Tuomey’s Appeal of $237M False Claims Act Judgment Denied by the Fourth Circuit

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In Depth

The U.S. Court of Appeals for the Fourth Circuit affirmed the trial court’s decision in United States ex rel. Drakeford v. Tuomey that Tuomey Healthcare System, Inc., submitted 21,730 false claims, claims prohibited by the Stark Law, to the Medicare program. The court rejected Tuomey’s request for a new trial based on multiple errors by the trial court and Tuomey’s constitutional challenges to the trial court’s award of damages and civil penalties totaling $237 million. Although concurring with the Fourth Circuit’s opinion, Judge Wynn described this case as “troubling,” explaining that “even for well-intentioned health care providers, the Stark Law has become a booby trap rigged with strict liability and potentially ruinous exposure—especially when coupled with the False Claims Act.” Judge Wynn’s analysis in this case is timely, as Stark Law cases are on the rise, and questions regarding the proportionality and fairness of Stark Law liability grow ever more pressing.

Read the full Special Report here.