Ohio Court Upholds Arbitration of Qui Tam Claims

The U.S. District Court for the Southern District of Ohio, Western Division, in the case of U.S. v. ex rel. Hicks v. Evercare Hospice recently granted a stay on certain qui tam claims pending arbitration.

The Relators were registered nurses who worked for the Defendant hospice and alleged that the Defendants admitted patients without mandatory consent and/or power of attorney designations, billed for continuous care that was not reasonable or necessary and provided inadequate services to Medicare patients.

The Relators had entered into an arbitration agreement that specifically included whistle blower claims.

The Relators’ key argument was that the government, which did not agree to arbitration, is the real party in interest in the case.

The court found that the arbitration agreement agreed to by the Relators was clear, unambiguous and covered whistleblower claims.  The court also based its decision on the strong federal policies in favor of arbitration and the fact that the government was not objecting to the arbitration, so long as the arbitration was deemed non-binding and subject to the government’s consent.

The parties were instructed to give the Attorney General the option of consenting to the resolution of the False Claims Act claims as determined by the arbitrator or resuming the litigation.

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