The D.C. Circuit reversed the district court’s dismissal of a serial relator’s qui tam lawsuit under the FCA’s first-to-file bar in U.S. ex rel. Heath v. AT&T, Inc., finding that the relator’s two qui tam lawsuits targeted factually distinct types of frauds. The D.C. Circuit further determined that the relator’s qui tam lawsuit satisfied the pleading requirements of Rule 9(b).
The FCA’s first-to-file bar provides that once a qui tam action has been filed, “no person other than the Government may intervene or bring a related action based on the facts underlying the pending action.” As an initial matter, the D.C. Circuit determined that the first-to-file rule was not jurisdictional in nature; but rather, implicated only whether a qui tam plaintiff properly stated a claim. The D.C. Circuit then determined that the relator’s second qui tam lawsuit, which alleged that AT&T and 19 of its subsidiaries deprived schools and libraries of the lowest corresponding price for phone and internet services, was sufficiently different from the relator’s first qui tam lawsuit in terms of its scope and how the fraud scheme allegedly was carried out to avoid dismissal under the first-to-file rule.
The D.C. Circuit also determined that the relator’s qui tam lawsuit met the requirements of Rule 9(b), despite the fact that the relator’s complaint failed to identify the specific of any actual claims. The D.C. Circuit held that “the precise details of individuals claims are not, as a categorical rule, an indispensable requirement of a viable [FCA] complaint, especially not when the relator alleges that the defendant knowingly caused a third party to submit a false claim of a federal regulatory program.”
In reaching the foregoing conclusions, the D.C. Circuit has joined an increasing number of jurisdictions that have watered down the pleading requirements applicable to a relator’s FCA claims.