California Planned Parenthood, Overbilling & Federal Funds

July 2, 2010

"(Washington, DC) – The United States Court of Appeals for the Ninth Circuit has ruled in favor of the American Center for Law and Justice’s (ACLJ) client in a multi-million dollar fraud case against Planned Parenthood (PP) affiliates in California. ACLJ attorneys are representing a former employee of the PP affiliate in Los Angeles, who is now a federal whistleblower. A federal district court in California had dismissed the case, but the Ninth Circuit’s ruling, dated yesterday, reinstates the lawsuit.

“This is a tremendous victory,” said Jay Sekulow, Chief Counsel of the ACLJ. “While this case is by no means over, winning this appeal means we have gotten the federal claim over the threshold hurdles and can now get down to the heart of this case: the alleged fraud.”

The federal False Claims Act (FCA) forbids government contractors from submitting “false or fraudulent” claims for payment. The FCA also authorizes private individuals to bring suit against the offenders to recover the fraudulently obtained funds.

The allegation in this case is that PP affiliates in California illegally marked up the supposed cost of various birth control drugs when seeking government reimbursement, resulting in tens of millions of dollars of overbilling – at taxpayer expense. State audits in both California and Washington State have found PP affiliates guilty of overbilling.

When a former PP staffer sued the PP affiliates in federal court, charging the defendants with having fraudulently overbilled the state and federal governments in the amount of tens of millions of dollars, a prominent law firm began representing the PP defendants in the case at no cost to the defendants. The PP attorneys asked the federal district court to dismiss the case on technical jurisdictional grounds.

The federal district court accepted their arguments in part, and dismissed the case. ACLJ attorneys then entered the case to handle the appeal.

“The question on appeal was whether the former PP employee is a proper whistleblower under the False Claims Act,” said Sekulow. “We contended that the answer is ‘Yes,’ and now a three-judge panel of the Ninth Circuit has unanimously agreed with us.”

The ACLJ’s opening brief had dissected and refuted the arguments of PP’s attorneys point by point, explaining why the court of appeals should reverse the lower court’s judgment and reinstate the lawsuit. You can read the ACLJ opening brief HERE.

ACLJ attorneys subsequently filed a reply brief and two supplemental briefs addressing intervening developments in the law.

Led by Chief Counsel Jay Sekulow, the American Center for Law and Justice focuses on constitutional law and is based in Washington, D.C."

Blessed!