# United States v. Rochester Regional Health

> District Court, W.D. New York · June 11, 2025

URL: https://www.frixlaw.com/law-library/cases/11069695

## Case

- **Court:** District Court, W.D. New York
- **Decided:** June 11, 2025
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/11069695

## How later opinions describe it (automated extraction)

- concluding that the government’s response showed strong evidence that the requirements at issue were not material, where it investigated the allegations and did not disallow any charged costs

## Opinion text

UNITED STATES DISTRICT COURT STATES DISTRIGS
WESTERN DISTRICT OF NEW YORK Comin
JUN 11 2025
DNBORAT COME AD. AMERICA ex rel.

Plaintiff/Relator,
v. 23-CV-438 (JLS)

ROCHESTER REGIONAL HEALTH and
UNITED MEMORIAL MEDICAL
CENTER,
Defendants.

DECISION AND ORDER
Relator Deborah Conrad brought this False Claims Act (“FCA”) case against
Rochester Regional Health and United Memorial Medical Center (collectively,
“RRH”). Dkt. 1, 34. RRH moved to dismiss Relator’s amended complaint. See Dkt.
37-38. For the reasons set forth below, the motion to dismiss is granted in part and
denied in part.
PROCEDURAL HISTORY
Relator Conrad filed the original complaint under seal on May 17, 2023. Dkt.
1. The United States declined to intervene, Dkt. 7, and the Court unsealed the case.
Dkt. 8.
RRH filed a motion to dismiss on May 28, 2024. Dkt. 21. Relator responded
(Dkt. 27), and RRH replied. Dkt. 28. The parties appeared for oral argument on

August 20, 2024, and this Court granted the motion to dismiss with leave to amend.
See Dkt. 29-30.
Relator then filed an amended complaint that RRH again moved to dismiss.
Dkt. 34, 37-38. Relator responded (Dkt. 45), and RRH replied. Dkt. 46. The Court
held oral argument on March 11, 2025. See Dkt. 47.
AMENDED COMPLAINT
Relator alleges that RRH violated the FCA because it knowingly failed to
report adverse events to the Vaccine Adverse Event Reporting System (“VAERS”)!,
but nevertheless submitted claims for payment to the United States, through the
Centers for Disease Control and Prevention’s (“CDC”) COVID-19 Vaccination
Program. See Dkt. 34 3.
Relator is a Physician Assistant. Id. § 11. She was employed by RRH until
she was fired on October 6, 2021. Id. J] 49, 90. During her employment, Relator
allegedly observed RRH disregard its reporting obligations. Id. § 5. Relator alleges
that RRH submitted “thousands” of claims for payment, despite failing to comply
with its reporting obligations. Id. { 6.
She also alleges that she saw RRH patients suffer serious adverse events
following the COVID shot. Jd. § 53. And she learned that these events must be
reported through VAERS. Id. { 54. Because Relator had concerns about RRH’s
reporting efforts, she took the initiative to submit VAERS reports on her own,

1 VAERS is a “national early warning system to detect possible safety problems in
vaccines used in the United States.” VACCINE ADVERSE EVENT REPORTING SYSTEM,
https://vaers.hhs.gov/reportevent.html (last visited June 9, 2025).

sometimes even after her shift ended. See id. § 55. She allegedly submitted 160
VAERS reports. Jd. But she claims the problem “escalated” from May 27, 2021 to
October 6, 2021, when RRH prevented her from submitting 170 serious adverse
events to VAERS. Id. { 5.
Noteworthy here, Relator alleges specific examples, including:
e Patient E.F., who presented with sudden shortness of breath and
fatigue, one day after receiving the vaccine;
e Patient S.B., who experienced syncope, convulsions, fevers, chills, and
myalgias, one day after receiving the vaccine;
e Patient J.F., who presented with arm pain and induration, three days
after receiving the vaccine;
e Patient M.D., who was admitted due to hypertensive urgency;
e Patient N.M., who was admitted for bradycardia, AMS, and weakness;
e Patient D.A., who experienced an unknown illness; and
e Patient C.M., who experienced dizziness and unsteady gate.
Id. § 91.
RRH had administered COVID shots to Patients M.D., N.M., D.A., and C.M.,
but the provider for the remaining patients in paragraph 91 is “unknown.” Id.
Relator claims that she tried numerous times to escalade the issue to her
higher leadership, but she was turned away. See, e.g., id. J] 57, 68, 65, 68, 69, 70,
71, 72, 73, 74, 75, 77, 78, 81, 86, 87. She further alleges that RRH knew it needed to
report to VAERS, but failed to provide proper education and training to staff. See

id. {{{ 58, 68, 76. RRH fired Relator after her several attempts to address the issue
with RRH. See id. 90.
Relator alleges that RRH, as a vaccination provider, must report to VAERS
under statute and contract. Id. {| 44. She asserts that VAERS reporting is
mandatory under statute—specifically, the National Childhood Vaccine Injury Act
(“NCVIA”) and the emergency use authorization provisions under the Food, Drug
and Cosmetic Act, 21 U.S.C. § 360bbb-3 (““EUA”). See id. J§ 6, 19-38. She also
alleges that RRH’s reporting obligation is an “express material condition” of
payment under the Vaccination Program Provider Agreement (“Provider
Agreement”) that RRH agreed to. Id. J] 6, 39-48.
The amended complaint contains claims for: (1) presenting and causing false
claims, in violation of 31 U.S.C. § 3729(a)(1)(A), see id. |] 123-27; (2) false records,
in violation of 31 U.S.C. § 3729(a)(1)(B), see id. ¢] 128-33; (3) conspiracy, in
violation of 31 U.S.C. § 3729(a)(1)(C), see id. 134-39; (4) reverse false claims, in
violation of 31 U.S.C. § 3729(a)(1)(G), see id. 9 140—48; (5) retaliation, in violation
of 31 U.S.C. § 3730(h), see id. | 149-56; and (6) violation of New York Labor Laws
§§ 740 and 741, see id. 157-61.
LEGAL STANDARDS
I. Motion to Dismiss
On a motion pursuant to Federal Rule of Civil Procedure 12(b)(6), a “court’s
task is to assess the legal feasibility of the complaint.” Lynch v. City of New York,
952 F.3d 67, 75 (2d Cir. 2020). The court “must take the facts alleged in the

complaint as true, drawing all reasonable inferences in [the plaintiffs] favor.” In re
NYSE Specialists Sec. Litig., 503 F.3d 89, 91 (2d Cir. 2007). To survive a Rule
12(b)(6) motion, a complaint must contain sufficient factual matter, accepted as
true, to “state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) Gnternal quotation marks and citation omitted). Courts “are
not bound to accept as true a legal conclusion couched as a factual allegation,” and
“(t]hreadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Jd. Gnternal quotation marks and citation
omitted).
This standard demands “more than a sheer possibility that a defendant has
acted unlawfully.” Jd. Plausibility depends on many considerations: “the full
factual picture presented by the complaint, the particular cause of action and its
elements, and the existence of alternative explanations so obvious that they render
[the] plaintiffs inferences unreasonable.” Fink v. Time Warner Cable, 714 F.3d 739,
741 (2d Cir. 2018) (internal quotation marks and citation omitted).
II. False Claims Act and Rule 9(b)
The False Claims Act is an anti-fraud statute “enforced not just through
litigation brought by the Government itself, but also through civil qui tam actions
that are filed by private parties, called relators, in the name of the
Government.” United States ex rel. Chorches for Bankr. Est. of Fabula v. Am. Med.
Response, Inc., 865 F.3d 71, 81 (2d Cir. 2017) (quoting Kellogg Brown & Root
Servs., Inc. v. United States ex rel. Carter, 575 U.S. 650, 653 (2015)) Gnternal

quotation marks omitted). In relevant part, the FCA imposes liability on any
person who “knowingly presents, or causes to be presented, a false or fraudulent
claim for payment or approval” by the United States Government, 31 U.S.C. §
3729(a)(1)(A), “knowingly makes, uses, or causes to be made or used, a false record
or statement material to [such] a false or fraudulent claim,” id. § 3729(a)(1)(B), or
“conspires to commit [either] violation,” id. § 3729(a)(1)(C). The FCA defines a
“claim” as “any request or demand... for money or property’ that is presented,
directly or indirectly, to the United States.” Chorches, 865 F.3d at 81 (quoting 31
U.S.C. § 8729(b)(2)(A)).
Substantive FCA allegations are subject to the heightened pleading
requirements of Federal Rule of Civil Procedure 9(b). Jd. (first citing United States
ex rel. Ladas v. Exelis, Inc., 824 F.3d 16, 26 (2d Cir. 2016), and then citing Gold v.
Morrison-Knudsen Co., 68 F.3d 1475, 1476-77 (2d Cir. 1995)). When allegations
involve fraud, Rule 9(b) requires that a party “state with particularity the
circumstances constituting fraud.” Fed. R. Civ. P. 9(b). An FCA complaint alleging
fraud? ordinarily must “(1) specify the statements that the plaintiff contends were
fraudulent, (2) identify the speaker, (3) state where and when the statements were
made, and (4) explain why the statements were fraudulent.” Chorches, 865 F.3d at
81 Gnternal quotation marks and citation omitted). Courts sometimes characterize
this pleading standard “as the ‘who, what, when, where, and how’ of the alleged

2 The pleading requirements for FCA retaliation claims are discussed infra.

fraud.” United States ex rel. Monda v. Stkorsky Aircraft Corp., No. 3:99CV1026
(JBA), 2005 WL 1925903, at *2 (D. Conn. Aug. 11, 2005), aff'd, 207 F. App’x 28 (2d
Cir. 2006) (citations omitted).
The adequacy of particularized allegations under Rule 9(b) is “case-and
context-specific.” Chorches, 865, F.3d at 81 (internal quotation marks and citation
omitted). Courts have described the “threefold” purpose of Rule 9(b) as “designed to
provide a defendant with fair notice of a plaintiffs claim, to safeguard a defendant’s
reputation from improvident charges of wrongdoing, and to protect a defendant
against the institution of a strike suit.” Ladas, 824 F.3d at 25 (internal quotation
marks and citation omitted). A court must dismiss a complaint under Rule 9(b)
where FCA claims under Sections 3729(a)(1)(A) and (B) rest on “speculation and
conclusory allegations.” United States ex rel. Duhaine v. Apple Health Care Inc., No.
3:19-CV-00963 (KAD), 2022 WL 3226631, at *5 (D. Conn. Aug. 10, 2022) (quoting
United States ex rel. Gelbman v. City of New York, 790 F. App’x 244, 249 (2d Cir.
2019)) Gnternal quotation marks omitted).
Despite Rule 9(b)’s strict pleading requirements, allegations may be based
on “information and belief when facts are peculiarly within the opposing party’s
knowledge.” Chorches, 865 F.3d at 81-82 (internal quotation marks and citation
omitted). Where pleading is permitted on information and belief, the complaint
must “adduce specific facts supporting a strong inference of fraud.” Id. at 82
(internal quotation marks and citation omitted). §

3 Chorches will be discussed further below.

DISCUSSION
Relator alleges that each time RRH submitted a claim for payment, it
certified compliance with the Vaccine Provider Agreement, the NCVIA, and the
EVA. Dkt. 344101. Although the Provider Agreement serves as a basis to support
potential FCA liability, Plaintiff fails to plead sufficiently any allegations that
support a statutory violation.
I. The Vaccine Provider Agreement may impose liability on the
Organization
Relator alleges that, under the Provider Agreement, RRH is responsible for
reporting serious adverse events following vaccination. See id. J 40. But RRH
argues that only its employees “involved in handling [the] COVID-19 Vaccine” may
trigger liability under the Provider Agreement. See Dkt. 38, at 10.4
RRH’s interpretation is too narrow. Under the “Organization Identification”
section, the Provider Agreement lists the “Organization’s legal name,” the
“Organization telephone number,” and the “Organization address.” Dkt. 34-24, at 1.
RRH is the organization. But the Provider Agreement does not request contact
information from the smaller entities, like the vaccination locations that are
“affiliated” with the organization.® Seeid. Instead, the Provider Agreement only
asks for how many vaccination locations the agreement covers. Id. This reveals

4 Page numbers referenced refer to the CM/ECF pagination.
5 The Provider Agreement states that Section B “must be completed for each
vaccination [ljocation,” but that section must be filled out for “each vaccination
[location covered under the Organization listed in Section A.” Jd. (emphasis
added). Section A only requests contact information from the organization. Id.

that the parent company or, here, RRH, is ultimately responsible under this
contract. In fact, the Provider Agreement states that “this is an agreement between
[the] [o]rganization and CDC.” Id. at 2.
Additionally, the organization’s “chief medical officer (or equivalent) and chief
executive officer (or chief fiduciary) ... must complete and sign the [Provider
Agreement].” Id. at 1. And they are required to provide their contact information;
there is a section on the form specifically for “Responsible Officers,” particularly, the
Chief Medical Officer (or equivalent) and the Chief Executive Officer (or Chief
Fiduciary). Id. Responsible officers—as well as “the Organization”—are
“accountable for compliance.” Id. Thus, the Provider Agreement imposes
obligations and potential liability on RRH, not the individual vaccination locations
or the handlers at those locations. RRH bears “organizational responsibility” as a
vaccine provider under this contract. See Dkt. 34 § 44. Under the Provider
Agreement, RRH, and its employees, must adhere to the requirements set forth
therein.
Because RRH is liable under this agreement, it must report adverse events
for patients who were vaccinated at RRH. Here, Relator alleges four patients who
experienced adverse events after receiving the COVID vaccine at RRH. See id. { 91.
Thus, under the Provider Agreement, RRH was responsible for reporting any
adverse events that these patients experienced. And this theory is valid under the
FCA.

But the agreement has its limitations. The Provider Agreement, for example,
does not require RRH to report adverse reactions regardless of where the patient
was vaccinated. Indeed, the Agreement’s reporting obligations are dose specific
(Dkt. 34-24, at 3) and apply to the shots administered by RRH—not by anyone
outside of RRH.
Relator alleges that the NCVIA and the EUA also impose reporting
obligations on Defendants and that, because Defendants failed to report adverse
events to VAERS, they violated the FCA. See Dkt. 34 44] 19-38. The Court
disagrees.
Under the NCVIA, “[e]ach health care provider and vaccine manufacturer
shall report ... the occurrence of any event seé forth in the Vaccine Injury Table
.... 42 U.S.C. § 300aa-25(b)(1)(A) (emphasis added). The COVID shot, however,
is not listed on this table. See Dkt. 38, at 14-15; see also Dkt. 34-28. And the
Provider Agreement does not reference the table either. See Dkt. 34-24. Thus, the
NCVIA is not a basis for liability here.
Moreover, under the EVA, the Secretary of Health and Human Services
(“HHS”) is authorized to introduce a “drug, device, or biological product intended for
use in an actual or potential emergency ....” 21 U.S.C. §§ 321(d), 360bbb-3(a)(1).
Plaintiff, however, fails to link a violation under this statute to an FCA claim.6

6 And even if the EUA does create a basis for liability, it does not expand the
obligations imposed under the Provider Agreement. See Dkt. 38, at 16.
10

In sum, there is no statutory basis under the NCVIA or EUA for RRH to be
liable under the FCA. This leaves the allegations raised under paragraph 91 as the
only possible FCA claim—based on the Provider Agreement—if Relator alleged
them with sufficient particularity under Rule 9. This is analyzed below.
II. The Amended Complaint alleges fraud with sufficient particularity
as to paragraph 91
A. Falsity/Misrepresentation (Implied Certification Theory)
Under the FCA, a plaintiff must allege a “false or fraudulent claim for
payment or approval” or “false record or statement material to a false or fraudulent
claim.” 31 U.S.C. § 3729(a)(1)(A)—(B); see also Fed. Deposit Ins. Corp. v. Fifth Third
Bank, N.A., No. 23-209-cv, 2023 WL 7130553, at *2 (2d Cir. Oct. 30, 2023). Plaintiff
asserts claims for both. Dkt. 34 44 123-133. A “claim” includes “direct requests to
the [g]overnment for payment as well as reimbursement requests made to the
recipients of federal funds under federal benefits programs.” United States ex rel.
Gelbman v. City of New York, No. 14-CV-771 (VSB), 2018 WL 4761575, at *5
(S.D.N.Y. Sept. 30, 2018), aff'd, 790 F. App’x 244 (2d Cir. 2019) (quoting Universal
Health Servs., Inc. v. United States ex rel. Escobar, 579 U.S. 176, 182 (2016)). FCA
claims are either factually false or legally false. Gelbman, 2018 WL 4761575, at *5;
see also United States ex rel. Foreman v. AECOM, 19 F.4th 85, 104 (2d Cir. 2021). A
“factually false claim” is one that is “untrue on its face,” such as “a claim that
‘include[s] an incorrect description of goods or services provided or a request for
reimbursement for goods or services never provided.” Foreman, 19 F.4th at 104 n.7

11

(quoting United States v. Kellogg Brown & Root Servs., Inc., 800 F. Supp. 2d 143,
154 (D.D.C. 2011)).
Here, Relator first alleges that RRH submitted factually false claims because
it “misrepresented the nature of services provided when seeking payment.” Dkt. 34
§ 103. Particularly, Relator claims that RRH failed to report a patient that died
after a vaccination and altered that patient’s medical records to “conceal” the
patient’s recent vaccine. Jd. { 104. But this is not sufficient. Relator fails to
connect this example to a claim RRH submitted that is “untrue on its face,” like
providing an incorrect description or failing to provide certain goods or services. In
other words, Relator does not allege that RRH submitted a claim where it
represented that this patient received a COVID vaccine, but changed the medical
records to indicate otherwise, or that RRH submitted a VAERS report for that
patient, when it really did not. Thus, Relator does not adequately plead that RRH
submitted factually false claims.’

7 Additionally, Relator alleges that “RRH fraudulently induced its participation in
the vaccination program by initially certifying it would comply with all safety
monitoring requirements while never intending to implement comprehensive
adverse event reporting.” Id. § 107. Defendants argue that this is “wholly
conclusory” and “should not be assumed true” because “Relator has not plausibly
alleged any facts describing representations that RRH made to the CDC to induce
its entrance into the Vaccination Provider Agreement.” Dkt. 38, at 24. This Court
agrees. See United States v. Strock, 982 F.3d 51, 60 (2d Cir. 2020) (“Under this
fraudulent inducement theory, FCA liability attaches not because a defendant has
submitted any claim for payment that is literally false, but instead because the
contract under which payment [is] made is procured by fraud.”) Gnternal quotation
marks and citations omitted).
12

But Relator also alleges that RRH submitted legally false claims. A legally
false claim rests on “a false representation of compliance with an applicable federal
statute, federal regulation, or contractual term.” United States ex rel. Askari v.
PharMerica Corp., No. 23-909-CV, 2024 WL 1132191, at *2 (2d Cir. Mar. 15, 2024)
(internal quotation marks and citation omitted). There are two types of legally false
claims that a relator can rely on to support an FCA claim. Jd. The first is an
express false certification claim. In addition, in some circumstances, “implied false
certification” can amount to a false or fraudulent claim. United States ex rel. Yu v.
Grifols USA, LLC, No. 22-107, 2022 WL 7785044, at *2 (2d Cir. Oct. 14, 2022)
(citing Escobar, 579 U.S. at 186).
Relator alleges both—specifically, that RRH expressly and implicitly certified
compliance with the COVID-19 Vaccination Program when it submitted claims for
payment. See Dkt. 34 4 101. Defendants argue that Relator does not sufficiently
plead any particularized allegations that support an express false certification
theory. Dkt. 38, at 21-22. The Court agrees. Thus, this case concerns only the
implied false certification theory.
Under the implied false certification theory, “when a defendant submits a
claim, it impliedly certifies compliance with all conditions of payment.” Escobar,
579 U.S. at 180. But “if that claim fails to disclose the defendant’s violation of a
material, statutory, regulatory, or contractual requirement... the defendant has
made a misrepresentation that renders the claim ‘false or fraudulent’ under
[section] 3729(a){1)(A).” Id.

13

In some instances, the implied false certification theory can be a basis for
liability “when the defendant submits a claim for payment that makes specific
representations about the goods or services provided, but knowingly fails to disclose
the defendant’s noncompliance with a statutory, regulatory, or contractual
requirement.” Jd. at 181. In these circumstances, “liability may attach if the
omission renders those representations misleading.” Jd. But not all
misrepresentations are actionable; the challenged claim must omit “critical
qualifying information.” Fed. Deposit Ins. Corp., 2023 WL 7130558, at *2 (citing
Escobar, 579 U.S. at 188-89).
Liability for failing to disclose violations of legal requirements “does not turn
upon whether those requirements were expressly designated as conditions of
payment.” Escobar, 579 U.S. at 181. While that is relevant, it is not dispositive.
Id. at 190. And even if a requirement is expressly designated as a condition of
payment, “not every violation of such requirement gives rise to liability.” Id. at 181.
What matters is “whether the defendant knowingly violated a requirement that the
defendant knows is material to the [g]overnment’s payment decision.” Id.
(emphasis added). Materiality and knowledge (or scienter) are “rigorous” pleading
requirements that are “strictly enforced.” Fed. Deposit Ins. Corp., 2023 WL
7130558, at *2 (citing Escobar, 579 U.S. at 192). A failure to plead either is fatal.
Fed. Deposit Ins. Corp., 2023 WL 7130558, at *2.
In sum, the implied certification theory can be a basis for liability when at
least two conditions are met. First, “the claim does not merely request payment,

14

but also makes specific representations about the goods or services provided... .”
Escobar, 579 U.S. at 190; see also Fed. Deposit Ins. Corp., 2023 WL 7130553, at *2.
And second, “the defendant’s failure to disclose noncompliance with material
statutory, regulatory or contractual requirements make those representations
misleading half-truths.” Escobar, 579 U.S. at 190.
As relevant here, there is a contractual basis of potential liability—
specifically as to the allegations raised in paragraph 91. The issue, then, is whether
those allegations satisfy Rule 9.
The Provider Agreement lists “Agreement Requirements” that “are material
conditions of payment for COVID-19 Vaccine-administration claims submitted by
[the] [o]rganization to any federal healthcare benefit program....” Dkt. 34-24, at
2-3 (emphasis added). And “[t]o receive one or more of the publicly funded COVID-
19 vaccines (COVID-19 Vaccine), constituent products, and ancillary supplies at no
cost, [the] [o]rganization agrees that it will adhere to . . . [these] requirements[.]”
Id. at 2.
At issue is the requirement that an organization “must report moderate and
severe adverse events following vaccination to [VAERS].” Jd. at 3. Further, under
this contract, reimbursement for administering the vaccine “is not available under
any federal healthcare program if [the] [o]rganization fails to comply with these
requirements with respect to the administered COVID-19 Vaccine dose.” Id. When
the organization submits a reimbursement claim for COVID-19 Vaccine

15

administration, that organization “expressly certifies that it has complied with
these requirements with respect to that administered dose.” Id.
Accordingly, each time RRH submits a claim for payment, under this
Provider Agreement, it is not merely requesting payment, but instead making
specific representations that it has complied with the requirements set forth
therein. Escobar, 579 U.S. at 190; see also Fed. Deposit Ins. Corp., 2023 WL
7130553, at *2.
On this record, particularity is alleged.
B. Materiality
A misrepresentation about compliance with a statutory, regulatory, or
contractual requirement “must be material to the [g]lovernment’s payment decision
in order to be actionable under the False Claims Act.” Escobar, 579 U.S. at 192. A
relator, therefore, must plead materiality “with particularity under Rule 9(b).” Fed.
Deposit Ins. Corp., 2023 WL 7130558, at *8 (citation omitted).
“Material” is defined as “having a natural tendency to influence, or be
capable of influencing, the payment or receipt of money or property.” 31 U.S.C. §
3729(b)(4). To assess materiality, the court must look to “the effect on the likely or
actual behavior of the recipient of the alleged misrepresentation . .. rather than
superficial designations.” Yu, 2022 WL 7785044, at *2 (quoting Foreman, 19 F.4th
at 109).
The Supreme Court identified three factors in assessing materiality: “(1)
whether the government expressly designates compliance with a particular

16

statutory, regulatory, or contractual requirement as a condition of payment; (2) the
government’s response to noncompliance with the relevant contractual, statutory, or
regulatory provision; and (3) whether the defendants’ alleged noncompliance was
minor or insubstantial.” Yu, 2022 WL 7785044, at *2 (quoting Foreman, 19 F.4th at
110) Gnternal quotation marks omitted); see also Escobar, 579 U.S. at 194-96. This
inquiry is “holistic,” meaning a court should weigh these factors. See Foreman, 19
F.4th at 110, 117.
1. Express Condition of Payment
Relator alleges that reporting to VAERS is material to the Government’s
payment decision because it is required by the Provider Agreement. See Dkt. 34 □□
40, 41, 119. Moreover, the Provider Agreement expressly states that each
requirement is a “condition of payment,” and that the Government will not
reimburse RRH if it fails to comply. See Dkt. 34-24, at 3. Thus, although not
determinative, it is relevant that the Provider Agreement specifies that the
requirements are “conditions of payment.” This factor weighs in Relator’s favor.
Escobar, 579 U.S. at 190 (‘Whether a provision is labeled a condition of payment is
relevant to but not dispositive of the materiality inquiry”).
2. Government’s Response to Noncompliance
As to the second factor, evidence that the Government “consistently refuses to
pay claims in the mine run of cases based on noncompliance with the particular
statutory, regulatory, or contractual requirement at issue can prove materiality.”
Yu, 2022 WL 7785044, at *3 (quoting Escobar, 579 U.S. at 195) (internal quotation

17

marks omitted). But “if the [glovernment pays a particular claim in full despite its
actual knowledge that certain requirements were violated, that is very strong
evidence that those requirements are not material.” Id. Thus, this factor requires
examining the Government’s reaction to noncompliance in other similar cases’ and
in the case at issue. See Foreman, 19 F.4th at 111-12 (citing Escobar, 579 USS. at
194-95).
Here, RRH argues that Relator reached out to the FDA, CDC, and New York
State Department of Health about the reporting obligations to VAERS, and she
retained a law firm to mail letters to the HHS and CDC, but these agencies did
“nothing” in response. Dkt. 38, at 25. Defendants contend that this is “highly
probative that the alleged fraud is immaterial.” Id.
Although these agencies did not respond or take any action, it is unclear
whether the CDC had “actual knowledge.” There is no indication that the CDC
investigated or audited RRH and continued to pay, despite any wrongdoing. See
Foreman, 19 F.4th at 115, 117-18; see United States ex rel. McBride v. Halliburton
Co., 848 F.3d 1027, 1034 (D.C. Cir. 2017) (concluding that the government’s
response showed strong evidence that the requirements at issue were not material,
where it investigated the allegations and did not disallow any charged costs). And
even if the Government had actual knowledge, the Government may choose to
continue funding this type of contract given its extensive approach to COVID-19—
making the issue not particularly probative here. See Foreman, 19 F.4th at 115

8 Here, neither side references any similar cases.
18

(“There may be circumstances where the government’s payment of a claim or failure
to terminate a contract despite knowledge of certain alleged contractual violations
will not be particularly probative of lack of materiality.”); see also United States ex
rel. Harrison v. Westinghouse Savannah River Co., 352 F.3d 908, 917 (4th Cir.
2008). Thus, at best, this factor is neutral.
3. Substantiality
The last factor is whether RRH’s noncompliance was substantial. Materiality
“cannot be found where noncompliance is minor or insubstantial .. . because
material falsehoods are those that go to the very essence of the bargain.” Foreman,
19 F.4th at 116 Gnternal quotation marks and citation omitted). Relator must
demonstrate more than a “superficial designation,” but instead show “sufficiently
widespread deficiencies in the contractor’s performance or identified
misrepresentations that go to the heart of the bargain, such that any regulatory,
statutory, or contractual violations would likely affect the Government’s payment
decision.” Jd. (internal quotation marks and citation omitted).
Defendants argue that the alleged noncompliance is not substantial because
Relator only identified four to five patients RRH vaccinated and later admitted.
Dkt. 38, at 26. Additionally, Defendants argue that “Relator has not plausibly
linked up VAERS reporting failures occurring at the hospital with violations of
either contractual or statutory duties, which, to the extent they apply, only impose
obligations in geographical and temporal proximity to the vaccine clinic and those
who handle vaccines.” Id.

19

But the Provider Agreement applies here. And this obligation is not limited
to the vaccine clinic or handlers—it extends to any patient RRH vaccinates and
later admits for an adverse reaction. Additionally, although Relator only alleges
four patients that RRH vaccinated, admitted, and did not report to VAERS (Dkt. 34
4 91), in accordance with the Provider Agreement, discovery has not occurred.? In
other words, the key at this stage is whether these “identified misrepresentations

... go to the heart of the bargain.” Foreman, 19 F.4th at 116 (internal quotation
marks and citation omitted). Here, they do. The Agreement specifically addresses
this issue and linked it to payment.
Relator alleges that the FDA and CDC maintain that VAERS reporting is a
material condition and that the Provider Agreement demonstrates this. See Dkt. 34
{ 118. The Provider Agreement, which is incorporated by reference to the amended
complaint, is persuasive here. The contract does not just state that the
requirements listed are “conditions of payment;” it goes one step further in stating
that the conditions are “material” to the Government’s payment decision. Dkt. 34-
24, at 3. And it claims that if the organization does not comply with the terms, that
organization may be liable under federal law, including, inter alia, the FCA. Id.
The intention is clear here—these twelve conditions, including reporting to
VAERS, are essential to this contract. They go to the “heart of the bargain” and are
necessary to carry out the COVID Vaccination Program. This intention also aligns

9 She also alleges that RRH failed to report an additional 170 patients, but their
vaccination locations are “unknown” at this time. Id. {J 92-93.
20

with Relator’s allegations regarding the purpose behind VAERS—specifically, that
VAERS gives the “CDC and FDA vital information to help quickly identify potential
health concerns and ensure vaccines are safe.” Dkt. 34 { 23. Thus, this factor
weighs in Relator’s favor.
Therefore, weighing all factors, Relator has plausibly alleged with
particularity that the condition at issue here—reporting adverse events to
VAERS—is material to the Government’s payment decision. Foreman, 19 F.4th at
118 (“Taken together with the substantiality factor, which also weighs in favor of
materiality as to the .. . allegations, [the relator] has sufficiently pled materiality
with respect to his claims... .”); see also Strock, 982 F.3d at 65.
C. Scienter
Under the implied certification theory, a defendant must have “knowingly
violated a requirement that the defendant knows is material to the [glovernment’s
payment decision.” Escobar, 579 U.S. at 181. The terms “knowing” and
“knowingly” 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.” 31 U.S.C. § 3729(b)(1)(A). Additionally, “knowledge” does not require
“proof of specific intent to defraud.” Jd. § 3729(b)(1)(B).
To comply with Rule 9(b), a relator may assert knowledge “generally,” but
must still “plead the factual basis which gives rise to a strong inference of
fraudulent intent.” Strock, 982 F.3d at 66 Gnternal quotation marks and citation

21

omitted). To show a “strong inference of fraud,” relator may either: (1) allege facts
showing that the defendants had “both motive and opportunity to commit fraud,” or
(2) allege facts constituting “strong circumstantial evidence of conscious
misbehavior or recklessness.” Jd. internal quotation marks and citation omitted).
Defendants argue that Relator fails to allege any facts “bearing on RRH’s
knowledge that could support a strong inference of fraudulent intent,” and her
allegations instead involve differences in medical opinions and in interpreting the
reporting obligations. Dkt. 38, at 30, 32. The Court disagrees.
Relator adequately alleges that Defendants had actual knowledge that
reporting to VAERS was material to the Government’s payment decision. See Dkt.
34 94 110-11. To participate in the COVID Vaccination Program, the Provider
Agreement requires an organization to certify that “all relevant officers, directors,
employees, and agents of [the] [o]rganization involved in handling COVID-19
Vaccine understand and will comply with the agreement requirements listed... .”
Dkt. 34-24, at 3; Dkt. 34 7 111. It also expressly states that reporting to VAERS is
a “material condition of payment.” Dkt. 34-24, at 3. Additionally, Dr. Gellasch
agreed with Relator that “we must report to VAERS per guidance.” Dkt. 34 65,
110. And RRH acknowledged that it needed to help healthcare providers comply
with their responsibility to report adverse events. Id. □□ 80, 110.
Relator also asserts “strong circumstantial evidence of... recklessness” as to
materiality—particularly in the instances where Relator is dealing with RRH. See
Strock, 982 F.3d at 66. For example, RRH allegedly ordered Relator to “dial...

22

back” her reporting efforts. Dkt. 34 § 112. And despite RRH certifying that its
“officers, directors, employees, and agents... understand and [will] comply with the
agreement requirements,” its President told Relator that “it is not the
organization|[]s duty to educate providers.” Jd. § 114; Dkt. 34-24, at 3. Thus,
Relator’s allegations about her interactions with RRH are sufficient to allege
scienter.
Moreover, Relator asserts that RRH “remov[ed] vaccine information from [a
patient’s] death certificate and discharge summary” to conceal reportable events.
Dkt. 34 § 116. Not only does this further support that RRH acted recklessly in
carrying out its reporting obligations, but, when paired with Relator’s allegation
that RRH wanted to prioritize high vaccination numbers over mandatory safety
monitoring, it suggests a motive to commit fraud. Id.
Therefore, accepting these allegations as true, Relator has plausibly alleged
scienter with particularity to support a claim under the FCA.
D. Chorches
A relator must also sufficiently allege that the defendant submitted false
claims for payment. Here, Relator satisfies this requirement.
FCA claims are subject to Rule 9(b). Chorches, 865 F.3d at 81. Rule 9(b) is
generally a rigid requirement; however, “allegations may be based on information
and belief when facts are peculiarly within the opposing party’s knowledge.” Id. at
81-82. Pleading on information and belief is a “desirable and essential expedient
when matters that are necessary to complete the statement of a claim are not

23

within the knowledge of the plaintiff but he [or she] has sufficient data to justify
interposing an allegation on the subject.” Jd. at 82 Gnternal quotation marks and
citation omitted). In other words, Rule 9(b) does not require that “every qui tam
complaint provide details of actual bills or invoices submitted to the government,” if
the relator “makes plausible allegations ... that lead to a strong inference that
specific claims were indeed submitted and that information about the details of the
claims submitted are peculiarly within the opposing party’s knowledge.” Id. at 93.
Here, Relator alleges that RRH submitted reimbursement claims for
“thousands” of COVID vaccinations, certifying that it reported adverse events to
VAERS. See Dkt. 34 | 95. And she alleges that she learned about these claims
from other employees and publicly available information. Jd. Defendants argue
that Relator fails to satisfy Rule 9(b) because she does not allege anything about
events taking place at the vaccine clinic or the personnel involved in handling
COVID vaccines. Dkt. 38, at 27. But as stated previously, this interpretation is too
narrow. The Provider Agreement imposes an obligation on RRH, not the individual
vaccination locations and handlers, to comply with VAERS reporting. And because
Relator worked at RRH from 2007 to 2021, when the alleged “scheme” occurred, she
directly observed patients experiencing adverse events and how RRH handled its
reporting efforts. See Dkt. 34 4 49-94.
Relator did not work in billing, and does not attach actual bills or invoices to
her amended complaint, but her allegations are plausible and “lead to a strong
inference that specific claims were indeed submitted ....” Chorches, 865 F.3d at

24

93. She asserts that “RRH, like all healthcare organizations, uses sophisticated
accounting and billing systems to track services and ensure payment.” Dkt. 34 {
97. Particularly, for each COVID vaccine dose administered, RRH records the
service in the patient’s medical record, documents it in the NYSIIS system, and
then generates a claim for payment. Jd. Namely, RRH tracks each vaccine dose,
through the payment process.
Defendants argue that Relator fails to allege facts showing a strong inference
that RRH submitted specific claims because the patients that Relator provides as
examples did not all receive their vaccines at the RRH clinic. Dkt. 38, at 27.
Although Relator does not list a vaccination location for every patient, she does
allege (in paragraph 91) four patients, who received a vaccine at RRH, experienced
an adverse event, went back to RRH, and as to whom RRH did not submit VAERS
reports. Dkt. 34 | 91. Accepting these allegations as true, RRH failed to adhere to
the Provider Agreement. RRH was presumably paid for all shots given. Thus,
Relator alleges specific and plausible facts from which this Court may infer that
Defendants submitted false claims. See Chorches, 865 F.3d at 84.
Relator also plausibly alleges that the “claims submitted are peculiarly
within the opposing party’s knowledge.” Jd. at 98. Defendants contest this,
claiming that Relator accessed RRH’s systems to learn about her patients’
vaccination statuses. Dkt. 38, at 28-29. While she could look up whether a patient
received a vaccine, nowhere does Relator allege that she had access to RRH’s billing
records. To the contrary, she asserts that RRH controls its billing system

25

exclusively, and the billing records are in RRH’s possession. Dkt. 34 {4 97, 108.
And she alleges “sufficient data to justify interposing an allegation on the subject,”
despite not having access to the billing system. Chorches, 865 F.3d at 82 (internal
quotation marks and citation omitted). For instance, she asserts that she “knows
RRH’s billing department processes vaccine administrative records into claims
seeking the standard $40 payment per dose through established federal health
program billing procedures, including Medicare, Medicaid and HRSA Covid-19
Uninsured Program.” Dkt. 34 § 97. She also states that the billing records,
documenting the false claims, include: (1) claim submission dates; (2) certification
language; and (3) administration details demonstrating systematic false claims. Id.
{ 108.
In sum, Defendants’ motion to dismiss is denied as to Relator’s FCA claim
(Count 1) to the extent based on the implied false certification theory, as it relates
to the Provider Agreement, and involving patients who received a COVID shot at
RRH. The motion to dismiss is also denied as to Relator’s section 3729(a)(1)(B)
claim (Count 2) for the same reasons set forth in connection with her section
3729(a)(1)(A) claim. RRH knew reporting to VAERS was a material condition of
payment, under the Provider Agreement, but allegedly falsified records to conceal
reportable events in connection with the false claim. See, e.g., id. Jf 104, 116.
Ill. Relator’s reverse false claims count is dismissed
Relator alleges liability for reverse false claims pursuant to section
3729(a)(1)(G). That section states that any person who “knowingly makes, uses, or

26

causes to be made or used, a false record or statement material to an obligation to
pay or transmit money or property to the Government,” or who “knowingly conceals
or knowingly and improperly avoids or decreases an obligation to pay or transmit
money or property to the Government” is liable under the FCA. 31 U.S.C. §
3729(a)(1)(G). Reverse false claims counts are also subject to Rule 9(b)’s heighted
pleading standard. Foreman, 19 F.4th at 119.
A court should dismiss such a count if the complaint “makes no mention of
any financial obligation that the [defendants] owed to the government,” and “does
not specifically reference any false records or statements used to decrease such an
obligation... Jd. (nternal quotation marks and citation omitted). Additionally,
the Second Circuit recognized that “several district courts, some of them within this
Circuit, have concluded that a reverse false claim cannot turn on the same conduct
underlying a traditional false claim.” Jd. at 119. And to conclude otherwise would
mean that “any time a defendant violated sub-sections (a)(1)(A) or (B) and received
payment, the defendant would also necessarily violate sub-section (G) if it failed to
repay the Government the fraudulently-obtained payments.” Jd. at 120 (internal
quotation marks and citation omitted). Thus, this “[t]lype of redundant false claim
is not actionable under subsection (a)(1)(G).” Jd. Gnternal quotation marks and
citation omitted).
Here, other than the conduct underlying Relator’s false claims under sections
3729(a)(1)(A) and (B), Relator does not adequately allege any independent facts that

27

support her reverse false claims count, and, as such, it is dismissed. See Dkt. 38, at
32-33.
IV. Relator’s FCA conspiracy claim is dismissed
Relator also fails to allege a conspiracy claim pursuant to section
3729(a)(1)(C), which states that “any person who... conspires to commit a violation
of subparagraph (A), (B), (D), (E), (F), or (G) .. . is able to the United States
Government....” 31 U.S.C. § 3729(a)(1)(C).
Defendants argue that the Court should dismiss this claim in accordance
with the intra-corporate conspiracy doctrine. Dkt. 38, at 33-34. The Court agrees.
Under the intra-corporate conspiracy doctrine, “one entity cannot conspire
with its employees” and “it is well established that one corporation and wholly-
owned subsidiary cannot conspire with each other.” Untied States ex rel. Ross v.
Indep. Health Corp., No. 12-CV-2998, 2023 WL 24055, at *12 (W.D.N.Y. Jan 3,
2023) (quoting Pencheng Si v. Laogat Rsch. Found., 71 F. Supp. 3d 73, 98 (D.D.C.
2014)); see also United States ex rel. Schwartz v. Document Reprocessors of N.Y.,
Inc., 692 F. Supp. 3d 71, 81 n.3 (W.D.N.Y. 2023) (““Relator’s cursory attempt to
assert a conspiracy between a corporation and its owner/corporate officers runs
afoul of the intra-corporate conspiracy doctrine.”).
Here, Relator alleges that “RRH and its administrators entered into
agreements with each other to violate the False Claims Act....” Dkt. 34 | 120.
Relator is, thus, attempting to plead a conspiracy claim in violation of the intra-

28

corporate conspiracy doctrine. A corporation and its employees (including its
owners and officers) generally cannot conspire among each other.
Courts in this Circuit recognize an exception to this doctrine “when a party
acts pursuant to personal interests ‘separate and apart from the entity.” Ross,
2023 WL 24055, at *12 (quoting Vegas v. Artus, 610 F. Supp. 2d 185, 205 (N.D.N.Y.
2009)). But the amended complaint does not contain any such allegations.
Therefore, the Court grants Defendants’ motion to dismiss the conspiracy claim.
V. The Amended Complaint alleges a plausible retaliation claim
The FCA’s anti-retaliation provision states:
Any employee, contractor, or agent shall be entitled to all relief
necessary to make that employee, contractor, or agent whole, if that
employee, contractor, or agent is discharged, demoted, suspended,
threatened, harassed, or in any other manner discriminated against in
the terms and conditions of employment because of lawful acts done by
the employee, contractor, agent or associated others in furtherance of an
action under this section or other efforts to stop 1 or more violations of
this subchapter.
31 U.S.C. § 3730(h)(1).
To state a retaliation claim under the FCA, courts “generally require[ ]a
plaintiff to show that (1) he [or she] engaged in activity protected under the statute,
(2) the employer was aware of such activity, and (3) the employer took adverse
action against him [or her] because he [or she] engaged in the protected activity.”
Dhaliwal v. Salix Pharms., Ltd., 752 F. App’x 99, 100 (2d Cir. 2019) (quoting
Chorches, 865 F.3d at 95) Gnternal quotation marks omitted). If an employee’s
alleged actions “are sufficient to support a reasonable conclusion that the employer
could have feared being reported to the government for fraud or sued in a qui tam

29

action by the employee,” then the employee has stated a retaliation claim under
section 3730(h). U.S. ex rel. Sanchez v. Lymphatx, Inc., 596 F.3d 1300, 1304 (11th
Cir. 2010).
FCA-based retaliation claims are not subject to the more stringent pleading
requirements of Rule 9(b). See Chorches, 865 F.3d at 95 (“The particularity
requirement of Rule 9(b) does not apply to retaliation claims under the FCA.”).
Rather, a plaintiff must “show a good faith basis, or objectively reasonable basis, for
believing that he or she was investigating matters in support of a viable FCA case.”
Swanson v. Battery Park City Auth., No. 15-CV-6938 (JPO), 2016 WL 3198309, at *3
(S.D.N.Y. June 8, 2016) (internal quotation marks and citation omitted).
Ultimately, the conduct must be “directed at exposing a fraud upon the
government.” Mirza v. Garnet Health, No. 20-CV-556 (PMH), 2022 WL 826410, at
*9 (S.D.N.Y. Mar. 17, 2022), aff'd sub nom. Mirza v. Orange Reg'l Med. Ctr., No. 22-
815-CV, 2024 WL 30422389 (2d Cir. June 18, 2024) (internal quotation marks and
citations omitted).
Here, Relator plausibly alleges that RRH retaliated against her when it fired
her.
A. Protected Activity
A relator engages in protected activity if he or she tries to stop one or more
FCA violations. See 31 U.S.C. § 3730(h)(1); see also Pilat v. Amedisys, Inc., No. 23-
566, 2024 WL 177990, at *2 (2d Cir. Jan. 17, 2024). Such efforts “can include both
complaining internally to supervisors about suspected fraudulent practices and

30

refusing to engage in such practices.” Pilat, 2024 WL 177990, at *2. A party,
however, “need not succeed on the underlying FCA claim to successfully show
retaliation, but ‘he [or she] must demonstrate that he [or she] had been
investigating matters that were calculated, or reasonably could have led, to a viable
FCA action.” Schwartz, 692 F. Supp. 3d at 81 (quoting United States v. N. Adult
Daily Health Care Ctr., 205 F. Supp. 3d 276, 298 (E.D.N.Y. 2016)).
Here, Defendants assert that Relator did not engage in protected activity
because she fails to allege that she suspected fraud; she only had concerns about
RRH’s reporting obligations to VAERS. See Dkt. 38, at 35-36. But, in Pilat, the
Second Circuit disagreed with dismissing a retaliation claim on that basis. See
Pilat, 2024 WL 177990, at *1—2 (“The district court determined that [the] [r]elators
did not allege that they engaged in protected activity because the complaints to
supervisors they rely on to support their retaliation claims did not have anything to
do with potential false claims and were more appropriately characterized as
concerns about patient care ... We disagree... .”) (internal quotation marks and
citation omitted). Thus, because Defendants make a similar argument here, it is
not sufficient.
Relator alleges that she refused to participate in the alleged wrongdoing. She
asserts that she “undertook specific actions to stop [D]efendants’ False Claims Act
violations,” when she “identified and reported over 160 adverse events to VAERS,
documented additional unreported cases, alerted management to their reporting
obligations, and maintained records of systematic non-compliance.” Dkt. 34 4 151.

bl

Furthermore, she alleges four examples where RRH vaccinated a patient—who
experienced an adverse event—and subsequently did not report the adverse event
to VAERS, in accordance with the Provider Agreement. Id. § 91. In drawing all
reasonable inferences in Relator’s favor, her acts were an “effort[ ] to stop 1 or more
violations” of the FCA. See Pilat, 2024 WL 177990, at *2 (internal quotation marks
and citation omitted).
Relator also alleges numerous examples where she complained internally to
supervisors about the suspected fraudulent practices. See, e.g., Dkt. 34 4 57, 68,
65, 68, 69, 70, 71, 72, 73, 74, 75, 77, 78, 81, 86, 87. For instance, on one occasion,
Relator emailed Dr. Tara Gellasch, UMMC’s Chief Medical Officer, about an
unreported adverse event, stating: “I want this case reported and I want their
VAERS case number for my records because now having knowledge of this case and
not reporting it myself as I have been instructed to do by the system, puts me in a
position to knowingly violate the law.” Dkt. 34-16; see also Dkt. 34 J 75. Not only
does this example support that Relator notified her leadership about the issue, but
also that she refused to engage in, and tried to stop, the suspected fraudulent
activity.
Thus, the amended complaint plausibly alleges that Relator engaged in
protected activity.
B. Awareness of that Activity
As noted, to satisfy the second element, Relator must sufficiently plead that
Defendants knew she was engaging in protected activity. Chorches, 865 F.3d at 95.

32

Relator alleges that “[m]Janagement specifically acknowledged her VAERS
reporting efforts, audited her submissions,!° and received multiple communications
from her regarding their legal obligations to report.” Dkt. 34 {| 153. These
allegations are plausible because Relator also provides examples to support these
assertions. For instance, she alleges, inter alia, that she emailed UMMC’s Chief
Medical Officer and President about reporting to VAERS, and she volunteered to
report on her colleagues’ behalf until RRH educated or trained its employees and
developed a better system for reporting. Id. { 57.
Defendants also do not appear to contest this element. See Dkt. 38, at 34-38;
see also Dkt. 45, at 41. Thus, in accepting these allegations as true, the second
element is satisfied.
C. Adverse Action
Lastly, Relator must show that Defendants took “adverse action” against her
for engaging in protected activity. See N. Adult Daily Health Care Ctr., 205 F.
Supp. 3d at 299 (“The retaliatory discharge must occur because of the protected
conduct.”) (citations omitted). At the motion to dismiss stage, temporal proximity
between the protected conduct and adverse action is a sufficient basis for a claim to
go forward. See Garcia v. Aspira of N.Y., Inc., No. 07 CIV. 5600 (PKC), 2011 WL
1458155, at *5 (S.D.N.Y. Apr. 13, 2011).

10 The Hospital’s Chief Quality Officer allegedly audited her and concluded she
overreported to VAERS. See Dkt. 34 { 74.
33

Here, RRH terminated Relator on October 6, 2021, after she engaged in the
protected activity described above. Dkt. 34 4 90. Most notably, RRH fired Relator
shortly after Relator retained a law firm (Siri & Glimstad LLP) to send a letter to
RRH about its underreporting.) Jd. 79, 83. This alleged temporal proximity,
combined with the allegations about her protected conduct, satisfies the causation
prong at this early 12(b)(6) stage. Beckles-Canton v. Lutheran Soc. Sers. of N.Y.,
Inc., No. 20 CIV. 4379 (KPF), 2021 WL 3077460, *9-10 (§.D.N.Y. July 20, 2021).
Thus, the amended complaint plausibly alleges that RRH took adverse action
against Relator for engaging in protected conduct.
Defendants’ argue that RRH terminated Relator because she refused to get a
COVID vaccine, but this is insufficient to dismiss the retaliation claim at this stage
because temporal proximity is plausibly alleged here. Dkt. 38, at 37.12 Thus,
Defendants’ motion to dismiss is denied as to Relator’s FCA-based retaliation claim.

11 The amended complaint alleges that Siri & Glimstad LLP sent RRH letters on
June 28, 2021 and July 21, 2021 regarding its reporting obligations. Id. {{ 79, 88.
RRH fired Relator on October 6, 2021—less than three months after the last letter
sent. Id. § 90.
12 Tn light of this, the Court denies Defendants’ request for this Court to take
judicial notice of a declaration submitted in connection with a state court case, as
well as the docket associated with that action. See id. at 37n.8. Relator’s request
to strike Exhibit D to the Declaration of James E. Peacock, Esq. (Dkt. 38-1) is also
denied as moot. See Dkt. 45, at 44.
34

VI. Relator’s state law claim survives
The amended complaint also asserts a retaliation claim under state law—
specifically N.Y. Labor Law §§ 740-41. See Dkt. 34 | 157-61. Defendants fail to
set forth any substantive argument as to whether this Court should exercise
supplemental jurisdiction if Relator’s federal claims survive, as some do here. See
Dkt. 38, at 38; see also Dkt. 45, at 44. Because this issue is not contested, and for
the below reasons, the motion to dismiss is denied as to the state law claim.
Under section 1367(a), a federal court may exercise supplemental jurisdiction
“over all other claims that are so related to claims in the action within such original
jurisdiction that they form part of the same case or controversy under Article III of
the United States Constitution.” 28 U.S.C. § 1367(a). Claims “form part of the
same case or controversy” if they “derive from a common nucleus of operative fact.”
Shahriar v. Smith & Wollensky Rest. Grp., Inc., 659 F.3d 234, 245 (2d Cir. 2011)
(internal quotation marks and citation omitted). Here, the state and federal actions
arise from the same set of facts—particularly, that RRH retaliated against Relator
because she tried to stop RRH from committing False Claims Act violations. See
Dkt. 34 { 158. Thus, section 1367(a) is satisfied.
When section 1367(a) applies, “the discretion to decline supplemental
jurisdiction is available only if founded upon an enumerated category of subsection
1367(c).” Shahriar, 659 F.3d at 245 Gnternal quotation marks and citation
omitted). Under section 1367(c), a court may decline to exercise supplemental
jurisdiction over a claim if:

35

(1) the claim raises a novel or complex issue of State law, (2) the claim
substantially predominates over the claim or claims over which the
district court has original jurisdiction, (8) the district court has
dismissed all claims over which it has original jurisdiction, or (4) in
exceptional circumstances, there are other compelling reasons for
declining jurisdiction.
28 U.S.C. § 1367(c).
But these do not appear to apply. Here, there are remaining claims the
Court has original jurisdiction over, so that category does not apply. Nor does the
state law claim appear to raise a “novel or complex issue of State law.” The state
law claim also does not predominate here—this is primarily a FCA case, which the
Court has original jurisdiction over. Lastly, the Court does not foresee any other
compelling reasons as to why it should decline jurisdiction.
Therefore, the Court will exercise supplemental jurisdiction over the state
law claim.

36

CONCLUSION
For the reasons discussed above, the Court DENIES Defendants’ motion as to
Relator’s false claims counts, solely as to the allegations raised in paragraph 91
(and any alike) involving patients who received COVID vaccines from RRH as set
forth above (Counts 1 and 2); FCA retaliation claim (Count 5); and state law
retaliation claim (Count 6). The Court GRANTS the remainder of Defendants’
motion to dismiss the amended complaint.

SO ORDERED.
Dated: June 11, 2025
Buffalo, New York (~
int L. SINATRA, JR.
(UNITED STATES DISTRICT JUDGE

37

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11069695. Public record. Not legal advice.