For the Defense - Volume 2, Issue 4 - 2017 - 17

that Defendants' alleged fraudulent marketing of
Plavix to prescribing physicians caused allegedly
legally false claims to be submitted to Medicaid
government payors, the Prescriber Allegations
clearly state that the government payors' decision
to pay the claims" was not affected.62 Relying
on Petratos, the District Court explained that
"the inquiry in FCA false certification cases is
not whether defendants' marketing efforts are
material to the submission of claims, but rather
whether the ultimate false certification that
reaches the government is material to the government's payment decision."63
These apparently conflicting decisions leave it at
least somewhat unclear as to what role doctors will
ultimately play in determining materiality; it may
be that their role, if any, will be limited to medical
decision-making and not encompass questions of,
for example, cost-effectiveness. But the ultimate
effect of the Third Circuit's decision on this issue,
which allows issues of materiality to be governed,
at least in part by the idiosyncratic decision-making
of individual doctors notwithstanding the guidance

of expert government agencies, will evolve through
judicial decisions to come.

Conclusion
With its decision in Petratos, the Third Circuit has
embraced a demanding pleading standard for
materiality in FCA cases. As subsequent district
court decisions already demonstrate, the Third
Circuit's precedential holding will serve as a
needed check on qui tam pleadings that fail to
connect what the defendant allegedly did wrong
with decisions on claims for payment by government payors.
The Court's analysis of the role that doctors
play in government payment decisions, however,
raises significant concern to healthcare industry
defendants. FCA practitioners will want to keep a
close watch on how courts continue to confront
that issue in future litigation.

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About the Authors
Mr. Lustberg chairs the Gibbons Criminal Defense Department and is a longtime
Director of the firm's John J. Gibbons Fellowship in Public Interest & Constitutional
Law, which litigates historic, cutting-edge civil rights and civil liberties cases. Prior to
joining the firm as its first Gibbons Fellow, he served as an Assistant Federal Public
Defender for the District of New Jersey for five years; he previously served as a Law
Clerk to the Honorable H. Lee Sarokin, United States District Judge.
Mr. Lustberg is the former president of both the Association of the Federal Bar of New
Jersey and Association of Criminal Defense Lawyers of New Jersey, each of which has
awarded him its highest honor-the William J. Brennan, Jr. Award and Honorable
Lawrence A. Whipple Memorial Award, respectively. Mr. Lustberg is also former
Co-Chair of the Criminal Litigation Committee of the American Bar Association. He has
served on, and chaired, numerous court, government and bar association committees,
as well as non-profit and philanthropic boards, and he has been a member of the
faculties of Seton Hall, Rutgers, and New York University Law Schools.
Amanda B. Protess is an associate in the Litigation Department of Goodwin, and a
member of its Securities Litigation and White Collar Defense Group. Her practice
focuses on white collar criminal defense and investigations, as well as complex civil
and appellate litigation.

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