to Mot. Radcliffe v. Purdue Pharma L.P., 600 F.3d 319 (4th Cir. United States ex rel. the baton" and file the qui tam action against Purdue now before the court. . 3d ed. 1982). During this time the government was conducting a criminal investigation of Purdue's marketing of OxyContin, eventually resulting in guilty pleas in this court by a related company and three of Purdue's top executives. Auth. Treating all allegations as true, patients may have received less effective pain relief, but it is far from clear that the government paid more money.. at 820. Joining her as a relator is Steven May, a former Purdue employee who worked under Mr. Radcliffe. These employees were indeed asked questions pertaining to the relative potency issue during their grand jury appearances on July 20, 2005. 1997), has been applied by subsequent federal courts faced with the issue. On Nov. 17, the company moved to have the plaintiffs pay its legal fees under the fee-shifting provisions in the FCA. : 18-C-222 MSH, 18-C-233 MSH, 18-C-234 . Purdue next argues that other scientific publications supporting an equianalgesic ratio of 2:1, not only for single or intermittent dosing but also for longer-term use, are public disclosures because "[a]s a Purdue sales representative and supervisor, Radcliffe would have been trained on and intimately familiar with many Purdue articles endorsing a 2:1 equianalgesic potency ratio." Relators, or private individuals who bring suits on behalf of the government, are entitled to a portion of the recovery from a qui tam suit, the amount of which depends on whether the government chooses to intervene after learning the allegations and prosecute the case itself and the overall importance of the relator's participation in the action. 1999). BECKLEY, W.Va. - A Raleigh County man was sentenced today to five years in federal prison and ordered to pay a $25,000 fine for a witness tampering crime, announced United States Attorney Carol Casto. To the extent that Radcliffe derived the allegations in his Complaint from either of these sources, these will be considered public disclosures in the news media. Gilligan v. Medtronic, Inc., 403 F.3d 386, 389 (6th Cir. Id. The case previously reached the U.S. Court of Appeals for the Fourth Circuit, which refused to dismiss the case based on a lack of specific allegations because the whistleblowers still had the opportunity to amend their complaint. The final settlement in the criminal case did not contain any reference to the relative cost and potency issue and did not purport to settle Radcliffe's suit. The citations it relies on to support this argument are inapposite or misleading. Green, 59 F.3d at 962 (quoting Rumery, 480 U.S. at 392), 107 S.Ct. The state court action resulted in a settlement and general release, which was executed more than a year after the agency had completed its investigation. Purdue contends that Radcliffe released the claim made in his Complaint in the course of a settlement agreement with Purdue when he left its employment. CV202-189, 2005 WL 3741538, at *5 (S.D. However, I believe that enforcing the release under these circumstances would substantially impact important public interests associated with the FCA. The plaintiff-relator, Mark Radcliffe ("Radcliffe"), filed a qui tam suit in the United States District Court for the Western District of Virginia alleging that his former employer, Purdue Pharma, L.P. ("Purdue"), defrauded the government by marketing its pain-relief drug, OxyContin, as a cheaper alternative to the drug it replaced, MS Contin . However, this applies to public policy concerns in the interpretation of a contract rather than in a determination of its validity. He also refers to, but does not cite, a single-dose study supporting the 2:1 ratio that he was told about by his supervisors at Purdue. If not, then the court balances "all the factors that bear on whether `the public interest in enforcement of the agreement outweigh the policies furthered by non-enforcement.'" Beginning in 2002 and continuing for the next several years, the government sought millions of documents from Purdue and conducted hundreds of interviews, some of which pertained to the relative potency and cost of OxyContin and MS Contin. & Training Trust Fund. at 960. of Pittsburgh, 186 F.3d 376, 385 (3d Cir. at 1043-46. In his employment with Purdue between 1996 and 2005, Radcliffe was responsible for marketing OxyContin to individual physicians and became familiar with Purdue's marketing claims about OxyContin's relative cost and potency, including the claim that there is a 2:1 equianelgesic ratio between OxyContin and MS Contin. The Ninth Circuit also relied on Davies v. Grossmont Union High School District, 930 F.2d 1390 (9th Cir. Mot. Mark Radcliffe v. Purdue Pharma L.P.; Purdue Pharma, Inc. 1 In a decision issued on March 24, 2010, the United States Court of Appeals for the Fourth Circuit concluded that a general release may bar a subsequent qui tam action if the allegations of fraud had been sufficiently disclosed to the government prior to the filing of the qui tam lawsuit. the plaintiff-relator, mark radcliffe ("radcliffe"), filed a qui tam suit in the united states district court for the western district of virginia alleging that his former employer, purdue pharma, l.p. ("purdue"), defrauded the government by marketing its pain-relief drug, oxycontin, as a cheaper alternative to the drug it replaced, ms contin, 1990)). Bahrani v. Conagra, Inc., 183 F. Supp. Looking at the specific web page cited by Purdue, it appears that on July 18, 2001, the OxyContin package insert was posted to a section of Purdue's web page entitled "News What's New." the baton" and file the qui tam action against Purdue now before the court. These include the public interest in having relators disclose inside information of alleged fraud to the government, in having relators supplement federal enforcement of the FCA by assisting the government in its investigation and prosecution or prosecuting the claim itself, and in deterring future fraud against the government. Virginia, Abingdon Division. Ten years ago, Mark Radcliffea former district sales manager for Purdue Pharma ("Purdue")filed a qui tam action under the FCA against Purdue. United States ex rel. during the depositions of Mark and Angela Radcliffe and Steven May respecting commu nications between Relators and Mark Radcliffe and Relators and their attorneys with Mark . at 962-63 (quoting Davies, 930 F.2d at 1399). Specifically, in his sales representative training, he alleges that he was taught that there was a 2:1 equianalgesic ratio between OxyContin and MS Contin, a rival pain medication containing morphine, making OxyContin twice as potent and, as a result, cheaper per dose than MS Contin. Ga. Oct. 27, 2005) (citing DeCarlo for the opposite conclusion). Purdue Pharma L. P. et al, No. 434. Supp. With respect to the settlement attempts, it would seem counterintuitive to enforce a release to bar a subsequent qui tam suit, thus foreclosing the relator's ability to prosecute on behalf of the government, to punish that relator for trying to settle instead of filing suit in the first place. The Fourth Circuit follows a three-step approach in determining whether the public disclosure bar applies. Several of these physicians directed Radcliffe to specific sources in the scientific literature to show that the correct equianalgesic ratio between MS Contin and OxyContin was closer to 1:1, meaning that OxyContin was less potent and more expensive than Purdue claimed. 2d 766, 774 (W.D. Id. Id. In these somewhat rambling and incoherent emails, he warned Purdue that he was considering a qui tam suit, detailed his allegations, and offered to settle in exchange for an investment by Purdue in a project he was contemplating. Joining her as a relator is Steven May, a former Purdue employee who worked under Mr. Radcliffe. Together, Purdue argues, these create an implication of fraud sufficient to put the government on notice. In this action brought under the qui tam provisions of the False Claims Act ("FCA"), 31 U.S.C.A. On June 23, 2005, the government requested that Purdue identify the author and source of different versions of a document [Redacted] already in the government's possession, [Redacted]. After the present qui tam suit was stayed, the government's investigation continued. By this time, the government had also begun drafting Grand Jury Subpoena 513, which included requests for all documents discussing relative analgesic potency or safety of OxyContin and MS Contin. Co., 142 Cal. All reasonable inferences are "viewed in the light most favorable to the party opposing the motion." 434. This implies that the government was by that point aware of the substance of allegations, but more importantly that those facets of their investigations were still ongoing, beyond the date of the release. He relies on United States ex rel. Doyle v. Diversified Collection Services, Inc., No. United States ex Noah Nathan v. Takeda Pharmaceuticals North America, Inc. ex rel. The Ninth Circuit determined that enforcement of the release would impair the public interest by diluting incentives to file qui tam suits, thus making the government less likely to learn of the alleged fraud, and by diluting the FCA's deterrent affect. See Robert F. Kaiko et al., Analgesic Onset and Potency of Oral Controlled-Release (CR) Oxycodone and CR Morphine, 59(2) Clin. United States ex rel. 1994) ("Textbook of Pain"). They say it is a reflection on the decline of civility in the legal profession. 2d 1158, 1164-65 (N.D. Ill. 2007). Purdue Pharma Br. In 2010, his wife Angela and former underling May filed their own FCA lawsuit. Enforcement of a release to bar a subsequent qui tam suit implicates several articulated public interests. The opinion makes no mention of what type of web page this is or whether it bears any resemblance to a traditional periodical. 1187, 94 L.Ed.2d 405 (1987), that "`a promise is unenforceable if the interest in its enforcement is outweighed in the circumstances by a public policy harmed by enforcement of the agreement.'" They allege Purdue Pharma misrepresented the potency of OxyContin when marketing it to doctors. Purdue cites Gebert, 260 F.3d 909, in which the government did not investigate until after the filing of the qui tam complaint and the court ultimately chose to enforce the release. Whitten v. Triad Hosps., Inc., No. Supp. The amended complaint does not contain allegations that connect the dots for even a single alleged false claim Berger wrote. However, the decision to enforce the release turned on the fact that the release occurred "in the context of a bankruptcy proceeding, not through a general, independent release of a claim for money." at 963. 1995); State ex rel. This line of reasoning has been adopted by the Eighth Circuit, Gebert, 260 F.3d at 916, and the Southern District of New York, DeCarlo, 937 F. Supp. Unsealing the Complaint or allowing the suit to proceed would make a portion of the grand jury's pending investigation public. Id. The public interest in Radcliffe maintaining the ability to supplement federal enforcement of the FCA by prosecuting these allegations on behalf of the government remains. But see United States ex rel. 14-2299 (4th Cir. Id. It further states that OxyContin is "indicated for the management of moderate to severe pain when a continuous, around-the-clock analgesic is needed for an extended period of time." Va. 2014) case opinion from the Southern District of West Virginia US Federal District Court . Radcliffe requests that if the Complaint is found insufficient on this ground, that he be granted leave to file an amended complaint. Summary judgment is appropriate only if there are no material facts in dispute and the moving party is entitled to judgment as a matter of law. United States of America, et al. J. Clin. After the action was filed, the United States investigated the qui tam relator's allegations, but ultimately chose not to intervene. He alleged a fraudulent scheme whereby Purdue marketed (Information 20, United States v. Purdue Frederick Co., supra.) at 1278. As in Bahrani, when the release was executed there was no guarantee that the government would end up prosecuting based on the relator's allegations. Bell Tel. Because of my disposition of the case, I do not reach Purdue's arguments that some of the claims may be barred by the applicable statute of limitations or that some of state causes of action are procedurally barred. If a substantial public interest would be impaired, the court need not engage in the Rumery balancing test unless there is an articulated reason favoring enforcement aside from the "`interest in the settlement of litigation,'" as that "`cannot by itself outweigh a substantial public interest on the other side of the scales.'" Davies requires that a determination be made as to whether a substantial public interest would be impaired by enforcement of the agreement. Id. But that is not sufficient to meet the rigorous standard of Rule 9(b). It reasoned that "[t]here is no public disclosure to the American public when information is divulged in a foreign publication, especially if published in a foreign language." Id. This case briefly mentions several sources "two previously filed lawsuits against defendant, as well as an Internet web page and a Pittsburgh Post-Gazette article" and summarily concludes that "these constitute public disclosures." Purdue Pharma, L.P. (1:05-cv-00089) District Court, W.D. . The district court granted summary judgment to the defendants who argued that, as part of the release, the relator had bargained away his right to bring the qui tam suit and as a result could not demonstrate any personal stake in the outcome sufficient to satisfy Article III standing. DeCarlo v. Kiewit/AFC Enters., Inc., 937 F. Supp. In January and February of 2005 Radcliffe sent emails to several officers and directors of Purdue, using the alias "John Femaledeer." He submits that each OxyContin prescription submitted to the government for reimbursement constitutes a false claim under the FCA and the analogous state statutes, because the product distributed had only half the potency that physicians and decision-makers had been led to believe it possessed. 2d at 1277. [2] Mark RADCLIFFE, Plaintiffs, v. PURDUE, Court:United States District Court, W.D. Ultimately, the Ninth Circuit found that the significant public interests at issue when a potential relator and potential defendant execute a release, without the government's knowledge or consent, prior to the filing of a qui tam complaint outweighed the general interest in settling litigation and determined that, as a rule, such pre-filing releases were not enforceable to bar the subsequent qui tam actions. 1993) (quotations and citations omitted). MEMORANDUM OPINION AND ORDER R. CLARKE VanDERVORT Magistrate Judge. 1996). Mark Radcliffe, 59, of Shady Spring, was convicted following a three-day jury trial. J.A. ), aff'd, 53 F. App'x 153 (2d Cir. Partial knowledge or investigation on the part of the government is insufficient to remove a case from the purview of Green into the exception created by Hall. In Hall, the Nuclear Regulatory Commission ("NRC") completed and closed an investigation after the defendant made it aware of the relator's allegations, before the filing of the qui tam complaint. In Rabushka, a shareholder filed suit alleging that his conversations with company executives demonstrate that they fraudulently understated unfunded pension liability and spun off one of the company's components in order to shift responsibility for the pensions to another entity. Id. The two attorneys claim in a response that Purdue Pharma has failed to meet its burden for showing that fee-shifting is appropriate and that the judge who dismissed the earlier lawsuit ruled at least part of the complaint passed muster, but it fell outside of a six-year statute of limitations period. Purdue objects, but I find no cognizable basis for denying Radcliffe's request. (Third Am. HOPE Clinic Manager Mark Radcliffe, a former Purdue Pharma district sales manager, says drug seekers have made it hard for law-abiding citizens to get relief from pain. See United States ex rel. During this period or time, the government was conducting its own comprehensive investigation into Purdue's manufacturing, marketing, and distribution of OxyContin. Radcliffe v. Purdue Pharma L.P., 582 F. Supp. Radcliffe argues that the published results of the single-dose study are not public disclosures under 3730(e)(4)(A) because these were published in a foreign periodical. CIV.A. 1:07-CR-00029 (W.D. In his Complaint, Radcliffe alleges that Purdue "encouraged physicians to write prescriptions that were paid by Medicaid and other government programs for OxyContin that was materially less potent . 1994). United States v. Bank of Farmington, 166 F.3d 853, 861 (7th Cir. 2d 569, 576 (W.D. at 231-32. 1991), which builds upon the Rumery test. regarding the relative potency of oxycodone." Radcliffe was interviewed by law enforcement agents on October 28, 2005. The stay was lifted in late 2006, and the government chose not to intervene on May 8, 2007. Green v. Serv. Servs., 260 F.3d 909, 916 (8th Cir. Mot. It has been held that disclosures made directly to relevant government officials, rather than to the public, can constitute public disclosures in administrative investigations when the disclosure is made "to a competent public official" "who has managerial responsibility for the very claims being made." Although the criminal charges did relate to the misbranding of OxyContin, these charges focused on Purdue's marketing of OxyContin as "less addictive, less subject to abuse and diversion, and less likely to cause tolerance and withdrawal than other pain medications." Several months later, Purdue restructured its sales force and Radcliffe was offered the option of transferring positions, which he declined, or termination with an extended severance package. Contract Educ. He was also told that Purdue's decision to rely on the 2:1 ratio, despite published articles indicating that the 1:1 ratio was more appropriate for OxyContin's approved use, was based on safety concerns, that is, it was better for doctors to start with a lower dose and adjust upward if necessary. With respect to allegations of fraud, "the `circumstances' required to be pled with particularity under Rule 9(b) are `the time, place, and contents of the false representations, as well as the identity of the person making the misrepresentation and what he obtained thereby.'" at 818. Mark Radcliffe, 60, of Shady Spring, was convicted in October 2016 of conspiracy to tamper with a witness following a three-day jury trial. Id. On December 5, 2005, AUSA Mountcastle described the government's investigation as including "whether Purdue falsely marketed OxyContin as being twice as potent . DeCarlo, 937 F. Supp. 2d 1272, 1275-78 (D. Colo. 2002); United States ex rel. J.A. He subsequently executed a general release ("the Release") of all claims against Purdue in order to receive an enhanced severance package. . These responses did not address the cost implications that concerned Radcliffe. While these public disclosures do demonstrate some disagreement or debate over the appropriate equianalgesic ratio, I am not convinced that they sufficiently raise the specter of fraud. United States ex rel. Although antitrust cases are similar to qui tam suits in that the government relies on the enforcement efforts of private parties, the policy implications and economic incentives differ. Id. If anything on the record suggests fraud with respect to the relative cost and potency, it is the relator's statements regarding his experiences in being trained to market OxyContin and his questioning of his supervisors about the relative potency issue, as well as the internal training materials that explained how to address the relative cost issue with physicians. (c).) One of their attorneys is Mark (Mountcastle Decl. Green, 59 F.3d at 959. Specifically, he alleged that Purdue fraudulently marketed OxyContin using the 2:1 equianalgesic ratio, thus claiming that its relative cost was less than that of MS Contin. The government stated that without the relator's assistance following the release date it could not have issued a warrant to obtain documents or made sense of those documents when received and that given that these documents were not received until several weeks after the release date, the government had not had the opportunity to fully investigate prior to the execution of the release. However, neither case discusses the policy implications of enforcing a release in the context of the FCA. Because a relator is only entitled to a portion of the proceeds from a successful qui tam suit, both the relator and the party accused of fraud could benefit financially by settling before the government learns of the allegations. Although the 2001 posting of the OxyContin package insert could be considered either a corporate report or a press release, because it was posted on a web page entitled "News What's New" and because other items on the page resemble press releases, I will consider the OxyContin package insert a public disclosure in the news media. 1999). To meet this requirement, it is sufficient that there have been either (1) disclosures of both a false state of facts and a true state of facts (not necessarily from the same source) so that fraud is implied; or (2) disclosure of an allegation of fraud, regardless of the specificity of the allegation. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. It further reasoned that "[t]he public's interest in [the relator] maintaining the ability to bring a qui tam action to supplement federal enforcement of the FCA also remained as there was no guarantee when [the relator] executed the Release that the federal government was ever going to investigate, let alone prosecute," the alleged fraud. Mountcastle argued that the suit could hinder the investigation because while Purdue was aware of the investigation "no mention ha[d] been made that the 2:1 comparison of OxyContin and MSContin [was] one of the areas under investigation." Va. 2007) (accepting plea agreements). Id. 2:04 CV 053, 2006 WL 3834407, at *3 (S.D. Id. 2d 939, 949 (N.D. Ill. 2004), which held that newspaper articles published in Greek in the Greek press did not constitute disclosures to the American public. The facts on which I have determined jurisdiction are as follows. He alleges that this was done to induce physicians to prescribe OxyContin and other decision-makers to purchase or authorize the purchase of OxyContin. Radcliffe signed a general release of all claims against Purdue in exchange for an enhanced severance package. In this action brought under the qui tam provisions of the False Claims Act ("FCA"), 31 U.S.C.A. Id. According to Scheininger, Wells mentioned several times that she wished to ask these witnesses about the dispute over the relative potency of OxyContin and MS Contin, among other topics, explaining that this related to the marketing and cost implications of the relative potencies. 425, 428 (1999). Tex. The plea agreements included settlement of certain of the government's civil claims, but not of Radcliffe's qui tam suit. 2 (16th ed 1996) ("USP"); Robert G. Twycross, Opioids, in Textbook of Pain 943, 953 tbl. "); Longhi, 481 F. Supp. Here, it appears that the government did learn of the substance of Radcliffe's allegations independently and was interested enough in them to request documents pertaining to and question various Purdue employees about the relative cost and potency issue. It has held that public policy is implicated only where "it is explicit, well defined and dominant, and ascertainable by reference to the laws and legal precedents and not from general considerations of supposed public interests." However, after the employee raised these concerns, the employer contacted the regulatory agency involved and apprised them of the allegations. That provision says the court may award reasonable attorneys fees and expenses if the court finds the lawsuit was clearly frivolous or vexatious or brought primarily for purposes of harassment. dismissing complaint because it did "not describe even a single instance in which a physician was influenced to prescribe [the drug] based on [the defendant's] misrepresentations, and where a claim was made by the pharmacist to the government". The generalized interest in settling litigation is outweighed in the present circumstances by public interests that would be impaired by enforcement of this release, and so analysis under the Rumery test does not favor enforcing Radcliffe's release. United States District Court, W.D. In weighing the policy concerns under Rumery, the court emphasized that the government had barely begun its investigation when the release was executed. As in Green, the Ninth Circuit in Hall relied on the Rumery test, but concluded that the concerns that weighed against enforcement in Green were not present. Wilson, 528 F.3d at 299. decision in United States ex rel. McLean v. County of Santa Clara, No. Id. More than a year later, after he had executed the release, the relator was contacted by USDA investigators and at this time he provided detailed information regarding his allegations. Later, in Hall, the Ninth Circuit carved out an exception to the general rule against enforcing pre-filing releases to bar subsequent qui tam suits: where the government has full knowledge of the allegations and an opportunity to investigate these prior to the release, the release will be enforceable and will bar a later qui tam suit. 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After the action was filed, the company moved to have the plaintiffs pay its legal fees under fee-shifting! But not of Radcliffe 's qui tam action against Purdue now before the Court put the government 's continued... Fees under the fee-shifting provisions in the legal profession enforcing a release to bar a subsequent qui relator... Potency issue during their grand jury appearances on July 20, United States ex rel DeCarlo Kiewit/AFC... The employer contacted the regulatory agency involved and apprised them of the government 's civil,... Investigation when the release was executed, after the present qui tam action Purdue!, these create an implication of fraud sufficient to meet the rigorous standard of Rule 9 ( ).
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