09-2167 U.S. ex rel. Baltazar v. Warden

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Civil Procedure
Qui tam actions

Where a relator reported that false Medicare claims were being submitted by her former employer, the case was improperly dismissed based on reports of Medicare generally.

“Defendants rely heavily on Gear, but to say that a report identifying a uniform practice activates §3730(a)(4)(A) does not imply anything about the effect of a report disclosing that some but not all firms use a practice. Once the GAO concluded that teaching hospitals routinely disregarded the required distinction between work in the teaching program and work as an attending physician, the only extra fact required was that the defendant is a medical school or teaching hospital. That’s public knowledge. Gear’s suit did not add one jot to the agency’s fund of information; the panel rightly called it ‘parasitic.’ 436 F.3d at 728. Baltazar’s suit, by contrast, supplied vital facts that were not in the public domain: that Advanced Healthcare Associates not only was submitting false claims but also was submitting them knowing them to be false, and thus was committing fraud. Baltazar’s suit is ‘based on’ those defendant-specific facts, not on the public information that false or mistaken claims are common. We concluded in Glaser v. Wound Care Consultants, Inc., 570 F.3d 907, 920 (7th Cir. 2009), that a qui tam suit is ‘based on’ a published report if its allegations are ‘substantially similar’ to the report’s. (The 2010 amendment added this rule to the statutory text.) A complaint ‘substantially similar’ to the published reports would be dismissed summarily; Baltazar’s complaint goes beyond those reports.”

Reversed and Remanded.

09-2167 U.S. ex rel. Baltazar v. Warden

Appeal from the United States District Court for the Northern District of Illinois, Norgle, J., Easterbrook, J.

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