On Remand, First Circuit Finds Violations in Escobar Were Material

November 28, 2016
Firm Publication

In June, the Supreme Court issued Universal Health Services, Inc. v. U.S. ex rel. Escobar, a landmark opinion in which the Supreme Court addressed the standard for pleading materiality in FCA implied certification cases. The Supreme Court ultimately remanded the case to the First Circuit to resolve in the first instance whether the alleged violations met that standard, and last week, the First Circuit gave its answer: the violations were material.

Escobar arose when a patient died after receiving mental health treatment at a Massachusetts facility owned and operated by Defendant Universal Health Services (UHS). When the patient’s parents learned that the facility employed unlicensed and unsupervised personnel, in violation of state regulations, they filed a qui tam lawsuit under the FCA.

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