Fraud & Abuse: Fourth Circuit Holds Eleventh Amendment Bars Qui Tam Suit Against State in Federal Court

Abstract

The U.S. Court of Appeals for the Fifth Circuit ruled, in United States u. Texus Tech University, 171 F.3d 279 (5th Cir. 1999), that the Eleventh Amendment bars a private citizen from bringing a qui tam action in federal court against a state, absent federal intervention.Intervenor Carol Foulds was a dermatology resident at the Texas Tech Health Services Center. While a resident, Foulds examined patients, made diagnoses, and prescribed treatments for patients. Foulds alleged that she and other residents performed these medical services without the supervision of staff physicians. Foulds further alleged that, after residents performed these services without physician oversight, staff physicians signed charts and Medicare and Medicaid billing forms certifying that they personally performed or supervised the administration of these services. Foulds estimates approximately 500,000 false claims occurred in a span of ten years.In 1995, Foulds filed a qui tam action with the U.S. District Court for the Northern District of Texas. As regulated by the False Claims Act (FCA), 31 U.S.C. § 3729(b)(2) (West 1998), the complaint remained under seal.