United States Court of Appeals For the First Circuit
No. 23-2070
ROSEMARY MORGAN-LEE,
Plaintiff, Appellant,
UNITED STATES, ex rel. ROSEMARY MORGAN-LEE; COMMONWEALTH OF MASSACHUSETTS, ex rel. ROSEMARY MORGAN-LEE; STATE OF RHODE ISLAND, ex rel. ROSEMARY MORGAN-LEE,
Plaintiffs,
v.
THERAPY RESOURCES MANAGEMENT, LLC,
Defendant, Appellee,
THE WHITTIER HEALTH NETWORK, INC.; HEALTH CONCEPTS, LTD, d/b/a Bayberry Commons, d/b/a Eastgate Nursing and Recovery Center, d/b/a Elmwood Health Center, d/b/a Heritage Hills Nursing and Rehabilitation Center, d/b/a Morgan Health Center, d/b/a Pine Grove Health Center, d/b/a Riverview Nursing Home, d/b/a South Kingstown Nursing & Rehabilitation Center, d/b/a Village House Nursing and Rehabilitation Center, d/b/a Westerly Health Center, d/b/a West Shore Health Center, d/b/a Woodpecker Hill Health Center; DIOCESAN FACILITIES SELF-INSURANCE GROUP, INC., d/b/a Our Lady's Haven of Fairhaven, d/b/a Catholic Memorial Home, d/b/a Madonna Manor, d/b/a Marian Manor, d/b/a Sacred Heart Home; UMA RAJAGOPAL, individually and in her official capacity; HDH CORPORATION, d/b/a Hannah Duston Healthcare Center; LNF CORPORATION, d/b/a Masconomet Healthcare Center; MBO CORPORATION, d/b/a Nemasket Healthcare Center; ARBETTER CORPORATION, d/b/a Oak Knoll Healthcare Center; NWB CORPORATION, d/b/a Port Healthcare Center; MRN CORPORATION, d/b/a Sippican Healthcare Center,
Defendants.
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Douglas P. Woodlock, U.S. District Judge]
Before
Gelpí, Lynch, and Howard, Circuit Judges.
Jeremy L. Friedman, with whom Law Office of Jeremy L. Friedman, Louise A. Herman, and Herman Law Group were on brief, for appellant. Charles D. Blackman, with whom Levy & Blackman LLP was on brief, for appellee.
February 24, 2025 LYNCH, Circuit Judge. After a four-day bench trial, the
district court held Rosemary Morgan-Lee had not proven that her
former employer Therapy Resources Management, LLC ("TRM") had
discharged her in violation of the whistleblower protections of
the False Claims Act ("FCA"), 31 U.S.C. § 3730(h), and the Rhode
Island Whistleblowers' Protection Act ("RIWPA"), R.I. Gen. Laws
§§ 28-50-1 to -9 (2024). The court made findings of fact in her
favor that she had engaged in some protected activity and that TRM
had general corporate knowledge of her protected activity. The
court went on to find, citing Lestage v. Coloplast Corp., 982 F.3d
37, 46 (1st Cir. 2020), that she had not shown that but for her
protected conduct she would not have been discharged.
On appeal, Morgan-Lee argues that the district court
committed errors of law and that its factual findings were clearly
erroneous. Many of her arguments are waived and unpreserved and
at times mischaracterize the record. We reject her arguments, all
of which lack merit, and affirm. The district court's
seventy-six-page Memorandum of Findings of Fact and Conclusions of
Law properly stated and applied the applicable law, and each of
its findings, including as to her failure to show the requisite
causation, is well-supported by the record.
I.
Following voluntary dismissal and settlement of most of
Morgan-Lee's claims against numerous defendants, what remained
- 3 - were only the FCA and RIWPA1 whistleblower-retaliation claims
against TRM which are the subject of this appeal.2 A 2017 jury
trial on the retaliation claims resulted in a mistrial after a
juror refused to answer on being polled. The district court denied
Morgan-Lee's Renewed Motion for Judgement as a Matter of Law3 and
1 Although this case was filed in the District of Massachusetts, Morgan-Lee was employed by TRM in Rhode Island, and thus brought a claim under Rhode Island's whistleblower statute. The district court had jurisdiction over that claim under 28 U.S.C. § 1367.
2 Much of the earlier history of this case is not relevant to the issues on appeal, so we describe it briefly. This case began as a qui tam action filed on August 19, 2013, against TRM and various entities doing business with TRM, alleging that the defendants violated the FCA and its Massachusetts and Rhode Island analogs by, inter alia, submitting "false and fraudulent claims for payment or approval to the United States, [Massachusetts, and Rhode Island]." Morgan-Lee also alleged that "TRM unlawfully retaliated against [her] because of her efforts to stop [the] [d]efendants from engaging in violations of the [FCA] and the [RIWPA]." 3 We do not consider Morgan-Lee's argument that the district court's 2017 denial of her Renewed Motion for Judgment as a Matter of Law under Federal Rule of Civil Procedure 50 was not supported by the evidence. We lack jurisdiction to consider it because "[o]nce the case proceeds to trial, the full record developed in court supersedes the record existing at the time of the [earlier] motion." Hisert ex rel. H2H Assocs., LLC v. Haschen, 980 F.3d 6, 8 (1st Cir. 2020) (first alteration in original)(quoting Ortiz v. Jordan, 562 U.S. 180, 184 (2011)); see also Dupree v. Younger, 598 U.S. 729, 734 (2023) ("Some interlocutory district-court rulings . . . are unreviewable after final judgment because they are overcome by later developments in the litigation."). As Morgan-Lee herself stated, "[t]he [b]ench [t]rial [u]nearthed the [c]onclusive [r]ecord of [w]hen, and on [w]hat [b]asis, [she] was [f]ired," barring her arguments challenging the Rule 50 ruling following the earlier jury trial.
- 4 - conducted a bench trial for Morgan-Lee's claims pursuant to a joint
stipulation. The district court tried the case over four days,
during which it heard live testimony or received written testimony
from ten witnesses and made credibility findings.4
On November 13, 2023, the district court issued its
Memorandum. As to causation, the court applied this standard,
citing Lestage, 982 F.3d at 46: "Ms. Morgan-Lee can prevail on her
retaliation claim only if she can demonstrate that, but for her
FCA-protected activity, she would have kept her job." The court
made its factual findings that she "ha[d] not proven by a
preponderance of the evidence that she was fired because she
engaged in protected activity." The district court found
that she was discharged because of a spate of unapproved absences and an outright refusal to provide specifics about purported fraudulent activity, even though that was her job. The breakdown of Ms. Morgan-Lee’s employment relationship was the culmination of an escalating pattern of erratic, confrontational, and frequently insubordinate communications by Ms. Morgan- Lee with superiors and colleagues, rather than the product of any retaliatory animus on the part of TRM. . . . The evidence show[ed] . . . that the issue that ultimately motivated [TRM] to dismiss Ms. Morgan- Lee was a combination of her repeated unexcused absences from work in the weeks preceding her firing and her
4 These witnesses were: plaintiff Morgan-Lee; Armand Bergeron, former co-owner of TRM; Uma Rajagopal, former CEO and President of TRM; Brian Lewis, former attorney for TRM; Albin Moser, former attorney for Morgan-Lee; Brian Pontolilo, former co- owner of TRM; Allan Feldman, Morgan-Lee's expert witness; Robert Scott, former Vice President of Human Resources at TRM; Theresa Lewis, former TRM employee; Ronald Diurba, former co-owner of TRM.
- 5 - unwillingness to provide TRM with details of the fraud that she claimed to have found.
II.
We read Morgan-Lee's briefs as attempting to make two
claims of legal error, one about use of Maturi v. McLaughlin
Research Corp., 413 F.3d 166 (1st Cir. 2005), and the second going
to causation and burden-shifting. The Maturi argument, as we
explain below, is the opposite of what she argued to the district
court and so is barred by estoppel; in any event it is entirely
without merit. The second argument seems to have two components,
one challenging the district court's causation standard and the
other its burden-shifting framework, but the argument is unclear.
The argument fails in its entirety on the merits and at least its
second component is waived and estopped. We review properly
preserved arguments of legal error following bench trials de novo.
See ST Eng'g Marine, Ltd. v. Thompson, Maccoll & Bass, LLC, 88
F.4th 27, 32 (1st Cir. 2023).
Morgan-Lee first argues that the standard for when an
employer is charged with knowledge that an employee is engaged in
protected conduct under Maturi, 413 F.3d at 173 (2005), did not
survive the 2009 amendments to the FCA.5 This is a reversal of
5 She makes the argument although the district court found in her favor that she had engaged in protected conduct and TRM had general corporate knowledge of this protected conduct under Maturi.
- 6 - the position she took in the district court, where she argued that
the court should apply the Maturi standard. She is both estopped
and has waived the argument on appeal. See Patton v. Johnson, 915
F.3d 827, 836-37 (1st Cir. 2019) ("We think it self-evident that
a party cannot invite the trial court to employ one source of
applicable law and then -- after the trial court has accepted
h[er] invitation -- try to convince the court of appeals that some
other source of law would be preferable."); Medina–Rivera v. MVM,
Inc., 713 F.3d 132, 141 (1st Cir. 2013) ("[T]heories not squarely
presented below typically cannot be advanced here.").
Even had the appellate argument been properly presented,
it fails. This court ruled on the 2009 FCA amendments in United
States ex rel. Booker v. Pfizer, Inc., 847 F.3d 52 (1st Cir. 2017),
and we held that the amendments did not alter the requirement that
protected conduct "must pertain to violations of the FCA," see id.
at 59 n.8. Under Booker, it is clear the 2009 FCA amendments did
not alter Maturi.
Maturi held that "where an employee's job
responsibilities involve overseeing government billings or
payments, h[er] burden of proving that h[er] employer was on notice
that [s]he was engaged in protected conduct should be heightened."
413 F.3d at 173. In such cases, an employee "must make it clear
that h[er] actions go beyond h[er] regular duties" so that
"employers [are] disciplined for taking adverse action against
- 7 - their employees only when they are aware that the employees were
engaged in protected conduct." Id. at 172-73. The 2009 FCA
amendments did not undercut this holding and reasoning. Rather,
the amendments "clarified that the [anti-retaliation] provision
covers not only steps in the litigation process . . . but also
measures . . . which might not be taken in direct furtherance of
an actual lawsuit." Booker, 847 F.3d at 59 n.8. "[T]he amended
provision maintains the requirement . . . that even those
activities must pertain to violations of the FCA." Id. Given the
endurance of that nexus requirement, Maturi's heightened burden on
employees who oversee government billing or payments is all the
more critical, as the expanded scope of protected activity only
renders more obscure to employers which of these employees' actions
go beyond regular duties and "pertain to violations of the FCA."
See id.
The Tenth Circuit has similarly held that the rule "that
compliance employees typically must do more than other employees
to show that their employer knew of the protected activity"
"survived the 2009 [FCA] amendment." United States ex rel. Reed
v. KeyPoint Gov't Sols., 923 F.3d 729, 767 (10th Cir. 2019).6 It
explained that even under the 2009 amendments, "a relator's actions
still must convey a connection to the [False Claims Act]." Id.
6 We reject Morgan-Lee's argument that we instead adopt Mooney v. Fife, 118 F.4th 1081, 1095 (9th Cir. 2024).
- 8 - (alteration in original). The rationale underlying the rule was
that "an employer might reasonably presume that when a compliance
employee reports incidents of fraud she is just doing her job," so
such an employee must "overcome that presumption by showing that
she was engaging in protected activity, not just doing her job."
Id. The Tenth Circuit held that "nothing about the 2009 amendment
undercuts th[is] rationale." Id. We agree with this reasoning.
Morgan-Lee's second assertion of purported legal error
is unclear but seems to have two components. She first argues
inconsistently that the district court was required to apply the
McDonnell Douglas burden-shifting framework but then argues,
contrary to McDonnell Douglas, that once she establishes a prima
facie case the burden of both production and persuasion moves to
the employer. See McDonnell Douglas Corp. v. Green, 411 U.S. 792,
802-03 (1973). We bypass the question of whether the argument was
made in any clear form to the district court and reject it as
contrary to our case law.
We held in Lestage that the McDonnell Douglas framework
applies to FCA retaliation claims, under which "[o]nce the
plaintiff makes out a prima facie case, the burden shifts to the
employer to articulate a non-retaliatory reason for the adverse
employment action." 982 F.3d at 47. "This is merely a burden of
production," id., not of persuasion as Morgan-Lee would have it.
The district court's decision was entirely consistent with this
- 9 - framework. The court found, based on TRM's presented evidence,
that "TRM had multiple legitimate, nonretaliatory reasons to fire
Ms. Morgan-Lee, and it is more likely than not that one, or some
combination, of those reasons was the cause of her termination."
Morgan-Lee next attempts to argue the district court
erred in using "but-for" causation, but in the district court, she
urged the use of that standard, so once again she is estopped.
See Patton, 915 F.3d at 836. But in any event, she is wrong. We
have held that FCA retaliation claims are subject to the but-for
causation standard. See Lestage, 982 F.3d at 46 (citing Univ. of
Tex. Sw. Med. Ctr. v. Nassar, 570 U.S. 338, 352 (2013)). A
plaintiff "must establish that his or her protected activity was
a but-for cause of the alleged adverse action by the employer."
Nassar, 570 U.S. at 362.
The majority of our sister circuits agree that but-for
causation applies to FCA retaliation claims. See Mooney v. Fife,
118 F.4th 1081, 1090 (9th Cir. 2024); United States ex rel. Barrick
v. Parker-Migliorini Int'l, LLC, 79 F.4th 1262, 1277 (10th Cir.
2023); Nesbitt v. Candler Cnty., 945 F.3d 1355, 1359-60 (11th Cir.
2020), DiFiore v. CSL Behring, LLC, 879 F.3d 71, 76–78 (3d Cir.
2018); United States ex rel. King v. Solvay Pharms., Inc., 871
F.3d 318, 333 (5th Cir. 2017) (per curiam); United States ex rel.
Cody v. ManTech Int'l, Corp., 746 F. App'x 166, 176-77 (4th Cir.
2018).
- 10 - The district court correctly applied this standard in
finding that "Morgan-Lee ha[d] not shown by a preponderance of the
evidence that her protected activity was a but-for cause of her
termination." 7
The attack on the district court's extensive and
sensible findings of fact as clear error also fails. We are not
free to reject the district court's findings of fact unless, on
the record as a whole, we form a strong, unyielding belief that a
mistake has been made. Richard v. Reg'l Sch. Unit 57, 901 F.3d
52, 60 (1st Cir. 2018). In particular, "[w]e have repeatedly said
that 'in a bench trial, credibility calls are for the trier.'"
Sawyer Bros., Inc. v. Island Transporter, LLC, 887 F.3d 23, 31
(1st Cir. 2018) (quoting Carr v. PMS Fishing Corp., 191 F.3d 1, 7
(1st Cir. 1999)). Indeed, the court found Morgan-Lee's account of
key events not credible, that "her perceptions were frequently
distorted," and that "some of [her] testimony about interactions
with her colleagues [wa]s unreliable."
The district court found as fact that there were a number
of legitimate, non-retaliatory reasons for Morgan-Lee's discharge,
including that she "repeatedly missed work on minimal notice" and
7 Morgan-Lee's reply brief attempts to suggest Bostock v. Clayton County, 590 U.S. 644 (2020), altered the but-for causation test. This argument is both waived because it was not made in the opening brief, see BioChemics, Inc. v. AXIS Reins. Co., 924 F.3d 633, 644 n.8 (1st Cir. 2019), and is incorrect. Our decision in Lestage was published after, and is consistent with, Bostock.
- 11 - "refus[ed] to give details of her claimed findings of impropriety."
The court found that "the communications to her from [former TRM
Vice President of Human Resources] Mr. Scott and from TRM's
attorneys made clear that her unexcused . . . absences were a
significant issue." "Mr. Scott credibly testified that Ms. Morgan-
Lee refused to provide him with any specific examples of the
fraudulent conduct to which she continually referred" and "[i]n
her own testimony, and in contemporaneous emails, Ms. Morgan-Lee
acknowledged as much." Further, the court found that Morgan-Lee's
"unproductive and disruptive" behavior even before these events
"would itself have provided a valid, non-retaliatory reason to
fire her."
The court's findings of lack of but-for causation, many
of which were informed by its assessment of the credibility of
witness testimony, are well-supported.
We affirm. Costs are awarded to TRM.
- 12 -