District Court Determines That The Eleventh Time Is NOT The Charm

Author:Mr James Chadwick
Profession:Sheppard Mullin Richter & Hampton

The United States District Court of the Eastern District of Pennsylvania recently issued a decision unsealing a False Claims Act case over the objections of the government, the relator and the defendant.1 In United States ex. Rel. Brasher v. Pentec Health, Inc. No. 13-05745, 2018 WL 5003474 (E.D.P.A. Oct. 16, 2018), a case initially filed five years ago, the government filed a motion to continue the seal - which happened to be its eleventh such motion - arguing that additional time was necessary, in part, to finalize its decision whether to intervene in the action, as well as to pursue settlement options. The Court disagreed.

In initially denying the government's request to extend the seal - an extension also supported by the relator and the Defendant - the Court expressed concerns "about the secrecy and pendency of the case, including concerns about the lack of meaningful deadlines, and that the need for transparency and accountability were not being met" by what, at the time, already amounted to just over five years of extensions.

In response, the Government filed a motion for reconsideration in October 2018, in another attempt to continue the seal on the case. This motion too was denied. In its decision, the Court stressed the importance of the FCA's requirement that there be "good cause" shown in order to extend the period the case is under seal, rejecting the government's general argument that it was the practice among some courts to routinely grant unlimited extensions. Indeed, the Court recognized that "courts have grown increasingly impatient with the Government's repeated requests for extension of the seal in qui tam actions." The decision pointed to the fact that none of the parties in this case were able to identify any specific, concrete harm that would occur as a direct result to the seal expiring, and made clear that the effect on settlement negotiations was irrelevant, as "the sealing provision is...

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