When a qui tam case is dismissed, it’s not unusual for the defendant to seek an order requiring the whistleblower to reimburse its attorneys’ fees. What is unusual is for the defendant to seek an order requiring the whistleblower’s attorneys, rather than the whistleblower himself, to make the payment. But that’s what has happened in the now-notorious US ex rel. Leysock v. Forest Labs case.
On April 28 the court dismissed the qui tam case for failure to plead the alleged fraud with particularity as required by Fed. Rule of Civil Procedure 9(b). That was a complete reversal of the court’s earlier ruling on the same motion. Why the turn-around? Because in the interim the court had discovered that the surprisingly detailed allegations in the complaint had been obtained through an “elaborate scheme of deceptive conduct” orchestrated by the whistleblower’s law firm.
The firm had hired a doctor to obtain confidential patient and treatment information from innocent doctors under the guise of conducting legitimate medical research. Then, despite assurances of confidentiality, the information—including physician names and patient information sufficient to identify them—was included in the second amended whistleblower complaint, which became public when the case was unsealed.
The court ruled that the law firm had violated the Mass. Rules of Professional Conduct and the rules of the District Court. As a sanction, it struck all the allegations gained from the fraud scheme and then found the remaining allegations insufficient to withstand the motion to dismiss.
That was on April 28. On May 12 Forest Labs moved for an order awarding it all its attorneys’ fees and costs, payable by the whistleblower’s law firm. How much money are we talking about? The motion put the sum at “more than six million dollars [italics and bold in original].”
The case is US ex rel. Leysock, No. 12-CV-11354, D. Mass., motion filed May 12, 2017).
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