United States District Court, N.D. Illinois, Eastern Division
UNITED STATES OF AMERICA ex rel. YOUNG, et al., Plaintiffs,
SUBURBAN HOMES PHYSICIANS, d/b/a DOCTOR AT HOME, et al., Defendants.
MEMORANDUM OPINION AND ORDER
Robert Blakey United States District Judge
qui tam action is brought by Allen Young, Sylviette
Young,  Teresa Dedina, Vianka Calderon, and
D'Ander Hooks-Czapansky (collectively,
“Relators”) on behalf of the United States
against both individuals and corporate entities for different
forms of Medicare fraud. . This Court previously
dismissed a number of claims and parties from the case,
including claims against Defendant Bestmed-Care Services,
Ltd. . Relators amended their Complaint , and
Bestmed-Care moves to dismiss the remaining claim against it
. For the reasons explained below, Bestmed-Care's
motion is granted.
procedural background follows below. This Court presumes
familiarity with, and incorporates by reference, its opinion
granting Bestmed-Care's prior motion to dismiss. .
first amended their complaint in 2016. . In response,
many of the numerous Defendants then involved in the case
moved to dismiss. [105, 117, 132, 135, 138, 143, 146, 149,
163]. This Court granted the motions but permitted Relators
to re-plead most of their claims.  at 23-24. Relators
filed their second amended complaint in June 2017. .
present complaint alleges violations of the False Claims Act
(FCA), 18 U.S.C. § 3279 et seq. (Counts I, II,
III, and V); and violations of the Anti-Kickback Statute
(AKS), 42 U.S.C. § 1320a-7b (Count IV). The sole claim
against Bestmed-Care is Count IV, alleging AKS violations in
the form of cross-referring Medicare patients with
co-Defendants Suburban Home Physicians and Diana Jocelyn
Gumila.  at 12-16.
moves to dismiss Count IV for failing to state a claim upon
which relief can be granted, and for failing to satisfy
Federal Rule of Civil Procedure 9(b)'s heightened
requirements for pleading fraud. [207, 208]. As discussed
below, Bestmed-Care's motion is granted.
9(b)'s heightened pleading requirements govern
Relators' AKS claims. See United States v. A Plus
Physicians Billing Serv., Inc., No. 13-cv-733, 2015 WL
8780548, at *2 (N.D. Ill.Dec. 15, 2015); see also United
States v. Patel, 778 F.3d 607, 612 (7th Cir. 2015) (The
AKS “is designed to prevent Medicare and Medicaid
fraud.”). Rule 9(b) requires claimants alleging fraud
to “state with particularity the circumstances
constituting fraud.” Specifically, claimants
“ordinarily must describe the who, what, when, where,
and how of the fraud-the first paragraph of any newspaper
story.” Pirelli Armstrong Tire Corp. Retiree Med.
Benefits Trust v. Walgreen Co., 631 F.3d 436, 441-42
(7th Cir. 2011) (internal quotation marks omitted). Although
different cases require different levels of detail to satisfy
Rule 9(b), Pirelli, 631 F.3d at 442, claimants must
inject “precision and some measure of
substantiation” into fraud allegations, United
States ex rel. Presser v. Acacia Mental Health Clinic,
LLC, 836 F.3d 770, 776 (7th Cir. 2016) (internal
quotation marks omitted).
survive a motion to dismiss under Rule 12(b)(6),
Relators' complaint must “state a claim to relief
that is plausible on its face.” Yeftich v.
Navistar, Inc., 722 F.3d 911, 915 (7th Cir. 2013).
“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Id. Rule 12(b)(6) limits
this Court's consideration to “allegations set
forth in the complaint itself, documents that are attached to
the complaint, documents that are central to the complaint
and are referred to in it, and information that is properly
subject to judicial notice.” Williamson v.
Curran, 714 F.3d 432, 436 (7th Cir. 2013).
allege that Bestmed-Care cross-referred Medicare-eligible
patients with Suburban Home Physicians in 2011 and 2012, in
violation of the AKS, 42 U.S.C. § 1320a-7b(b)(1)(A).
 at 13-15. To bring their AKS claim, Relators
“must allege, with the specificity required by Rule
9(b), ” that Bestmed-Care: (1) knowingly and willfully;
(2) offered, paid, solicited, or received; (3) remuneration;
(4) in return for purchasing or ordering any item or service
for which payment may be made under a federal healthcare
program. A Plus Physicians, 2015 WL 8780548, at *2.
Here, that standard requires alleging that Bestmed-Care
offered or received “remuneration” in return for
referring Medicare patients, knowing that such conduct was
wrongful. §§ 1320a-7b(b)(1)(A), (b)(2)(A); see
Klaczak v. Consol. Med. Transp., 458 F.Supp.2d 622,
626-27, 675-76 (N.D. Ill. 2006).
support of their claim, Relators allege that: (1) from
December 3, 2011 to April 5, 2012, Suburban Home Physicians
referred eight Medicare patients to Bestmed-Care; (2) from
April 17, 2012 to December 4, 2012, Bestmed-Care referred 11
Medicare patients to Suburban Home; (3) referring patients
constitutes remuneration because of the patients' value
in Medicare billings; and (4) the defendants knew their
conduct was wrongful because the Stark Act, 42 U.S.C. §
1395nn(a)(1)(A), “prohibits ...