United States of America v. Mobile Care Group, Inc.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

WESTERN DIVISION

UNITED STATES OF AMERICA ex

rel. BRANDEE WHITE, et al.,

Plaintiffs, Case No. 1:15-cv-555

JUDGE DOUGLAS R. COLE

v.

MOBILE CARE EMS & TRANSPORT,

INC., et al.,

Defendants.

AMENDED1 OPINION AND ORDER

This is a qui tam action with a long and somewhat muddled procedural history

(as is often the case with such actions). Relators initially sued four entities—Mobile

Care Group, Inc.; Mobile Care Group of Ohio, LLC; Mobile Care EMS & Transport,

Inc.; and LogistiCare Solutions, Inc.—on behalf of the United States under the False

Claims Act (“FCA”). (Compl., Doc. 1). Shortly thereafter, Relators amended their

complaint to add three individual claims against Mobile Care EMS & Transport, Inc.

on behalf of Relator Brandee White: one claim for FCA retaliation and two pendent

state law claims generally sounding in wrongful termination. (Am. Compl., Doc. 6).

About three years later, the government partially intervened (only against Mobile

1 The Court originally issued this Opinion and Order on October 18, 2021. (Doc. 86). Since

that time, LogistiCare Solutions (now known as ModivCare) has moved the Court to certify

the Order under 28 U.S.C. § 1292(b). (See Doc. 92). As discussed further below, after briefing

on the issue, the Court concurs that such certification is appropriate. Accordingly, the Court

issues this Amended Opinion and Order to include that certification. Changes relating to

considering and implementing that certification are the only changes from the previous

version of this Opinion and Order. (See Doc. 86).

Care EMS & Transport, Inc. (“Mobile Care”), and not against LogistiCare Solutions,

Inc. (“LogistiCare”)),2 and the Court (the matter was assigned to a different judge at

the time) unsealed the amended complaint. (See Doc. 26). A few months later, the

government filed its own complaint. (Gov’t Compl., Doc. 48). Shortly thereafter,

Relators filed a Second Amended Complaint (“SAC”) asserting claims against only

two of the original defendants—Mobile Care and LogistiCare—and adding more

allegations regarding Relator White’s individual claims. (See Doc. 53). Mobile Care

Group, Inc. and Mobile Care Group of Ohio, LLC are thus no longer parties to this

action.

The action is now before the Court on a host of motions to dismiss and related

briefing. Specifically, Mobile Care seeks dismissal of Relators’ first amended

complaint (see Doc. 52), second amended complaint (see Doc. 58), and the

government’s complaint-in-intervention (see Doc. 51), or in the alternative a transfer

of venue to the Northern District of Ohio.3 LogistiCare likewise seeks dismissal of

Relators’ first amended complaint (see Doc. 50), and second amended complaint (see

Docs. 59 and 60 (the latter amending the former)), but does not seek dismissal of the

United States’ complaint-in-intervention, as that complaint directs no claims at

LogistiCare.

2 The government’s notice of intervention (Doc. 23) actually states that the government is

intervening as against “Mobile Care Group, Inc.,” but the government’s complaint-in-

intervention (Doc. 48) is against Mobile Care EMS & Transport, Inc.

3 In addition to moving to dismiss Relators’ second amended complaint, Mobile Care also

moved to strike it. (See Doc. 57). Shortly thereafter, though, Mobile Care withdrew that

motion. (See Doc. 63).

For the reasons more fully set forth below, the Court DENIES each of the

motions to dismiss and the request to transfer venue.

FACTUAL BACKGROUND

Because this case is before the Court on various motions to dismiss, the Court

takes its factual recitation from the allegations in the Relators’ second amended

complaint (their operative complaint) and the government’s complaint (which largely

mirror the allegations in the second amended complaint, at least as to Mobile Care’s

alleged role in violating the FCA). In discussing the substance of these allegations,

however, the Court expressly notes that they are merely allegations, which have not

yet been, and may never be, proven.

A. The Defendants Are Medical Transport Services Providers.

Mobile Care is an ambulance transportation supplier. It transports patients to

hospitals or other healthcare facilities. LogistiCare is a non-emergency medical

transportation broker. Both entities participate in government-run healthcare

programs, including Ohio’s Medicaid and MyCare Ohio programs (both of which are

funded in part by federal dollars) and the federal government’s Medicare and

Medicare Advantage programs.

These healthcare programs provide certain coverage for medical transport

services, but only to the extent that those services are medically necessary. (SAC,

Doc. 53, #426; Gov’t Compl., Doc. 48, #323). The medical necessity test applies not

only to the transport service generally, but also the level at which such services are

provided. That is, transport providers may offer a variety of service types, for

example, both non-emergency and emergency transport services. Moreover, even

within those broad categories, a given program may specify further distinctions.

Medicare, for example, specifies seven different categories for transport services.

(SAC, Doc. 53, #448–49). Under the government healthcare programs at issue here,

reimbursements for transport vary depending on the level of transport services (as

defined in each program) that the supplier provides. And the supplier must also

certify that the level of service it provided—whichever level that may be—was

medically necessary pursuant to the regulations at issue.

Again, though, even the lowest level of transport services must be medically

necessary in order to qualify for reimbursement. For example, non-emergency

ambulance transport is considered medically necessary only if the “beneficiary is bed-

confined, and it is documented that the beneficiary’s condition is such that other

methods of transport are contraindicated; or, if his or her medical condition,

regardless of bed confinement, is such that transportation by ambulance is medically

required.” (Id. at #444 (quoting 42 C.F.R. § 410.40(d)(1)).

Beyond the medical necessity requirement, the programs may also have other

prerequisites for coverage of transport services. Medicare Part B, for example,

provides a good starting point, as “Relator’s allegations in [the] Second Amended

Complaint primarily involve the Defendants’ false and fraudulent claims made under

Medicare Part B for ambulance transports.” (Id. at #434; Gov’t Compl, Doc. 48, #324

(“the majority of the claims, and those at issues [sic] in this Complaint, were

submitted to Medicare Part B”)). Medicare Part B (and thus also Medicare

Advantage) provide reimbursement only if (1) the patient is transported to an

“appropriate destination,” (2) applicable staffing, billing, and reporting requirements

are met, and (3) the transportation is not part of a “Part A service.” (SAC, Doc. 53,

#442). As to the first of those, the only appropriate destinations are a hospital, critical

access hospital, skilled nursing facility, the patient’s home, or a dialysis facility for

end-stage renal disease patients. (Id. at #452; Gov’t Compl., Doc. 48, #327)). Medicare

also generally conditions reimbursement on the supplier obtaining a signature from

the patient who is transported (unless that person has died). (Id. at #446).

Medicaid programs likewise have requirements that transport suppliers must

meet to qualify for reimbursement. Importantly, as with Medicare, Medicaid “only

covers medically necessary services.” (SAC, Doc. 53, #453 (citing Ohio Admin. Code

§ 5160-15-03(A)(2)(a)).

B. The Relators Are Mobile Care Employees Who Say That They Were

Instructed In Various Manners To Overbill For Transport Services.

Relator White was a Mobile Care employee. (Id. at #431). The company hired

her to oversee Mobile Care’s billing practices. (Id.). She claims that, beginning in

December of 2009 and continuing at least through the date of the second amended

complaint, Mobile Care had “knowingly … caused the submission of false or

fraudulent claims to Government healthcare programs, and made or caused to be

made false records and statements to get claims for ambulance services to

Government healthcare programs paid.” (Id. at #455). In particular, she alleges that

Mobile Care was “pressuring its employees” to “upcode[]” medical transport services

to higher billing levels. (Id. #456).

The other two relators are likewise Mobile Care employees, one a biller and

one a licensed EMT. (Id. at #432). The former claims she “refus[ed] to bill for services

that were not supported by … records.” (Id.). The latter claims that he was instructed

“to add specific statements and words to [his] Patient Care Reports in order to create

the impression that the patients had a medically necessary reason requiring them to

be transported” even if that was not the case. (Id. at #460). The Complaint also

provides examples of meetings and other interactions in which Mobile Care allegedly

applied pressure to EMTs and billers to assist in the fraudulent billing scheme. (Id.

at #456–64).

C. The Relators Claim That LogistiCare Also Participated In The

Overbilling.

As noted above, LogistiCare does not directly provide medical transport

services. Rather, it is a broker for such services. The Relators claim that “[w]hen

nursing facilities, skilled nursing facilities, or others request ambulance transport for

beneficiaries of Government healthcare programs, they contact LogistiCare and

LogistiCare schedules such transportation by arranging an ambulance provider or

supplier, like Mobile Care, to provide such transportation.” (Id. at #465).

Relators allege that “LogistiCare routinely schedules” such transport “by

ambulance on a nonemergency basis where no medical necessity exists for ambulance

transportation.” (Id.). Relator White further alleges that she tried to inform

LogistiCare when she learned that no medical necessity existed in a given case, but

that LogistiCare departments “routinely do not answer their phones or return calls.”

(Id. at #466). On those occasions where she has spoken to LogistiCare employees,

they have told her that the ambulance services are preapproved by Aetna (which

administers Ohio’s MyCare Ohio program), but in her experience Aetna does not

typically review patient files to make such determinations. (Id.). Thus, she says, by

relying on that preapproval, “LogistiCare has a practice and policy of directing

ambulance transport companies to bill Government healthcare programs for

ambulance transportation even when medical necessity is not present.” (Id. at 467).

D. Relators Point To Specific Examples Of Alleged Fraud.

Buttressing the allegations, Relators point to five examples of alleged

fraudulent billing. All five examples involve patients who Mobile Care transported.

According to Relators, as to each of the five, Mobile Care overbilled. And as to two of

the five, LogistiCare was aware of the overcharges, but nonetheless participated in

scheduling further transport for those patients through Mobile Care, knowing that

such overbilling was occurring. (Id. at #469–78). As to each of the five, Relators

describe the date on which the transport occurred, and provide sufficient details

about the transport that the defendants should be able to identify the transport at

issue. For example, Relators identify emails that employees exchanged in connection

with the transport, as well as the services provided, the billed amount, and, in some

cases, the dates of claim submission and payment. (Id.).

E. The Government’s Complaint In Partial Intervention Is Limited To

Mobile Care.

For its part, the government’s complaint-in-intervention is nearly identical to

the Relators’ second amended complaint in terms of describing the conduct that

allegedly violated the FCA, but there are some notable exceptions. Let’s start with

the latter. Perhaps most importantly, the government’s complaint is limited to Mobile

Care. It makes no FCA allegations (or any other allegations for that matter) against

LogistiCare. Nor does the government’s complaint, not surprisingly, include Relator

White’s personal claims, whether for FCA retaliation or wrongful discharge.

Beyond that, though, the story is basically the same. The government alleges

that Mobile Care overbilled Medicare and Medicaid for ambulance transport services.

(See Gov’t Compl., Doc. 48, #332). In support of that, the government points to the

same examples of alleged pressure that Relators say Mobile Care applied to billing

personnel and EMTs. (See id. at #332–39). It also points to the same examples of how

that pressure was applied (various meetings and email communications). (See id.).

And the government relies on the same five specific examples of alleged overbilling

as set forth in the Relators’ second amended complaint. (See id. at #339–46). As to

these issues, the substance of the allegations is nearly word-for-word identical to the

account that Relators put forward.

Based on those allegations, the government presses four counts. The first two

are the same FCA claims that the Relators had alleged in their amended complaint.

(Id. at #346). The third is a common law claim for unjust enrichment. (Id. at #347).

Last, the government asserts another common law claim for payment by mistake. (Id.

at 347–48).

Of course, as to the Mobile Care overbilling claims, the government’s

complaint, not the Relators’ second amended complaint, is the operative complaint.

Thus, these are the four overcharge-based counts currently pending against Mobile

Care, supported by the allegations set forth in the government’s complaint. As to the

FCA claims against LogistiCare (to the extent such claims are permissible, an issue

to which the Court returns below) and Relator White’s individual claims against

Mobile Care, though, the second amended complaint is the operative complaint.

THE PENDING MOTIONS

The various complaints have led to a flurry of motions to dismiss. As noted

above, this includes motions from both defendants to dismiss both Relators’ first and

second amended complaints. Defendant Mobile Care has further moved to dismiss

the government’s complaint-in-intervention. The Court need not discuss all five of the

motions, though, as the filing of the second amended complaint mooted the motions

directed at the first amended complaint. Moreover, even were that not the case, each

defendant’s motion to dismiss the Relators’ second amended complaint is virtually

identical to that defendant’s motion to dismiss the first amended complaint. So the

Court will discuss only (a) Mobile Care’s motion to dismiss the government’s

complaint-in-intervention, (b) Mobile Care’s motion to dismiss the Relators’ second

amended complaint, and (c) LogistiCare’s Motion to dismiss the Relators’ second

amended complaint.

A. Mobile Care’s Motion To Dismiss The Government’s Complaint-in-

Intervention.

In its motion seeking to dismiss the government’s claims, Mobile Care presses

three basic arguments.

First, Mobile Care argues that the FCA claims fail because the government

has failed to sufficiently allege that Mobile Care either knew the claims were false or

acted with deliberate ignorance or reckless disregard. (MC Mot. to Dismiss Gov’t

Compl., Doc. 51, #389–98). Mobile Care says that the allegations, at most, show

negligence, which is not enough to support an FCA claim. (Id.). In support of this, it

offers innocent explanations of the various communications and meetings cited in the

government’s complaint. It further goes through each of the five proffered examples

of patient transports and attempts to show that the billings for those patients do not

reflect fraud. (Id. at #396–98).

Second, Mobile Care attacks the claims for unjust enrichment and payment by

mistake on similar grounds. Essentially, Mobile Care claims that the government has

failed to provide sufficient allegations to plausibly show that Mobile Care submitted

claims for payments that were not medically necessary. (Id. at #398–400).

Finally, Mobile Care claims that venue is not appropriate in the Southern

District of Ohio. (Id. at #400–02). According to Mobile Care, the government has not

alleged that Mobile Care or LogistiCare reside in this district, or that they committed

an FCA violation here. (Id. at #400). Of course, the government is not intervening

against LogistiCare, so it is not surprising that the government did not specify where

LogistiCare’s alleged conduct occurred. But as it appears that at least some of

LogistiCare’s conduct did occur in this district, Mobile Care also explains why the

Court cannot rely on LogistiCare’s conduct in support of the venue issue. According

to Mobile Care, the government’s partial intervention in this action precludes the

case from going forward against LogistiCare, against whom the government chose

not to intervene. (Id. at #401). (The Court expands on this argument in discussing

LogistiCare’s motion to dismiss below.)

B. Mobile Care’s Motion To Dismiss The Relators’ Second Amended

Complaint.

Mobile Care’s other motion to dismiss is directed at Relator White’s claims

against the company. (See MC Mot. to Dismiss SAC, Doc. 58). In terms of the FCA

retaliation claim, Mobile Care contends that: (i) she failed to adequately allege that

she was engaged in FCA-protected activity; (ii) that in any event, she fails to

adequately allege that Mobile Care was on notice of any such activity; and (iii) that,

without such notice, Mobile Care thus could not have fired her in retaliation for

engaging in FCA-protected conduct. Mobile Care says each of these is necessary to

support an FCA retaliation claim. (Id. at #509–13).

As for the state law retaliation claim, Mobile Care says that, as alleged here,

it is basically a mirror of the FCA retaliation claim, and thus it is fatally flawed for

the same reasons identified above. (Id. at #514). And the state-law claim for discharge

in violation of public policy, Mobile Care says, suffers from that same basic flaw. (Id.

at #514–15).

Separately, Mobile Care also attacks venue in this Court. Its argument in that

regard is identical to the argument it pressed on the venue matter in its motion to

dismiss the government’s complaint. (Id. at #515–17). Accordingly, the Court will not

repeat that argument here.

C. LogistiCare’s Motion To Dismiss The Relators’ Second Amended

Complaint.

Finally, LogistiCare moves to dismiss Relators’ second amended complaint on

two grounds. (See LC Am. Mot. to Dismiss SAC, Doc. 60). First, LogistiCare argues

that the government’s decision not to intervene in the FCA claims against

LogistiCare forecloses Relators from proceeding against LogistiCare on those claims,

as well. Second, LogistiCare argues that Relators have failed to adequately allege any

misrepresentation that was material to any government payment decision.

LogistiCare summarizes its first argument this way: a “False Claims Act []

relator may not pursue claims in the Government’s name that the Government has

decided not to pursue.” (Id. at #555). In other words, according to LogistiCare, if a

relator brings an FCA suit on the government’s behalf against multiple defendants,

and the government elects to intervene as to some, but not all, of those parties, then

the FCA suit may not continue as to the remaining parties.

LogistiCare bases this argument largely on United States ex rel. Brooks v.

Stevens-Henager Coll., Inc., 359 F. Supp. 3d 1088, 1116–17 (D. Utah 2019). (See LC

Am. Mot. to Dismiss SAC, Doc. 60, #561–69). There, as LogistiCare explains it, the

government intervened in part. In particular, the government intervened as to some,

but not all, of the claims against two, but not all, of the then-named defendants.

Thereafter, the relator sought to add new claims and new defendants. The court,

based on its reading of the FCA’s text, concluded that an FCA suit cannot have “two

masters,” and dismissed the relator’s amended complaint. LogistiCare argues that

Brooks likewise compels dismissal of Relators’ second amended complaint here.

Separately, LogistiCare argues that none of its alleged misrepresentations

could have been material to a government payment decision. (Id. at #569–74). To get

there, LogistiCare makes a two-step argument. First, LogistiCare says that the

second amended complaint fails to sufficiently allege that LogistiCare is involved in

billing any government healthcare plan other than MyCare Ohio, which is managed

by Aetna. Thus, according to LogistiCare, only the terms of that program are relevant

to the claims against LogistiCare. (Id. at #569–71).

LogistiCare then asks the Court to take judicial notice of the payment

structure under that program. In particular, according to LogistiCare, publicly

available materials show that Aetna receives a capitated rate from the federal

government for plan participants in MyCare Ohio. That means that, independent of

how may transports LogistiCare arranges, the amount of federal money Aetna

receives will not change. Therefore, according to LogistiCare, the alleged conduct as

a matter of law is not “material” to any government payment decision, and thus

cannot support an FCA claim. (Id. at #572–74).

LEGAL STANDARD

At the motion to dismiss stage, a complaint must “state[] a claim for relief that

is plausible, when measured against the elements” of a claim. Darby v. Childvine,

Inc., 964 F.3d 440, 444 (6th Cir. 2020) (citing Binno v. Am. Bar Ass’n, 826 F.3d 338,

345–46 (6th Cir. 2016)). “To survive a motion to dismiss, in other words, Plaintiffs

must make sufficient factual allegations that, taken as true, raise the likelihood of a

legal claim that is more than possible, but indeed plausible.” Id. (citations omitted).

In making that determination, the Court must “construe the complaint in the

light most favorable to the plaintiff, accept its allegations as true, and draw all

reasonable inferences in favor of the plaintiff.” Bassett v. Nat’l Collegiate Athletic

Ass’n, 528 F.3d 426, 430 (6th Cir. 2008) (internal quotation omitted). That is so,

however, only as to factual allegations. The Court need not accept as true any legal

conclusions alleged in a complaint. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing

Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Moreover, the well-pled

facts must be sufficient to “raise a right to relief above the speculative level,” such

that the asserted claim is “plausible on its face.” Iqbal, 556, U.S. at 678; Twombly,

550 U.S. at 546–47. Under the Iqbal/Twombly plausibility standard, courts play an

important gatekeeper role, ensuring that claims meet a threshold level of factual

plausibility before defendants are subjected to the potential rigors (and costs) of the

discovery process. Discovery, after all, is not meant to allow plaintiffs to discover

whether a claim in fact exists, but rather to provide a process for gathering evidence

to substantiate an already plausibly-stated claim.

LAW AND ANALYSIS

A. The False Claims Act Penalizes The Submission Of Fraudulent Claims

For Payment To The United States Government.

As noted above, this is a qui tam action asserting a False Claims Act (“FCA”)

claim against two defendants. As at least some of the defendants’ arguments here

involve the intricacies of the FCA, a statutory primer serves as a good starting point.

Congress originally enacted the FCA in 1863, and the Act was “aimed

principally at stopping the massive frauds perpetrated by large contractors during

the Civil War.” Universal Health Servs., Inc. v. United States, 136 S. Ct. 1989, 1996

(2016) (quoting United States v. Bornstein, 423 U.S. 303, 309 (1976)). Consistent with

that goal, the False Claims Act provides for an award of treble damages and civil

penalties against any party who knowingly causes the submission of false or

fraudulent claims for payment to the United States Government. 31 U.S.C.

§ 3729(a)(1). Under the terms of the statute, liability extends both to those who

present such claims and those who cause such claims to be presented. Specifically,

the FCA provides that:

[A]ny person who—

(A) knowingly presents, or causes to be presented, a false or

fraudulent claim for payment or approval;

(B) knowingly makes, uses, or causes to be made or used, a false

record or statement material to a false or fraudulent claim; [or]

(C) conspires to commit a violation of subparagraph (A), (B), (D),

(E), (F), or (G)[]

…

is liable to the United States Government for a civil penalty of not less

than $5,000 and not more than $10,000, as adjusted by the Federal Civil

Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 note; Public

Law 104–410 [1]), plus 3 times the amount of damages which the

Government sustains because of the act of that person.

Id.

As the language reflects, the conduct must be “knowing” to give rise to liability.

Helpfully, the FCA also defines that term:

[T]he terms “knowing” and “knowingly”—

(A) mean that a person, with respect to information—

(i) has actual knowledge of the information;

(ii) acts in deliberate ignorance of the truth or falsity of the

information; or

(iii) acts in reckless disregard of the truth or falsity of the

information; and

(B) require no proof of specific intent to defraud[.]

Id. at § 3729(b)(1).

Separately, if liability is predicated on making a false “record or statement” in

support of a false claim, the statement must be material. Id. at § 3729(a)(1)(B). The

definition for that term again comes straight from the FCA:

[T]he term “material” means having a natural tendency to influence, or

be capable of influencing, the payment or receipt of money or property.

Id. at § 3729(b)(4).

The FCA further provides that a person—referred to as the “relator”—“may

bring a civil action for a violation of [the FCA] for the person and for the United States

Government.” 31 U.S.C. § 3730. In order to protect such relators, who may often be

employees with knowledge of the wrongdoing, the FCA also includes an anti-

retaliation provision. See id. at § 3730(h). One of Relator White’s individual claims in

this action arises under this provision.

As originally enacted, once a relator filed a qui tam action under the FCA, the

relator controlled that action through its completion. Over the years, though,

Congress provided, and most recently in 1986 refined, a role for the government in

such actions. See False Claims Amendments Act of 1986, Pub. L. No. 99–562, sec. 3,

§ 3730, 100 Stat. 3153, 3154–55. Under the current FCA, a relator is required to file

his or her action in camera and under seal. Once that occurs, the relator must provide

the government a “copy of the complaint and written disclosure of substantially all

material evidence and information the person possesses.” Id. at § 3730(b)(2). The FCA

requires that complaint to “remain under seal for at least 60 days,” and “not be served

on the defendant until the court orders.” Id.

The sixty-day period is designed to provide the government time to consider

the information that the relator has provided and decide whether to intervene in the

action. See id. at § 3730(b)(4). As a practical matter, the government often requests

several extensions of that time, which the statute allows. Id. at § 3730(b)(3). Here, for

example, nearly three years passed before the government filed notice of its intent to

intervene.

Importantly for one of the arguments at issue here, if the government elects to

intervene, “the action shall be conducted by the Government.” Id. at § 3730(b)(4). The

FCA expands on that in this fashion:

If the Government proceeds with the action, it shall have the primary

responsibility for prosecuting the action, and shall not be bound by an

act of the person bringing the action. Such person shall have the right

to continue as a party to the action, subject to the limitations set forth

in paragraph (2).

Id. at § 3730(c)(1). The “limitations” to which this section refers include that the

government may dismiss or settle the action without the relator’s consent, but only

after the Court has afforded the relator an opportunity to be heard if he or she objects

to that course of action. Id. at § 3730(c)(2). Similarly, if the relator’s “unrestricted

participation” is interfering with the government’s handling of the matter, or is

resulting in harassment to the defendant, the court can limit the relator’s

participation in various ways, as well. Id. at § 3730(c)(2)(C).

Finally, if the FCA action succeeds, the relator is entitled to payment in the

form of a percentage of the recovery from the defendant. The exact percentage

depends on whether the government intervenes, and also the extent to which the

relator contributed to the prosecution of the action, but the award can range up to

30% of the proceeds. See 31 U.S.C. § 3730(d). The relator is also entitled to recovery

of any reasonable expenses that were necessarily incurred, plus reasonable attorneys’

fees and costs. Id. Moreover, if the relator succeeds on his or her FCA retaliation

claim, the relator is entitled to reinstatement, two times his or her back pay (along

with interest on that amount), compensation for any “special damages,” and litigation

costs and attorneys’ fees. Id. at § 3730(h)(2).

With that description of the FCA in mind, the Court addresses the various

outstanding motions in this FCA action.

B. LogistiCare’s Two Challenges To The Relators’ Second Amended

Complaint Both Fail.

While the Court described LogistiCare’s motion last in the Court’s discussion

above of the pending motions, the Court starts its analysis with that motion. That is

because parts of Mobile Care’s arguments (in particular, the venue issues) turn on

Mobile Care’s claim that LogistiCare is correct in arguing that the Relators’ second

amended complaint does not state a viable claim against LogistiCare. Thus, the

resolution of Mobile Care’s motions turns, in part, on the Court’s resolution of

LogistiCare’s motion.

As noted above, LogistiCare advances two arguments in support of its request

for dismissal: (1) that, given the government’s decision to intervene against Mobile

Care, but not LogistiCare, the Relators cannot continue their FCA claims against the

latter either; and (2) that, in any event, the Relators have failed to adequately allege

that LogistiCare made a material misstatement. As discussed below, the Court

rejects both of these arguments.

1. The Government’s Decision To Intervene Against Only Mobile

Care Does Not Preclude Relators From Pursuing The Non-

Intervened Claims Against LogistiCare.

It has long been understood that the government can choose to intervene as to

fewer than all of the claims set forth in an FCA case. For just two of the many recent

examples, see, e.g., United States ex rel. A. Duane Seabury, v. Cookeville Regional

Medical Ctr. Auth., No. 2:15-CV-00065, 2021 WL 4594784, at *1 (M.D. Tenn. Oct. 6,

2021); United States ex rel. Alt v. Anesthesia Servs. Assocs., PLLC, No. 3:16-CV-0549,

2021 WL 3115157, at *1 (M.D. Tenn. July 22, 2021). Indeed, the FCA specifically

provides that, if the government elects to intervene, it has the right to amend the

complaint “to clarify or add detail to the claims in which the Government is

intervening.” 31 U.S.C. § 3731(c) (emphasis added). That certainly sounds like it

creates the possibility for partial intervention, i.e., intervention as to certain “claims.”

In fact, so far as the Court can tell, LogistiCare does not dispute that basic

proposition. All parties likewise acknowledge that when the government intervenes

in a qui tam lawsuit, it takes over primary responsibility for “the action” and can

settle claims or dismiss defendants.

The question, though, is what happens to any claims as to which the

government elects not to intervene. According to LogistiCare, the acknowledged

option for the government to partially intervene, coupled with the settled proposition

that when the government intervenes it takes responsibility for “the action,” means

that the government’s decision not to intervene as to certain claims essentially results

in a tacit dismissal of those claims. And LogistiCare relies on that proposition to seek

dismissal of the FCA claims against it, based on the government’s decision not to

intervene as to those claims.

The crux of LogistiCare’s argument is the statutory reference in the FCA to

“the action.” According to LogistiCare, the government’s option when presented with

a sealed FCA complaint is either to “proceed with the action,” or to “decline[] to take

over the action.” 31 U.S.C. 3730(b)(4). And “the action,” LogistiCare insists,

necessarily refers to the entire lawsuit. In support of this position, LogistiCare points

to (1) the Federal Rules of Civil Procedure, which provide that “there is one form of

action—the civil action,” Fed. R. Civ. P. 2, (2) the FCA, which allows the relator to

bring (and the government to intervene in) “a civil action,” 31 U.S.C. 3730(b)(1), and

(3) the Utah district court decision in Brooks.

The Court is not convinced. Other courts have not been either. Indeed, as

Relators point out, decisions both before and after Brooks have concluded that the

reference to “the action” does not foreclose the possibility of the relator proceeding

with non-intervened claims. See, e.g., United States v. Berkeley Heartlab, Inc., 225 F.

Supp. 3d 487, 505 (D.S.C. 2016) (noting that “[t]he Government partially intervened

regarding the waiver of insurance copays and deductibles,” but that “[b]ecause the

Government elected not to intervene with regard to [the relator’s] allegations

involving the payment of speaker’s fees or the waiver of private insurance copays and

deductibles, [the relator] has ‘the right to conduct the action’” as to those claims)

(quoting 31 U.S.C. § 3730(c)(3)). Indeed, those courts that have expressly considered

Brooks have rejected it. (See Relators’ Not. of Supp. Auth., Doc. 82 (citing United

States ex rel. Rauch v. Oaktree Med. Ctr., P.C., No. 6:15-cv-1589, 2020 WL 1065955

*9 (D.S.C. March 5, 2020) (“After examining the FCA statute as a whole, the Court is

persuaded that ‘action’ means ‘cause of action’ and not ‘civil action.’ Therefore, the

Court declines to adopt the reasoning of the Brooks court, which is an outlier in a

large body of FCA case law.”); United States ex rel. Ormsby v. Sutter Health, 444 F.

Supp. 3d 1010, 1077 (N.D. Cal. 2020) (“Given the clear weight of authority that allows

a relator to pursue non-intervened claims, the court follows that approach (and not

Brooks) as persuasive.”); United States ex rel. Fischer v. Cmty. Health Network, 2020

U.S. Dist. Lexis 221082 *13 (S.D. Ind. Nov. 25, 2020) (noting that “[t]he Court

disagrees” with Brooks)).

Of course, the mere fact that other courts have rejected Brooks’s holding, in

and of itself, is not enough to make that holding incorrect. Brooks, like LogistiCare

here, basically argues that under a plain language reading, “action” means the entire

case. But the problem is that, in arriving at that result, Brooks appears to over-parse

the statutory language, without considering the broader statutory context.

That approach can lead one astray when it comes to the FCA. As now-Justice,

then-judge, Alito once observed, “the draftsmanship of the qui tam statute has its

quirks … and one of those quirks is that the statute is based on the model of a single-

claim complaint.” United States ex rel. Merena v. SmithKline Beecham Corp., 205 F.3d

97, 101 (3d Cir. 2000), as amended (Apr. 21, 2000). In other words, that statute is

written as though every FCA claim consisted of a single claim against a single

defendant. For example, 31 U.S.C. § 3730(b), in describing the “civil action” that a

“person” may bring, repeatedly refers to “the defendant.” Of course, if the sole claim

pursued in this action were for a single violation of the FCA by a single defendant,

LogistiCare’s desired outcome would follow as a matter of course. Where there is only

one claim and one defendant, either the government or the private party is pursuing

that claim, not both.

But when there are multiple claims and multiple parties, things get trickier.

The government’s right, after all, is either to “proceed with the action” or “decline to

take over the action.” 31 U.S.C. § 3730(b)(4). Thus, under LogistiCare’s proposed

single-action rule, partial intervention presumably should not be allowed at all. If the

government wanted to partially intervene (i.e., intervene as to only some claims or

some defendants), the only way to achieve that result would be for the government to

take over the entire action, and then move to dismiss the claims (and parties) that it

elects not to pursue under 31 U.S.C. § 3730(c)(2)(a). Indeed, LogistiCare essentially

argues that the Court should treat the government as having impliedly done that

here.

That observation highlights at least one potential problem with LogistiCare’s

argument: because the statute provides an express mechanism to accomplish that

very result, the Court is not generally predisposed to find that Congress also meant

to include in the statute an implied, yet unmarked, route to that same destination.

The existence of an express path to achieve dismissal also highlights another

shortcoming in LogistiCare’s implied-dismissal view of partial intervention under the

FCA. When the government follows that path for dismissal that the FCA expressly

provides, the relators have certain procedural rights to object and be heard. 31 U.S.C.

§ 3730(c)(2). But the implied dismissal route that LogistiCare urges here would result

in relators losing such rights—the case would continue as to the intervened claims,

with the other claims tacitly dismissed. In light of the statute’s express provisions as

to how the government could achieve that end (and the related procedural rights

conferred on relators), the Court sees no reason to read LogistiCare’s implied-

dismissal theory into the statute.

Nor do the other concerns that LogistiCare raises change that result. According

to LogistiCare, allowing the Relators to continue means that the ship has “two

masters.” Not so. Each claim has a single master. The government is the master of

the claims as to which it intervened, and Relators are the master as to the others.

The Court acknowledges that things could get a little messier if the

government had intervened as to only some of the claims against a single defendant.

Imagine the government considers some of the claims against that defendant to be

strong (as to which it intervenes), and others against that same defendant to be

weaker (as to which it does not). In that setting, LogistiCare’s concern—that the

relators’ pursuit of the non-intervened claims may interfere with the government’s

pursuit of the intervened claims—seems like a genuine possibility.

But the Court offers two responses. First, perhaps “action” in the FCA is

properly understood to refer to the entirety of the claims as to a given defendant. After

all, the same section of the FCA that gives the government the right to intervene in

“the action,” repeatedly refers to “the defendant” in “the action.” See 31 U.S.C.

§ 3730(b)(2) (“The complaint shall be filed in camera, shall remain under seal for at

least 60 days, and shall not be served on the defendant until the court so orders.”);

§ 3730(b)(3) (“The defendant shall not be required to respond to any complaint filed

under this section ….”); § 3730(c)(2)(B) (“The Government may settle the action with

the defendant ….”). Read in context, then, one could understand “the action” in that

same statutory provision to refer to all of the claims asserted against the single

defendant to which that section likewise refers. If that is correct, the government’s

decision not to pursue specific claims against a particular defendant as to which it is

intervening would result in tacit dismissal of those claims against that defendant. So,

Brooks would be right, but only as to the pursuit of non-intervened claims against a

particular defendant as to which the government has intervened in part.

But, even if that is the appropriate reading of the FCA, an issue the Court need

not, and thus does not, reach, that would offer no assistance to LogistiCare here. The

government has not intervened as to some of the claims against LogistiCare. Rather,

LogistiCare asserts implied dismissal based on the fact that the government

intervened as against a different party (Mobile Care), but did not intervene against

LogistiCare. The contextual argument above about what “the action” means in the

context of separate claims against a specific defendant offers LogistiCare no support

for the result it seeks here.

Separately, as a practical matter, even in the multiple-claims-against-one-

defendant setting described above, the statute affords the government the ability to

protect itself against the concern that LogistiCare raises, i.e., that the relators’

pursuit of the non-intervened claims may harm the government’s pursuit of the

intervened claims. First, as already noted, if the government has that concern in a

given matter, the government certainly could assume all claims against the

defendant as to whom it is intervening, and then settle those that it deems to be weak.

Moreover, if the government determines after the fact that the relators’ pursuit of the

non-intervened claims is causing problems, the government may request that the

court “limit[] the participation by [the relator] in the litigation.” 31 U.S.C.

§ 3730(c)(2)(C). In short, the Court need not adopt a single-action reading of the FCA

to protect against the concerns that LogistiCare raises.

It also bears mentioning that, while Mobile Care supports LogistiCare’s

argument on this implied-dismissal-under-the-FCA point (see MC Mot. to Dismiss

Gov’t Compl., Doc. 51, #400), Mobile Care does not suggest that this principle requires

dismissal of Relator White’s individual claims against Mobile Care. But why not? If

there is in fact a single action for any qui tam suit under the FCA, as LogistiCare

argues, then presumably the government either must take over that “action” or not.

But “the action,” understood that way, would include the individual claims, which the

government of course cannot assume. Reading the FCA to require the government to

assume individual claims that the government cannot assume would be an odd result,

but so far as the Court can tell, that result follows directly and unalterably from

LogistiCare’s reading of the term “the action.”

In the end, the Court certainly agrees with Justice Alito—the FCA is no model

of draftsmanship. Or as Justice Alito put it more recently writing on behalf of the

Supreme Court in Kellogg Brown & Root Services, Inc. v. United States, ex rel. Carter,

575 U.S. 650, 664 (2015), “[t]he False Claim Act’s qui tam provisions present many

interpretive challenges,” and it can be difficult “to make them operate together

smoothly like a finely tuned machine.” That being said, this Court finds that the

statutory term “the action,” when read in context, does not mean the entire lawsuit

in the context of a multi-defendant FCA case. Accordingly, the Court holds that the

government’s decision to intervene as to the FCA claims against Mobile Care does

not preclude Relators from pursuing their non-intervened FCA claims against a

separate defendant, LogistiCare.

2. The Second Amended Complaint Sufficiently Alleges An FCA

Claim Against LogistiCare.

As described above, aside from its partial-intervention argument, LogistiCare

also seeks dismissal on the merits of the FCA claims. That argument does not work

either.

It is important to recall that the Relators’ only burden at this stage is to allege

a plausible claim. Here, Relators allege that LogistiCare has caused claims to be

submitted for ambulance transport despite knowing that such transport was not

medically necessary. In particular, LogistiCare has continued to arrange for

companies like Mobile Care to provide such transportation services for particular

patients, even after learning that such services are not medically necessary for those

patients. Assuming these allegations are true, as the Court must, both LogistiCare

(in connection with arranging the transport service) and companies like Mobile Care

(in connection with providing the transport service) have knowingly made claims (or

caused claims to be made) for, and indeed also received, funds to which they are not

entitled under the terms of the government healthcare programs. That makes out a

plausible FCA claim.

LogistiCare takes on that argument in two steps. First, it says that Relators

have failed to sufficiently allege non-medically-necessary transport for anyone other

than participants in MyCare Ohio, which is only one of the multiple government

healthcare programs otherwise at issue in this action. Second, LogistiCare asserts

that the payment structure for MyCare Ohio forecloses an FCA claim. In particular,

the government pays a “capitated” rate—meaning a set amount per person who

participates in the program. Thus, even if ambulance transport was over-provided to

MyCare Ohio participants, no extra government funds were spent, and as a result,

LogistiCare says, an FCA claim will not lie.

Because the Court’s resolution of the latter capitated-payment point obviates

the need to discuss the sufficiency of the allegations relating to other government

healthcare programs, the Court starts with that issue. FCA liability turns on the

presentation of a false claim. See 31 U.S.C. § 3729(a)(1). And here, “LogistiCare does

not dispute that Relators have alleged ‘claims’ under [the FCA’s] definition.” (LC

Reply on Mot. to Dismiss, Doc. 71, #715). But, LogistiCare says, Relators must also

allege that the defendant made a material false statement in connection with that

claim, a proposition it finds in United States ex rel. Sheldon v. Kettering Health

Network, 816 F.3d 399, 308 (6th Cir. 2016). And that, LogistiCare claims, is where

the second amended complaint falls short.

This argument starts on firm legal footing. Here, Relators seek to pursue

claims under both 31 U.S.C. §§ 3729(a)(1)(A) and (a)(1)(B). The statutory text of the

latter expressly includes a materiality requirement. And, even though the former

provision does not directly mention materiality, the Supreme Court has nonetheless

confirmed that claims under this provision likewise require a showing of materiality

in order to succeed. See Universal Health Services v. United States ex rel. Escobar,

136 S. Ct. 1989, 1996 (2016). Thus a plausible allegation of material falsity is required

in order to survive dismissal under either section. Moreover, as already discussed

above, there is no dispute as to what materiality means under the FCA. A statement

is material if it tends to influence the payment or receipt of money. See 31 U.S.C.

§ 3729(b)(4).

Of course, there is little question that the statements regarding medical

necessity here led to the payment of funds, so that would seem to meet the FCA’s

definition of materiality. But LogistiCare says not so fast, money means government

money. And, in particular, the claim must lead to the payment of more government

money, which under the MyCare Ohio payment structure cannot happen. And,

without an increased demand on the public fisc, LogistiCare argues, FCA liability

cannot arise.

Two problems with that. First, the argument relies on LogistiCare’s

representations about how the MyCare Ohio payment structure actually works.

Those details are not included in the second amended complaint, nor in the

government’s complaint-in-intervention. LogistiCare instead asks the Court to take

“judicial notice” of these facts. But the source to which it points—which appears to be

a report for the Centers for Medicare and Medicaid Services (see Doc. 60, #571–72)—

is not necessarily the kind of source on which the Court would typically rely for

purposes of “judicial notice.” At the very least, the Court is not certain of how

authoritative this report is, or whether it provides an adequate basis for such notice.

And, given how central these facts are to LogistiCare’s claim, that gives the Court

pause.

The Court need not get to the bottom of that, though, as, even assuming that

the federal government’s payments to Aetna under the MyCare Ohio program are

capitated, the Court does not agree that this would prevent LogistiCare’s statements

from being material. As pled in the second amended complaint, LogistiCare’s

practices led to LogistiCare and Mobile Care themselves receiving additional money

to which they were not entitled from an entity that is funded at least in part by federal

funds. Accordingly, the alleged conduct did “tend to influence” the payment of money.

To be sure, the entity paying the money (i.e., apparently Aetna) will not receive any

additional federal funds as a result of these two defendants receiving the alleged

payments. But that is beside the point.

LogistiCare argues otherwise, citing various cases involving capitated

payments. But so far as the Court can tell, those cases involve a factual setting that

differs in an important manner. In those cases, the defendant itself was the recipient

of the capitated funding. That matters because, in such cases, the misrepresentation

does not (indeed, cannot) result in the misrepresenting entity itself receiving more

funds. So, for example, if a hospital receives $1000 per program participant per year

to provide care, reporting (or even providing) unnecessary surgical procedures will

not increase the amount that the hospital receives. In that context, legitimate

questions could be raised as to whether that type of misreporting is “material” for

FCA purposes. But here, there does not appear to be any dispute that Mobile Care

and/or LogistiCare themselves are alleged to have received more money as a result of

the allegedly false reports.

LogistiCare counters that the alleged overpayments nonetheless will not come

from the public fisc, and that this is a line in the sand that the FCA cannot cross. But

LogistiCare’s assertion about the public fisc is not exactly true. A portion of the

funding for MyCare Ohio (a capitated portion to be sure, but a portion nonetheless)

comes from the “public fisc.” Accordingly, if LogistiCare and Mobile Care are receiving

payments from Aetna to which they are not entitled, some of the additional money

those entities are receiving in fact could be said to come from the federal government.

To be sure, the federal government may not pay more, but the Defendants may receive

more of the federal funds that the administrator (Aetna) was already paid.

Nor is there any question that Aetna is a recipient of federal funds who is

“spen[ding] or us[ing] [the money] on the Government’s behalf or to advance a

Government program.” See 31 U.S.C. § 3279(b)(2). And, as noted, there likewise can

be no question that the federal government has “provided [a] portion of the money …

requested.” Id. Thus, Aetna is essentially “the government” for purposes of a claim

under the FCA, meaning that anything that “tends to influence” the payment of

claims under the Aetna-administered government program would be “material” for

FCA purposes. On that front, as noted, there is no question that the Relators are

alleging that the statements at issue “tended to influence” the payments that the

Defendants received. That is enough for an FCA claim.

In sum, the Court finds that Relators have the right to pursue their FCA claims

against LogistiCare, and that they have plausibly alleged such a claim for Rule

12(b)(6) purposes. Thus, the Court DENIES LogistiCare’ Motion (and Amended

Motion) to Dismiss the Second Amended Complaint (Docs. 59 and 60).

B. Mobile Care’s Motion To Dismiss The Government’s Complaint-In-

Intervention Fails.

Having addressed LogistiCare’s Motion to Dismiss, the Court next turns to

Mobile Care’s Motion to Dismiss the government’s complaint-in-intervention. As

described above, that motion presses three arguments. First, it argues that the

government has failed to allege an FCA claim, as it has not alleged that Mobile Care

acted “knowingly” in connection with the alleged violation. Second, it argues that the

government’s other claims turn on the validity of the FCA claims, so the failure to

adequately allege an FCA claim renders these claims invalid as a matter of law, as

well. Finally, it challenges venue.

The Court starts with Mobile Care’s last argument first—venue. Mobile Care

tacitly concedes that the Relators’ second amended complaint alleges that

LogistiCare engaged in conduct in the Southern District of Ohio, thereby establishing

a basis for venue here. According to Mobile Care, though, LogistiCare is correct that

the Relators’ claims against LogistiCare fail as a matter of law, and thus “the

government cannot use alleged conduct by LogistiCare in the Southern District of

Ohio to establish venue.” (MC Mot. to Dismiss Gov’t Compl., Doc. 51, #401). But, as

the Court has concluded that the Relators’ second amended complaint states

plausible FCA claims against LogistiCare, the predicate for Mobile Care’s venue

argument is not met. Thus, as LogistiCare will remain a party in this action, the

Court DENIES Mobile Care’s motion to transfer venue.

Next, the Court turns to Mobile Care’s arguments on the merits. The Court

rejects those arguments for two reasons. First, Mobile Care is essentially arguing

that it has an innocent (or at least merely negligent) explanation for all of the facts

that the government has alleged relating to Mobile Care’s billings. That may well be

the case. But a motion to dismiss is not the proper vehicle to assess which of two

competing explanations of the facts are accurate. The allegations in the government’s

complaint plausibly show that Mobile Care knowingly submitted false claims for

ambulance transport that was not medically necessary, and the allegations provide

sufficient details regarding the specific examples it offered to allow defendants

“reasonably to pluck out” those claims “from all the other claims they submitted.” See

United States ex rel. Owsley v. Fazzi Assocs., Inc., No. 19-4240, 2021 WL 4771702, at

*3 (6th Cir. Oct. 13, 2021). If Mobile Care can show that it in fact did not make false

claims, either as to the five specified examples, or others identified during discovery,

Mobile Care will be entitled to prevail at trial, or perhaps even at summary judgment.

But it is not entitled to dismissal of the complaint. Thus, the FCA claims can move

forward.

Finally, the Court’s determination on the FCA claims dooms Mobile Care’s

arguments on the government’s other claims. Mobile Care’s only real argument on

those claims was that these claims relied on the existence of a viable FCA claim,

which Mobile Care insisted was not present here. But, as the Court disagrees with

Mobile Care on that front, Mobile Care’s argument as to these other claims

necessarily fails, as well.

Accordingly, the Court DENIES Mobile Care’s motion to dismiss the two FCA

claims, the unjust enrichment claim, and the payment by mistake claim.

C. Mobile Care’s Motion To Dismiss The Relators’ Second Amended

Complaint Fails.

That leaves Mobile Care’s Motion to Dismiss the Second Amended Complaint

(Doc. 58). In this motion, as described above, Mobile Care argues that the FCA

retaliation claim and the two pendent state law wrongful termination claims fail as

a matter of law. Separately, Mobile Care again argues that venue is improper here.

1. Mobile Care’s Venue Challenge Fails For The Same Reason As It

Did When Asserted Against The Government’s Complaint.

Once again, the Court starts with this last argument first. As was the case

with Mobile Care’s venue challenge to the government’s complaint, the venue

argument here hinges on Mobile Care’s assertion that the claims against LogistiCare

fail as a matter of law. The Court disagrees. Thus, Mobile Care’s venue argument

fails right out of the chute, and the Court thus DENIES the motion to transfer venue.

2. White Has Adequately Alleged An FCA Retaliation Claim.

The Court next turns to the FCA retaliation claim. As Relators concede, to

adequately plead such a claim, the plaintiff must allege three elements: (1) that the

employee was engaged in protected activity, (2) that the employer knew that the

employee was engaged in protected activity, and (3) that the employer discharged or

otherwise discriminated against the employee as a result of the protected activity.

(See Opp. to Mot. to Dismiss SAC, Doc. 65, #589).

a. White Alleges She Was Engaged In Protected Activities.

Let’s start with the “engaged in protected activity” element. Mobile Care’s

argument on this element stumbles a bit right at the outset because Mobile Care

claims that the retaliation provision applies only to activities undertaken in

furtherance of a potential False Claims Act suit, and that the allegations here fail to

show that Relator White was acting in furtherance of such a suit before the time of

her dismissal. (MC Mot. to Dismiss SAC, Doc. 58, #509). But, as Relators correctly

point out, the 2009 amendments to the FCA broadened coverage under the retaliation

provision. (Opp. to Mot. to Dismiss SAC, Doc. 65, #590). In its reply, Mobile Care does

not argue otherwise, meaning it appears all parties now agree that retaliation

extends to activities beyond those in furtherance of a qui tam suit.

That being said, though, Relator White must still plausibly allege some

“protected activity.” On that front, the Relators’ second amended complaint alleges

that White “continued to insist that claims to Medicare for ambulance transport be

billed to Government healthcare programs only if medical necessity both existed and

was documented, and also that all other payment requirements were satisfied.” (SAC,

Doc. 53, #459). It likewise provides an example in which Relator White allegedly

contacted CMS (the agency responsible for overseeing Medicare) to confirm that a

particular transport as to a particular patient did not meet the requirements for

medical necessity, and then informed her supervisor of that confirmation (but then

Mobile Care nonetheless continued billing for transport for that patient anyway). (Id.

at #473–74). At least at the pleading stage, those strike the Court as sufficient to

plausibly allege that Relator White was engaged in efforts to prevent what she

characterizes as false claims on government healthcare programs. Again, alleging is

far different from proving, but at this stage only the former matters.

Mobile Care argues otherwise. It starts by noting that, even under the

amended FCA, retaliation claims apply only to “efforts to stop” an FCA violation, not

mere “expressions of interest of concern about compliance-related issues.” (MC Reply

in Supp. of Mot. to Dismiss SAC, Doc. 70, #687). And Mobile Care further observes

that the alleged activity must “stem from a reasonable belief that fraud is being

committed.” (Id. (quoting Fakorede v. Mis-S. Heart Ctr., P.C., 709 Fed. App’x 787, 789

(6th Cir. 2017))). But what of it? Relator White does not allege she merely had some

kind of passing interest in Medicare compliance as an abstract matter, but rather

that her interest in such matters was directed at attempting to stop Mobile Care’s

allegedly fraudulent billing practices. And, as chief of Mobile Care’s billing-

compliance efforts, her belief that fraud was occurring, based on the facts alleged,

plausibly seems “reasonable,” at least for pleading purposes.

None of this is to say that Mobile Care may not succeed on this defense. But,

once again, Mobile Care appears to be pressing at the motion to dismiss stage

arguments that, assuming the facts play out as Mobile Care suggests they will, would

be better made at the summary judgment stage. Indeed, many, if not most, of the

cases it cites on this issue are summary-judgment-stage cases.

For purposes of a motion to dismiss, Relator White has sufficiently pled the

first element.

b. White Alleges Mobile Care Was On Notice.

Next, Relator White must plausibly allege that Mobile Care was on notice of

her protected activities. She clears that hurdle. To start, she specifically states that

she “regularly informed [Mobile Care] that these claims were not legally compliant

with requirements of the Government healthcare programs.” (SAC, Doc. 53, #480).

That reflects not only a protected activity (trying to prevent a fraudulent claim), but

also that Mobile Care had knowledge of her engaging in that protected activity (as

she was voicing her concerns directly to Mobile Care management). Indeed, one would

imagine that a typical way in which a company receives notice of FCA-protected

activities is when a whistleblower first attempts to raise concerns within a company,

only to later choose to file suit. That appears to be the case, for example, as to many

of the cases on which Relators rely. (See Opp. to MC Mot. to Dismiss SAC, Doc. 65,

#597).

Mobile Care again urges a different result. According to Mobile Care, because

Relator White’s job was to improve compliance with billing practices, her internal

complaints about billing practices merely reflect her doing her job, and thus could not

suffice to put Mobile Care on notice. That strikes the Court as a bit of a reach. To be

sure, if an employee charged with overseeing compliance were merely to tell

management, “we could do a better job on substantiating our claims,” that may not

suffice. In that circumstance, the employee is not necessarily even asserting that a

given claim is fraudulent, let alone trying to dissuade the employer from asserting

additional claims. But, whether or not that would suffice, Relator White alleges more

here. Indeed, she provides an example of one patient as to whom she affirmatively

obtained confirmation from the government agency in charge of Medicare that

ambulance transport would not count as medically necessary, and that she told

management of that fact, but that management nonetheless submitted “dozens” more

claims for that patient. (SAC, Doc. 53, #473–74). At least for pleading purposes, that

works.

c. Relator White Has Adequately Alleged An Adverse

Employment Action Caused By The Allegedly Protected

Conduct.

The final element Relator White must plead to move forward with her claim is

comprised of two sub-elements: (1) an adverse employment action, that was (2) caused

by the employer’s knowledge of her protected activities. See Bourne v. Provider Servs.

Holdings, LLC, No. 1:12-CV-935, 2019 WL 2010596, at *3 (S.D. Ohio May 7, 2019).

Start with the former. Relator White alleges two adverse employment actions.

She first says that Mobile Care demoted her in an attempt to prevent or minimize

her interference in the allegedly fraudulent billing. (SAC, Doc. 53, #431). Separately,

she alleges that Mobile Care fired her. (Id. at #432). Either of those would suffice

(assuming she can show a causal link) to constitute an adverse employment action.

That leaves causation. Admittedly, White’s allegations as to a causal link

between the FCA-protected activities and the two adverse actions noted above require

something of an inferential leap, but it is really more of a hop. According to Relator

White, her insistence on compliance with government requirements was costing

Mobile Care money, thus providing Mobile Care an economic incentive to remove her

as an impediment to the allegedly unlawful billing. (See id. at #457–59). As separate

support for the causal link, Relator White alleges that, when Mobile Care terminated

her, it offered her $15,000 in what she claims amounted to a form of hush money to

remain quiet about the alleged violations. (See id. at #459–60). Either or both of these

allegations could easily prove false or mistaken, but separately or together they give

rise to at least a plausible inference that Mobile Care’s employment actions regarding

Relator White were undertaken in response to her alleged efforts to prevent

fraudulent billing.

Especially given that both parties agree that “pleading causation is not

difficult,” (see MC Reply in Supp. of Mot. to Dismiss SAC, Doc. 70, #693 (“Mobile Care

agrees with Relators’ contention that ‘[p]leading causation is not difficult ….’”)),

Relator White clears that low bar.

In sum, given the pleading standards that apply in federal court, even post-

Iqbal and Twombly, Relator White has validly stated an FCA retaliation claim. Thus,

the Court DENIES the motion to dismiss that claim.

3. Mobile Care’s Argument Against White’s State-Law Claims Fails.

Finally, Mobile Care moves the Court to dismiss White’s state-law wrongful

termination claims. (MC Mot. to Dismiss SAC, Doc. 58, #514). That argument

requires little by way of analysis, though, as Mobile Care’s sole argument in support

of that dismissal is its claim that White has failed to state a valid FCA retaliation

claim, coupled with its assertion that White cannot resurrect a failed FCA claim in

the guise of state-law wrongful termination claims. As the Court already has rejected

Mobile Care’s argument on the FCA retaliation claim, this argument necessarily fails,

as well.

D. ModivCare’s Motion To Amend To Certify For Interlocutory Appeal.

Having addressed the merits of the various issues raised above, the Court now

turns to the motion precipitating the amendments included in this Amended Opinion

and Order. On November 10, 2021, 23 days after the Court’s entry of the original

Order (Doc. 86) regarding LogistiCare’s Motion to Dismiss Relators’ Second Amended

Complaint (Docs. 59 (original) and 60 (amended)), ModivCare Solutions, LLC (i.e.,

the entity formerly known as LogistiCare) moved this Court to amend the Order to

certify it for interlocutory appeal under 28 U.S.C. § 1292(b). (Mot. to Amend to Certify

for Interlocutory Appeal, Doc. 92). ModivCare argues that the Order satisfies the

requirements of § 1292(b) specifically as to the question of whether “allegedly false

claims submitted to healthcare programs that the United States funds through fixed,

capitated payments can be material under the [False Claims Act].”4 (Id. at #1031).

Having considered the parties’ briefing (Docs. 92, 98, 99, 100), the Court concludes

that the Order satisfies the prerequisites of 28 U.S.C. § 1292(b) in that (1) the Order

involves a controlling question of law, (2) as to which there is substantial ground for

difference of opinion, and (3) an immediate appeal from the Order may materially

advance the ultimate termination of the litigation.

For purposes of § 1292(b), “[a] legal issue is controlling if it could materially

affect the outcome of the case.” W. Tenn. Chapter of Associated Builders &

Contractors, Inc. v. City of Memphis, 293 F.3d 345, 351 (6th Cir. 2002) (citing In re

Baker & Getty Fin. Servs., Inc., 954 F.2d 1169, 1172 n.8 (6th Cir. 1992)). Resolution

of the question ModivCare identifies above would materially affect the outcome here.

If the Sixth Circuit were to conclude that allegedly false claims submitted to

4 The Court recognizes—as does ModivCare—that certification under § 1292(b) “applies to

the order certified,” Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199, 205 (1996), and

that “even those issues not properly certified are subject to [the Sixth Circuit’s] discretionary

power of review if otherwise necessary to the disposition of the case,” Pinney Dock & Transp.

Co. v. Penn. Cent. Corp., 838 F.2d 1445, 1455 (6th Cir. 1988). The Court adopts ModivCare’s

framing of the issue only insofar as it aids the Sixth Circuit’s review.

intermediaries receiving only “capitated” funding from the United States cannot be

“material” under the FCA, the Relators’ Complaint would fail to the extent it alleges

such a theory. In this way, immediate appeal also would, at least as to ModivCare,

“materially advance the ultimate termination of the litigation”—litigation which has

already lasted over six years. And, while the Court concludes, for the reasons

discussed above, that it correctly analyzed the issue that ModivCare raises in its

motion to certify, the Court concedes that “reasonable jurists might disagree” on the

appropriate resolution of that issue. In re Trump, 874 F.3d 948, 952 (6th Cir. 2017)

(“A substantial ground for difference of opinion exists where reasonable jurists might

disagree on an issue’s resolution ….” (quoting Reese v. BP Exploration, Inc., 643 F.3d

681, 688 (9th Cir. 2011))).

CONCLUSION

For the reasons stated above, the Court DENIES LogistiCare’s Motion to

Dismiss Relators’ First Amended Complaint (Doc. 50) and Mobile Care’s Motion to

Dismiss Relators’ First Amended Complaint (Doc. 52), as moot. The Court further

DENIES: (1) Mobile Care’s Motion to Dismiss the Government’s Complaint in

Intervention (Doc. 51); (2) Mobile Care’s Motion to Dismiss Relators’ Second Amended

Complaint (Doc. 58); and (3) LogistiCare’s Motion to Dismiss Relators’ Second

Amended Complaint (Docs. 59 (original) and 60 (amended)). To the extent that Mobile

Care separately moves for a transfer of venue in the motions cited above, the Court

DENIES that request, as well.

However, the Court GRANTS ModivCare’s (formerly known as LogistiCare)

Motion to Amend to Certify for Interlocutory Appeal (Doc. 92). As such, the Court

hereby CERTIFIES that this Amended Opinion and Order “involves a controlling

question of law as to which there is substantial ground for difference of opinion” and

“an immediate appeal from the order may materially advance the ultimate

termination of the litigation.” See 28 U.S.C. § 1292(b). That said, the Court expressly

notes that it declines to stay the current proceedings in connection with that

certification, although it recognizes that “the Court of Appeals or a judge thereof”

may order such a stay, should that court deem it appropriate. See id.

SO ORDERED.

December 21, 2021

DATE DOUGLAS R. COLE

UNITED STATES DISTRICT JUDGE

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