By Brendan Pierson
(Reuters) – Texas and an anonymous anti-abortion activist made a joint court filing over the weekend, urging a federal judge to decide a $1.8 billion fraud lawsuit they brought against Planned Parenthood in their favor, saying a recent U.S. Supreme Court ruling strengthened the case.
The lawsuit, before U.S. District Judge Matthew Kacsmaryk in Amarillo, Texas, had been on hold awaiting the Supreme Court’s decision Friday, which gave a boost to whistleblower lawsuits accusing health care providers and others of defrauding the government.
Texas and the anonymous plaintiff are seeking to force Planned Parenthood to return money it collected from Texas’ and Louisiana’s state Medicaid programs after the states tried to cut off its funding, plus heavy additional penalties.
Kacsmaryk, who was appointed by former Republican president Donald Trump, is a staunch conservative who in April suspended approval for the abortion pill mifepristone. The Supreme Court has put that decision on hold while the Biden administration appeals. Lawsuits filed in Amarillo federal court automatically go to him, making the court popular with conservative activists.
The lawsuit was brought in 2021 by an anonymous plaintiff, identifying himself as the person who in 2015 released undercover video footage purporting to show Planned Parenthood staff discussing the sale of fetal tissue.
Those videos led to Texas and Louisiana announcing in 2015 that they would terminate Planned Parenthood as a provider covered by their Medicaid programs.
Planned Parenthood sued over those decisions and won court orders blocking the states’ terminations. Those orders were later lifted on appeal, allowing Texas to end its contract with Planned Parenthood in 2021 and Louisiana in 2022.
The federal government has not intervened in the case, but said in a February filing that it did not believe there was any basis for Texas’ and Louisiana’s termination of Planned Parenthood.
The plaintiff claims that Planned Parenthood violated the federal False Claims Act by continuing to bill and collect payments from the state’s Medicaid programs after it was originally terminated and failing to repay what it received after those orders were lifted.
Texas intervened in the case, though Louisiana did not. The plaintiff will be entitled to a portion of any award if his lawsuit is successful.
Planned Parenthood noted that the states never asked for the money to be repaid and that it was allowed to keep billing them after winning court orders against the states. It had also pointed to a decision by the 5th U.S. Circuit Court of Appeals, which covers Texas and Louisiana, saying a defendant cannot be held liable for defrauding the government as long as its billing practices were supported by an “objectively reasonable” interpretation of the law.
The Supreme Court rejected that standard on Friday, saying that whether a defendant can be liable for fraud depends on whether it subjectively believed its bills were false when it submitted them. Texas and the plaintiff argued in a Sunday court filing that the decision supported their case by knocking out one of Planned Parenthood’s defenses.
Planned Parenthood countered that there was no evidence it subjectively believed its bills were false, meaning the lawsuit fails under the Supreme Court’s new standard.
Kacsmaryk is considering motions by both sides to decide the case without a trial. It is not clear when he will rule.
(Reporting By Brendan Pierson in New York, Editing by Alexia Garamfalvi and David Gregorio)
