Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 1 of 20
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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`UNITED STATES OF AMERICA and THE
`STATE OF CALIFORNIA, ex rel. Judy
`Jones, an individual,
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`Plaintiffs,
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`v.
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`SUTTER HEALTH, et al.,
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`Defendants.
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`Case No. 18-CV-02067-LHK
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`ORDER GRANTING DEFENDANTS’
`MOTIONS TO DISMISS WITH LEAVE
`TO AMEND
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`Re: Dkt. Nos. 72, 73
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`Pseudonymous qui tam plaintiff “Judy Jones” (“Relator”) brings this action under the False
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`Claims Act and California False Claims Act against three groups of Defendants: (1) Sutter Health,
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`Sutter Bay Medical Foundation, and Palo Alto Medical Foundation (collectively, “Sutter
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`Defendants”); (2) Palo Alto Foundation Medical Group and Dr. Roy Hong (collectively, “Doctor
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`Defendants”); and (3) unknown Does 1–10. Before the Court are Sutter Defendants’ motion to
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`dismiss Relator’s First Amended Complaint (“FAC”), ECF No. 73, and Doctor Defendants’
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`motion to dismiss the FAC, ECF No. 72. Having considered the submissions of the parties, the
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`relevant law, and the record in this case, the Court GRANTS Defendants’ motions to dismiss with
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`leave to amend.
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`Case No. 18-CV-02067-LHK
`ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS WITH LEAVE TO AMEND
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 2 of 20
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`I.
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`BACKGROUND
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`A. Factual Background
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`Relator filed this qui tam action against Sutter Defendants, Doctor Defendants, and
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`unknown Does 1–10 (collectively, “Defendants”). Relator alleges that Defendants’ “fraudulent
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`billing practices” violated the False Claims Act (“FCA”), 31 U.S.C. §§ 3729–33, and the
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`California False Claims Act (“CFCA”), Cal. Gov’t Code §§ 12650–56. FAC ¶ 2, ECF No. 13.
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`Specifically, Relator alleges that “through her expert analysis of thousands of adjudicated
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`Medicare claims,” she has “showed that Sutter [Health] and its surgeons freely took advantage of a
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`flawed medical payment system by regularly upcoding and unbundling major surgical codes for
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`breast cancer surgery, and coding ‘first-time’ immediate mastectomy reconstruction codes multiple
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`times in the same patient.” Id.; see FAC ¶¶ 4 (similar allegation against all Defendants), 22
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`(defining Defendant Sutter Health as “Sutter”).
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`To obtain the Medicare claims she analyzed, Relator made two Freedom of Information
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`Act (“FOIA”) requests to the Centers for Medicare & Medicaid Services (“CMS”). The first FOIA
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`request was made “in or about November 2016” and sought “billing and coding records for [Dr.]
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`Hong and Sutter [Health].” FAC ¶ 94. The second FOIA request was made sometime before
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`March 2017 and sought “Medicare billing and payment data for other Sutter [Health] plastic and
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`reconstructive surgeons from 2010 through 2016.” FAC ¶ 98. Relator’s analysis of the FOIA data
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`allegedly showed that “Sutter [Health] had pattern billed and received federal and State funds for
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`breast surgery claims which did not appear to conform to NCCI [CMS’ National Correct Coding
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`Initiative], were incompatible code combinations, and failed to adhere to CMS mandates.” FAC
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`¶ 100. Altogether, Defendants allegedly miscoded and overbilled surgical services. See FAC
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`¶¶ 115–131 (alleging that Defendants “routinely upcoded and unbundled mastectomy
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`reconstruction claims”).
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`B. Procedural History
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`The instant case is one of two that Relator has pseudonymously brought against Doctor
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`Defendants. In December 2012, Relator underwent a bilateral preventative mastectomy at
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 3 of 20
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`Defendant Palo Alto Medical Foundation. FAC ¶ 41. In November 2016, Relator allegedly
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`reviewed the medical bills from her December 2012 mastectomy and noticed billing irregularities.
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`FAC ¶ 94. On March 5, 2014, Relator brought a malpractice case against Defendants Dr. Hong,
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`Palo Alto Foundation Medical Group, and other parties in Santa Clara County Superior Court. See
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`Compl. for Damages, Doe vs. Hong, No. 1-14-CV-261702 (Cal. Super. Ct. Mar. 05, 2014). Relator
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`brought her malpractice case under the pseudonym “Jane Doe.” Compare FAC ¶ 41 (alleging a
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`December 2012 bilateral mastectomy performed by Dr. Hong), with, e.g., Compl. for Damages
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`¶¶ 17–19 (same). On November 29, 2017, the Superior Court dismissed Relator’s malpractice case
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`after she failed to appear for trial. See Doctor Defendants’ Request for Judicial Notice in Support
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`of Motion to Dismiss (“Doctor RJN”) at Ex. B, ECF No. 72-2 (Order re: Defendants’ Motion to
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`Dismiss dismissing case pursuant to Cal. Code Civ. Proc. § 581(b)(5)).
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`On April 4, 2018, Relator brought the instant qui tam action. ECF No. 1 (original
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`complaint). On October 19, 2018, Relator filed the FAC, which is the operative complaint. ECF
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`No. 13. The FAC cites discovery obtained in Relator’s dismissed Superior Court malpractice case.
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`See, e.g., FAC ¶¶ 96, 118, 119 (deposition testimony).
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`On June 11, 2019, the United States declined to intervene in the instant qui tam action.
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`ECF No. 23. On June 19, 2019, California followed suit. ECF No. 29.
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`At first, the FAC alleged violations of not only the FCA and CFCA, but also the California
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`Insurance Fraud Prevention Act. However, on December 4, 2019, Relator voluntarily dismissed
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`without prejudice her California Insurance Fraud Prevention Act claim. ECF No. 39. Thus, only
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`the FCA and CFCA claims remain.
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`On June 15, 2020, Sutter Defendants and Doctor Defendants each filed a motion to dismiss
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`(ECF Nos. 72, 73),1 and Doctor Defendants filed a request for judicial notice in support of their
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`1 Sutter Defendants’ motion to dismiss contains a notice of motion paginated separately from the
`memorandum of points and authorities in support of the motion. ECF No. 73 at 2. Civil Local
`Rule 7-2(b) provides that the notice of motion and points and authorities should be contained in
`one document with the same pagination.
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`Case No. 18-CV-02067-LHK
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 4 of 20
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`motion to dismiss. ECF No. 72-2 (“Doctor RJN”); ECF No. 81 (errata to same). On August 14,
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`2020, Relator filed identical oppositions to the motions to dismiss and a request for judicial
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`notice.2 ECF Nos. 79 (“Opposition” or “Opp’n”), 80. On September 11, 2020, Sutter Defendants
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`and Doctor Defendants each filed a reply supporting their motion to dismiss (ECF Nos. 84, 87),
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`Doctor Defendants filed a request for judicial notice in support of their reply (ECF No. 85), and
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`Defendants jointly filed an opposition to Relator’s request for judicial notice (ECF Nos. 86, 88).
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`The Court may take judicial notice of matters that are either “generally known within the
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`trial court’s territorial jurisdiction” or “can be accurately and readily determined from sources
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`whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b). Moreover, courts may
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`consider materials referenced in the complaint under the incorporation by reference doctrine, even
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`if a plaintiff failed to attach those materials to the complaint. Knievel v. ESPN, 393 F.3d 1068,
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`1076 (9th Cir. 2005). Public records, including judgments and other publicly filed documents, are
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`proper subjects of judicial notice. See, e.g., United States v. Black, 482 F.3d 1035, 1041 (9th Cir.
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`2007). However, to the extent any facts in documents subject to judicial notice are subject to
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`reasonable dispute, the Court will not take judicial notice of those facts. See Lee v. City of Los
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`Angeles, 250 F.3d 668, 689 (9th Cir. 2001), overruled on other grounds by Galbraith v. County of
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`Santa Clara, 307 F.3d 1119 (9th Cir. 2002). Here, Doctor Defendants request judicial notice of
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`court filings and a CMS fee schedule available on CMS’s website. ECF No. 72-2; ECF No. 85.
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`These documents are public records. Accordingly, the Court GRANTS Doctor Defendants’
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`requests for judicial notice, ECF No. 72-2 and ECF No. 85.
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`Relator requests judicial notice of 504 pages of documents plus other “redacted”
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`documents that in fact have not been filed on the Court’s docket. ECF No. 79-1. Defendants
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`2 The Opposition violates Local Rules 3-4(c)(2) and 7-4(b), which require that opposition papers
`“may not exceed 25 pages,” and each page “must be double-spaced with no more than 28 lines per
`page.” The Opposition instead contains 25 pages of at least 32 lines each—and hardly any
`paragraph breaks. Thus, the Opposition is overlong by 100 lines or 3.5 pages of properly spaced
`text.
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 5 of 20
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`correctly note several defects with Relator’s request for judicial notice. See ECF No. 86 at 4–6.
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`However, given that Relator seeks judicial notice of public records (such as court filings and
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`government announcements), the Court also GRANTS Relator’s request for judicial notice. The
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`Court notes again that to the extent any facts in documents subject to judicial notice are subject to
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`reasonable dispute, the Court does not take judicial notice of those facts. See Lee, 250 F.3d at 689.
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`II.
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`LEGAL STANDARD
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`A. Motion to Dismiss Under Federal Rule of Civil Procedure 12(b)(6)
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`Rule 8(a)(2) of the Federal Rules of Civil Procedure requires a complaint to include “a
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`short and plain statement of the claim showing that the pleader is entitled to relief.” A complaint
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`that fails to meet this standard may be dismissed pursuant to Federal Rule of Civil Procedure
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`12(b)(6). The U.S. Supreme Court has held that Rule 8(a) requires a plaintiff to plead “enough
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`facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S.
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`544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that
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`allows the court to draw the reasonable inference that the defendant is liable for the misconduct
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`alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “The plausibility standard is not akin to a
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`probability requirement, but it asks for more than a sheer possibility that a defendant has acted
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`unlawfully.” Id. (internal quotation marks omitted). For purposes of ruling on a Rule 12(b)(6)
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`motion, the Court “accept[s] factual allegations in the complaint as true and construe[s] the
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`pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine
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`Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).
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`The Court, however, need not accept as true allegations contradicted by judicially
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`noticeable facts, see Schwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and it “may look
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`beyond the plaintiff’s complaint to matters of public record” without converting the Rule 12(b)(6)
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`motion into a motion for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 n.1 (9th Cir.
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`1995). Nor must the Court “assume the truth of legal conclusions merely because they are cast in
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`the form of factual allegations.” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam)
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`(internal quotation marks omitted). Mere “conclusory allegations of law and unwarranted
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`inferences are insufficient to defeat a motion to dismiss.” Adams v. Johnson, 355 F.3d 1179, 1183
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`(9th Cir. 2004).
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`B. Motion to Dismiss Under Federal Rule of Civil Procedure 9(b)
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`Claims sounding in fraud are subject to the heightened pleading requirements of Federal
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`Rule of Civil Procedure 9(b). Bly-Magee v. California, 236 F.3d 1014, 1018 (9th Cir. 2001). Under
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`the Federal Rules, a plaintiff alleging fraud “must state with particularity the circumstances
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`constituting fraud.” Fed. R. Civ. P. 9(b). To satisfy this standard, the allegations must be “specific
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`enough to give defendants notice of the particular misconduct which is alleged to constitute the
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`fraud charged so that they can defend against the charge and not just deny that they have done
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`anything wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). Thus, claims sounding
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`in fraud must allege “an account of the time, place, and specific content of the false
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`representations as well as the identities of the parties to the misrepresentations.” Swartz v. KPMG
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`LLP, 476 F.3d 756, 764 (9th Cir. 2007). In other words, “[a]verments of fraud must be
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`accompanied by ‘the who, what, when, where, and how’ of the misconduct charged.” Vess v. Ciba-
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`Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (quoting Cooper v. Pickett, 137 F.3d 616,
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`627 (9th Cir. 1997)). The plaintiff must also plead facts explaining why the statement was false
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`when it was made. See In re GlenFed, Inc. Sec. Litig., 42 F.3d 1541, 1549 (9th Cir. 1994) (en
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`banc), superseded by statute on other grounds as stated in Adomitis ex. rel. United States v. San
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`Bernardino Mountains Cmty. Hosp. Dist., 816 F. App’x 64, 66 (9th Cir. 2020). When there are
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`multiple defendants in a case, “Rule 9(b) does not allow a complaint to merely lump multiple
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`defendants together but ‘requires plaintiffs to differentiate their allegations when suing more than
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`one defendant and inform each defendant separately of the allegations surrounding his alleged
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`participation in the fraud.’” Swartz, 476 F.3d at 764–65 (alterations in original omitted) (quoting
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`Haskin v. R.J. Reynolds Tobacco Co., 995 F. Supp.1437, 1439 (M.D. Fla. 1998)). The heightened
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`pleading requirement of Rule 9(b) does not apply to allegations regarding defendant’s state of
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`mind. Thus, knowledge and intent need only be alleged generally to state a valid claim. See Fed.
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`R. Civ. P. 9(b) (“Malice, intent, knowledge, and other conditions of a person's mind may be
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 7 of 20
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`alleged generally.”).
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`“When an entire complaint . . . is grounded in fraud and its allegations fail to satisfy the
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`heightened pleading requirements of Rule 9(b), a district court may dismiss the complaint
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`. . . .” Vess, 317 F.3d at 1107. The Ninth Circuit has recognized that “it is established law in this
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`and other circuits that such dismissals are appropriate,” even though “there is no explicit basis in
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`the text of the federal rules for the dismissal of a complaint for failure to satisfy 9(b).” Id. A
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`motion to dismiss a complaint “under Rule 9(b) for failure to plead with particularity is the
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`functional equivalent of a motion to dismiss under Rule 12(b)(6) for failure to state a claim.” Id.
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`C. Leave to Amend
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`If the Court determines that a complaint should be dismissed, it must then decide whether
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`to grant leave to amend. Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend
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`“shall be freely given when justice so requires,” bearing in mind “the underlying purpose of Rule
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`15 to facilitate decisions on the merits, rather than on the pleadings or technicalities.” Lopez v.
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`Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (alterations and internal quotation marks
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`omitted). When dismissing a complaint for failure to state a claim, “a district court should grant
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`leave to amend even if no request to amend the pleading was made, unless it determines that the
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`pleading could not possibly be cured by the allegation of other facts.” Id. at 1130 (internal
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`quotation marks omitted). Accordingly, leave to amend generally shall be denied only if allowing
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`amendment would unduly prejudice the opposing party, cause undue delay, or be futile, or if the
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`moving party has acted in bad faith. Leadsinger, Inc. v. BMG Music Publ’g, 512 F.3d 522, 532 (9th
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`Cir. 2008).
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`III. DISCUSSION
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`The FCA “prohibits submitting false or fraudulent claims for payment to the United States,
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`[31 U.S.C.] § 3729(a), and authorizes qui tam suits, in which private parties bring civil actions in
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`the Government’s name, § 3730(b)(1).” Schindler Elevator Corp. v. U.S. ex rel. Kirk, 563 U.S.
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`401, 404 (2011). The “California analogue” to the FCA, the CFCA, “is nearly identical.” United
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`States ex rel. Mosler v. City of Los Angeles, 414 F. App’x 10, 11 (9th Cir. 2010) (citing Cal. Gov’t
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`Code § 12652(d)(3)). “For that reason, California courts look to federal decisions to interpret the
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`public disclosure provision of the state statute.” Id. (citing State of California ex rel. Bowen v.
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`Bank of Am. Corp., 126 Cal. App. 4th 225, 240 n.11 (Ct. App. 2005)); accord, e.g., State of
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`California v. Altus Fin., 116 P.3d 1175, 1184 (Cal. 2005) (“[T]he CFCA ‘is patterned on similar
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`federal legislation’ and it is appropriate to look to precedent construing the equivalent federal act.”
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`(quoting Laraway v. Sutro & Co., 96 Cal. App. 4th 266, 274 (Ct. App. 2002))).
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`Similarly here, the parties assume that the relevant provisions of the CFCA are
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`substantively identical to the corresponding provisions of the FCA. Those provisions are the
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`statutes’ public disclosure bar, 31 U.S.C. § 3730(e)(4)(A) & Cal. Gov’t Code § 12652(d)(3)(A),
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`and “original source” exception to that bar, 31 U.S.C. § 3730(e)(4)(B) & Cal. Gov’t Code
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`§ 12652(d)(3)(B). Indeed, Plaintiff never cites (let alone analyzes) the CFCA in her Opposition.
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`See, e.g., Opp’n at vi (table of authorities citing federal statutes only); Opp’n at 6–16 (discussing
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`only the FCA and federal case law). Defendants also focus on federal law and argue that “any
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`failure to state a claim under the FCA will similarly foreclose claims alleged under the CFCA.”
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`ECF No. 73 at 3; accord ECF No. 72 (Doctor Defendants’ same argument). Thus, to resolve the
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`instant motions, the Court analyzes the FCA. The parties have waived any argument that the FCA
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`and the CFCA are not functionally identical here. See, e.g., United States v. Chattanooga-
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`Hamilton Cty. Hosp. Auth., 782 F.3d 260, 264 n.3 (6th Cir. 2015) (holding, in a FCA case, that
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`“[i]ssues averted to in a perfunctory manner and without developed argumentation are
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`deemed waived.”); U.S. ex rel. Estate of Cunningham v. Millennium Labs. of California, Inc., 713
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`F.3d 662, 674 (1st Cir. 2013) (similar).
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`Defendants move to dismiss the FAC on three grounds: (1) the public disclosure bar;
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`(2) Relator’s failure to allege fraud—or Defendants’ knowledge of fraud—under Federal Rules of
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`Civil Procedure 8(a), 9(b), and 12(b)(6); (3) and Relator’s use of a pseudonym in violation of
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`Federal Rule of Civil Procedure 10(a) and the common law. See ECF Nos. 72, 73. However,
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`because the public disclosure bar is dispositive, the Court need not address Defendants’ other
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`arguments.
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`The Court’s analysis below proceeds in two parts. To start, the Court holds that the public
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`disclosure bar requires the Court to dismiss the FAC. The Court then holds that Plaintiff’s
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`arguments to the contrary are meritless.
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`A. The Public Disclosure Bar Requires Dismissing Relator’s Claims.
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`The public disclosure bar provides that “[t]he court shall dismiss” a qui tam action “if
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`substantially the same allegations or transactions as alleged in the action or claim were publicly
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`disclosed” in any of several sources. 31 U.S.C. § 3730(e)(4)(A). One source covered by the public
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`disclosure bar is a federal “report.” Id. § 3730(e)(4)(A)(ii). Most relevant here, “a federal agency’s
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`written response to a request for records under the Freedom of Information Act (FOIA), 5 U.S.C.
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`§ 552, constitutes a ‘report’ within the meaning of the public disclosure bar.” Schindler Elevator,
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`563 U.S. at 404.
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`As the United States Supreme Court explained in Schindler Elevator, qui tam actions
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`based on FOIA requests are “a classic example of the ‘opportunistic’ litigation that the public
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`disclosure bar is designed to discourage.” Id. at 413. These suits are “opportunistic” or “parasitic”
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`because they are “based on ‘evidence or information in the possession of the United States at the
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`time such suit was brought.’” Id. at 412 (quoting Graham Cty. Soil & Water Conservation Dist. v.
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`U.S. ex rel. Wilson, 559 U.S. 280, 294 (2010)). “[A]nyone could [] file[] the same FOIA requests
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`and then file[] the same suit.” Id. at 413.3
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`So too here. Relator made FOIA requests to CMS to obtain the Medicare claims data
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`analyzed in the FAC. Thus, Schindler Elevator controls. The Medicare claims data were “publicly
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`3 Schindler Elevator analyzed a prior version of the public disclosure bar. In 2010, the Affordable
`Care Act amended the public disclosure bar but retained the bar’s provision for federal “report[s].”
`Compare 31 U.S.C. § 3730(e)(4)(A) (1986) (“in a congressional, administrative, or Government
`Accounting Office report”), with id. at § 3730(e)(4)(A)(ii) (2010) (“in a congressional,
`Government Accountability Office, or other Federal report”). Thus, Schindler Elevator’s analysis
`of FOIA requests still controls. In fact, even where the amended language has differed more
`substantially, the Ninth Circuit has held that the court’s analysis “would be the same under either
`version” of the statute. U.S. ex rel. Mateski v. Raytheon Co., 816 F.3d 565, 569 n.7 (9th Cir. 2016)
`(analyzing change from “based upon” to “substantially the same”).
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`Case No. 18-CV-02067-LHK
`ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS WITH LEAVE TO AMEND
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 10 of 20
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`disclosed” under the public disclosure bar.
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`It follows that “the [C]ourt shall dismiss” Relator’s action if the Medicare claims data
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`comprise “substantially the same allegations or transactions as alleged in the action.” 31 U.S.C.
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`§ 3730(e)(4)(A). “The phrase ‘allegations or transactions’ in § 3730(e)(4)(A) [] suggests a wide-
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`reaching public disclosure bar.” Schindler Elevator, 563 U.S. at 408. In particular, the word
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`“transactions” has “broad meaning.” Id. A “‘transaction’ [] refers to facts from which fraud can be
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`inferred.” U.S. ex rel. Mateski v. Raytheon Co., 816 F.3d 565, 571 (9th Cir. 2016). In other words,
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`“the substance of the disclosure need not contain an explicit ‘allegation’ of fraud, so long as the
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`material elements of the allegedly fraudulent ‘transaction’ are disclosed in the public domain.” Id.
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`(original alterations omitted) (quoting United States ex rel. Found. Aiding the Elderly v. Horizon
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`W., Inc., 265 F.3d 1011, 1014 (9th Cir.), amended on denial of reh’g, 275 F.3d 1189 (9th Cir.
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`2001)). In turn, a “transaction” is “substantially the same” as what is alleged in the qui tam action
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`if the action does not “provide the Government with genuinely new and material information of
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`fraud.” Id. at 579; see id. at 576–77 (describing the appropriate level of generality for “genuinely
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`new and material information”).
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`Here, all “the material elements of the allegedly fraudulent ‘transaction’ are disclosed in”
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`CMS’s responses to Relator’s FOIA requests. The FAC alleges that “Relator’s Investigation”
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`comprised (1) two FOIA requests; (2) CMS’s “reports” of Medicare claims data in response;
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`(3) and Relator’s analysis of that publicly disclosed Medicare claims data. FAC ¶¶ 94, 96, 100.
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`Relator then inferred fraud from that data. For instance, Relator made the following inferences on
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`the face of the Medicare claims data, which Relator attached to the FAC as Exhibits A and B, see
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`FAC ¶¶ 95, 99:
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`• Dr. Hong billed CMS $488,575 for breast-related procedures, see FAC ¶ 95;
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`• Dr. Hong used an allegedly erroneous procedure code, CPT code 19340, 29 times from
`April 20, 2010 through May 14, 2014, see FAC ¶ 96; and
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`• Defendant Sutter Health also often used CPT code 19340 where other procedure codes
`allegedly would have been more appropriate, see FAC ¶¶ 101, 107.
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`By the FAC’s own terms, Relator uncovered Defendants’ alleged fraud simply by analyzing data
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`Case No. 18-CV-02067-LHK
`ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS WITH LEAVE TO AMEND
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 11 of 20
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`“in the possession of the United States at the time [her] suit was brought.’” Schindler Elevator,
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`563 U.S. at 412 (quoting Graham Cty., 559 U.S. at 294). This analysis fails to offer “genuinely
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`new and material information.” Mateski, 816 F.3d at 579. Rather, Relator’s analysis relies on
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`publicly disclosed procedure codes and CMS billing guidelines. Id. at 576; see also FAC ¶ 75
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`(attaching, as Exhibit C, “CMS guidelines for global surgical codes”).
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`Thus, “it is possible to say that the evidence and information in the possession of the
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`United States at the time the False Claims Act suit was brought was sufficient to enable it
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`adequately to investigate the case and to make a decision whether to prosecute.” Found. Aiding,
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`265 F.3d at 1016 (alteration in original omitted) (quoting United States ex rel. Joseph v. Cannon,
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`642 F.2d 1373, 1377 (D.C. Cir. 1981)). Indeed, the United States and California have declined to
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`intervene here. ECF Nos. 23, 29. All told, Relator’s suit is a paradigmatic example of a suit
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`foreclosed by the public disclosure bar.
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`Another court has reached the same conclusion for the same Relator. On December 4,
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`2017, four months before filing the instant action, Relator brought another qui tam action under
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`the FCA and CFCA against Stanford Healthcare. See United States ex rel. Roe v. Stanford
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`Healthcare Billing Department, No. 2:17-CV-8726 (C.D. Cal. filed Dec. 4, 2017). There, as here,
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`Relator alleges pseudonymously that she is a medical coder and physician who underwent a
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`mastectomy in December 2012 and then procured FOIA reports from CMS. Compare Doctor RJN
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`at Ex. C ¶¶ 179–181 (First Am. Compl. filed in No. 2:17-CV-8726 on June 22, 2018), with FAC ¶¶
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`38–41 (alleging same).
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`The Stanford Healthcare Court dismissed Relator’s action twice under the public
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`disclosure bar. The first time, the court held that “information acquired via a FOIA request
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`qualifies as public disclosure under 31 U.S.C. § 3730(e)(4)(A)” and dismissed Relator’s complaint
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`with leave to amend. Stanford Healthcare Billing Dep’t, 2020 WL 1074585, at *1 (C.D. Cal. Feb.
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`4, 2020). Despite that clear holding and other guidance on how to fix a “poorly organized and
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`extremely repetitive” complaint, Relator’s amended complaint was again defective. Id. at *2.
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`“Essentially nothing was added to bolster Relator’s claim” that the public disclosure bar did not
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`Case No. 18-CV-02067-LHK
`ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS WITH LEAVE TO AMEND
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 12 of 20
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`foreclose her lawsuit. Stanford Healthcare, 2020 WL 5033219, at *2 (C.D. Cal. July 13, 2020).
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`Thus, the second time around, the court dismissed Relator’s qui tam suit with prejudice. Id.
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`B. Relator’s Contrary Arguments are Meritless.
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`Relator’s arguments to the contrary are meritless. Essentially three arguments can be
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`discerned from Relator’s overlength, rambling, and bombastic Opposition.4 The first argument is
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`that the dissent in Schindler Elevator somehow controls here. The second argument is that, under a
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`district court case from the Central District of California, Relator’s data analysis discovered new
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`evidence outside the public disclosure bar. Lastly, Relator argues that she meets the “original
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`source” exception to the public disclosure bar. The Court rejects each argument in turn.
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`1. Schindler Elevator’s majority opinion, not its dissent, controls here.
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`Relator first argues that “Defendants’ reliance on Schindler [Elevator] is misplaced.”
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`Opp’n at 10. To support this argument, Relator discusses the “significant abstention [sic] of 4
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`justices” in Schindler Elevator and Justice Ginsburg’s “compelling dissenting opinion.” Opp’n at
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`11. Justice Ginsburg argued that “a federal agency’s response to a FOIA request should not
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`automatically qualify as a ‘report, hearing, audit, or investigation’ preclusive of a whistleblower’s
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`lawsuit under the public disclosure bar of the FCA.” Id. (quoting Schindler Elevator, 563 U.S. at
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`417 (Ginsburg, J., dissenting)).
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`Justice Ginsburg’s dissent is not controlling precedent. The majority opinion in Schindler
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`4 The Opposition violates this district’s Guidelines for Professional Conduct,
`https://www.cand.uscourts.gov/forms/guidelines-for-professional-conduct/. Among other things,
`the Guidelines require that “[w]ritten materials submitted to the court should always be factual and
`concise, accurately state current law, and fairly represent the parties’ positions without unfairly
`attacking the opposing party or opposing counsel.” By contrast, the Opposition inaccurately states
`the law, misrepresents Defendants’ arguments, and unfairly attacks Defendants’ counsel. For
`instance, the Opposition purports to respond to several arguments that neither motion to dismiss
`raised. See ECF No. 84 at 6 n.6 (Doctor Defendants’ Reply noting such arguments); ECF No. 87 at
`5 n.2 (Sutter Defendants’ Reply noting same). The Opposition also baselessly asserts that
`“Defendants and their counsel have knowingly made legally frivolous arguments based on
`deliberate factual falsehoods.” Opp’n at 2. It is unacceptable for Relator and Relator’s counsel,
`Anthony George Graham, to make such accusations without basis.
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`Case No. 18-CV-02067-LHK
`ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS WITH LEAVE TO AMEND
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`Northern District of California
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`United States District Court
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`Case 5:18-cv-02067-LHK Document 90 Filed 11/06/20 Page 13 of 20
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`Elevator is. Suffice it to say