Purdue Pharma Br. It has been noted that "[c]ourts have applied Rumery to a broad spectrum of pre- and post-filing releases of qui tam claims entered into without the United States' knowledge or consent." Longhi involved a release executed eleven days after the relator filed a qui tam complaint. 2d 1158, 1164-65 (N.D. Ill. 2007). Defs.' Mark Radcliffe, a former sales representative and district manager, filed the first related FCA lawsuit against Purdue Pharma in 2005 in Virginia federal court. The facts on which I have determined jurisdiction are as follows. In September and December of 2005, the Department of Justice contacted Purdue with electronic search terms, some of which pertained to the relative cost and potency issue. The one silver lining is that this behavior is largely limited to big city law practice, in which lawyers rarely appear regularly in the same court against the same opposing counsel, the response says. 2007). United States ex rel. 458 (S.D.N.Y. at 1513. The plaintiff-relator, Mark Radcliffe ("Radcliffe"), filed a qui tam suit in the United States District Court for the Western District of Virginia alleging that his former employer, Purdue Pharma, L.P. ("Purdue"), defrauded the government by marketing its pain-relief drug, OxyContin, as a cheaper alternative to the drug it replaced, MS Contin . This furthers the public interests in encouraging a potential relator to disclose his allegations to the government as quickly as possible, before the government has an opportunity to discover the alleged wrongdoing through other means. As in Bahrani, when the release was executed there was no guarantee that the government would end up prosecuting based on the relator's allegations. But see United States ex rel. Radcliff is a former sales representative and manager at Purdue, who left its employment shortly before he filed the present suit. Thus, allowing enforcement of such a release to bar a subsequent qui tam suit undermines the financial incentives thought necessary by Congress to ensure that those with inside knowledge file qui tam suits alerting the government of the alleged fraud and potentially assisting the government with its investigatory and prosecutory burden. Subsequent cases have not addressed this type of argument. The Fourth Circuit does not have any analogous case law interpreting Rumery. at 1043-46. Specifically, they argue that, as here, where the government learned of the allegations independently and had already begun its investigation into the substance of the allegations prior to the date of the release, where the relator delayed in filing the qui tam complaint and attempted to settle with the defendants prior to doing so, and where the government ultimately chose not to intervene, enforcement of the release is appropriate. Hurt thus acted in bad faith by bringing an action when he knew that Relators had no personal knowledge of the allegations he drafted in their name.. After carefully considering the arguments of the parties, I hold that the Complaint does not adequately state a claim for fraud under Rule 9(b). Section 3730(e)(4)(A) provides an exclusive list of sources that may give rise to a public disclosure that will strip a court of subject matter jurisdiction: "disclosures in (1) criminal, civil, or administrative hearings; (2) congressional, administrative, or Government [Accountability] Office reports, hearings, audits, or investigations; and (3) the news media." In finding the release unenforceable, the court reasoned that the limited knowledge of the allegations held by the government did not negate the public interest in providing incentives for the relator to fully disclose inside information concerning the allegations to the government. Ten years ago, Mark Radcliffe, a former district sales manager for Purdue Pharma, filed a qui tam action under the FCA against Purdue. The Ninth Circuit also relied on Davies v. Grossmont Union High School District, 930 F.2d 1390 (9th Cir. Bahrani, 183 F. Supp. Id. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. Purdue Pharma's attorneys suspected that Radcliffe was behind those threats. Some studies recommended an equianalgesic ratio of 1:1, particularly for chronic, around-the-clock dosing; they acknowledged studies that recommended a ratio of 2:1 for single or intermittent doses. To the extent that Radcliffe based the allegations in his Complaint on either the published abstract or the published article, these constitute public disclosures in the news media. Howard M. Shapiro and Jennifer M. O'Connor, Wilmer Cutler Pickering Hale and Dorr LLP, Washington, D.C., and Howard C. McElroy, McElroy, Hodges, Caldwell, Abingdon, VA, for Purdue Pharma L.P. and Purdue Pharma, Inc. Purdue cites United States ex rel. Bahrani, 183 F. Supp. Adams v. Bain, 697 F.2d 1213, 1219 (4th Cir. 1348, 89 L.Ed.2d 538 (1986) (quotations and citations omitted). Accordingly, I do not address Purdue's second argument that the package insert is a public disclosure from an administrative investigation. I think it is sufficient under Hall that the government know of the substance of the allegations. Id. Mot. United States ex rel. After the present qui tam suit was stayed, the government's investigation continued. Yannacopolous v. General Dynamics, 315 F. Supp. Radcliffe's allegations pertain to the issue of the relative cost and potency of OxyContin and MS Contin. (Mountcastle Decl. The allegation is contained in a motion asking U.S. District Judge Irene Berger, of the Southern District of West Virginia, to force the plaintiffs and their attorneys to pay the companys nearly $850,000 legal bill in the second case, which Berger dismissed on Oct. 31. at 963. Purdue cites Gebert, 260 F.3d 909, in which the government did not investigate until after the filing of the qui tam complaint and the court ultimately chose to enforce the release. The opinion makes no mention of what type of web page this is or whether it bears any resemblance to a traditional periodical. However, he states that no details of the alleged misconduct were given and the attorney did not identify the name of his client. United States ex Noah Nathan v. Takeda Pharmaceuticals North America, Inc. This rule would also make the enforcability of such a release dependant on the government's intervention decision and may discourage some potential relators from initiating qui tam suits in the first place, leaving some allegations undisclosed. (f)(2).) Dismiss 11.) Id. Will be used in accordance with our terms of service & privacy policy. Purdue also argues that in Hall itself the government had not completed its investigation prior to the execution of the release. Id. Disclosures made in other public forums do not implicate the public disclosure bar. Matsushita Elec. Given the vast array and varying credibility of web pages on the Internet, I am not ready to conclude that anything posted online would automatically constitute a public disclosure within the meaning of 3730(e)(4)(A). Va.)) None of the misbranding charges pertained to the relative cost and potency issue. The two are represented by the same two attorneys who represented Mark Hurt and Roop. On Nov. 17, Purdue Pharma alleged attorney Mark Hurt of Abingdon, Va., used information from a previous, unsuccessful whistleblower lawsuit against Purdue Pharma to file another through the plaintiffs wife and former coworker. In responding to Purdue Pharmas allegations, the attorneys say the whistleblowers have always been upfront that their knowledge of the alleged scheme was second-hand. 1999). 3729 et seq., against Purdue, alleging that the company was involved in a fraudulent scheme regarding the equianalgesic ratio of OxyContin. On August 2, 2005, a subpoena was issued commanding Radcliffe to appear before the grand jury. Va. 2007) (accepting plea agreements). Radcliffe v. Purdue Pharma L.P., 600 F.3d 319 (4th Cir. He attached to the complaint at least one document already in the government's possession: an "Answer Guide" used to train sales representatives, which urged them to emphasize OxyContin's higher potency and lower cost compared to MS Contin. ), aff'd, 53 F. App'x 153 (2d Cir. With respect to the settlement attempts, it would seem counterintuitive to enforce a release to bar a subsequent qui tam suit, thus foreclosing the relator's ability to prosecute on behalf of the government, to punish that relator for trying to settle instead of filing suit in the first place. Purdue Pharma L.P., No. The generalized interest in settling litigation is outweighed in the present circumstances by public interests that would be impaired by enforcement of this release, and so analysis under the Rumery test does not favor enforcing Radcliffe's release. . 2010). McLean v. County of Santa Clara, No. Ten years ago, Mark Radcliffea former district sales manager for Purdue Pharma ("Purdue")filed a qui tam action under the FCA against Purdue. Radcliffe encountered skepticism from physicians he spoke with regarding OxyContin's relative cost and potency. 1039, 1043-47 (S.D.N.Y. He was also told that Purdue's decision to rely on the 2:1 ratio, despite published articles indicating that the 1:1 ratio was more appropriate for OxyContin's approved use, was based on safety concerns, that is, it was better for doctors to start with a lower dose and adjust upward if necessary. [2] The court found no statutory or policy reasons to prevent enforcement of the release. More than a year later, after he had executed the release, the relator was contacted by USDA investigators and at this time he provided detailed information regarding his allegations. 2006). 2010) case opinion from the U.S. Court of Appeals for the Fourth Circuit L E Corp. v. Days Inns of Am., Inc., 992 F.2d 55, 58 (4th Cir. 2d at 820 ("If there is a dividing line to be found between Hall and Green, it is the fullness of the government's investigation, not the timing of the release."). It is unclear from Hall whether the NRC was made aware of the identity of the specific person making the allegations when it first investigated the matter. On September 27, 2005, Radcliffe filed his qui tam Complaint. . This action was stayed for some time at the request of the federal government, which eventually declined to intervene, along with all of the thirteen state governments named in the Complaint. Kennedy v. Aventis Pharms., Inc., 512 F. Supp. See United States ex rel. at 961 (applying the three-part test in United States v. Kimbell Foods, Inc., 440 U.S. 715 (1979)). and, accordingly, less expensive than MSContin" and the accuracy of "the 2:1 comparison of OxyContin to MSContin." Pharmacol. The parties have been provided with the sealed copy. at 308. Id. 2d 569, 576 (W.D. MARK RADCLIFFE: Defendant - Appellee: PURDUE PHARMA L.P. and PURDUE PHARMA, INCORPORATED: Amicus Curiae: Admin. Co. v. Quinn, 14 F.3d 645, 654-55 (D.C. Cir. See Agency for Health Care Policy Research, Public Health Serv., U.S. Dept. The published scientific articles and reference materials cited by Radcliffe in his Complaint the Clinical Practice Guideline, the USP, and the Textbook of Pain fall within the "news media" category of 3730(e)(4)(A) and constitute public disclosures. Gilligan, 403 F.3d at 389; see also Springfield, 14 F.3d at 655; United States ex rel. Harrison v. Westinghouse Savannah River Co., 176 F.3d 776, 784 n. 5 (4th Cir. . Va. 1989). During this time the government was conducting a criminal investigation of Purdue's marketing of OxyContin, eventually resulting in guilty pleas in this court by a related company and three of Purdue's top executives. However, that is not the situation before me. Likewise, the prior public disclosures reveal that there was contradicting scientific evidence as to the relative potency of OxyContin to MS Contin, but they do not imply fraud. While allegations of fraud were known to the Department of Justice, they had not been publically disclosed within the meaning of 3730(e)(4)(A). Indus. (c) and (f)(2)). Id. 2d 1272, 1275-78 (D. Colo. 2002); United States ex rel. Radcliffe was interviewed a second time in September 2006 and asked about the misleading promotion of OxyContin. at 231-32. ( Id. Mot. No list was kept of the documents reviewed or flagged, but according to the declaration of one of Purdue's outside counsel these included documents about the dispute over the relative potency of OxyContin and MS Contin. Purdue urges the court to consider pre- Green cases Virginia Impression Products Co. v. SCM Corp., 448 F.2d 262 (4th Cir. Mountcastle argued that the suit could hinder the investigation because while Purdue was aware of the investigation "no mention ha[d] been made that the 2:1 comparison of OxyContin and MSContin [was] one of the areas under investigation." Green involved a general release between an employer and a terminated employee, who later filed a qui tam suit against that employer. at 956-57. While the prior public disclosures included information that was true, they did not reveal the "true" state of facts regarding the executives' knowledge or intentions. Id. (quoting 5 Charles Alan Wright Arthur R. Miller, Federal Practice and Procedure 1297, at 590 (2d ed. Rost v. Pfizer, Inc., 507 F.3d 720, 733 (1st Cir. The court held the release unenforceable both because it was executed within the statutory sixty-day investigatory period and interfered with the government's ability to evaluate whether to intervene in the suit and because it was contrary to public policy under the Green/Hall framework. Id. (c).) Specifically, he alleged that Purdue fraudulently marketed OxyContin using the 2:1 equianalgesic ratio, thus claiming that its relative cost was less than that of MS Contin. Regardless, the 1996 abstract was published in Clinical Pharmacology Therapeutics, a scientific journal headquartered in Alexandria, Virginia. Here, it appears that the government did learn of the substance of Radcliffe's allegations independently and was interested enough in them to request documents pertaining to and question various Purdue employees about the relative cost and potency issue. 9 n.4. Id. Radcliffe was a district sales manager for Purdue, laid off as part of a reduction in force in June 2005. Id. Id. at 1512. The term "news media" includes scholarly, scientific, and technical periodicals, including trade journals, because, like newspapers, these sources disseminate information to the public in a periodic manner. The relator would likely be willing to accept a lower overall settlement amount from the other party, knowing that he would receive the entire amount, rather than only a portion of the settlement. In January and February of 2005 Radcliffe sent emails to several officers and directors of Purdue, using the alias "John Femaledeer." Co., 142 Cal. In his employment with Purdue between 1996 and 2005, Radcliffe was responsible for marketing OxyContin to individual physicians and became familiar with Purdue's marketing claims about OxyContin's relative cost and potency, including the claim that there is a 2:1 equianelgesic ratio between OxyContin and MS Contin. 2010), the district court dismissed . During this period . Defs.' The district court determined that between 1996 and 2005 Radcliffe, on behalf of Purdue, marketed "OxyContin, The final and perhaps the most difficult issue is whether the public disclosure reveals "allegations or, Full title:UNITED STATES, et al., ex rel. 3730(e)(4)(A); see United States ex rel. Further, the public policy concerns raised by Purdue do not alter the relative balance of public interests under the Rumery test. Gebert v. Transp. While these disclosures all reveal true information regarding the current state of the scientific debate, they do not reveal the "true" state of facts regarding the fraud alleged by the relator, that is, that Purdue used the 2:1 ratio despite knowing that it was inaccurate in order to mislead physicians and other decision-makers regarding the relative cost and potency of OxyContin. Id. Id. Id. While the OxyContin package insert recommends the 2:1 conversion ratio as a starting point for doctors switching patients from MS Contin to OxyContin, it also suggests the need to reevaluate based on each individual patient's response to the new medication. Wilson v. Graham County Soil Water Conservation Dist., 528 F.3d 292, 309 (4th Cir. 1971), and Coleson v. Inspector General of the Department of Defense, 721 F. Supp. The three articles cited by Radcliffe were published in scientific and medical reference periodicals that distribute new or updated material on a periodic basis. Under 3730(e)(4), an action is properly dismissed for lack of subject matter jurisdiction only if there was a public disclosure on which the relator's allegations were based and that relator is not an original source. If a substantial public interest would be impaired, the court need not engage in the Rumery balancing test unless there is an articulated reason favoring enforcement aside from the "`interest in the settlement of litigation,'" as that "`cannot by itself outweigh a substantial public interest on the other side of the scales.'" Enforcement of a release to bar a subsequent qui tam suit implicates several articulated public interests. Wilson, 528 F.3d at 300-01 (alternations and internal quotations omitted); see Eberhardt v. Integrated Design Constr., Inc., 167 F.3d 861, 870 (4th Cir. Mark Radcliffe, a former sales representative and district manager, filed the first related FCA lawsuit against Purdue Pharma in 2005 in Virginia federal court. In this action brought under the qui tam provisions of the False Claims Act ("FCA"), 31 U.S.C.A. Green v. Serv. They amended their complaint, and again Purdue Pharma asked Berger to dismiss it. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. 425, 428 (1999). The citations it relies on to support this argument are inapposite or misleading. Beginning in 2002 and continuing for the next several years, the government sought millions of documents from Purdue and conducted hundreds of interviews, some of which pertained to the relative potency and cost of OxyContin and MS Contin. These include the public interest in having relators disclose inside information of alleged fraud to the government, in having relators supplement federal enforcement of the FCA by assisting the government in its investigation and prosecution or prosecuting the claim itself, and in deterring future fraud against the government. A separate order will be entered herewith. The Fourth Circuit follows a three-step approach in determining whether the public disclosure bar applies. Purdue then filed the present Motion to Dismiss, seeking a dismissal on the grounds that Radcliffe's claims are based on publicly disclosed information rather than information he discovered; that Radcliffe has released Purdue from the claims; and that the Complaint fails to adequately allege fraud as required by Federal Rule of Civil Procedure 9(b). Radcliffe v. Purdue Pharma, L.P., 562 U.S. 977 (2010), his wife Angela decided to "take up . Auth. However, the government ultimately took its investigation in a different direction, focusing on the misbranding of OxyContin as "less addictive, less subject to abuse and diversion, and less likely to cause tolerance and withdrawal than other pain medications." at 1278. at 1512-13. This case briefly mentions several sources "two previously filed lawsuits against defendant, as well as an Internet web page and a Pittsburgh Post-Gazette article" and summarily concludes that "these constitute public disclosures." The plaintiff-relator, Mark Radcliffe ("Radcliffe"), filed a qui tam suit in the United States District Court for the West-ern District of Virginia alleging that his former employer, Purdue Pharma, L.P. ("Purdue"), defrauded the government . In Virginia Impression Products, which was decided before Green and also before Rumery, the Fourth Circuit chose to enforce a release to bar a subsequent antitrust claim. . On June 23, 2005, the government requested that Purdue identify the author and source of different versions of a document [Redacted] already in the government's possession, [Redacted]. and as a result, generally more expensive than the OxyContin that was described in [Purdue's] marketing pitch to the same physicians." While the issue of whether a general release is enforceable to bar a subsequent qui tam action has not been addressed by the Fourth Circuit, the framework established by the Ninth Circuit in United States ex rel Green v. Northrop Corp., 59 F.3d 953 (9th Cir. It has held that public policy is implicated only where "it is explicit, well defined and dominant, and ascertainable by reference to the laws and legal precedents and not from general considerations of supposed public interests." The qui tam provisions are designed to supplement government enforcement of the FCA by using financial incentives to encourage insiders privy to fraud on the government to disclose this inside knowledge and potentially prosecute violations. Based on the evidence in the present case, it is clear that the government was aware of the substance of Radcliffe's allegations and had begun, but not completed, its investigation of these allegations as of the date of the release. at 733-34 (remanding to allow leave to amend). Virginia Search this Docket Tags Get Alerts View on PACER Last Updated: Dec. 28, 2020, 6:49 a.m. EST Assigned To: James Parker Jones Referred To: Pamela M. Sargent Date Filed: Sept. 27, 2005 Date Terminated: Jan. 25, 2009 Date of Last Known Filing: June 1, 2010 DeCarlo, 937 F. Supp. "); Longhi, 481 F. Supp. 2d at 1278. To determine whether the circumstances of a case fall within the general rule articulated in Green or the exception in Hall, the critical issue is the completeness of the government's knowledge or the fullness of its investigation. Tex. The government's decision not to intervene "does not necessarily signal governmental disinterest in an action, as it is entitled to most of the proceeds even if it opts not to intervene."