Relator in settled off-label case loses her wrongful retaliation claim in summary judgment

by Ben Vernia | April 26th, 2011

On April 11, Judge Richard D. Bennett of the District of Maryland granted the defendant’s motion for summary judgment on a False Claims Act wrongful retaliation claim in U.S. ex rel. Parks v. Alpharma, Inc.. The defendant settled the qui tam claims in the case in 2010, paying $42.5 million, $5.33 million of which went to the relator, a former sales representative at the drug company. She also alleged, however, that she had been fired for complaining about the company’s unlawful promotion practices.

After a lengthy review of the relator’s allegations and the company’s evidence, Judge Bennett granted summary judgment for the company. He first agreed with the whistleblower that her internal complaints were sufficient tied to a potential suit under the False Claims Act to constitute “protected activity”:

This Court has previously noted that the “protected activity” element of FCA retaliation cause of action should be interpreted broadly, and that the type of activity that Parks claims she engaged in – internal reporting of allegedly fraudulent or false claims – qualifies as activity protected by the whistleblower provision of the FCA.

He did not, however, find that she met the requirements of notice and retaliation.

As for notice, Judge Bennett acknowledged, as the company argued, that the relator had not described the conduct as fraudulent in her internal complaints; the use of “buzzwords” was not required, however, he wrote. Instead, the central question was whether what she told her superiors was sufficiently suggestive of fraud that they should have reasonably understood that a qui tam suit was possible. But the relator’s only complaints about off-label promotion had to be viewed against a background of her own active promotion of these efforts, words and actions “which belie[d] her alleged concerns regarding fraud or illegality”.

Likewise, Judge Bennett found insufficient evidence of retaliation. The company had proffered evidence that the relator was terminated as a result of complaints by her fellow employees, and, in the absence of evidence that these reasons were false or pretextual, he found them persuasive. He also pointed out that she had filed a state-law case alleging that she was terminated as a result of a conspiracy to defame her. She had dismissed this case when it appeared that it might complicate the government’s investigation of her qui tam allegations, and Judge Bennett wrote that the contradictory theories of her firing “seriously undermine[d]” her FCA retaliation allegations.

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