United States of America ex rel. v. Caring & Compassionate Health Care Agency…

Background

Relators Nicole Chase and Jennifer Erickson filed a qui tam action under the False Claims Act, a law that permits certain private parties to sue on the government's behalf, in April 2015. The government declined to intervene. In an amended complaint, the relators alleged that the defendants billed the government for medical services that Caring & Compassionate Health Care Agency, L.L.C. did not provide from 2010 through 2018. They asserted claims under the federal False Claims Act, the Minnesota False Claims Act, and the Michigan Medicaid False Claims Act. The government again declined to intervene.

In September 2017, Minnesota charged defendant Remona Lysa Brown with 14 felony counts of aiding and abetting theft by false representation. The state criminal charges arose from the allegations in the civil action. The opinion states that the criminal indictment alleged Brown aided Caring & Compassionate Health Care Agency, L.L.C. and Mattie Brown in submitting claims for private duty nursing services that were not provided according to law and obtaining money from Minnesota's Department of Human Services.

Motion and Legal Standard

The relators moved to stay, or pause, the civil proceedings until the related Minnesota criminal case was resolved. They argued that a stay would prevent interference with the criminal matter and promote judicial economy. Remona Brown agreed with the motion. The opinion states that she was the only defendant who had filed an answer after being served.

The court explained that federal courts have authority to control the timing of proceedings on their dockets. A stay of a civil case during related criminal proceedings is not ordinarily required by the Fifth Amendment, but may be appropriate depending on the circumstances and competing interests. The court considered the relationship between the two proceedings, the potential effect on the parties, judicial efficiency, the interests of nonparties, and the public interest.

Court’s Analysis

The court found that a stay was warranted because the Minnesota criminal matter was based on the same allegations as the civil action. The criminal case's resolution would likely streamline issues in the civil proceeding. The court also relied on the parties' agreement that a stay would serve judicial economy. It determined that the stay would preserve the parties' and court's time and resources and would not unduly burden any party because the parties who had appeared agreed to it.

Disposition

The court granted the relators' Motion to Stay. The civil case was stayed until the Minnesota criminal case was resolved by dismissal, a not-guilty verdict, sentencing after a guilty plea or guilty verdict, or further order of the court. The parties were ordered to file a joint status letter every 60 days describing developments in the criminal proceeding and upcoming deadlines. The court also stated that prior consistent orders remained in effect and listed possible remedies for violations of the order, including costs, fines, attorney fees, evidentiary limits, striking pleadings, dismissal with prejudice, and default judgment. The order did not decide the merits of the false-claims allegations.