Health Law Daily Motion for certification of interlocutory appeal fails in case alleging widespread healthcare fraud
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Friday, June 12, 2020

Motion for certification of interlocutory appeal fails in case alleging widespread healthcare fraud

By Karin Hicks, J.D.

A district court finds that health care organizations did not present exceptional legal issues that meet the heavy burden for immediate appeal.

The United States District Court in Minnesota denied the motion for certification of interlocutory appeal and for a stay pending appeal in a protracted qui tam case alleging widespread healthcare fraud. Several health care organizations are accused of violating the False Claims Act (FCA) by submitting false Medicare claims in an extensive scheme involving the provision of therapy services to nursing home patients. The court determined that the motion did not meet the heavy burden of demonstrating the need for granting the extraordinary relief of interlocutory review (U.S. ex rel. Johnson v. Golden Gate National Senior Care, LLC, June 10, 2020, Frank, D.).

Factual Background. The relators filed this qui tam action in 2008 alleging that Golden Gate National Senior Care, LLC., GGNSC Holdings, LLC, GGNSC Wayzata, LLC., and Aegis Therapies, Inc. violated the FCA. The relators allege that the health care organizations submitted false Medicare claims in connection with the provision of physical and occupational therapy services to nursing home patients. The relators’ complaint involved two separate time periods, which the court bifurcated into Phase I and Phase II. The court split the time periods and divided discovery such that Phase II would only occur if relators’ Phase I claims survived summary judgment.

The district court granted in part and denied in part the health care organizations’ motion for summary judgment with respect to Phase I on December 9, 2016. On January 10, 2020, the organizations moved for summary judgment on the Phase II claims and theories. The district court ultimately denied the motion in its entirety on May 27, 2020.

In the present action, the health care organizations moved to certify the Phase I Order and a separate April 2020 order for interlocutory appeal and motion for a stay pending appeal. The organizations sought to certify five questions related to specifics of the litigation. The motion was opposed by both the relators and the government.

Motion. The motion was before the court pursuant to 28 U.S.C. § 1292(b), which allows district courts to certify orders for interlocutory appeal if certain criteria are satisfied and the district court determines that certification is appropriate. The court pointed out that Section 1292 is to be used only in extraordinary cases in which the decision of interlocutory appeal might avoid protracted litigation and was not intended to merely provide review of difficult rulings in hard cases.

The health care organizations argued that the questions they sought to certify are controlling questions of law and are based on interpretations of the meaning of the FCA. The relators asserted that the health care organizations’ motion was an attempt to obtain immediate review of unfavorable decisions. The government further contended that the motion did not present any exceptional legal issues that rose to the level required to grant an immediate appeal.

Decision. The court determined that the health care organizations had not demonstrated that the circumstances warranted the extraordinary relief of interlocutory review. Specifically, the court indicated that it found no controlling question of law which would necessitate further delay in a case that has already seen 12 years of litigation.

The case is No. 08-1194 (DWF/HB).

Attorneys: Chad A. Blumenfield, U.S. Attorney's Office, for the United States. Jonathan M. Bye (Ballard Spahr LLP) for Health Dimensions Rehabilitation, Inc. Amy Slusser Conners (Best & Flanagan LLP) for Golden Gate National Senior Care, L.L.C. d/b/a Golden LivingCenter, GGNSC Holdings, L.L.C. d/b/a Golden LivingCenter, GGNSC Wayzata, L.L.C. d/b/a Golden LivingCenter and Aegis Therapies, Inc.

Companies: Health Dimensions Rehabilitation, Inc.; Aegis Therapies, Inc.; Golden Gate National Senior Care, L.L.C. d/b/a Golden LivingCenter; GGNSC Holdings, L.L.C. d/b/a Golden LivingCenter; GGNSC Wayzata, L.L.C. d/b/a Golden LivingCenter

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