Latest 2 Cases This Week: United States v. Strock (2d Cir.), Maur v. Hage-Korban (6th Cir.)

How Mike Huckabee and Robert Bork Could Help Center Neil Gorsuch

SHERRY F. COLB

Cornell law professor Sherry F. Colb analyzes an unusual comment by former Arkansas Governor Mike Huckabee that a government restriction on the size of people’s Thanksgiving gathering would violate the Fourth Amendment’s guarantee against unreasonable searches and seizures. Colb describes a similar statement (in a different context) by conservative Supreme Court nominee Robert H. Bork during his (unsuccessful) confirmation hearings in 1987 and observes from that pattern a possibility that even as unenumerated rights are eroded, the Court might be creative in identifying a source of privacy rights elsewhere in the Constitution.

Read More

United States v. Strock

Court: US Court of Appeals for the Second Circuit

Docket: 19-4331

Opinion Date: December 3, 2020

Judge: Robert A. Katzmann

Areas of Law: Government Contracts

The United States appealed the district court's dismissal of its claims under the False Claims Act (FCA) and federal common law against SCI. The government's claims stemmed from its belief that a service-disabled veteran's ownership in VECO was illusory. Rather, the government alleges that the company was controlled by Defendant Lee Strock, who set up VECO as a front to funnel contract work for his company, SCI. The Second Circuit concluded that the district court's finding with respect to materiality was erroneous because it was premised on too restrictive a conception of the FCA materiality inquiry set out in Universal Health Services, Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (2016); the government has plausibly alleged materiality in this case; the district court's conclusion that the complaint failed to allege defendants' knowledge was erroneous as to Lee Strock, and potentially as to SCI, but not as to Cynthia Golde; and the district court should not have dismissed the common law claims on jurisdictional grounds because it had original jurisdiction over these claims under 28 U.S.C. 1345. Accordingly, the court affirmed in part, reversed in part, and vacated in part.

Maur v. Hage-Korban

Court: US Court of Appeals for the Sixth Circuit

Docket: 20-5301

Opinion Date: December 1, 2020

Judge: Larsen

Areas of Law: Civil Procedure, Government & Administrative Law, Government Contracts, Health Law, Public Benefits

Dr. Korban and his medical practice Delta, practice diagnostic and interventional cardiology. In 2007, Dr. Deming filed a qui tam action under the False Claims Act (FCA), 31 U.S.C. 3729(a)(1)(A)–(C), (G) against Korban, Jackson Regional Hospital, and other Tennessee hospitals, alleging “blatant overutilization of cardiac medical services.” The United States intervened and settled the case for cardiac procedures performed in 2004-2012. Korban entered into an Integrity Agreement with the Office of Inspector General, effective 2013-2016 that was publicly available and required an Independent Review Organization. The U.S. Department of Justice issued a press release that detailed the exposed fraudulent scheme and outlined the terms of Korban’s settlement. In 2015, Jackson Regional agreed to a $510,000 settlement. The Justice Department and Jackson both issued press releases. In 2017, Dr. Maur, a cardiologist who began working for Delta in 2016, alleged that Korban was again performing “unnecessary angioplasty and stenting” and “unnecessary cardiology testing,” paid for in part by Medicare. In addition to Korban and Jackson, Maur sued Jackson’s corporate parent, Tennova, Dyersburg Medical Center, and Tennova’s corporate parent, Community Health Systems. The United States declined to intervene. The district court dismissed, citing the FCA’s public-disclosure bar, 31 U.S.C. 3730(e)(4). The Sixth Circuit affirmed. Maur’s allegations are “substantially the same” as those exposed in a prior qui tam action and Maur is not an “original source” as defined in the FCA.