What the Litigation Attorneys Want You to Know About the Recent Supreme Court Ruling on Contractor Fraud

When someone is wronged in a facility that receives federal funding, it’s not necessarily as straightforward an issue as people would like. Like may rules, the forces that govern company liability are left to a good deal of interpretation. The US Supreme Court recently appeared to place limits on bringing charges up against federal contractors after examining a case that involved the deal of the woman within one of the facilities of the nation’s largest hospital operators, Universal Health Services. The litigation attorneys will give you more on what happened.

What Happened?

A 19-year old woman named Yarushka Rivera was staying in a mental health facility owned by Universal Health Services when she had a fatal seizure, and her parents sued the company for poorly trained employees handling her care and inadequate treatment for her condition. Their claim brought the US federal government into the matter because the facility accepted federal funds through Medicare. They claim those funds were used to hire unqualified people who could not take care of their daughter, thereby violating the terms of their receiving federal funding. It was an argument that was not shut down so easily. Their case went through court after court and appeal after appeal until reaching the Supreme Court.

False Claims Act

The parents brought the case under the US False Claims Act, which wasn’t necessarily meant to apply to a situation like this. It has been difficult for lower courts to determine which companies fall under this act, especially when the terms of different contracts aren’t explicit. There’s also cases of implied fraud, which further complicates the matters with the issue of intent.

The Verdict and Future

The Supreme Court looked over the allegations that the mental health facility billed for services that were never provided, and employing people who couldn’t help their daughter. There was no ambiguity in the court: all 8 justices voted that this should go back to the lower courts where it will be voted on again. It wasn’t exactly what Universal Health Services and other businesses were hoping for. Their company and many other companies who provide these types of services are nervous about what the US False Claims Act will ultimately mean for their liability, so they were hoping for a flat-out dismissal. Just because they ruled against the option for the parents of the woman to appeal under this act in the Supreme Court, it doesn’t necessarily mean that this case won’t be tried in the lower courts. However, it does seem to be a sign that they favor a certain about of protection for businesses for this particular law. Clarence Thomas stated that the law was really not meant to cover contractual violations, it was meant to cover the more standard definition of fraud to federal government (e.g., outright lies as opposed to shades of fine print.)

Business Reaction

It’s worth noting that both sides of the issue seemed to take this ruling as a win, as bigger businesses may take this as the justices attempting to keep company liability from falling under the False Claims Act — even if they receive federal funds. For the other side though, it could mean some validation to their argument if the parents of this woman can have their voices heard again. Some litigation attorneys claim they stand a good chance, so long as they can show that their claim is relevant as to whether or not a company should receive money from the government. As it is, the language written about it does not necessarily make it clear whether or not they fall under the jurisdiction, but that may be changed if this case continues to stay relevant to the powers that be.

If you or someone you know are involved in any of these types of lawsuits, contact the litigation attorneys at GOM Law for a free consultation. We can tell you more about your rights, and how your case should proceed.

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