supreme Court, legal experts on both sides of the issue are hinting that the Court could place limits on the False Claims Act without shooting down the implied certification theory entirely.

Lawrence Freedman, an attorney with Mintz Levin, told MedPage Today the case could give the government an "incredibly broad view" of liability. He said the Court could place limitations on the implied certification theory, which would require states to make certain requirements a condition of payment.

Justices Stephen Breyer, Sonia Sotomayor and Elena Kagan appeared to side with the implied certification theory, while Chief Justice John Roberts was the lone advocate for limitations, two attorneys with Sheppard, Mullin, Richter & Hampton LPP pointed out in an article for the National Law Review.

Based on the opening arguments, the Supreme Court appears unwilling to shoot down the theory in its entirety, according to attorneys with Latham & Watkins, but the it may "adopt some form of limiting principle on the implied certification theory to address issues of overbreadth, notice and fairness."

Meanwhile, attorneys with Fried, Frank, Harris, Shriver & Jacobson LLP said opening arguments were a "microcosm" of the arguments lower courts have been facing for 20 years. The authors pointed to one particular exchange between the government attorney and Kagan regarding the use of materiality as a limiting factor that reflected the difficulty the justices may have in finding a "workable test that limits this theory."

The implied certification theory has been a divisive issue leading up to the Supreme Court hearing, with providers arguing the government has overstepped the intent of the statute in some cases, and anti-fraud advocates indicating it is a valuable tool to stop improper payments.

To learn more:
- here's the MedPage Today article
- read the National Law Review article
- here's the Latham & Watkins post
- read the Fried, Frank, Harris, Shriver & Jacobson post

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