The U.S. Supreme Court ruled Thursday in Universal Health Services v. Escobar that corporations can face False Claims Act liability if they bill the government while out of compliance with regulations that aren’t explicit conditions of payment. Here, attorneys tell Law360 why the decision is significant.
Thomas J. Finn, McCarter & English LLP
“Today’s Supreme Court decision reaffirms the implied false certification theory of liability. In doing so, the court held that liability can be imposed upon a government contractor for its knowing non-compliance with federal statutes, regulations, or contract requirements, regardless of whether the requirements were an express condition of payment. The court’s decision, in my view, added further ambiguity to this theory of liability under the FCA. The practical effect is that government contractors are left with no greater clarity as to what would be considered material to the government’s payment decision, thus subjecting them to liability for criminal penalties, civil penalties, and treble damages.”