June 01, 2017

Materiality Kicks Back: Escobar and the Anti-Kickback Statute

Rebecca L. Gibson, Berg & Androphy, Houston, TX


The Supreme Court’s landmark 2016 decision in Universal Health Services, Inc. v. United States ex rel. Escobar resolved a circuit split as to use of the “implied certification” theory of False Claims Act (FCA) liability.1 Now implied certification can serve as a basis for FCA liability if two requirements are met: (1) the claim must not “merely request payment,” but must also make “specific representations about the goods or services provided,” and (2) the defendant’s “failure to disclose noncompliance with material statutory, regulatory, or contractual requirements” must transform its specific representations into “misleading half-truths.”2

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