Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Bishop v. Wells Fargo & Co.

United States Court of Appeals, Second Circuit

September 7, 2017

Paul Bishop, Robert Kraus, United States of America, Ex Rel Paul Bishop, Ex Rel Robert Kraus, Plaintiffs-Appellants, State of New York, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Delaware, Ex Rel Paul Bishop, Ex Rel Robert Kraus, District of Columbia, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Florida, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Hawaii, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of California, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Indiana, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Illinois, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Minnesota, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Nevada, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of New Hampshire, Ex Rel Paul Bishop, Ex Rel Robert Kraus, Commonwealth of Massachusetts, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of New Mexico, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Montana, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of North Carolina, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of New Jersey, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Oklahoma, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Rhode Island, Ex Rel Paul Bishop, Ex Rel Robert Kraus, State of Tennessee, Ex Rel Paul Bishop, Ex Rel Robert Kraus, Commonwealth of Virginia, Ex Rel Paul Bishop, Ex Rel Robert Kraus, Plaintiffs,
v.
Wells Fargo & Company, Wells Fargo Bank, N.A., Defendants-Appellees.

          Argued: March 1, 2016

          Final Submission: August 1, 2017

         The Supreme Court vacated our prior decision in this False Claims Act ("FCA") case in light of Universal Health Services, Inc. v. United States ex rel. Escobar, 136 S.Ct. 1989 (2016). Escobar abrogated two holdings of Mikes v. Straus, 274 F.3d 687 (2d Cir. 2001), upon which this Court and the district court had relied in our prior decisions in the present case. Specifically, Escobar abrogated Mikes's express- designation requirement for implied false certification claims and Mikes's particularity requirement for express false certification claims. In place of these requirements, Escobar held that a misrepresentation must be material to the government's payment decision to be actionable under the FCA. Because this materiality standard has not been applied in the present case, we remand for the district court to determine in the first instance whether defendants' alleged misrepresentations were material.

         Accordingly, we VACATE the judgment of the district court and REMAND for further proceedings consistent with this opinion.

          Thomas C. Goldstein & Tejinder Singh, Goldstein & Russell, P.C., Bethesda, Maryland; Rachel Grier, Berg & Androphy, Houston, Texas, for Plaintiffs-Appellants.

          Amy Pritchard Williams & Sara S. Ash, Troutman Sanders LLP, Charlotte, North Carolina; Stephen G. Rinehart, Troutman Sanders LLP, New York, New York, for Defendants-Appellees.

          Chad A. Readler, Acting Assistant Attorney General; Bridget M. Rohde, Acting United States Attorney; Michael S. Raab, Charles W. Scarborough, and Benjamin M. Schultz, Attorneys; United States Department of Justice, Washington, DC, filed a brief for Amicus Curiae the United States, supporting Neither Party.

          Kate Comerford Todd & Steven P. Lehotsky, United States Chamber Litigation Center, Inc., Washington, DC; John P. Elwood & Ralph C. Mayrell, Vinson & Elkins LLP, Washington, DC, filed a brief for Amici Curiae Chamber of Commerce of the United States of America and the Clearing House Association, in support of Defendants-Appellees.

          Before: Katzmann, Chief Judge, Sack and Lohier, Circuit Judges.

          PER CURIAM.

         This False Claims Act ("FCA") case returns to us on remand from the United States Supreme Court. The Supreme Court vacated and remanded our earlier opinion, Bishop v. Wells Fargo & Co., 823 F.3d 35 (2d Cir. 2016), in light of the Supreme Court's decision in Universal Health Services, Inc. v. United States ex rel. Escobar, 136 S.Ct. 1989 (2016). See Bishop v. Wells Fargo & Co., 137 S.Ct. 1067 (2017). Because Escobar set out a materiality standard for FCA claims that has not been applied in the present case, we vacate and remand for further proceedings consistent with this opinion and Escobar.

         The present case began in 2011, when Robert Kraus and Paul Bishop (together, "the relators") brought a qui tam action under the FCA on behalf of the United States against Wells Fargo & Company and Wells Fargo Bank, N.A. (together, "Wells Fargo"). The relators claimed that Wells Fargo, along with Wachovia Bank and World Savings Bank, which later merged into Wells Fargo, falsely certified their compliance with banking laws in order to borrow money at favorable rates from the Federal Reserve System. The government declined to intervene, and the district court (Cogan, J.) dismissed the relators' complaint in its entirety. See United States ex rel. Kraus v. Wells Fargo & Co., 117 F.Supp.3d 215 (E.D.N.Y. 2015). We affirmed. Bishop, 823 F.3d at 50.

         When evaluating the relators' claims, our decision and that of the district court relied on Mikes v. Straus, 274 F.3d 687 (2d Cir. 2001), for two points in particular. First, we relied on Mikes's holding that "implied false certification is appropriately applied only when the underlying statute or regulation upon which the plaintiff relies expressly states the provider must comply in order to be paid." Mikes, 274 F.3d at 700. We refer to this as Mikes's express-designation requirement. Second, we relied on Mikes's holding that "[a]n expressly false claim is . . . a claim that falsely certifies compliance with a particular statute, regulation or contractual term, where compliance is a prerequisite to payment." Id. at 698 (emphasis added). We refer to this as Mikes's particularity requirement.

         These two Mikes requirements-the express-designation requirement for implied false certification claims and the particularity requirement for express false certification claims-did not survive Escobar. First, the Escobar Court directly abrogated Mikes's express-designation requirement, holding that "[a] statement that misleadingly omits critical facts is a misrepresentation irrespective of whether the other party has expressly signaled the importance of the qualifying information." 136 S.Ct. at 2001; s ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.