United States of America, ex rel. Intergra Med Analytics, LLC. v. Issac Laufer

Background

Integra Med Analytics, LLC, which the opinion describes as specializing in statistical analysis to identify health-care fraud, brought the action against Issac Laufer and several skilled nursing facilities owned and operated by him. The United States later intervened and asserted claims under the False Claims Act and, alternatively, common-law claims against Laufer, Tami Whitney, Paragon Management SNF LLC, and the facilities.

The Government alleges that, from at least 2010 through September 2019, the defendants knowingly submitted false Medicare claims for unreasonable services. According to the allegations, the defendants kept residents at the facilities longer than necessary and placed them on higher levels of rehabilitation therapy than was reasonable or necessary, allowing the facilities to bill Medicare at higher rates.

The defendants had previously moved to dismiss. On September 23, 2022, Judge Cathy Seibel denied that motion except as to Whitney’s and Paragon’s motions concerning the Government’s unjust-enrichment and payment-by-mistake claims, which were granted. The case then proceeded to discovery.

Discovery Dispute

The Government’s initial disclosures listed 154 individuals, including Laufer and Whitney. Excluding those two defendants, 152 individuals—mostly former facility employees—were at issue here. The defendants asked the Government to identify which of those 152 people it had interviewed and to provide a summary of the information obtained from each interview.

The Government argued that both the identities and summaries were protected by the attorney work-product privilege and the law-enforcement privilege. The defendants argued that identifying the interviewees was necessary to avoid the burden and expense of locating and interviewing all 152 people. They also argued that obtaining the interview information through depositions would require numerous unnecessary depositions.

Interviewee Names

The court held that the interviewee names were factual work product. Work product is material prepared in connection with litigation; factual work product generally receives qualified protection, meaning it may be disclosed when the requesting party shows substantial need and that obtaining equivalent information elsewhere would cause undue hardship.

The court rejected the Government’s law-enforcement-privilege argument as to the names. It found no sufficient danger of retaliation or deterrence of future cooperation, particularly because most of the listed individuals were former employees. The court also concluded that names alone did not reveal the Government’s investigative techniques or strategy.

Although the names were factual work product, the court found that the defendants had shown substantial need and undue hardship. The defendants needed to identify the witnesses supporting the Government’s claims in order to prepare their defense, and locating and interviewing all 152 people would be time-consuming and costly.

The court therefore directed the Government to identify the individuals it intended to rely on at trial and the individuals referenced in the complaint. The court stated that this limited disclosure would not constitute a broad waiver of any privilege concerning the Government’s legal strategy or investigation. In the conclusion, the court characterized the defendants’ motion to compel disclosure of the interviewee identities as denied while ordering this limited disclosure.

Interview Summaries

The court denied the request for interview summaries. It held that summaries prepared by counsel during an agency investigation were classic work product and were more likely than witness identities to reveal attorneys’ mental impressions.

Even assuming the summaries were factual rather than opinion work product, the defendants did not show substantial need or undue hardship. The defendants acknowledged that they could obtain the underlying information through depositions or their own interviews. The court also found that its order requiring disclosure of the trial witnesses eliminated the claimed need to take numerous unnecessary depositions.

Because the work-product privilege was sufficient to resolve the issue, the court did not decide whether the law-enforcement privilege also protected the summaries.

Disposition

The court denied the defendants’ request to compel disclosure of the identities of all interviewees, directed the Government to provide the limited witness and complaint-reference information described above, and denied the request for interview summaries. This was a discovery ruling and did not decide the merits of the False Claims Act allegations.