Whistleblowers Argue that Seventh Circuit Allows Disingenuous FCA Defense

Qui tam whistleblowers filed a brief with the Supreme Court arguing that the Seventh Circuit “turned the law on its head” by ruling that because of ambiguous regulatory guidance, compliance lapses by pharmacies SuperValu and Safeway were “objectively reasonable.” They argued that this means “a defendant can present false claims, believing at the time that it is presenting false claims, and yet escape liability by later identifying a wrong-but-reasonable interpretation of the law that would have permitted its conduct.” They seek to have the case remanded to the district court, taking into consideration the defendants' subjective understanding of the regulation at the time.