Baron & Budd Whistleblower Attorney Kenneth Capesius recently penned an article in Law360 about the False Claims Act (FCA), the Anti-Kickback Statute (AKS), and how recent rulings on their relationship may affect the FCA landscape.

The FCA is a federal law that imposes liability on people and companies who defraud the government. For example, if a Department of Defense contractor provides goods to the federal government, lies that its goods meet certain standards, and then bills the government for those goods, the contractor could be found liable for FCA violations.

The AKS, on the other hand, prohibits kickbacks – which are essentially financial incentives for referrals – specifically in the healthcare space. For example, if a drugmaker pays physicians to give preferential treatment to its drug, that drugmaker could be found liable for AKS violations.

In his Law360 article, Capesius explains the relationship between these two laws, noting how enforcement of the AKS through the FCA is a natural fit. After all, “if a healthcare provider performs services that are tainted by kickbacks and then – impliedly or explicitly – falsely certifies compliance with the AKS in seeking payment from the government, such conduct would constitute a false claim.”

However, despite clear Congressional intent that a 2010 amendment to the AKS would strengthen FCA claims involving kickbacks, some courts have said that the amendment instead narrowed the relationship between the two statutes.

In October 2023, the U.S. District Court for the District of Massachusetts concurred with defendant Regeneron Pharmaceuticals Inc. when it argued that an AKS violation couldn’t lead to FCA liability unless the kickback was the but-for cause of the claim at issue – meaning the kickback must be shown to directly cause the request for payment from the government. The District Court’s decision, which created an intradistrict split over the causation standard, will soon be reviewed at the U.S. Court of Appeals for the First Circuit.

To learn about the relationship between the AKS and the FCA, and how the courts and Congress have all weighed in to bring us to this moment, read the full article here: Law360 – Anti-Kickback Statute Does Not Require But-For Causation