Vanderlan v. Jackson HMA

135 F.4th 257
CourtCourt of Appeals for the Fifth Circuit
DecidedApril 18, 2025
Docket24-60215
StatusPublished
Cited by2 cases

This text of 135 F.4th 257 (Vanderlan v. Jackson HMA) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vanderlan v. Jackson HMA, 135 F.4th 257 (5th Cir. 2025).

Opinion

Case: 24-60215 Document: 88-1 Page: 1 Date Filed: 04/18/2025

United States Court of Appeals for the Fifth Circuit ____________ United States Court of Appeals Fifth Circuit

FILED No. 24-60215 April 18, 2025 ____________ Lyle W. Cayce W. Blake Vanderlan, Medical Doctor, Relator, Clerk

Plaintiff—Appellant,

versus

United States of America,

Plaintiff—Appellee,

Jackson HMA, L.L.C., doing business as Central Mississippi Medical Center, also known as Merit Health Central - Jackson,

Defendant—Appellee. ______________________________

Appeal from the United States District Court for the Southern District of Mississippi USDC No. 3:15-CV-767 ______________________________

Before Wiener, Stewart, and Southwick, Circuit Judges. Carl E. Stewart, Circuit Judge: Not every fight is ours to finish. This case concerns power—who holds it and how it is exercised. Under the False Claims Act (the “FCA”), Case: 24-60215 Document: 88-1 Page: 2 Date Filed: 04/18/2025

No. 24-60215

Congress deputized private individuals—relators—to aid in the fight against fraud. The government, however, retains the right to commandeer a relator’s case and, if it so chooses, dismiss it. That is what happened here. And the district court found no reason to stand in its way. Dr. Blake Vanderlan, the relator in this case, insisted that he was owed an evidentiary hearing. The district court disagreed, relying on United States ex rel. Polansky v. Executive Health Resources, Inc., 599 U.S. 419 (2023), where the Supreme Court confirmed the government’s broad discretion to dismiss qui tam actions. For the following reasons, we AFFIRM the district court’s judgment. I. A. In 1863, congressional investigations exposed rampant fraud in military contracting. War profiteers billed the federal government for phantom goods, overcharged for supplies, and exploited wartime procurement. See United States v. McNinch, 356 U.S. 595, 599 (1958) (explaining that congressional testimony “painted a sordid picture of how the United States had been billed for nonexistent or worthless goods, charged exorbitant prices for goods delivered, and generally robbed in purchasing the necessities of war”). Congress responded with the FCA to stop the plunder and “protect the funds and property of the [g]overnment.” Rainwater v. United States, 356 U.S. 590, 592 (1958). That statute empowers relators to enforce its terms by suing “for the person and for the United States Government.” 31 U.S.C. § 3730(b)(1). Such suits were a staple of early American law. See Adams v. Woods, 6 U.S. (2 Cranch) 336, 341 (1805) (noting

2 Case: 24-60215 Document: 88-1 Page: 3 Date Filed: 04/18/2025

that “[a]lmost every” penal statute could have been enforced this way). 1 They are known as qui tam actions, named for the Latin phrase meaning “who as well for the king as for himself sues in this matter.” Qui Tam Action, Black’s Law Dictionary (12th ed. 2024).

The injury, a relator asserts in a qui tam action, belongs exclusively to the government. Polansky, 599 U.S. at 425 (internal citation omitted). The government, moreover, is the “real party in interest” in a qui tam suit. United States ex rel. Eisenstein v. City of New York, 556 U.S. 928, 930 (2009). A qui tam suit alleges both an injury to the government’s “sovereignty arising from violation of its laws” and an injury to its “proprietary [interest] resulting from [an] alleged fraud.” Vermont Agency of Nat. Res. v. United States ex rel. Stevens, 529 U.S. 765, 771 (2000). A relator more or less acts as the “statutorily designated agent of the United States . . . and [] the relator’s bounty is simply the fee he receives out of the United States’ recovery for filing and/or prosecuting a successful action on behalf of the [g]overnment.” Id. at 772 (emphasis in original); see also § 3730(d) (declaring that if successful, a relator receives a bounty, but the government takes the larger share).

The statutory framework confirms the government’s control over qui tam litigation. Under § 3730(c)(1), when the government proceeds with the action, it “shall have the primary responsibility for prosecuting the action” and is “not [] bound by an act of the [relator].” The relator may continue as a party—filing motions and conducting discovery—but only “subject to the limitations set forth in [§ 3730(c)(2)].” § 3730(c)(1).

_____________________ 1 Senator Jacob M. Howard, the senator from Michigan who introduced the bill, explained that the qui tam provision was based on the “old-fashioned idea of holding out a temptation . . . which is the safest and most expeditious way ever discovered of bringing rogues to justice.” Cong. Globe, 37th Cong., 3d Sess. 956 (Feb 14, 1863).

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Section 3730(c)(2) defines those limitations. Subsection (c)(2)(A) gives the government the right to dismiss the action over the relator’s objection after notice and an opportunity for a hearing. Subsection (c)(2)(B) allows the government to settle the case, despite the relator’s objections, so long as the court finds the settlement fair and reasonable. Subsections (c)(2)(C) and (c)(2)(D) further restrict the relator’s participation if it interferes with the government’s case or imposes an undue burden on the defendant. Section 3730(c)(4) applies “[w]hether or not the Government proceeds.” It allows the government to stay discovery if it would interfere with a related investigation or prosecution. In sum, the statutory scheme evinces that the government retains ultimate authority over qui tam litigation.

B. Vanderlan, a physician at a hospital operated by Jackson HMA, LLC (“Jackson HMA”) alleged that the hospital systematically violated the Emergency Medical Treatment and Labor Act (“EMTALA”). He reported these violations to the Department of Health and Human Services, prompting an investigation by the Center for Medicare and Medicaid Services (“CMS”). CMS confirmed that Jackson HMA had violated EMTALA, citing 42 C.F.R. §§ 489.20 and 489.24, and referred the matter to the Office of Inspector General (the “OIG”) to assess potential civil monetary penalties. CMS also notified Vanderlan of the violation with a form letter that suggested he consider EMTALA’s civil enforcement provisions. EMTALA, however, authorizes private civil actions only for personal injury or financial losses suffered by other medical facilities. 42 U.S.C. § 1395dd(d)(2)(A)–(B).

The OIG and Jackson HMA engaged in settlement discussions over potential civil monetary penalties. No penalties were imposed, no settlement was reached, and administrative enforcement proceedings were stayed

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pending this litigation. The government informed Vanderlan that any potential settlement with Jackson HMA would be narrow in scope.

Vanderlan sued Jackson HMA, alleging five FCA violations, including a retaliation claim under § 3130(h). He sought injunctive relief to block any settlement between Jackson HMA and the government.

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135 F.4th 257, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vanderlan-v-jackson-hma-ca5-2025.