Universal Health Services, Inc. v. United States

The Supreme Court endorses the implied false certification theory of violation of the federal False Claims Act, but only if the undisclosed facts (such as violations of law) would be material to the United States’ decision to pay the claim.  The implied false certification theory can be a basis for recovery under the federal False Claims Act if the defendant submits a claim for payment, making representations that are half-truths, and omitting to state material facts which would, if disclosed, likely lead to denial of the claim for payment.  Here, the defendant made representations by submitting billings using specific health care codes which represented that it had supplied specific medical services.  However, it omitted the information that many of those supplying those services were not licensed health care providers.  An implied false certification claim may be based on undisclosed violations of statutes or regulations compliance with which is not a stated precondition to payment so long as the government or relator proves that the defendant knowingly violated a requirement that it knew was material to the government’s decision to pay the claim.  However, the materiality requirement is demanding.  It is not satisfied merely by showing that the government is entitled to decline payment for noncompliance with that statute or regulation.

United States Supreme Court (Thomas, J.); June 16, 2016; 2016 WL 3317565

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