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2016 was a big year for the False Claims Act (FCA).  Total government recoveries were up; total new matters filed were up; and total new government-led FCA matters were up.  The Supreme Court issued multiple decisions relating to the FCA, including one—Universal Health Services, Inc. v. U.S. ex rel. Escobar, 136 S. Ct. 1989 (2016)—which will have dramatic ramifications for litigation relating to the FCA’s materiality standard.  The Supreme Court also denied certiorari in an important FCA case—U.S. ex rel. Purcell v. MWI, Inc., 807 F.3d 281 (D.C. Cir. 2015), reh’g en banc denied, cert. denied, 580 U.S. ___ (2017)[1]—in which the D.C. Circuit held that when a defendant adopts an objectively reasonable or plausible interpretation of an ambiguous regulatory term and the agency has not warned the defendant away from its interpretation via authoritative guidance, the FCA’s scienter element cannot be established.  (Note: We previously covered the Purcell decision on our FCA blog.  You can view our article, here.)  Although some of these developments may seem concerning, there is plenty of silver lining here for government contractors.
Continue Reading What’s Past is Prologue: How The FCA’s Eventful Year in 2016 Will Affect Government Contractors