United States ex rel. Bledsoe v. Community Health Systems, Inc.

Brief Fact Summary.

Bledsoe, an employee of Community Health Systems, Inc. filed suit against Community Health Systems, Inc. for (Community) fraudulent billing practices.

Synopsis of Rule of Law.

A plaintiff is required to plead allegations of fraud with particularity.

Facts.

Community Health Systems, Inc. owned a hospital where Bledsoe worked. Bledsoe contacted the federal government to report the defendant’s fraudulent billing practices and filed suit under the False Claims Act (FCA). Bledsoe alleged that Community presented fraudulent claims to Medicaid and Medicare. The district court claimed that Bledsoe’s fraud claims should be pled with particularity under FRCP 9(b). The district court dismissed with prejudice and the appellate court reversed. Bledsoe filed an amended complaint alleging fraudulent schemes by the defendants, and the claims were dismissed for failure to plead for particularity.

Issue.

Whether a plaintiff is required to plead allegations of fraud with particularity?

Held.

Yes. The district court’s dismissal is affirmed. Although Bledsoe pled with particularity specific claims of miscoding, upcoding, and charges for specific payments, the remaining statements lack factual support.

Discussion.

FRCP 9(b) requires a plaintiff to plead allegations of fraud with particularity. FRCP 8, a plaintiff is only required to include short, plain statement regarding their entitlement to relief, as well as give the defendant notice of the action. A plaintiff only satisfies the pleading for fraudulent schemes with representative examples.