After denying cert in health law cases, SCOTUS ends term

The Supreme Court concluded its 2015 term by cleaning house and disposing of many pending petitions for writ of certiorari. In doing so, the High Court declined to hear—and thereby, affirmed the lower court rulings in—a number of health law cases in its order lists of June 27 and June 28, 2016. The Court denied petitions in cases regarding health care employees, the False Claims Act (FCA) (31 U.S.C. §3729 et seq.), and a Washington state law requiring the timely delivery of all prescription medications by licensed pharmacies that was challenged pharmacists with religious objections to certain medications. In wake of the Court’s decision in Whole Women’s Health v. Hellerstedt, it also denied certiorari in two Targeted Regulation of Abortion Providers (TRAP) law challenges.

Health care workforce

The Court denied petitions in both Prime Healthcare Services, Inc. v. Service Employees International Union (Dkt. 15-1448) and Home Care Association of America v. Weil (Dkt.15-683). Prime Healthcare appealed the Ninth Circuit’s unpublished decision finding that it failed to sufficiently allege harm to competition or monopoly power in favor of a conspiracy and monopolization claims against Kaiser Permanente, Kaiser-affiliated companies, and two unions (for more information on this case, see Court dismisses antitrust lawsuit against Kaiser Foundation entities and United Healthcare Workers unions, Health Law Daily, July 29, 2013). In Home Care, the Court’s denial upholds the D.C. Circuit’s decision that the Department of Labor’s revised domestic worker regulations (78 FR 60453, October 1, 2013) that extended minimum wage and overtime protections to home care workers was a reasonable interpretation of the Fair Labor Standards Act due to changes in the long-term home care industry.

False Claims Act

In PharMerica Corporation v. U.S. ex rel. Gadbois (Dkt. 15-1309), PharMerica asked the Court to review its 2015 decision in Kellogg Brown & Root Services, Inc. v. U.S. ex rel Carter, which found that the FCA’s first-to-file rule does not bar subsequent relator claims if earlier lawsuits were dismissed (see Nothing to fear: whistleblower action timeline not suspended during war, Health Law Daily, May 27, 2015). Based on that decision, the First Circuit allowed a whistleblower to revive an earlier case brought against PharMerica that was originally barred under the first-to-file rule (see PharMerica requests Supreme Court review of FCA’s first-to-file bar, Health Law Daily, April 28, 2016; FCA action dismissed under first-to-file bar may get another chance on remand, Health Law Daily, December 17, 2015).

Religious pharmacists

In Stormans, Inc. v. Weisman (Dkt. 15-862), a divided Court denied cert, leading to a dissent from Justice Alito, joined by the Chief Justice and Justice Thomas. Washington state medication prescribing rules require the timely delivery of all prescription medications by licensed pharmacies; an individual pharmacist may refuse to deliver a prescription due to religious objections, so long as another pharmacist working for the pharmacy provides timely delivery. If there is no other pharmacist to provide timely delivery, pharmacists and pharmacy owners must deliver the prescription even in the face of religious objections. The Ninth Circuit determined that the state law is neutral and of general application, and is rationally related to a legitimate government purpose, and therefore does not violate the Constitutional protections of the Free Exercise, Due Process, or Equal Protection clauses (see Prescribing rules withstand religious attacks, patient safety takes the higher ground, Health Law Daily, July 24, 2015).

In his dissent, Justice Alito suggested that the law will make religious pharmacists “unemployable” and notes that the facts in the case show that the pharmacy in question, Ralph’s Thriftway, does not stock emergency contraceptives, but rather uses the practice of facilitated referrals, sending customers to other nearby pharmacies, to ensure timely delivery. The dissent also argued that the law in question is not neutral, because there is evidence to suggest that it was passed predominantly to “‘stamp out the right to refuse’ to dispense emergency contraceptives for religious reasons.”

TRAP laws

The Court also denied certiorari in a pair of TRAP law cases. In Currier v. Jackson Women’s Health Organization (Dkt. 14-997), the Fifth Circuit upheld a preliminary injunction preventing the enforcement of a Mississippi law requiring abortion facility physicians to have admitting privileges at a local hospital and staff privileges to replace the on-staff physicians at local hospitals (see Admitting privileges requirement for abortion clinics put on hold, Health Law Daily, July 31, 2014). Similarly, in Schimel v. Planned Parenthood of Wisconsin (Dkt. 15-1200), the Seventh Circuit affirmed a permanent injunction against a Wisconsin law requiring a physician performing an abortion to have admitting privileges at a hospital no more than 30 miles from the clinic where the abortion is performed (see Court terminates enforcement of Wisconsin law requiring admitting privileges for abortion doctors, Health Law Daily, November 24, 2015). These two Circuit Court decisions align with the Court’s decision released the previous day in Whole Women’s Health, which found that a Texas abortion law requiring physicians at abortion clinics to have admitting privileges at a nearby hospital and obligating clinics to meet ambulatory surgical center standards violated the Constitution by creating an undue burden on access to abortion services (see High Court strikes down Texas abortion restrictions as unconstitutional burdens, Health Law Daily, June 27, 2016).

PharMerica requests Supreme Court review of FCA’s first-to-file bar

PharMerica Corporation, a provider of long-term care pharmacy services, asked the Supreme Court to change its position on the “first-to-file” bar under the False Claims Act (FCA). In a petition for a writ of certiorari, the pharmacy company asked the high court to review its May 2015 ruling in Kellogg Brown & Root Services, Inc. v. U.S. ex rel. Carter (Carter), in which the court ruled that an earlier FCA suit based upon substantially the same subject matter ceases to bar related and subsequent FCA suits after the earlier suit is dismissed. PharMerica objects to the 2015 ruling because it led to the revival of a whistleblower case brought against the company by a former employee. PharMerica’s petition warns that the Supreme Court needs to review its earlier decision to prevent the “neutering of the first-to-file bar.”

Trial court

The dispute arose from the qui tam action of a pharmacist formerly employed by PharMerica. Because a similar case was pending in Wisconsin (Wisconsin case) when the whistleblower’s case was filed, a district court dismissed the case on the grounds that it was barred under 31 U.S.C. §3730(b)(5). The trial court concluded that dismissal under the first-to-file bar was appropriate because the two actions were based on substantially the same facts and conduct.

First Circuit

After the case was dismissed, the Supreme Court handed down its decision in the Carter case, changing the outlines of the FCA’s first-to-file bar. Subsequent to that decision, the Wisconsin case that barred the whistleblower action was settled and dismissed. As a result, the whistleblower filed a motion to remand, seeking to either have the appeals court supplement his complaint with additional facts or have the case remanded to allow for supplementation. The First Circuit granted the whistleblower’s request to supplement his complaint (see FCA action dismissed under first-to-file bar may get another chance on remand, Health Law Daily, December 17, 2015).

Certiorari

PharMerica objected to the First Circuit’s decision in its petition, asserting that the Carter decision and the appellate court’s holding will allow copycat lawsuits to “circumvent the plain terms of the first-to-file bar.” The pharmacy service provider argued that the whistleblower should not have been able to resurrect his case simply by keeping it on the docket until the prior case was inevitably dismissed. PharMerica asserted that review is necessary to prevent copycat relators from “bringing placeholder suits, certain in the knowledge that earlier-filed actions will one day conclude.”