Relator points the Court to United States v. Public Warehousing Co. K.S.C., which holds that "the appropriate action for the Court to take when a defendant moves to dismiss those portions of a relator's complaint that have been superseded by government intervention is to deny the motion as moot as it relates to the intervened claims." 242 F.Supp.3d 1351, 1357 (N.D.Ga. 2017). While HealthNet maintains that the Court should dismiss Count II, it acknowledges that the result is the same whether the Court denies as moot HealthNet's motion or grants it.
Indeed, as another court has explained, "[w]hen the government has intervened, that portion of the relator's complaint effectively ceases to exist because it has been superseded." United States v. Pub. Warehousing Co. K.S.C., 242 F. Supp. 3d 1351, 1357 (N.D. Ga. 2017); see also United States ex rel. Sansbury v. LB & B Assocs., Inc., 58 F. Supp. 3d 37, 47 (D.D.C. 2014)("[B]y automatic operation of the statute, the Government's complaint in intervention becomes the operative complaint as to all claims in which the government has intervened."). Stepe "does not dispute her disparate pricing claim against Defendants is superseded by the Government's Usual and Customary Price claim in the Government's Complaint."
“The more essential the continued execution of a contract is to an important government interest, the less the government's continued payment weighs in favor of the government knowledge defense.” United States v. Pub. Warehousing Co. K.S.C., at *6 (N.D.Ga. Mar. 16, 2017). “To find otherwise could lead to perverse outcomes; the more dependent the government became on a fraudulent contractor, the less likely it would be to terminate the contract (and the less likely the contractor would be held liable).
She cites to and quotes a federal district court case for the assertion that “the appropriate action for the Court to take when a defendant moves to dismiss those portions of a relator's complaint that have been superseded by government intervention is to deny the motion as moot as it relates to the intervened claims.” (See Doc. 47, pp. 5-6; United States v. Pub. Warehousing Co. K.S.C., 242 F.Supp.3d 1351, 1357 (N.D.Ga. 2017). Relator cites to no other authority for this proposition, and neither do Defendants.
It is noteworthy that federal courts addressing the standing issue since Sprint have uniformly held that individual litigants cannot bring common law claims on behalf of the federal government. See, e.g., United States v. Public Warehousing Co., K.S.C., 242 F. Supp. 3d 1351, 1361 (N.D. Ga. 2017); Jacobs v. Bank of Am. Corp., No. 1:15-cv-24585, 2016 WL 11653744, at *8 (S.D. Fla. Dec. 20, 2016); United States ex rel. Fortenberry v. Holloway Grp., Inc., 515 B.R. 827, 830 (W.D. Okla. 2014). I see no reason to forge a different path.
Relators' allegations are not conclusory—they plausibly alleged particular facts showing an agreement among the Defendants to submit false claims to the Government, so the conspiracy claim stands. See United States v. Pub. Warehousing Co. K.S.C., 242 F. Supp. 3d 1351, 1359 (N.D. Ga. 2017). Whether they can prove it is for another day.
Accordingly, the Relator's claims are superseded by the Government's Complaint to the extent that it intervened, and Relator's Second Amended Complaint survives only with respect to non-intervened claims. United States v. Pub. Warehousing Co. K.S.C., 242 F. Supp. 3d 1351, 1357 (N.D. Ga. 2017); see also Relator's Consolidated Response to the Motions to Dismiss at 4-5 ("Relator's kickback claims against the Soothe Defendants and CV McDowell Defendants that allege false claims based on those same illegal commission arrangements are superseded by the Government's Complaint."). The Relator's claims against DeStefano that have not been superseded remain pending.
Although "[t]he construction of a contract is a question of law for the courts," Kwok v. Delta Air Lines, Inc., 994 F.Supp.2d 1290, 1293 (N.D. Ga. 2014) (quoting Avion Systems, Inc. v. Thompson, 293 Ga. App. 60, 62, 666 S.E.2d 464 (2008) ), "[c]ontract interpretation is typically inappropriate at the motion to dismiss stage." Alhassid v. Bank of Am., N.A., 60 F.Supp.3d 1302, 1312 (S.D. Fla. 2014) ; see also United States v. Pub. Warehousing Co. K.S.C., No. 1:05-CV-2968-TWT, 2017 WL 1021745, at *8 (N.D. Ga. Mar. 16, 2017) (declining to construe contractual language at motion to dismiss stage). Plaintiffs argue that any construction of the Teaming Agreement with respect to their quantum meruit claim necessarily requires "a more in-depth evaluation of the ‘true facts’ and allegations" in the underlying suit.