On the surface, the changes to the False Claims Act's public
disclosure bar that were enacted through the
Patient Protection and Affordable Care Act of 2010 (PPACA),
P.L. 111-148, title X, §10104(j)(2), 124 Stat.
119 (2010), 31 U.S.C. § 3730(e)(4), clearly took the
jurisdictional component of the public disclosure bar out of the
statute. Simply stated, the provision changed from reading
"No court shall have jurisdiction over an action" to
"A court shall dismiss an action, unless opposed by the government
…." Cf. 31 U.S.C. § 3730(e)(4)(A)
(2009) with 31 U.S.C. § 3730(e)(4)(A) (2013).
Despite this seemingly clear difference in the language, however,
courts have been less than clear in their interpretations of the
significance of the change. As discussed below, there are
important consequences that flow from a determination that the
public disclosure bar either is or is not jurisdictional in
Patient Protection and Affordable Care Act Amendments to the
False Claims Act
Most recently, the court in Prather v. AT&T
Inc., 2013 U.S. Dist. LEXIS 158483 (N.D. Cal.
Nov. 5, 2013) squarely held that the PPACA amendments to the
False Claims Act "amended the public disclosure bar of the FCA by
modifying the definitions of "public disclosure" and "original
source" and by making the public disclosure an affirmative
defense rather than a jurisdictional bar."
Id. at *10 (emphasis added). See also
United States ex rel. Kraxberger v. Kan. City Power & Light
Co., 2013 U.S. Dist. LEXIS 101013 (W.D. Mo. July 19, 2013)
("Patient Protection and Affordable Care Act ("PPACA") of 2010,
amended the Public Disclosure Provision to make it an affirmative
defense"). The impact of that holding in that case is
discussed below, but it is one of the more straightforward
recognitions that the public disclosure bar is no longer an element
of subject matter jurisdiction. Read
here about The False Claims Act Public Disclosure Bar and the
Meaning of News Media.
Several other courts, however, have reached different
conclusions, holding that the Congressional dictate for courts to
dismiss an action was substantially equivalent to a lack of
jurisdiction or remained a jurisdictional element. See,
e.g., United States ex rel. Beauchamp v. Academi Training Ctr.,
Inc., 933 F. Supp. 2d 825, 838-839 (E.D. Va. 2013) ("clear
that the public disclosure bar remains jurisdictional because it
commands district courts to dismiss actions subject to the public
disclosure bar, unless the Government specifically opposes the
application of the bar" and "context makes clear that the public
disclosure bar remains jurisdictional, as the public disclosure bar
has long been interpreted as jurisdictional and is contained in a
subsection entitled "certain actions barred."); United States
ex rel. Osheroff v. Humana, Inc., 2013 U.S. Dist. LEXIS
13259, 11-12 (S.D. Fla. Jan. 31, 2013) (denying a motion for
reconsideration and holding that "[t]he history of the FCA and
Cooper establish that district courts do not have
jurisdiction to entertain qui tam suits where the
relator's complaint is based upon or substantially similar to
information that, because of the manner in which it was
disseminated, could have brought the defendant's alleged wrongdoing
to the Government's attention.") (emphasis added); United
States ex rel. Sanchez v. Abuabara, 2012 U.S. Dist. LEXIS
76969 (S.D. Fla. June 4, 2012) (Congress's recent amendments
to the Public Disclosure Bar under PPACA "eliminated an absolute
jurisdictional bar in favor of a jurisdictional bar that can be
lifted by government discretion").
The notion that a true subject matter jurisdiction defect can be
waived by the government is, to this writer's knowledge, an
unprecedented conclusion. Additionally, giving unfettered
discretion to the executive branch (which is "the Government" with
the option to waive the public disclosure bar) has potential
Constitutional implications under a separation of powers analysis
since federal court jurisdiction is generally governed by the
Constitution or Congress. On a more practical scale, it is
incongruous, to say the least, that the government - by definition
a party in every FCA case - has the power to impose jurisdiction on
the federal courts.
The implications of the bar being jurisdictional or not are
extremely significant. First, there are statute of
limitations and retroactivity issues that are impacted. This
was the upshot of the ruling in Beauchamp,
supra. Second, the timing of when an issue must be
raised is impacted, since subject matter jurisdiction can be raised
at any point in a proceeding, and cannot be waived.
Little v. Shell Exploration & Prod. Co., 690
F.3d 282, 285 (5th Cir. 2012)(" a legitimate question about
jurisdiction must be answered no matter when it is first
asked"). Indeed, a court is required to consider its subject
matter jurisdiction sua sponte. E.g., Rockwell
Int'l Corp. v. United States, 549 U.S. 457, 470 (2007)
(Court must decide whether jurisdictional requirement is met);
Grupo Dataflux v. Atlas Global Group, L.P., 541 U.S.
567, 571 (2004) ("If the court determines at any time that it lacks
subject-matter jurisdiction, the court must dismiss the action.");
Fed. R. Civ. P. 12(h)(3).
Who has the burden of establishing the applicability of the
public disclosure bar?
Additionally, the question of who has the burden of establishing
the applicability of the public disclosure bar varies depending on
whether it is a matter of subject matter jurisdiction (burden on
plaintiff to establish jurisdiction) or an affirmative defense
(defendant's burden), and there is a different standard at play in
terms of presuming plaintiff's allegations to be true on a motion
to dismiss. E.g., United States ex rel. Zizic v.
Q2Administrators, LLC, 728 F.3d 228, 234 (3d Cir. 2013)
(plaintiff bears burden of persuasion of establishing jurisdiction
and his jurisdictional allegations are not entitled to a
presumption of truthfulness); United States ex rel. Newell v.
City of St. Paul, 728 F.3d 791, 795 (8th Cir.
2013)(party invoking federal jurisdiction has burden of
establishing court's FCA jurisdiction).
It is this writer's opinion that Congress would not have lightly
eliminated the term jurisdiction unless it intended to remove the
jurisdictional element attached to the bar, and that the government
would not have been given the prerogative to waive the issue if
Congress intended it to remain as an element of subject matter
jurisdiction. Hopefully courts will follow the lead of the
court in Prather and squarely reject the notion that
the public disclosure bar continues to have jurisdictional
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