FCA retaliation claim survives motion to dismiss

Where a former employee alleged that she repeatedly complained to upper management that the company was reporting false information to the Virginia Department of Medical Assistance Services, or DMAS, including in the six months leading up to her termination, her claim for retaliation under the False Claims Act, or FCA, survived a motion to dismiss.

Background

Virginia Premier Health Plan Inc. moves to dismiss the FCA retaliation claim asserted by Lekei M. Patel. To survive the motion to dismiss, Patel “must allege facts to support a ‘reasonable inference’” that “(1) she engaged in protected activity; (2) her employer knew about the protected activity; and (3) her employer took adverse action against her as a result.”

Protected activity

Patel believed that Va. Premier was violating the FCA in two ways: 1) by reporting fraudulent care coordination ratios to DMAS, and 2) by falsely representing that Va. Premier was assisting its members in applying for environmental modifications or EMs, and assistive technology or ATs, even though it was discouraging its care coordinators from doing so. And the second amended complaint adequately shows that this belief was reasonable.

Patel alleges that she acted based on that belief on multiple occasions, including on June 14, 2018, when she “expressly and explicitly complained about [the] excessive and unlawful care coordination staffing ratios to Va. Premier’s Senior Human Resources Generalist Brittany S. Wooden” and “repeated her complaints and protestations to Ms. Wooden on or about July 31, 2018.” Patel then alleges that she continued to raise the “subject of fraud” “in a series of conversations, communications, and conferences with Va. Premier managers, agents, and employees[.]”

Patel also alleged that she “complained about Va. Premier’s refusal to process AT and EMs applications for its members.” Patel claims that at a training session on July 18, 2018, she asked Brodman how to apply for EMs on behalf of a member. When Brodman told her not to promote the program, Patel responded that the money was there for the members and that her member needed it to make her house safer to continue to live in.

Patel alleges that over the next six months, she “continuously alerted management that the Defendant was obligated to provide its membership with ready access to EM and AT services” and that Va. Premier’s refusal to do so “was a standing, material breach of those legal obligations.” Therefore, with respect to both her complaints about the care coordination staffing ratios and the refusal to provide members with access to ATs and EMs, Patel has adequately alleged that she engaged in protected activity.

Knowledge

Patel contends that she satisfied this requirement by alleging that “she complained repeatedly to upper management” that the staffing ratios were unlawful and that the monthly reports to DMAS were fraudulent. The court agrees. Patel’s reports to upper management were sufficient to put Va. Premier on notice, satisfying the knowledge element.

Causation

The six-month gap between the last specific date that Patel claims she lodged complaints (July 31, 2018) and her termination (Jan. 31, 2019) is double the three-month time gap at which the Fourth Circuit says causation can be inferred. Therefore, without more, the court cannot infer that Patel’s protected activity was the but-for cause of Patel’s termination.

However, Patel offers “more” by providing additional evidence on the issue of causation. Patel asserts that she complained about the alleged fraud repeatedly in the six months leading up to her termination. Therefore, the gap between her last complaint and her termination could have been fewer than three months. Accepting as true the allegation that Patel raised her concerns repeatedly in the six months leading up to her termination, it is plausible that her complaints were the cause of her termination.

Patel also offers evidence that the reason given for her termination was not legitimate. Patel explains that she was fired for a purportedly fraudulent patient report, but the report was not actually fraudulent. Patel additionally details alleged fraud committed by her supervisor, Nora Bell, while employed by Va. Premier, for which she was not terminated. The court finds that plaintiff has sufficiently plead causation and satisfied the third element of her FCA retaliation claim at the pleadings stage.

Defendant’s motion to dismiss denied.

Patel v. Virginia Premier Health Plan Inc., Case No. 7:19-cv-516, July 6, 2022. WDVA at Roanoke (Urbanski). VLW 022-3-282. 19 pp.