FCA Retaliation Claim Reinstated by Sixth Circuit

The dismissal of a False Claims Act relator's retaliation claim for failure to state a claim was overturned on appeal to the Sixth Circuit Court of Appeals, because the relator sufficiently alleged she was engaged in a protected activity, her employer knew she was engaged in the protected activity, and she was discharged as a result. The district court dismissed the relator's claim for failure to comply with Federal Rule of Civil Procedure 8(a)(2), which requires a plaintiff's complaint to include "a short and plain statement of the claim showing that the pleader is entitled to relief." Under 31 USC 3730(h), to obtain relief for an FCA retaliation claim, the plaintiff must prove she was engaged in a protected activity, the employer knew she was engaged in the protected activity, and the employer discharged or otherwise discriminated against the employee as a result of the protected activity. A "protected activity" is a lawful act done by the employee on behalf of the employee or others in furtherance of an FCA action, including investigation for, initiation of, testimony for, or assistance in an FCA action filed or to be filed. The district court had found the relator did not allege participation in a "protected activity" because she failed to establish her employer knew she was considering an FCA action.

However, the district court impermissibly narrowed the Sixth's Circuit's interpretation of the term "protected activity," established by the Sixth Circuit in U.S. ex rel. McKenzie v. Bellsouth Telecommunications, Inc. (41 CCF ¶77,165), as any activity that would have given the defendant reason to believe the relator was contemplating an FCA action. Here, the relator met the McKenzie standard when she informed her employer she believed the use of fraudulent medical reporting was causing it to receive illegal incentive payments under its contract with the government. The relator sufficiently put her employer on notice when she wrote a letter to the president and general manager that gave specific information regarding the alleged illegal activities and asserted she had been placed on administrative leave because she had refused to participate in the illegal activities. Therefore, the relator's complaint contained all the required elements of a retaliation claim under 31 USC 3730(h), and was sufficient under the pleading standards of FRCP 8(a)(2). (U.S. ex rel. Marlar v. BWXT Y-12, L.L.C., CA-6, 52 CCF ¶78,937)

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