The opinion of the court was delivered by: Gettleman, District Judge.
MEMORANDUM OPINION AND ORDER
Relator/plaintiff Janet Chandler ("plaintiff") has brought a
three-count complaint against defendants the Hektoen Institute for
Medical Research ("Hektoen"), Cook County Hospital ("CCH"), and Cook
County (together, "the County Defendants"). Plaintiff alleges: (1)
presentation of false claims in violation of the False Claims Act
("FCA"), 31 U.S.C. § 3729 et seq. (Count I); (2) retaliation in
violation of the FCA (Count II); and (3) retaliatory discharge in
violation of Illinois law and public policy (Count III).
Defendant Hektoen moves to dismiss Counts I and III, arguing that: (1)
the FCA's qui tam provisions are unconstitutional; and (2) plaintiff does
not allege that Hektoen's actions violated clearly established Illinois
public policy. Hektoen has also moved for an extension of time in which to
answer Count II, pending the court's decision on the County Defendants'
motion to dismiss Count II. The United States has filed an amicus brief
in opposition to Hektoen's argument that the qui tam provisions of the
FCA are unconstitutional.
The County Defendants have likewise filed a motion to dismiss the
complaint, arguing that: (1) CCH is not a suable entity under Illinois
law; (2) Count II fails to state a claim against the County Defendants
because plaintiff was employed by Hektoen, not by the County; (3) the
County Defendants are immune from punitive damages for Count III; (4)
Count III fails to state a claim for retaliatory discharge; and (5) the
qui tam provisions of the FCA are unconstitutional. The County Defendants
have filed a supplemental motion to dismiss, arguing that they are not
"persons" who can be sued under the FCA.*fn1
The federal grant had two components. The clinical component was
designed to provide the research subjects with a comprehensive medical
and social service program that included drug treatment and prenatal
care. The research component was designed to study whether the research
subjects had benefitted from the comprehensive treatment program.
Plaintiff alleges that during her employ, she became aware that
defendants were not complying with the terms of the grant or with federal
regulations and were misrepresenting the progress of the New Start
study. Specifically, plaintiff alleges that defendants: did not follow
the mandatory protocol associated with research on human subjects and the
dispensing of methadone to pregnant women; did not obtain informed
consent from study participants; did not obtain thorough medical or drug
histories from the participants; provided the participants with
substandard care; failed to keep accurate records; and failed to
randomize participants. Plaintiff also alleges that defendants reported
"ghost" research subjects and submitted false progress reports to the
government. Finally, plaintiff alleges that defendants violated the grant
and federal law because they did not have procedures in place to protect
whistleblowers from retaliation.
Plaintiff alleges that in 1994, she began informing doctors employed by
CCH of her concerns that the study was violating the terms of the grant,
the Assurance of Compliance plan, and federal regulations. She alleges
that after reporting her concerns, Dr. Mason, an employee of CCH,
rescinded a number of her responsibilities. Plaintiff also alleges that
Hektoen retaliated against her by recalculating her vacation and sick
time. According to plaintiff, after she reported in a draft of her paper
for NIDA that the study had not been successful, she was further
chastized by employees of both CCH and Hektoen. On January 24, 1995, John
Prochaska ("Prochaska"), the administrator of Hektoen, accused plaintiff
of lying in her monograph on the study and fired her. On February 21,
1995, plaintiff was formally removed as co-principal investigator of the
study. Plaintiff subsequently testified at an HHS Commission on Research
Integrity hearing, and in August 1996, a subdivision of HHS issued a
report on the research conducted by CCH and Hektoen that identified
"multiple failures to comply with requirements of the HHS human subjects
I. Defendant Hektoen's Motions
A. Motion to Dismiss Count I
Hektoen moves to dismiss Count I on the grounds that the qui tam
provisions of the FCA are unconstitutional.*fn3 Hektoen argues: (1) qui
tam relators do not have Article III standing to bring an FCA claim; (2)
the qui tam provisions violate separation of powers principles by
encroaching on the authority of the executive branch, U.S. Coust., Art.
II, § 3; and (3) the qui tam provisions violate the Constitution's
Appointments Clause, U.S. Coust., Art. II, § 2. Defendants rely
primarily on the reasoning of a lone decision from the Eastern District of
Texas, United States ex rel. Riley v. St. Luke's Episcopal Hospital,
982 F. Supp. 1261 (S.D.Tex. 1997). The overwhelming majority of courts
that have considered the issue have upheld the qui tam provisions of the
FCA in the face of identical constitutional challenges.
Defendants argue that plaintiff does not have Article III standing to
bring suit under the qui tam provisions of the FCA because she does not
allege an injury-in-fact, one of the three elements of Article III
standing, see Lujan v. Defenders of Wildlife, 504 U.S. 555, 559-61, 112
S.Ct. 2130, 119 L.Ed.2d 351 (1992). The Seventh Circuit has
held that because the United States is the real party in interest in a
qui tam action, a relator has standing to pursue the suit as long as the
federal government has suffered an injury-in-fact. See United States ex
rel. Hall v. Tribal Development Corp., 49 F.3d 1208, 1214 (7th Cir. 1995)
("It is enough . . . that the United States, as the entity on whose
behalf and in whose name this suit was brought, has suffered an injury in
fact under Article III. Requiring an additional showing of injury on the
part of the qui tam relator would be an analytical redundancy.").
Although defendants acknowledge the existence of Hall, they urge this
court to abjure binding precedent in favor of the reasoning of Riley, a
district court decision from another circuit that explicitly disagreed
with Hall. See Riley, 982 F. Supp. at 1266. Defendants also argue that
Hall is not binding on this court because it did not arise under the
FCA. However, Hall relied on FCA cases to draw its ultimate conclusion
that qui tam relators need not demonstrate an injury-in-fact. See U.S.
v. Johnson, 43 F.3d at 1214 (quoting the Second Circuit's holding in
United States ex rel. Kreindler & Kreindler v. United Technologies
Corp., 985 F.2d 1148, 1154 (2d Cir. 1993): "[un a qui tam action [under
the False Claims Act], the plaintiff sues on behalf of and in the name of
the government and invokes the standing of the government resulting from
the fraud injury."). The FCA comports with the principle that "if an
injured person assigns his right of action to someone else, the assignee
has standing to enforce the right even though he is not the one who was
injured by the defendant's wrongdoing." National Ass'n of Realtors v.
National Real Estate Ass'n, Inc., 894 F.2d 937, 941 (7th Cir. 1990).
Other courts have used similar reasoning to hold that qui tam relators
have standing to bring suit under the FCA. See, e.g., United States ex
rel. Kelly v. Boeing Co., 9 F.3d 743, 748 (9th Cir. 1993) ("the FCA
effectively assigns the government's claims to qui tam plaintiffs such as
Kelly, who then may sue based upon an injury to the federal treasury.");
United States ex rel. Lamers v. City of Green Bay, 924 F. Supp. 96, 98
(W.D.Wis. 1996) (agreeing with Kelly); United States ex rel. Robinson v.
Northrop Corp., 824 F. Supp. 830, 836 (N.D.Ill. 1993) ("Congress . . .
can transfer the rights of the United States to ...