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AG Nessel Statement on U.S. Supreme Court Decision Affirming Robust, Fair Reading of False Claims Act

LANSING – Michigan Attorney General Dana Nessel praised a unanimous decision by the U.S. Supreme Court that affirmed a robust and fair reading of the False Claims Act (FCA).

Earlier this year, AG Nessel joined a bi-partisan effort in filing a brief on behalf of 33 states arguing that the Supreme Court should interpret “knowingly” under the FCA to allow evidence of what a provider subjectively knew based on relevant guidance issued by state Medicaid agencies.

In the consolidated cases of United States ex rel. Tracy Schutte, et al v. SuperValu, Inc. (No. 21-1326) and United States ex rel. Thomas Proctor v. Safeway, Inc. (No. 22-111), the Supreme Court ruled that a retail pharmacy chain that subjectively believed that their discounted drug prices were the “usual and customary” prices, but nevertheless took steps to prevent Medicaid and Medicare from finding out, could be held liable under the FCA for knowingly submitting false claims for payment to the government.

“The False Claims Act is an important tool when it comes to protecting publicly funded programs from fraud,” Nessel said. “This decision will prevent pharmacies and hospitals from providing misleading or false information and then claiming ignorance to Medicaid regulations they should have reasonable knowledge of.”

A copy of the decision can be found here.


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