United States District Court, D. South Carolina
ORDER and OPINION
Richard Mark Cergel United States District Court Judge
matter is before the Court on defendant Latonya Mallory's
motion for summary judgment of Relators Scarlett Lutz and
Kayla Webster's Third Amended Qui Tarn
Complaint. (Dkt. No. 500.) Lutz and Webster have filed a
response in opposition (Dkt. No. 519), and Mallory has filed
a reply (Dkt. No. 529). For the reasons set forth below,
Mallory's motion for summary judgment (Dkt. No. 500) is
granted in part and denied in part.
February 6, 2013, Relators Lutz and Webster filed a qui
tarn complaint alleging that several defendants including
BlueWave Health Care Consultants, Inc.
("BlueWave"), Health Diagnostics Laboratory
("HDL"), Singulex, Inc., and several individuals
including Defendants Mallory, Floyd Calhoun Dent, III, and
Robert Bradford Johnson orchestrated a nationwide scheme to
offer and pay kickbacks to physicians who ordered HDL and/or
Singulex tests in violation of the federal False Claims Act
("FCA"), 42 U.S.C. § 3729, the Anti-Kickback
Statute ("AKS"), 42 U.S.C. § 1320a-7b(b),
various state false claims acts, and insurance fraud statutes
in California and Illinois. Specifically, Relators allege the
defendants' financial relationships with physicians
provided financial incentives for the use of their laboratory
services and resulted in billing private insurers for
medically unnecessary testing services, in violation Section
1871.7(a) of the CIFPA, Cal. Ins. Code 1871.7(a), and Section
92/5(a) of the ILCFPA 740 111. Comp. Stat. § 92/5(a).
(Dkt. No. 275 at 11). Relators also allege that defendants
conspired to commit violations of the federal and state false
claims acts. (Dkt. No. 275 at 10.)
filed this motion for summary judgment on June 23, 2017.
(Dkt. No. 500.) The Court has since granted Relators'
motion to dismiss many of their state law claims. (Dkt. No.
608.) Relators' remaining claims against Mallory arise
under the false claims acts of Colorado, Florida, Illinois,
Indiana, North Carolina, and Virginia and under insurance
fraud statutes in California and Illinois. (Dkt. No. 595 at
1-2.) Mallory has moved for summary judgment on all of
Relators' remaining state law claims. (Dkt. No. 500.)
Legal Standard A. Summary Judgment
prevail on a motion for summary judgment, the movant must
demonstrate that there is no genuine issue of any material
fact and that the movant is entitled to judgment as a matter
of law. Fed. R. Civ. P. 56(a). The party seeking summary
judgment has the burden of identifying the portions of the
"pleadings, depositions, answers to interrogatories, any
admissions on file, together with the affidavits, if any,
which show there is no genuine issue as to any material fact
that the moving party is entitled to judgment as a matter of
law." Celotex Corp. v. Catrett, 411 U.S. 317,
322 (1986). The Court will construe all inferences and
ambiguities against the movant and in favor of the non-moving
party. U.S. v. Diebold, Inc., 369 U.S. 654, 655
(1962). The existence of a mere scintilla of evidence in
support of the non-moving party's position is
insufficient to withstand a motion for summary judgment.
Anderson v. Liberty Lobby, Inc.,477
U.S.242, 252 (1986). However, an issue of material
fact is genuine if the evidence is such that a reasonable
jury could return a verdict in favor of the non-movant.
Id. at 257.
the moving party has carried its burden under Rule 56(c), its
opponent must do more than simply show that there is some
metaphysical doubt as to the material facts."
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586 (1986). "In the language of the Rule,
the nonmoving party must come forward with 'specific
facts showing that there is a genuine issue for
trial."' Id. at 587. "Where the record
taken as a whole could not lead a rational trier of fact to
find for the non-moving party, there is no 'genuine issue
for trial.'" Id. (quoting First
Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S.
253, 289 (1968)).
False Claims Act
order to establish a violation of the False Claims Act, a
plaintiff must show that: (1) there was a false statement or
fraudulent course of conduct; (2) made or carried out with
the requisite scienter; (3) that was material to the
government's decision to pay a claim; and (4) that caused
the government to pay out money or to forfeit moneys due.
See United States ex rel. Wilson v. Kellogg Brown &
Root, Inc., 525 F.3d 370, 376 (4th Cir. 2008). The state
false claims acts at issue here generally mirror the federal
FCA. (Dkt. No. 275 at 42, explaining that "[t]he false
claims acts of the sovereign States of North Carolina,
California, Colorado, Delaware, Florida, Georgia, Illinois,
Indiana, Iowa, Louisiana, Michigan, Minnesota, New Jersey,
New York, Tennessee, Texas, Virginia, and Wisconsin generally
mirror the federal FCA").
Intervened Federal FCA Claims
United States has intervened in all of Lutz and Webster's
claims against Mallory that arise under the federal FCA.
Because the Government bears responsibility for prosecuting
those claims under 31 U.S.C. § 3730(c)(1), the Court
will consider Mallory's arguments about those claims in
its order on Mallory's motion for summary judgment on
claims in the Government's Complaint in Intervention.
(Dkt. No. 498.)