Growing Use of Sampling to Establish Liability in False Claims Act Cases

In recent years, sampling has been used in many False Claims Act (“FCA”) cases to determine damages. Specifically, when there are allegations of wrongful conduct that impacts a large number of claims, sampling may be used to determine and extrapolate damages. Two recent rulings have expanded the use of sampling to establish liability.

In U.S. ex rel. Martin v. Life Care Centers, the U.S. District Court for the Eastern District of Tennessee ruled that extrapolations from a sampling of billing statements could be used to establish liability for the submission of false claims. Defendants were accused of billing for unnecessary medical care for a number of years. To establish liability for false billing for more than 50,000 patient admissions, the government sought to use a random sample of 400 patient admissions. The Court granted the government’s request, saying that it would be overly burdensome for the government to have to establish separate liability for more than 50,000 claims and that the FCA was silent on the use of sampling.

In U.S. ex rel. Ruckh v. Genoa Healthcare, LLC, the U.S. District Court for the Middle District of Florida found there is no bar on sampling to establish liability. Defendants had filed a motion asking the court to limit or prevent potential expert witness testimony on sampling before the witness testified or was challenged. The Court found the motion was premature, saying that, “no universal ban on expert testimony based on statistical sampling applies in a qui tam action.”

The Cogdell Law Firm is a full service criminal litigation and appellate law firm with a focus on federal fraud defense, Medicare fraud defense, bank fraud defense, and white collar criminal defense. We provide client-focused representation at all stages of the process, whether our clients are seeking to avoid charges, have been charged, or are seeking reversal of a conviction on appeal. When results matter most, contact Dan Cogdell at (713) 426-2244 or