United States District Court, W.D. Pennsylvania
UNITED STATES OF AMERICA, ex rel., J. WILLIAM BOOKWALTER, III, et al., Plaintiffs,
UPMC, et al., Defendants.
Bissoon, United States District Judge
Motion to Dismiss (Doc. 99) will be granted. In support of
this ruling, the Court incorporates by reference its analyses
in the Order dated June 21, 2017 (Doc. 95), as well as the
analyses in Defendants' current Motion-papers (Docs. 100
June 21st Order, the Court expressed “strong
doubts” regarding Plaintiffs' ability to
overcome-by-amendment the numerous pleading deficiencies
identified therein. See Doc. 95 at 2. Defense
counsel is correct that Plaintiffs did not comply with the
Court's instructions regarding amendment, see
Doc. 100 at 1; but, in fairness, it now seems clear that they
were directed to do that which could not be done. Indeed, had
Plaintiffs' request to amend not been so vociferously
stated, the Court might well have thought to allow, in the
alternative, a second path: that Plaintiffs be permitted to
stand on their pleadings and immediately proceed to appellate
review. See generally S.B. v. KinderCare Learning
Ctrs., 815 F.3d 150, 152 n.1 (3d Cir. 2016)
end, the outcome remains unchanged. Plaintiffs by-now have
abandoned all of their claims save those under the Stark Law.
Defendants have made compelling arguments that
Plaintiffs' current allegations do not plausibly identify
a Stark-implicating compensation agreement, see Doc.
100 at 7-9, and the Court adopts their arguments and
conclusions. Even were the Court to assume the contrary,
Plaintiffs' underlying premise - that targeted-physicians
conducted medically unnecessary, or unnecessarily complex,
procedures - persists. See, e.g., 2d Am. Compl.
(Doc. 98) at ¶¶ 67, 82, 188-212. Plaintiffs'
newly-amended pleadings offer no greater specificity, and
they still fail to sufficiently allege “particular
details of a scheme to submit false claims[, ] paired with
reliable indicia . . . lead[ing] to a strong inference”
that false claims actually were submitted. See Doc.
95 at 3 (citing and quoting binding Third Circuit authority).
face of this seemingly inevitable conclusion, Plaintiffs
attempt to side-step it by suggesting that the wRVU-based
compensation system, either generally or as applied by
Defendants, constituted a per se violation of the
Stark Law. The Court joins Defendants in rejecting this
contention. There is no support for it, in the law or
otherwise, and were such allegations enough, one can only
imagine the proliferation of qui-tam lawsuits that
would result. See Doc. 108 at 2-3 &
the clearest “shorthand” explanation for why
Plaintiffs' claims remain deficient is one emphasized in
the Court's prior Order: Plaintiffs have not, and cannot,
distinguish the presumably-lawful compensation/referral
arrangements between the Relator-physician(s) and
Defendant(s), and those of the purportedly malfeasant
physicians. The only plausible distinction is Plaintiffs'
contention - whether by express averment or through unspoken
implication - that certain “bad actors” performed
unnecessary or unnecessarily-complex medical procedures and
the Relator(s) did not.
of the reasons above, including those incorporated by
reference herein and in the June 21st Order,
Defendants' Motion to Dismiss (Doc. 99)
is GRANTED, and this action is
DISMISSED WITH PREJUDICE.
 At the onset, the Court dispenses with
the notion that Defendants should be faulted, or owe an
apology, for not adhering to the undersigned's
“meet and confer” requirement as-relates to
motions under Rule 12(b)(6). See generally Practices
& Procedures (http://www.pawd.uscourts.
at § II.A (requiring parties, in advance of
motions-practice, to discuss whether pleading defects may be
cured by amendment). The requirement does not
“fit” the current procedural posture
(i.e., Plaintiffs being afforded one last chance to
amend their pleadings, following the Court's grant of a
prior Motion to Dismiss based on detailed legal analyses;
after which it was almost a foregone conclusion that
Defendants again would test the legal-sufficiency of the
 Tellingly, the case decisions cited by
Plaintiffs' counsel are facially distinguishable.
See, e.g., Doc. 103 at 16 (citing cases in which
healthcare systems allegedly offered salaries or bonuses well
in excess of fair-market-value, essentially taking a loss on
those specific services in exchange for windfalls resulting
from increased referrals and “downstream
income”). Defendants' wRVU-based compensation model
is, on its face, productivity-related; and the “special
sauce” needed to make Plaintiffs' claims plausible
- sufficiently-specific allegations regarding a lack of
medical necessity - remains conspicuously absent.
 In contravention of the Court's
June 21st Order, a swath of the Second Amended Complaint
brazenly reasserts the same allegations regarding
lack-of-medical-necessity. See Doc. 98 at
¶¶ 188-212 (subsection titled, “[Physicians
p]erforming more complex procedures than necessary [to]
artificially inflate wRVUs”). Other instances have been
omitted. See Doc. 100-1 (redlined-comparison of
First and Second Amended Complaints, supplied by
Defendants' counsel). The Court's June
21st Order is the law ...