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United States v. Meadows Regional Medical Center, Inc.

United States District Court, S.D. Georgia, Statesboro Division

May 16, 2017

UNITED STATES OF AMERICA and THE STATE OF GEORGIA ex rel. PHIL FLEXON, Plaintiffs,
v.
MEADOWS REGIONAL MEDICAL CENTER, INC. and WAYNE WILLIAMS, M.D., Defendants.

          ORDER

          J. RANDAL HALL, CHIF JUDGE UNITED STATES DISTRICT COURT.

         In this qui tarn action, Relator Phil Flexon alleges that Defendants billed the government for services Defendants did not provide and for services that were not medically necessary and that Defendant Meadows Regional Medical Center fired Relator in retaliation for his reporting Defendants' fraudulent conduct. Defendants move to dismiss Relator's claims, arguing (1) that Relator has not sufficiently alleged that Defendants submitted false claims to the government and (2) that there is no causal connection between the termination of Relator's employment and his reporting Defendants' alleged misconduct. The Court, however, is satisfied that Relator has adequately pleaded that Defendants submitted false claims to the government. And when the complaint is viewed in the light most favorable to Relator, he has plausibly alleged a causal connection between his reporting Defendants' actions and the termination of his employment. Accordingly, the Court DENIES Defendants' motion to dismiss (doc. 26).

         I. Factual Background

         This case arises out of Relator's employment with Meadows Regional. Relator joined the staff at Meadows Regional in 2011. (Doc. 24 ¶ 84.) Defendant Dr. Wayne Williams, an ear-nose-and-throat specialist, was also employed by Meadows Regional during Relator's tenure there. (Id. ¶ 4.)

         As an ear-nose-and-throat specialist, Dr. Williams routinely operates on patients' sinuses. (Id. ¶ 52.) But according to Relator, Dr. Williams's surgeries are often a fraud. More specifically, Relator contends that Dr. Williams regularly fails to fully perform surgeries and performs surgeries that are not medically necessary. Relator alleges, for example, that J.H., a patient of Dr. Williams, needed extensive surgery in 2010. (IdL ¶ 77.) Although Dr. Williams operated on J.H., Relator contends, he did not perform the surgery he claimed to have performed. (Id. ¶ 77.) Relator also alleges, as another example, that Dr. Williams performed procedures on another patient, N.G., that were not medically necessary.[1] (Id. ¶ 79.) Relator alleges, moreover, that Defendants submitted claims for payment for these surgeries to the government. (Id. ¶¶ 77, 79, 81.) Relator uncovered Dr. Williams's fraudulent practices when he operated on two of Dr. Williams's former patients. (Id. ¶¶ 87-88.) Relator apprised Meadows Regional of his discovery, and he claims that Meadows Regional fired him in retaliation for reporting his findings. (Id. ¶¶ 88, 91-92.)

         II. Procedural Background

         Relator filed a sealed complaint in this Court in April 2015, alleging violations of the False Claims Act, 30 U.S.C. § 3729 et seq., and the Georgia Medicaid False Claims Act, O.C.G.A. § 49-4-168 et seq. (Doc. 1.) After investigating, the government declined to intervene, and the Court unsealed Relator's complaint and ordered it served on Defendants in September 2016. (Docs. 11, 12.) Defendants moved to dismiss Relator's complaint, and in response, Relator moved for leave to amend. (Docs. 17, 19.) Defendants consented and the Court granted Relator leave to file an amended complaint. (Doc. 23.) Defendants now move to dismiss Relator's claims.[2] (Doc. 26.)

         III. Legal Standards

         In considering a motion to dismiss under Rule 12(b)(6), the Court tests the legal sufficiency of the complaint. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). The Court must accept as true all facts alleged in the complaint and construe all reasonable inferences in the light most favorable to the plaintiff. See Hoffman-Pugh v. Ramsey, 312 F.3d 1222, 1225 (11th Cir. 2002). The Court, however, need not accept legal conclusions as true, only well-pleaded facts. Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009).

         A complaint also must "'contain sufficient factual matter, accepted as true, *to state a claim to relief that is plausible on its face.'" Id. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The plaintiff is required to plead "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. "The plausibility standard is not akin to a 'probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id.

         Under Rule 9(b), a plaintiff alleging fraud "must state with particularity the circumstances constituting fraud . . . ." Fed.R.Civ.P. 9(b). The purpose of this rule is to alert "defendants to the precise misconduct with which they are charged . . . ." Ziemba v. Cascade Int'l, Inc., 256 F.3d 1194, 1202 (11th Cir. 2001) (citation omitted) (internal quotation marks omitted). And it requires a plaintiff to allege details of the defendant's "allegedly fraudulent acts, when they occurred, and who engaged in them." Cooper v. Blue Cross & Blue Shield of Fla., Inc., 19 F.3d 562, 568 (11th Cir. 1994) (per curiam).

         IV. Discussion

         Relator asserts claims under 31 U.S.C. §§ 3729[3] and 3730(h).[4] More specifically, Relator contends that Defendants billed the government for services that Dr. Williams did not perform and for services that were not medically necessary in violation of § 3729. And he argues that Meadows Regional violated § 3730(h) because it terminated his employment in retaliation for his reporting the fraudulent practices. Defendants move to dismiss Relator's claims, arguing that he has failed to plead sufficient facts to support his claims.

         A. 31 ...


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