Facts

Marc Osheroff, a self-described entrepreneur, had business experience in several areas, including motorcycles, electronics, commercial real estate, and medical clinics. He filed a qui tam action on behalf of the government against HealthSpring Inc., one of the nation's largest managed-care companies, under the False Claims Act (FCA).

PLAINTIFF'S CONTENTIONS:
Osheroff alleged HealthSpring had created a scheme to obtain Medicare payments by doling out generous inducements to patients. He particularly alleged that defendant's clinics in South Florida gave patients lavish "Cuban-style" health care, providing them with chauffeured free limousine rides, free meals, personal indulgences, bingo, and other expense-free entertainment outings, which wasted the clinics' money. He claimed he discovered these activities through his own private investigations.

DEFENDANT'S CONTENTIONS:
Defendant argued that plaintiff's claims were based on publicly disclosed information, and that Osheroff did not add any independent or material information to what was already public information.

Result

The district court dismissed the action with prejudice, determining that the FCA's public disclosure provisions barred the claims. The U.S. later filed a motion for clarification asking the Court to clarify that the dismissal was without prejudice to the U.S. The Court granted the motion and held that the dismissal was without prejudice to the U.S., but still with prejudice to the relator.