United States Court of Appeals For the First Circuit
No. 23-2086
UNITED STATES OF AMERICA,
Plaintiff, Appellant,
v.
REGENERON PHARMACEUTICALS, INC.,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
[Hon. F. Dennis Saylor IV, U.S. District Judge]
Before
Montecalvo, Thompson, and Kayatta, Circuit Judges.
Daniel Winik, Attorney, Civil Division, U.S. Department of Justice, with whom Brian M. Boynton, Principal Deputy Assistant Attorney General, Civil Division, U.S. Department of Justice, Joshua S. Levy, Acting U.S. Attorney, District of Massachusetts, Michael S. Raab, Attorney, Civil Division, U.S. Department of Justice, and Charles W. Scarborough, Attorney, Civil Division, U.S. Department of Justice, were on brief, for appellant.
Paul D. Clement, with whom Matthew D. Rowen, Clement & Murphy, PLLC, Theodore V. Wells, Jr., H. Christopher Boehning, Paul Weiss Rifkind Wharton & Garrison LLP, Richard L. Scheff, Katharine Ladd, Faegre Drinker Biddle & Reath LLP, Brien T. O'Connor, John P. Bueker, and Ropes & Gray LLP were on brief, for appellee.
Tara S. Morrissey, Andrew R. Varcoe, U.S. Chamber Litigation Center, Jeffrey S. Bucholtz, Matthew V.H. Noller, and King & Spalding LLP on brief for Chamber of Commerce of the United States of America, amicus curiae.
February 18, 2025 KAYATTA, Circuit Judge. This appeal calls for us to
determine the meaning of the words "resulting from" as used in a
2010 amendment to the federal Anti-Kickback Statute (AKS), 42
U.S.C. § 1320a-7b. See Patient Protection and Affordable Care
Act, Pub. L. No. 111-148, 124 Stat. 119, 759 (2010) (codified at
42 U.S.C. § 1320a-7b(g)). That 2010 amendment states that "a claim
[for payment by a federal healthcare program] that includes items
or services resulting from a violation of [the AKS] constitutes a
false or fraudulent claim for purposes of" the False Claims Act
(FCA), 31 U.S.C. §§ 3729-33. Id. (emphasis added). The FCA, in
turn, imposes civil liability on anyone who "knowingly presents,
or causes to be presented, a false or fraudulent claim for payment
or approval" or "knowingly makes, uses, or causes to be made or
used, a false record or statement material to a false or fraudulent
claim." 31 U.S.C. § 3729(a)(1)(A), (a)(1)(B). Whether a
violation of the AKS is also a false claim under the FCA makes a
difference because the FCA allows both the government and
whistleblowers to bring civil actions for damages.
The government alleges that, in violation of the AKS,
Regeneron Pharmaceuticals knowingly induced prescriptions of a
drug called Eylea by covering copayments for certain patients who
received the drug. Further, contends the government, when doctors
filed Medicare claims for Eylea prescribed to patients receiving
copayment assistance, those claims "resulted from" a violation of
- 3 - the AKS whether or not those claims would have been made even had
Regeneron not covered the co-pay. Accordingly, as the government
sees it, those Medicare claims were "false or fraudulent" for
purposes of the FCA.
Regeneron begs to differ. The company says that a claim
only "result[s] from" an AKS violation if it includes "items or
services" that would not have been paid for by the government
absent the AKS violation. Put differently, Regeneron contends
that an AKS violation must be a but-for cause of the challenged
claim. So, reasons Regeneron, if a doctor would have purchased
(and sought reimbursement for) Eylea anyway, then the subsequent
Medicare claim cannot have "result[ed] from" Regeneron's allegedly
illicit payments. As we will explain, we agree with Regeneron.
I.
A.
Regeneron manufactures Eylea. Eylea is one of just a
few drugs approved by the Food and Drug Administration (FDA) for
treating an ophthalmological condition called neovascular age-
related macular degeneration, also known as wet AMD. Eylea is a
"buy and bill" drug under Medicare Part B. This means that
physicians buy the drug, prescribe it, administer it in their
offices, and then submit a reimbursement claim to Medicare. It
also means that Eylea is subject to Part B's cost-sharing
- 4 - requirement: Medicare covers eighty percent of the cost while the
patient pays the remaining twenty percent.
Eylea is expensive. Since 2013, Medicare Part B has
spent over $11.5 billion on Eylea. A single injection costs
$1,850. Because a patient requires multiple injections per year,
annual per-patient co-pays routinely exceed $2,000. For some
patients, that co-pay can deter the patients from using Eylea.
And while only a few drugs are FDA-approved to treat wet AMD, at
least one other drug that is much cheaper than Eylea is available
for off-label use.
These economics create an incentive for Regeneron to
price Eylea in a way that frees the patient from the co-pay. An
injection that sells for $1,850 with a $330 co-pay will likely
sell less well than an injection that costs $2,000 with no co-pay.
Of course, the insurer -- not the manufacturer -- sets the co-pay
(to ensure that the patient has economic skin in the game when
deciding whether to use the drug). But if the patient knows that
the manufacturer will rebate that co-pay, that is more or less
equivalent to having no co-pay.
Here enters the AKS, which prohibits kickbacks.1 All
parties assume for purposes of this appeal that a rebate by the
1 The AKS imposes criminal liability on anyone who "knowingly and willfully offers or pays any renumeration . . . to any person to induce such person[] . . . to purchase, lease, order . . . or
- 5 - manufacturer to the patient or doctor would be a kickback. So
some creative manufacturers have tried a less direct work-around
by supporting charitable foundations that help patients with co-
pays. The manufacturer gives the foundation a donation, and the
foundation gives patients (or doctors) the co-pay.
Suffice it to say, such an arrangement can easily be
seen as a conduit for manufacturer rebates. The Department of
Health and Human Services therefore issued guidance attempting to
differentiate truly independent co-pay assistance charities from
rebate conduits. See Special Advisory Bulletin: Patient
Assistance Programs for Medicare Part D Enrollees, 70 Fed.
Reg. 70623, 70627 (Nov. 22, 2005).
In this case brought under the FCA, the government
alleges that Regeneron crossed well into the conduit side of that
difference when it paid more than $60 million over the course of
four to five years to the Chronic Disease Fund (CDF), a foundation
that provides copayment assistance to patients suffering from wet
AMD. For purposes of this appeal, we follow the parties' lead by
assuming, without deciding, that some or all of those donations
were unlawful kickbacks. We focus our attention, instead, on the
recommend purchasing, leasing, or ordering any good, facility, service, or item for which payment may be made in whole or in part under a Federal health care program." 42 U.S.C. § 1320a-7b(b)(2).
- 6 - proper standard of causation required to turn an AKS kickback into
a per se FCA violation.
B.
A 2010 amendment to the AKS provides that a "claim that
includes items or services resulting from a violation of [the AKS]
constitutes a false or fraudulent claim for purposes of [the FCA]."
42 U.S.C. § 1320a-7b(g). In other words, an "AKS violation that
results in a federal [healthcare] payment is a per se false claim
under the FCA." Guilfoile v. Shields, 913 F.3d 178, 190 (1st Cir.
2019) (quoting United States ex rel. Lutz v. United States, 853
F.3d 131, 135 (4th Cir. 2017)).
Training their attention on the issue of causation, the
parties filed competing motions under Federal Rule of Civil
Procedure 56. Regeneron argued that, under the 2010 amendment,
the government "b[ore] the burden of proving that an AKS
violation . . . actually caused [a] physician to provide different
medical treatment (and thus caused the false claims)." United
States v. Regeneron Pharms., Inc., No. 20-11217, 2023 WL 6296393,
at *10 (D. Mass. Sept. 27, 2023). In other words, Regeneron
asserted that the phrase "resulting from" in the 2010 amendment
imposed a "'but-for' causation standard." Id. The government
disagreed, and it urged the district court to adopt the Third
Circuit's view that "all that is required to prove a causal link
[under the 2010 amendment] is that 'a particular patient is exposed
- 7 - to an illegal recommendation or referral and a provider submits a
claim for reimbursement pertaining to that patient.'" Id. (quoting
United States ex rel. Greenfield v. Medco Health Sols., Inc., 880
F.3d 89, 100 (3d Cir. 2018)).
Citing cases from the Sixth and Eighth Circuits, the
district court agreed with Regeneron's interpretation. See United
States ex rel. Martin v. Hathaway, 63 F.4th 1043, 1052–55 (6th
Cir. 2023) (interpreting the phrase "resulting from" in the 2010
amendment as imposing a but-for causation requirement); United
States ex rel. Cairns v. D.S. Med. LLC, 42 F.4th 828, 834–35 (8th
Cir. 2022) (same). Nevertheless, noting the conflict in the case
law and explaining that the issue was pivotal to the outcome in
this and another case in the circuit, see United States v. Teva
Pharms. USA, Inc., 682 F. Supp. 3d 142, 148 (D. Mass. Jul. 14,
2023), the district court concluded that an immediate appeal would
materially advance the ending of the case. Accordingly, the
district court sought and we granted interlocutory review pursuant
to 28 U.S.C. § 1292(b). We now affirm the district court's ruling
that to treat an AKS violation as a false or fraudulent claim under
the FCA, the government must prove that the AKS violation was a
but-for cause of the false claim. Our reasoning follows.
II.
As a threshold matter, the government contends that
another panel of this court already did our work for us by stating,
- 8 - with reference to the 2010 amendment, that "if there is a
sufficient causal connection between an AKS violation and a claim
submitted to the federal government, that claim is false within
the meaning of the FCA." Guilfoile, 913 F.3d at 190. That
statement says nothing about what "causal connection" is
sufficient. But, as the government stresses, the statement is
directly followed by a citation to the Third Circuit's opinion in
Greenfield, 880 F.3d at 96-98, and to a district court opinion,
United States ex rel. Bawduniak v. Biogen Idec, Inc., No. 12-cv-
10601, 2018 WL 1996829, at *5-6 (D. Mass. April 27, 2018). In
each case, the court indicated that it was sufficient that a
patient chose to use the defendant's services or product after
being "exposed" to an inducement, even if the patient would have
made the same decision in the absence of the inducement. See
Greenfield, 880 F.3d at 100; Biogen, 2018 WL 1996829, at *5-6.
So, reasons the government, we should read Guilfoile as having
adopted both what it said (that there must be a sufficient causal
connection) and what those cited cases said was sufficient.
We disagree. "The mere fact that a court cites a case
approvingly for one point does not imply the court's wholesale
acceptance of each and every proposition for which the cited case
stands." Kholi v. Wall, 582 F.3d 147, 152 n.5 (1st Cir. 2009).
This rule applies with special force here. The Guilfoile court
stressed that "the issue before us is not the standard for proving
- 9 - an FCA violation based on the AKS, but rather the requirements for
pleading an FCA retaliation claim." 913 F.3d at 190. The
plaintiff in Guilfoile therefore did not need to prove an FCA
violation, by virtue of the AKS or otherwise. He only needed to
prove that the conduct he reported "could reasonably lead to an
FCA action." Guilfoile, 913 F.3d at 189. Hence, the court said
that it was not "assess[ing] the full implications" of the 2010
amendment. Id. at 190.
Finding that Guilfoile therefore does not guide -- much
less control -- our analysis of the phrase "resulting from" in the
2010 amendment, we turn now to analyzing the phrase as a matter of
first impression in this circuit.
III.
The proper interpretation of the 2010 amendment's
"resulting from" language is a question of law, so we review the
district court's interpretation de novo. See Kenyon v. Cedeno-
Rivera, 47 F.4th 12, 20 (1st Cir. 2022).
The Supreme Court has held that a phrase like "resulting
from" "imposes . . . a requirement of actual causality." Burrage
v. United States, 571 U.S. 204, 211 (2014); see also Paroline v.
United States, 572 U.S. 434, 445 (2014) ("The words 'as a result
of' plainly suggest causation."). "In the usual course," such a
requirement of actual causality as imposed by the words "resulting
- 10 - from" demands proof "'that the harm would not have occurred' . . .
but for . . . the defendant's conduct." Univ. of Tex. Sw. Med.
Ctr. v. Nassar, 570 U.S. 338, 346–47 (2013) (quoting Restatement
(First) of Torts § 431, cmt. a (Am. L. Inst. 1934)). Accordingly,
"it is one of the traditional background principles 'against which
Congress legislate[s]' that a phrase such as 'result[ing] from'
imposes a requirement of but-for causation." Burrage, 571 U.S. at
214 (first alteration in original) (quoting Nassar, 570 U.S. at
347).
But the fact that "resulting from" is read as calling
for but-for causation in "the usual course," Nassar, 570 U.S. at
346, does not mean that such a reading applies in every situation.
Rather, that reading serves as a default assumption, not an
immutable rule. See Paroline, 572 U.S. at 458. A court may read
a phrase like "resulting from" to impose an alternative causation
standard if there are "textual or contextual indication[s]"
supporting that approach. Burrage, 571 U.S. at 212; see also
Paroline, 572 U.S. at 458 ("[T]he availability of alternative
causal standards where circumstances warrant is, no less than the
but-for test itself as the default, part of the background legal
tradition against which Congress has legislated.").
The concept of a "textual" indication seems clear
enough: We look at the statutory language at issue to see what it
indicates. See Paroline, 572 U.S. at 458. The concept of a
- 11 - "contextual indication" is perhaps less clear, but at a minimum
includes (as evidenced by Paroline) a signal of legislative purpose
gleaned from related statutory text. In other words, if the text
at issue, when read in the context of the statutory scheme as a
whole, indicates that a but-for standard would "undermine
congressional intent," it may be inappropriate to read a phrase
like "resulting from" as imposing such a standard. Id.
The Court's analysis in Paroline elucidates this point.
That case involved a statute -- 18 U.S.C. § 2259 -- that required
restitution for victims of child pornography. Id. at 439. The
statute defined a victim as a person "harmed as a result of"
possession of child pornography, 18 U.S.C. § 2259(c)(4) (emphasis
added), and required that a court determine "the full amount of
the victim's losses . . . incurred by the victim as a result of
the trafficking in child pornography depicting the victim," id.
§ 2259(b)(2)(A) (emphasis added). Ordinarily, this kind of
language would impose a but-for causation standard. See Burrage,
571 U.S. at 214; Paroline, 572 U.S. at 458. But six Justices
nevertheless found such a standard inappropriate.
A five-Justice majority concluded that the statute as a
whole left "no doubt [that] Congress wanted victims [of child
pornography] to receive restitution," because § 2259 expressly
made restitution "mandatory" for child pornography offenses.
Paroline, 572 U.S. at 457 (quoting 18 U.S.C. § 2259(b)(4)). A
- 12 - but-for causation standard would render this "mandatory" language
"a dead letter," because it would be impossible to determine the
"discrete" injury caused by each individual possessor of child
pornography. Id. at 456–57. So, given the context provided by
the statute as a whole, the majority found that a but-for standard
would not serve § 2259's "twin goals of helping the victim
achieve . . . restitution . . . and impressing upon offenders the
fact that child-pornography crimes . . . affect real victims."
Id. at 459. Justice Sotomayor -- writing in dissent -- agreed
with the majority on this point. She noted that there was a strong
"contextual" argument against applying a but-for causation
standard to § 2259: Such a standard would "swallow [the statute's]
'mandatory' restitution command, leaving victims with little hope
of recovery." Id. at 477 (Sotomayor, J., dissenting).
In sum, the phrase "resulting from" imposes a
requirement of actual causality, which in ordinary course takes
the form of but-for causation, but we may deviate from this
ordinary course if the statute in question provides "textual or
contextual indications" for doing so. A "textual" indication draws
on the plain text of the statute's causation language, while a
"contextual" indication arises from the substance or structure of
the statutory scheme as a whole. With these principles in mind,
we turn to addressing the parties' respective interpretations of
the 2010 amendment.
- 13 - B.
The government cannot show that the text of the 2010
amendment itself contraindicates a but-for causation standard.
Simply put, there is no language in the 2010 amendment that by
itself runs counter to the presumption that "resulting from" calls
for proof of but-for causation. So, the government finds itself
relying on three contextual arguments.
1.
First, throughout its brief, the government stresses
that the AKS itself -- including its imposition of criminal
liability -- requires no proof that the government would not have
paid a claim but for the inducement of the offered kickback.
Rather, contends the government, the "animating principle" of the
AKS is "that financial conflicts in themselves corrupt medical
decisionmaking." So, contends the government, because the 2010
amendment was "built on" such a statutory scheme, it too should
require only that payments are meant to induce the provision of
items or services and that those items or services are subsequently
provided. At least one other court in this circuit has accepted
this contention. See United States ex rel. Witkin v. Medtronic,
Inc., No. 11-cv-10790, 2024 WL 1892405, at *18 (D. Mass. Mar. 31,
2024) ("It would be counterintuitive for the [AKS] to define
illegal remuneration under an indirect causation standard in the
criminal context . . . [while] ascrib[ing] a more stringent
- 14 - causation standard in the civil context (e.g., an associated FCA
violation)."). But see Omni Healthcare, Inc. v. MD Spine Sols.
LLC, No. 18-cv-12558, 2025 WL 32676, at *8–9 (D. Mass. Jan. 6,
2025) (concluding that the phrase "resulting from" in the 2010
amendment requires a showing of but-for causation).
We do not follow the government's logic. As the
government concedes, the words "resulting from" require proof of
some type of actual causality. See Burrage, 571 U.S. at 211
("'Results from' imposes . . . a requirement of actual
causality."). Hence, the question posed here is whether the type
of actual causality required is (as in ordinary course) but-for
causation. AKS liability, by contrast, does not require any causal
link between an inducement and any payment. See 42 U.S.C. § 1320a-
7b(b)(2). So, the premise that the 2010 amendment's causation
requirement must track that of the AKS fails to get out of the
starting blocks.
Nor is this surprising. When Congress wants to make a
violation of one statute or statutory section generate liability
under another statute or section, it may or may not require proof
of added elements not required to prove the predicate violation.
Wire fraud, for example, is a federal offense that is necessary
but not sufficient for establishing additional liability under the
Racketeer Influenced and Corrupt Organizations (RICO) Act. 18
U.S.C. §§ 1961-1962. Similarly, certain firearm offenses can
- 15 - generate additional liability under the Armed Career Criminal Act,
but only if the defendant has three previous convictions for
violent felonies or serious drug offenses. 18 U.S.C. § 924(e)(1).
So, the mere fact that one liability is built on another says
nothing about whether any additional elements are required to
establish the subsequent liability. Moreover, if Congress wants
to make a violation of one statute a per se violation of another,
it can easily say so. See, e.g., 15 U.S.C. § 1692l(a) (stating
that violations of the Fair Debt Collection Practices Act also
constitute violations of the Federal Trade Commission Act); 16
U.S.C. § 2465 (stating that violations of the Antarctic Mineral
Resources Protection Act also constitute violations of the
Antarctic Marine Living Resources Convention Act).
Nor does the addition of a causation element in the 2010
amendment leave the AKS any less able to pursue its "animating
principle." Rather, by establishing a new pathway to liability
for AKS violations, the 2010 amendment clearly furthers the aims
of the AKS. The only question is how much further and on what
terms that added support extends.
So, our interpretative challenge is to select among
alternative forms of causation, one of which (but-for) is
presumptively correct, and all of which require some proof of
"actual causality." See Burrage, 571 U.S. at 211, 217; see also
Paroline, 572 U.S. at 458-59 (adopting an "alternative
- 16 - causa[tion]" standard where the defendant played an "indisputable
role . . . in the causal process"). As to that choice, the absence
of any causation requirement in establishing AKS liability
provides little interpretative insight.
So framed, our interpretative inquiry does not preclude
(at least in theory) a less ambitious version of the government's
argument: Because no causation is required to establish criminal
AKS liability, then that suggests that "not much" causation -- that
is to say, causation short of but-for causation -- should be needed
for civil FCA liability. But even this more nuanced argument falls
short of supporting the government's position because the
government's proposed standard requires no proof of actual
causation at all. Instead, the government posits that Medicare
claims for Eylea can "result from" a kickback even if that kickback
had no causal impact whatsoever on a patient’s decision to opt for
Eylea. While Burrage and Paroline recognize that "resulting from"
may in some instances not require but-for causation, they provide
no license to read "resulting from" as requiring no actual
causality whatsoever.
Finally, as Regeneron points out, it is not unheard of
for the same statute to impose different evidentiary burdens for
related civil and criminal claims. See, e.g., McCool v. Strata
Oil Co., 972 F.2d 1452, 1466 (7th Cir. 1992) (noting that civil
RICO claims require proof of injury to a plaintiff, while criminal
- 17 - RICO prosecutions do not require injury and instead punish the
defendant's "participation in the pattern as a whole"). Here, the
criminal provisions of the AKS serve a different purpose than the
provisions linking an AKS violation to FCA falsity. Criminal
liability under the AKS exists "to protect patients from doctors
whose medical judgments might be clouded by improper financial
considerations." See United States v. Patel, 778 F.3d 607, 612
(7th Cir. 2015). So, it makes sense for the AKS to criminalize
even those kickbacks that do not ultimately cause a referral or
purchase. By contrast, "the chief purpose" of the FCA's civil
penalties is "to provide for restitution to the government of money
taken from it by fraud." United States v. Bornstein, 423 U.S.
303, 314 (1976) (quoting United States ex rel. Marcus v. Hess, 317
U.S. 537, 551 (1943)). Furthermore, the FCA creates a civil cause
of action for multiple damages that can be initiated and prosecuted
by private individuals without any affirmative approval by the
government. So, it also makes sense for the 2010 amendment to
render a claim false (for FCA purposes) only when a kickback is
the cause of that claim's submission to the government.
2.
That brings us to the government's next contextual
argument, rooted in statutory history. Before addressing that
second contextual argument, we follow the lead of the parties and
first discuss what the government describes as the "false-
- 18 - certification" theory linking the FCA and AKS.2 Under this theory,
a defendant violates the FCA when presenting (or causing to be
presented) a claim that misrepresents compliance with a
"statutory, regulatory, or contractual requirement" that "the
defendant knows is material to the [g]overnment's payment
decision." Universal Health Servs., Inc. v. United States, 579
U.S. 176, 181 (2016).
Before the 2010 amendment, many courts broadly agreed
that AKS compliance could be a material precondition of Medicare
reimbursement. See United States ex rel. Westmoreland v. Amgen,
Inc., 812 F. Supp. 2d 39, 54–55 (D. Mass. 2011) (collecting cases).
So, a defendant who falsely represented AKS compliance when seeking
a payment from Medicare could be liable under the FCA. See, e.g.,
United States ex rel. Kosenske v. Carlisle HMA, Inc., 554 F.3d 88,
94 (3d Cir. 2009) ("Falsely certifying compliance with the [AKS]
in connection with a claim submitted to a federally funded
insurance program is actionable under the FCA.").
2 The parties use the phrase "false-certification" to describe the body of case law linking the FCA and AKS without reference to the 2010 amendment. Purely for the sake of simplicity, we follow their lead. However, we have previously noted that the term "certification" never appears in the text of the FCA and is more likely to "obscure than clarify the issues before us." United States ex rel. Hutcheson v. Blackstone Med., Inc., 647 F.3d 377, 385–86 (1st Cir. 2011).
- 19 - In United States ex rel. Hutcheson v. Blackstone Med.,
Inc., 647 F.3d 377 (1st Cir. 2011), we considered an FCA claim
that the defendant offered renumeration to doctors to use the
defendant's medical devices, and doctors and hospitals then sought
reimbursement for those medical devices from federal healthcare
programs. We held that the defendant could be liable under the
FCA for causing the doctors and hospitals to submit false claims
even if the defendant itself submitted no claims and even though
the hospitals knew of no AKS violation. Id. at 389-91. We also
held that where a provider agreement and a hospital cost report
made clear that the government healthcare program would not pay
claims if the underlying transaction that gave rise to the claim
violated the AKS, the claim could be false under the FCA. Id. at
392-94. In so holding, we eschewed reliance on terms like "false
certification" that are not mentioned in the statute, see id. at
389-90, but we reached a result identical to what a false
certification theory would have produced.
In sum, there is certainly a pathway to FCA liability
for an AKS violation when someone falsely represents compliance
with a material requirement that there be no AKS violation in
connection with the claim. Under that pathway, it is not the AKS
violation itself that renders the claim false. Rather, it is the
false representation that there is no AKS violation. And, as we
will explain, it is that pathway which the government claims is
- 20 - relevant to its position on this appeal. See also William A.
Escobar & Philip D. Robben, The False Claims Act, in 15 Business
& Commercial Litigation in Federal Courts §§ 160:1, :17 (Robert L.
Haig ed., 5th ed. 2022) (outlining the elements of a false-
certification claim).
We now turn to the government's argument about the
context provided by statutory history. At the outset, we reiterate
that Paroline appeared to define a "contextual" indication as a
signal of legislative intent derived from the text of the statute
when read as a whole. See 572 U.S. at 456-58. Paroline does not
clearly permit us to cite statutory history as a "contextual"
reason for deviating from the default but-for causation standard.
On the other hand, the Supreme Court has often relied on the
evolution of a statute over time as informative. See, e.g.,
Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 104-07 (1941);
Van Buren v. United States, 593 U.S. 374, 392-93 (2021). In any
event, even accepting the history of the statute's evolution as
potentially informative, we find the government's spin on that
history unconvincing.
The government begins by noting that Congress passed the
2010 amendment against a backdrop of false-certification cases.
As explained above, those cases did not require proof of causation
to demonstrate falsity under the FCA; a material misrepresentation
- 21 - of compliance with the AKS was enough. The government further
argues that, when Congress passed the 2010 amendment, it did not
clearly intend to alter false-certification caselaw by imposing a
but-for causation requirement. Cf. Midlantic Nat'l Bank v. N.J.
Dep't of Env't Prot., 474 U.S. 494, 501 (1986) ("The normal rule
of statutory construction is that if Congress intends for
legislation to change the interpretation of a judicially created
concept, it makes that intent specific.").
On both points, we agree. But there is nothing in the
2010 amendment that requires proof of but-for causation in a false-
certification FCA case. Rather, as the government itself points
out, the 2010 amendment "offer[s] a pathway to establish falsity
in FCA actions based on AKS violations without reliance on [the
false certification] theory." The circuit courts that read the
2010 amendment as imposing a but-for causation requirement also
agree that the 2010 amendment did not disturb alternative theories
of FCA liability (e.g., false certification). See Cairns, 42 F.4th
at 836 (rejecting the argument that the 2010 amendment "codified"
pre-2010 false-certification law, and then limiting the but-for
causation requirement to cases where "a plaintiff seeks to
establish falsity or fraud through the 2010 amendment" (emphasis
added)); United States ex rel. Martin v. Hathaway, 63 F.4th 1043,
1053 (6th Cir. 2023) (agreeing with the Cairns court's analysis).
- 22 - Nor is the causation requirement the only difference
between false-certification cases and claims under the 2010
amendment. For example, under the false-certification theory, FCA
liability lies when a defendant falsely represents AKS compliance
on a federal agency form. Hutcheson, 647 F.3d at 392. But the
2010 amendment does not require any representation -- implied or
express -- of AKS compliance. Instead, any AKS violation that
"results in a federal health care payment" gives rise to a "per se
false claim under the FCA." Guilfoile, 913 F.3d at 190 (emphasis
added) (quoting Lutz, 853 F.3d at 135). Furthermore, under the
implied false-certification theory, the government must show that
the defendant's misrepresentation of AKS compliance was material
to the government's payment decision. See Universal Health Servs.,
579 U.S. at 181. There is no such materiality requirement for
claims brought under the 2010 amendment. Guilfoile, 913 F.3d at
190.
Put simply, claims under the 2010 amendment run on a
separate track than do claims under a false-certification theory.
There is no reason to think that, because false-certification
claims require no proof of causation, Congress therefore eschewed
any actual causation requirement under the 2010 amendment. By its
own terms, the 2010 amendment requires some proof of causation;
the only question is what type of causation. On that question,
the statutory history provides no reason to deviate from the
- 23 - ordinary course, in which we treat "resulting from" as requiring
but-for causation.
3.
At its last source of context, the government points to
the legislative history of the 2010 amendment. Once more, nothing
in Paroline instructs that we may consider such evidence when
interpreting the phrase "resulting from." But even presuming that
such evidence is relevant, the legislative history simply offers
too little to justify the government's position.
The government primarily relies on a floor statement by
Senator Ted Kaufman, who sponsored the bill that originally
included what became the 2010 amendment. See United States ex
rel. Kester v. Novartis Pharms. Corp., 41 F. Supp. 3d 323, 332–33
(detailing the legislative genesis of the 2010 amendment). Senator
Kaufman stated that the provision would "ensure that all claims
resulting from illegal kickbacks are 'false or fraudulent,' even
when the claims are not submitted directly by the wrongdoers
themselves." 155 Cong. Rec. S10852-01 (2009), 2009 WL 3460582, at
*S10853. So, an ostensible purpose of the 2010 amendment was to
circumvent an arguable weakness in the false-certification theory.
Senator Kaufman himself appeared to cite an example of
this arguable weakness: United States ex rel. Thomas v. Bailey,
No. 06CV00465, 2008 WL 4853630 (E.D. Ark. Nov. 6, 2008). See 155
Cong. Rec. S10852-01 (2009), 2009 WL 3460582, at *S10853
- 24 - (describing the facts of the case). That case involved a surgeon
who received kickbacks from a medical device company to use their
cervical plating devices. Thomas, 2008 WL 4853630, at *1–3. The
hospital then submitted claims for reimbursement for the surgeon's
services, including the typical costs of products and devices
purchased for that type of procedure. Id. at *3. The court found
that Medicare claims submitted by the hospital were not false under
the FCA. Id. at *13–14. Because the hospital knew nothing about
the surgeon's AKS violations (and because it had only certified
its own AKS compliance "to the best of [its] knowledge"), the court
held that the requests for Medicare reimbursement were not false.
Id. at *10–13.
According to Senator Kaufman, the 2010 amendment would
prevent something like this from happening again. Under the 2010
amendment, the claims for the medical devices would still be deemed
false or fraudulent under the AKS, because they "result[ed] from"
the surgeon's acceptance of illicit kickbacks. 155 Cong.
Rec. S10852-01 (2009), 2009 WL 3460582, at *S10853. It would,
therefore, be no defense that the surgeon had never personally
certified compliance with the AKS.
Nothing about Senator Kaufman's floor statement is
inconsistent with an interpretation of the 2010 amendment that
imposes but-for causation. Rather, the floor statement simply
reinforces the government's view that the 2010 amendment creates
- 25 - a different "pathway to establish falsity in FCA actions based on
AKS violations without reliance on [the false-certification]
theory." If a medical provider accepts kickbacks, and then
personally represents compliance with the AKS, then FCA liability
can flow from that false representation. But if the medical
provider does not represent compliance with the AKS (expressly or
otherwise), then a claim submitted on that provider's behalf can
still be "per se false" under the 2010 amendment. Guilfoile, 913
F.3d at 190 (quoting Lutz, 853 F.3d at 135). That is, if the
government can show that the illicit kickback was a but-for cause
of the submitted claim, then the claim is "per se false" even
absent a false certification of AKS compliance.
We therefore disagree with the government that the
legislative history of the 2010 amendment requires us to interpret
the phrase "resulting from" as imposing something other than a
but-for causation standard.
4.
We respond, finally, to the government's contention that
it can "sometimes be difficult" to prove why a doctor prescribed
a particular drug. We do not doubt that such proof may be more
difficult to nail down in some cases. But the same could be said
about the requirement to prove other elements of a successful
action under the FCA, such as scienter. See, e.g., United States
ex rel. Hart v. McKesson Corp., 96 F.4th 145, 160-62 (2d Cir. 2024)
- 26 - (finding that the defendant lacked the requisite scienter to bring
a claim under the FCA), cert. denied, 145 S. Ct. 163 (2024); United
States ex rel. Gugenheim v. Meridian Senior Living, LLC, 36 F.4th
173, 181-82 (4th Cir. 2022) (same).
Nor is it the case that giving "resulting from" its
ordinary meaning renders it so difficult to establish liability
that the 2010 amendment would have no practical effect. As we
have explained in this opinion, the 2010 amendment made it easier
to bring an FCA action for damages by creating a pathway that does
not require proof of a false certification. And not even the
government argues that it will rarely be able to prove but-for
causation. Indeed, in this very case, the government's position
is that it has proffered enough evidence to get to a jury on the
issue of but-for causation. See U.S.'s Surreply to Regeneron's
Motion for Summary Judgment at 10, United States v. Regeneron
Pharms., Inc., No. 20-11217, 2023 WL 7016900 (D. Mass. Oct. 25,
2023) ("Even if the government were required to prove but-for
causation, it at least has identified sufficient evidence to defeat
summary judgment."). And the district court ultimately agreed,
finding that the government had alleged enough evidence "to
withstand summary judgment on the issue of [but-for] causation."
See Regeneron, 2023 WL 6296393, at *12-14.
- 27 - IV.
In sum, we find no convincing "textual or contextual"
reason to deviate from the default presumption that the phrase
"resulting from" as used in the 2010 amendment imposes a but-for
causation standard. We therefore hold that, to demonstrate falsity
under the 2010 amendment, the government must show that an illicit
kickback was the but-for cause of a submitted claim.
For the foregoing reasons, the judgment of the district
court is affirmed.
- 28 -