Firsthand Knowledge Needed To Clear FCA Bar, 3rd Circ. Rules

By Vin Gurrieri (October 20, 2014, 7:00 PM EDT) -- The Third Circuit on Monday upheld the dismissal of a former Medco Health Solutions Inc. executive's False Claims Act kickback suit against Bristol-Myers Squibb Co. and AstraZeneca Pharmaceuticals LP, saying that firsthand knowledge of improper activity is necessary to overcome the FCA's public disclosure bar.

In a precedential ruling, a three-judge panel said the whistleblower who brought the case, former Medco executive Karl Schumann, exhibited no "direct and independent knowledge" of any purportedly improper activities by the companies to satisfy the "original source" exception to the FCA's public disclosure bar.

The panel's ruling upheld a January 2013 decision by U.S. District...

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