United States of America, et al. v. Solvay Pharmaceuticals, Inc.

John King and Tammy Drummond (collectively, “Relators”) appeal the

district court’s grant of summary judgment to Solvay Pharmaceuticals, Inc., on

their False Claims Act (“FCA”) claims and a subsequent ruling that partly

granted court costs to Solvay. For the reasons explained below, we AFFIRM.

2

I. Background

Relators are both former Solvay sales and marketing employees. They

brought this FCA suit against Solvay claiming that Solvay induced false

Medicaid claims through a nationwide off-label marketing and kickback

scheme to promote three drugs: Luvox, Aceon, and AndroGel. See 31 U.S.C.

§ 3729(a)(1)(A)–(B). They allege that this scheme proximately caused

physicians to prescribe these drugs for off-label uses to Medicaid patients, the

cost of which was reimbursed by the federal government. Relators also claim

they were retaliated against for their internal complaints about Solvay’s offlabel

marketing. The district court granted summary judgment to Solvay on

all of Relators’ claims.

After final judgment, Solvay sought an award of $961,380.51 in taxable

costs against Relators under 28 U.S.C. § 1920. Relators objected to almost all

of those costs, claiming that Solvay was entitled to just $5,808.17. The district

court awarded Solvay $232,809.92. Relators appealed both the final order

granting summary judgment on all of Relators’ claims and the order granting

taxable costs to Solvay.

II. Standard of Review

“We review an order granting summary judgment de novo, applying the

same standards as the district court.” Cooley v. Hous. Auth. of City of Slidell,

747 F.3d 295, 297 (5th Cir. 2014). Summary judgment is appropriate when

“there is no genuine dispute as to any material fact and the movant is entitled

to judgment as a matter of law.” FED. R. CIV. P. 56(a). A disputed fact is

material if it has the potential to “affect the outcome of the suit under the

governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

“[W]e may affirm the district court’s decision on any grounds supported by the

record.” Phillips ex rel. Phillips v. Monroe Cty., 311 F.3d 369, 376 (5th Cir.

2002).

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“The district court has broad discretion in taxing costs, and we will

reverse only upon a clear showing of abuse of discretion.” Brazos Valley Coal.

for Life, Inc. v. City of Bryan, 421 F.3d 314, 327 (5th Cir. 2005) (quoting Migis

v. Pearle Vision, 135 F.3d 1041, 1049 (5th Cir. 1998)).

III. Discussion

A. FCA Claims

The FCA imposes civil liability and treble damages on any person who,

inter alia, “knowingly presents, or causes to be presented, a false or fraudulent

claim for payment or approval” to the United States government; or “knowingly

makes, uses, or causes to be made or used a false record or statement material

to a false or fraudulent claim.” 31 U.S.C. § 3729(a)(1)(A)–(B); see also United

States ex rel. Steury v. Cardinal Health, Inc., 625 F.3d 262, 267 (5th Cir. 2010).

An FCA claim consists of four elements: “(1) whether there was a false

statement or fraudulent course of conduct; (2) made or carried out with the

requisite scienter; (3) that was material; and (4) that caused the government

to pay out money or to forfeit moneys due (i.e., that involved a claim).” United

States ex rel. Longhi v. United States, 575 F.3d 458, 467 (5th Cir. 2009) (citation

omitted).

Relators have developed several theories of FCA liability with varying

degrees of connectivity between Solvay’s off-label marketing of Luvox, Aceon,

and AndroGel and the actual filing of false claims. Those theories are that

(1) Solvay marketed the three relevant drugs for off-label uses causing

physicians to prescribe them to Medicaid patients for those uses; (2) Solvay

lobbied members of state pharmaceutical and therapeutic committees (“P&T

committees”) to list these three drugs on their preferred drug lists; (3) Solvay

used misleading scientific literature to lobby the publisher of drug

compendium DRUGDEX Information System (“DrugDex”) to include the offlabel

uses of these drugs in the compendium; and (4) Solvay paid doctors

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kickbacks to prescribe these drugs to Medicaid patients in violation of the antikickback

statute (“AKS”), 42 U.S.C. § 1320a-7b(b)(2)(A).1 Relators also

brought an FCA retaliation claim challenging their terminations.

The district court disposed of all of Relators’ claims through a series of

partial summary judgment orders. Relators’ AndroGel claims were dismissed

on summary judgment for lack of jurisdiction under the FCA’s public disclosure

bar. For the remaining two drugs, Luvox and Aceon, the off-label marketing

claims failed to survive summary judgment because Relators’ evidence of

Medicaid claims was inadmissible and, even if it were admissible, did not

sufficiently demonstrate causation. Both the lobbying theories of liability

relating to state P&T committees and DrugDex and the retaliation claims also

failed to survive summary judgment due to insufficient causation evidence.

Finally, the AKS claims did not survive summary judgment because there was

insufficient evidence that Solvay intended the kickbacks to induce payments

from Medicaid. The summary judgment orders in the district court involved

additional issues, but Relators do not challenge the district court’s judgment

on those issues so we do not consider them.2

Because we conclude that Relators failed to produce sufficient evidence

to survive summary judgment on any of their briefed claims, we affirm the

district court’s grant of summary judgment to Solvay.

1 “The AKS provides no private right of action; therefore, a private plaintiff may not

sue a health care provider under the AKS alone.” United States ex rel. Ruscher v. Omnicare,

Inc., 663 F. App’x 368, 371 n.2 (5th Cir. 2016) (per curiam) (quoting United States ex rel.

Nunnally v. W. Calcasieu Cameron Hosp., 519 F. App’x 890, 893 n.5 (5th Cir. 2013)). We now

reiterate these holdings in a precedential, published opinion.

2 Relators’ Fifth Amended Complaint also includes counts under the false claims acts

of numerous states. However, because the state false claims issues are not raised at all in

the appellate briefing, we deem them waived. See Williams v. Parker, 843 F.3d 617, 622 n.14

(5th Cir. 2016) (“Failure to raise an issue on appeal is waiver.”).

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1. Public Disclosure Bar

The district court first determined that it lacked jurisdiction to consider

any of Relators’ AndroGel claims because they were subject to the FCA’s public

disclosure bar. The applicable version of the FCA’s public disclosure bar, which

has since changed, provides that “[n]o court shall have jurisdiction over an

action under this section based upon the public disclosure of allegations or

transactions . . . from the news media, unless the action is brought by the

Attorney General or the person bringing the action is an original source of the

information.” 31 U.S.C. § 3730(e)(4)(A) (2006) (emphasis added).3 The statute

defines original source as “an individual who [1] has direct and independent

knowledge of the information on which the allegations are based and [2] has

voluntarily provided the information to the Government before filing an action

under this section which is based on the information.” Id. § 3730(e)(4)(B).

The district court determined that Relators’ AndroGel claims were based

on publicly disclosed allegations from a magazine article and that Relators’

pre-suit disclosure made the day before filing suit could not satisfy the

voluntary disclosure requirement of the original source exception.

Specifically, the district court concluded that because Relators’ pre-suit

disclosure satisfied the mandatory disclosure requirement under § 3730(b)(2),

it could not simultaneously satisfy the voluntary disclosure requirement under

§ 3730(e)(4). Relators appeal only the district court’s determination that they

are not original sources.

3 The section creating the public disclosure bar was amended in 2010, but the Supreme

Court has held that the amendment is not retroactive. Graham Cty. Soil & Water

Conservation Dist. v. United States ex rel. Wilson, 559 U.S. 280, 283 n.1 (2010) (noting that

section 10104(j)(2) of the Patient Protection and Affordable Care Act, Pub. L. 111–148, 124

Stat. 119, “replace[d] the prior version of 31 U.S.C. § 3730(e)(4) with new language” but

“makes no mention of retroactivity”); Abbott v. BP Expl. & Prod., Inc., 851 F.3d 384, 387 n.2

(5th Cir. 2017) (concluding that the 2010 amendment altered the jurisdictional nature of the

public disclosure bar). Accordingly, all citations to this section refer to the applicable 2006

version of the public disclosure bar.

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It is well established that the party invoking federal jurisdiction carries

the burden of establishing that jurisdiction is proper. United States ex rel.

Jamison v. McKesson Corp., 649 F.3d 322, 327 (5th Cir. 2011). Thus, it was

Relators’ burden to show that they qualified under the original source

exception; otherwise, the public disclosure bar “strips” the court of subject

matter jurisdiction. See United States ex rel. Fried v. W. Indep. Sch. Dist., 527

F.3d 439, 441–42 (5th Cir. 2008); see also § 3730(e)(4)(A) (stating that “[n]o

court shall have jurisdiction” if the public disclosure bar applies). However,

because “[a] challenge under the FCA jurisdictional bar is necessarily

intertwined with the merits,” we treat it as a motion for summary judgment.

Jamison, 649 F.3d at 326 (quoting United States ex rel. Reagan v. E. Tex. Med.

Ctr. Reg’l Healthcare Sys., 384 F.3d 168, 173 (5th Cir. 2004)).

Assuming without deciding that a single pre-suit disclosure can satisfy

both the pre-suit mandatory and voluntary disclosure requirements, Relators

still failed to create a genuine issue of material fact as to whether their presuit

disclosure to the government disclosed “the information on which the

allegations are based.” 31 U.S.C. § 3730(e)(4)(B). The Supreme Court has

interpreted the phrase “information on which the allegations are based” as

referring to the “information underlying the allegations of the relator’s action.”

Rockwell Int’l Corp. v. United States, 549 U.S. 457, 470–72 (2007) (abrogating

United States ex rel. Laird v. Lockheed Martin Eng’g & Sci. Servs. Co., 336 F.3d

346, 354–55 (5th Cir. 2003) (holding that a relator must have direct and

independent knowledge of information on which the allegations in the public

disclosure are based)). The Court further indicated that such information

includes knowledge of conduct suggesting that false claims were made to the

government. See id. at 475 (concluding that relator’s knowledge fell short

because he was not employed by the defendant during the relevant time period

and thus could not have known about the predicate conduct and subsequent

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false statements to the government). Indeed, without knowledge of conduct

that—when placed in the context of all of the other relevant information—

suggests that false claims were made to the government, Relators could not

allege an FCA claim.4 See United States ex rel. Spicer v. Westbrook, 751 F.3d

354, 364–65 (5th Cir. 2014) (stating that “the statute attaches liability, not to

the underlying fraudulent activity or to the government’s wrongful payment,

but to the claim for payment” (quoting Longhi, 575 F.3d at 467)); United States

ex rel. Grubbs v. Kanneganti, 565 F.3d 180, 188 (5th Cir. 2009) (stating that

proof of a false claim against the government is the “sine qua non” of liability

under the FCA). Accordingly, the Fourth Circuit has affirmed a finding that a

relator was not entitled to original source status where, inter alia, his pre-suit

disclosure never connected information about the alleged fraudulent conduct

with the filing of a claim for reimbursement from the government. United

States ex rel. Vuyyuru v. Jadhav, 555 F.3d 337, 353, 355 (4th Cir. 2009).

Here, Relators failed to present any evidence indicating that their presuit

disclosure connected the knowledge of Solvay’s conduct to false claims

made to the government. Relators cite to a declaration of their attorney, Joel

Androphy, and a PowerPoint presentation to support the details of their presuit

disclosure.5 However, the declaration simply refers to discussions

4 Requiring relators to have direct and independent knowledge of information that,

when viewed in context, suggests the filing of false claims is also consistent with the FCA’s

dual goals of “preventing parasitic suits by opportunistic late-comers who add nothing to the

exposure of fraud,” Reagan, 384 F.3d at 174 (quoting Laird, 336 F.3d at 351), and

“encourag[ing] those who are either close observers or otherwise involved in the fraudulent

activity to come forward,” United States ex rel. Oliver v. Philip Morris USA Inc., 826 F.3d

466, 480 (D.C. Cir. 2016) (quoting United States ex rel. Barth v. Ridgedale Elec., Inc., 44 F.3d

699, 703–04 (8th Cir. 1995)); see also United States ex rel. Lam v. Tenet Healthcare Corp., 287

F. App’x 396, 400 (5th Cir. 2008) (“Congress’s intent was to encourage qui tam suits brought

by insiders, such as employees who come across information of fraud in the course of their

employment.” (quoting Laird, 336 F.3d at 355–56)).

5 The parties dispute whether any of this evidence should be considered in making the

FCA jurisdictional determination. However, we need not decide this issue because we

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Relators had with the Food and Drug Administration (“FDA”) about the offlabel

marketing and kickbacks associated with AndroGel, as well as Relators’

terminations. But the declaration does not indicate that Relators connected

this information with any false claims presented to the government. Moreover,

the lack of detail about which off-label uses Solvay marketed or how it paid

kickbacks to physicians is an additional defect that makes the declaration

insufficient to support the voluntary disclosure necessary for the original

source exception. See Rockwell, 549 U.S. at 473 (indicating that a relator must

satisfy his original source status as to each theory of fraud in the complaint as

amended); Jamison, 649 F.3d at 332 (holding that a relator was not an original

source of the allegations in his complaint because the information on which the

allegations were based described the fraud only generally).

Although the PowerPoint presentation provides additional details about

the information disclosed to the FDA, the presentation does not suggest that

any false claims were submitted to the government. It makes no mention of

any FCA provisions, never suggests that the off-label marketing or the

remuneration caused prescriptions to be reimbursed by the government, and

never suggests any false certifications of compliance with the AKS. Instead,

the information disclosed in the PowerPoint presentation suggests only Food,

Drug and Cosmetic Act (“FDCA”) and AKS violations, not FCA violations. For

Relators to satisfy the FCA’s voluntary pre-suit disclosure requirement of

disclosing information underlying their FCA action, their disclosure must—at

a minimum—connect direct and independent knowledge of information about

Solvay’s conduct to false claims submitted to the government, i.e., suggest an

conclude that, even if all of the evidence is considered, Relators still failed to meet their

summary judgment burden.

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FCA violation.6 Even assuming all of the information in the PowerPoint

presentation regarding possible FDCA and AKS violations came from Relators’

direct and independent knowledge, the presentation still fails to create a

genuine issue of material fact as to its disclosure of information on which the

FCA allegations are based because it is completely devoid of any indication

connecting such information with false claims presented to the government.

Accordingly, because Relators’ evidence of the information provided to

the government in their voluntary pre-suit disclosure does not suggest any

FCA violations, it is insufficient to support a finding that Relators disclosed to

the government the information underlying their FCA allegations prior to

filing suit. Consequently, Relators have failed to meet their summary

judgment burden as to their status as original sources under § 3730(e)(4) of the

FCA. Because the FCA public disclosure bar applies, the district court

correctly determined that it lacked jurisdiction to consider Relators’ AndroGel

claims.

2. Alleged Off-Label Marketing to Physicians

The FDCA prohibits a drug from being introduced in interstate

commerce unless the FDA approves the drug as safe and effective for each of

the uses suggested on its labeling. 21 U.S.C. § 355(a), (d); see also 21 C.F.R.

§ 310.303(a) (“[A] new drug may not be approved for marketing unless it has

been shown to be safe and effective for its intended use(s).”). The Medicaid Act

empowers states to deny reimbursement for a drug if “the prescribed use is not

6 Cf. United States ex rel. Rigsby v. State Farm Fire & Cas. Co., 794 F.3d 457, 462–63,

474 (5th Cir. 2015) (holding that direct and independent knowledge of information by claims

adjusters of fraudulent claims adjusting practices connected to claims for government-backed

flood insurance in the wake of Hurricane Katrina was sufficient to confer original source

status), aff’d on other grounds sub nom. State Farm Fire & Cas. Co. v. United States ex rel.

Rigsby, 137 S. Ct. 436 (2016); Oliver, 826 F.3d at 478 (“[I]n order to have ‘direct’ knowledge

for purposes of the original source exception, a relator must have some first-hand knowledge

that would lead him to believe that a fraud had been committed.” (collecting cases)).

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for a medically accepted indication.” 42 U.S.C. § 1396r-8(d)(1)(B)(i).7 A

“medically accepted indication” is “any use for a covered outpatient drug which

is approved under the [FDCA] or the use of which is supported by one or more

citations included or approved for inclusion in any of the compendia described”

elsewhere in the statute. 42 U.S.C. § 1396r-8(k)(6). That is to say, states may

deny Medicaid reimbursement for drugs prescribed for off-label uses that are

not otherwise listed in compendia described in the Medicaid statute.

Because off-label prescriptions may be ineligible for Medicaid

reimbursement, submitting such claims for Medicaid reimbursement may

result in FCA liability. See United States ex rel. Booker v. Pfizer, Inc., 847 F.3d

52, 58 & n.7 (1st Cir. 2017). Accordingly, when, as here, an off-label marketing

scheme is alleged to have violated the FCA, plaintiffs’ summary judgment

burden is to come forward with evidence sufficient to create a genuine issue of

material fact that the off-label marketing scheme caused physicians to make

off-label prescriptions that were submitted for Medicaid reimbursement.

Complicating matters is the fact that the FDA does not restrict

physicians from prescribing an otherwise FDA-approved drug for an off-label

use. See 21 U.S.C. § 396 (“Nothing in this chapter shall be construed to limit

or interfere with the authority of a health care practitioner to prescribe or

administer any legally marketed device to a patient for any condition or disease

within a legitimate health care practitioner-patient relationship.”). One

commentator has observed that “[o]ff-label prescription of drugs is common,

7 The First Circuit has noted that “whether state Medicaid programs actually have

the discretion to reimburse for off-label uses of a drug under the Medicaid statute ‘is up for

debate.’” United States ex rel. Booker v. Pfizer, Inc., 847 F.3d 52, 58 n.7 (1st Cir. 2017)

(quoting United States ex rel. Banigan v. Organon USA Inc., 883 F. Supp.2d 277, 294 (D.

Mass. 2012)). If state Medicaid programs do have the discretion to choose between granting

or denying reimbursements for off-label prescriptions, Relators claims would fail because

they have not presented evidence showing that any states in this case have chosen to deny

reimbursements for off-label prescriptions. However, we need not decide this issue because

we conclude that Relators’ claims easily fail on other grounds.

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with as many as forty percent of all prescriptions issued involving off-label

use.” Stephanie Greene, False Claims Act Liability for Off-Label Promotion of

Pharmaceutical Products, 110 PENN ST. L. REV. 41, 46 (2005). Indeed, “in

many cases, off-label drug prescription may represent the standard of care in

the industry.” Id.

Relators’ remaining off-label marketing claims relate to the drugs Luvox

and Aceon. Luvox received FDA approval in 1994 for use in treating obsessive

compulsive disorder (“OCD”). Relators contend that Solvay marketed Luvox

for a broader “spectrum” of disorders that they labeled the “OC Spectrum,” a

marketing approach the FDA rejected. Aceon was approved to treat

hypertension in 1993. Relators assert that Solvay attempted to expand sales

of Aceon by claiming that it would also improve arterial health, was

particularly good for the kidneys of diabetic hypertensives, and reduced the

risk of secondary strokes.

The main issue on appeal is the sufficiency of Realtors’ evidence that this

alleged off-label marketing caused the filing of false Medicaid reimbursement

claims. Relators first argue that the district court ignored circumstantial

evidence purportedly showing a nationwide off-label marketing scheme,

execution of that scheme, and an impact on prescriptions to Medicaid patients.

The expert report claiming to show that off-label marketing actually impacted

Medicaid prescriptions, however, shows no such thing. The report concludes

that, because economic studies show that pharmaceutical marketing is

generally linked to increased pharmaceutical sales and Solvay uses marketing

as a means of increasing sales, Solvay’s off-label marketing scheme must have

caused increased off-label prescriptions reimbursed through Medicaid. But

this conclusion is speculative and therefore insufficient to preclude summary

judgment. Simmons v. Willcox, 911 F.2d 1077, 1082 (5th Cir. 1990)

(“[S]peculative allegations . . . are insufficient to create a genuine issue of

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material fact precluding summary judgment.”). At best, Relators’

circumstantial evidence suggests only the potential for a causal link between

Solvay’s alleged off-label marketing and off-label prescriptions but says

nothing about whether the marketing scheme actually caused off-label

prescriptions to Medicaid patients. Without evidence indicating that off-label

marketing actually caused off-label prescriptions to Medicaid patients

resulting in false claims to the government, Relators’ off-label marketing

theory of FCA liability cannot survive summary judgment. Cf. Grubbs, 565

F.3d at 192 (holding that allegations of a fraudulent billing scheme were

sufficient at the motion to dismiss stage to show that doctors’ fraudulent

records caused the hospital’s billing system to present fraudulent claims where

presenting such claims was the regular course of billing for the hospital); see

also Booker, 847 F.3d at 58 (holding that circumstantial evidence could be used

at the summary-judgment stage to prove causation, but “not that such proof

could be used to demonstrate the existence of false claims.”).

The only evidence Relators present that attempts to show the actual

effect of the off-label marketing scheme alleged in this case is a set of call notes

recorded by Solvay sales representatives about their telephone

communications with physicians regarding Luvox and Aceon. Relators

identify eight examples of causation, in which they connect a call note to an

off-label prescription made to a specific Medicaid patient.8 Even assuming all

of the call notes are admissible, they still do not create a genuine issue of

material fact as to causation. Most of the call notes do not even discuss the

specific off-label use for which the relevant prescription was written. The few

8 Relators have included only these eight examples in their appellate briefs and merely

stated that they offered others below. Any argument with respect to the other examples is

waived due to inadequate briefing. See United States v. Martinez, 263 F.3d 436, 438 (5th Cir.

2001).

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that do merely show physicians explaining their practices and how they

prescribe the drug, which provides no insight into whether Solvay marketed

the off-label uses to them, let alone caused them to make off-label

prescriptions. Relators also point to academic articles discussed in some of the

calls, but there is no indication that those articles came to the physicians’

attention because of Solvay. At bottom, the probative value of Relators’

causation evidence is primarily based on conjecture and speculation and is

therefore insufficient to create a genuine issue of material fact for trial. See

Little v. Liquid Air Corp., 37 F.3d 1069, 1079 (5th Cir. 1994) (en banc) (per

curiam).9

3. Lobbying Activities

i. State P&T Committees

Several state Medicaid programs use P&T committees to decide whether

to place certain drugs on state preferred drug lists, thereby authorizing

prescriptions to Medicaid patients without pre-approval. These committees

are made up of practicing physicians, pharmacists, and others with recognized

expertise in prescribing, dispensing, and monitoring outpatient drugs, as well

as in drug use review and medical quality assurance. Relators allege that

Solvay violated the FCA by unduly influencing P&T committees to place

Solvay’s drugs on these preferred drug lists.

9 The parties suggested at oral argument that Medicaid pays for claims without asking

whether the drugs were prescribed for off-label uses or asking for what purpose the drugs

were prescribed. If this is true, given that it is not uncommon for physicians to make offlabel

prescriptions, we think it unlikely that prescribing off-label is material to Medicaid’s

payment decisions under the FCA. See Universal Health Servs., Inc. v. United States ex rel.

Escobar, 136 S. Ct. 1989, 2003–04 (2016) (“[I]f the Government regularly pays a particular

type of claim in full despite actual knowledge that certain requirements were violated, and

has signaled no change in position, that is strong evidence that the requirements are not

material.”). Nevertheless, because Relators have failed to survive summary judgment on the

issue of causation, we need not reach the issue of materiality in this case.

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Assuming all of the relevant evidence is admissible for the three state

committees Relators challenge (Alabama, Kentucky, and California), Relators

have still failed to create a genuine issue of material fact as to causation.

Relators’ evidence shows Solvay’s campaign to get its drugs added to these

three state preferred drug lists and that those states ultimately added those

drugs to their preferred drug lists. However, Relators lack evidence indicating

that Solvay’s campaign caused these results. The supposed “smoking gun”

email not considered by the district court does not help Relators meet their

burden. The most generous reading of that email shows that the Alabama P&T

committee added Aceon to its preferred drug list because it determined that

the data on Aceon’s secondary prevention of strokes supported such a decision.

But there is no evidence indicating that the Alabama P&T committee—made

up of medical experts—was unduly influenced by Solvay’s alleged lobbying

campaign in making this determination.

Moreover, even assuming that the P&T committees were influenced by

Solvay’s campaign, Relators have not connected this theory of liability to the

filing of any false claims. First, Relators failed to show that particular conduct

they contend was “lobbying” of the P&T committees was improper under the

particular states’ rules and regulations governing the same. Second, even

assuming it was improper, Relators failed to discuss how placement on the

preferred drug lists caused false claims to be presented to Medicaid for

reimbursement. The closest explanation provided is that “drugs requiring

prior authorization are less likely to be prescribed.” But Relators do not point

to any record evidence indicating that false claims were actually filed because

Solvay’s drugs were placed on preferred drug lists. Again, Relators need more

than speculation to meet their burden as to causation. Perhaps the state P&T

committees were unduly influenced, but that does not absolve Relators from

their burden of producing evidence indicating that this influence caused actual

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false claims (as opposed to claims for approved uses) to be submitted for

Medicaid reimbursement. See Spicer, 751 F.3d at 364–65 (“[T]he statute

attaches liability, not to the underlying fraudulent activity or to the

government’s wrongful payment, but to the claim for payment[.]” (quoting

Longhi, 575 F.3d at 467)). Relators’ evidence is insufficient to create a genuine

issue of material fact on this matter.

ii. DrugDex

Relators argue that Solvay became subject to FCA liability by misleading

one of the three leading drug compendia, DrugDex. Medicaid reimbursement

is not just limited to FDA approved uses, but also includes medically accepted

indications listed on Medicaid compendia, including DrugDex. See 42 U.S.C.

§ 1396r-8(d)(1)(B)(i), (g)(1)(B)(i)(III), (k)(6). Relators’ theory of FCA liability is

that Solvay “manufactured medical literature” and engaged in “deception and

collusion” in an effort to have DrugDex list the off-label uses of Solvay’s drugs

so they “might be deemed eligible for reimbursement under the various

government health programs, especially Medicaid and Medicare.”

Relators first argue that Solvay suppressed negative studies about the

efficacy of Luvox for off-label uses that Solvay had a duty to disclose. Relators

also contend that Solvay paid for “smaller and lower quality studies” that

would support off-label uses for Luvox, creating an “echo chamber” in which

the majority of literature supporting off-label uses for Luvox was sponsored by

Solvay. DrugDex ultimately rated over two-dozen conditions as medically

accepted uses for Luvox, including off-label uses.

Relators again fail to create a genuine issue of material fact as to

causation. The best evidence Relators point to shows that Solvay’s Medical

Affairs department would generally communicate with medical compendia

publishers about Luvox entries and review DrugDex draft documents to verify

their accuracy as to the name of the drug, trademarks, and similar items. But

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Relators point to no evidence indicating that Solvay’s failure to publish studies

showing negative results while also paying for lower quality studies to support

Luvox’s off-label uses misled DrugDex’s publisher and caused it to list Luvox

on its compendium. There is no record evidence that Solvay communicated

with DrugDex’s publisher about these studies; in fact, the only evidence cited

indicates that there was no communication about the studies. As Solvay

suggests, DrugDex’s publisher was able to review the studies and decide

whether it was appropriate to rely on them. Because Relators failed to produce

any evidence suggesting that Solvay’s studies misled DrugDex’s publisher and

caused Luvox to be listed on DrugDex for off-label uses, which in turn resulted

in false claims to the government, their DrugDex claim cannot survive

summary judgment.

4. Anti-Kickback Statute

The AKS prohibits offering money or other things of value to entice

another party to provide a good or service that would be paid for by a federal

health care program. 42 U.S.C. § 1320a-7b(b)(2)(A). Relators allege that

Solvay paid illegal kickbacks to physicians through various marketing

programs.10 They further allege that Solvay “knew these kickbacks would

induce physicians to write prescriptions for off-label uses or prescriptions

tainted by the kickbacks, which would in turn cause pharmacists to submit

claims for fraudulent Medicaid and Medicare Part D reimbursement.”

Medicaid claims induced by kickbacks are false if “the provider certified

compliance with the kickback statute in submitting a claim.” United States ex

rel. Colquitt v. Abbott Labs., 858 F.3d 365, 371 (5th Cir. 2017).

Relators’ evidence shows (1) physicians participating in Solvay programs

in which they were compensated for consultations or presentations and

10 Relators only appeal the AKS-based claims with respect to Texas Medicaid patients.

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(2) subsequent prescriptions by those physicians of Solvay’s drugs to Medicaid

patients.11 Nowhere, however, do Relators cite to evidence creating a genuine

issue of material fact that such compensation, or any incidental benefits,

caused those physicians to prescribe to Medicaid patients. There was nothing

illegal about paying physicians for their participation in these types of

programs and there is no evidence that participation was conditioned upon

prescribing Solvay’s drugs to Medicaid patients. Although it is not an

unreasonable inference that Solvay intended these programs to boost

prescriptions, it would be speculation to infer that compensation for

professional services legally rendered actually caused the physicians to

prescribe Solvay’s drugs to Medicaid patients.12 Accordingly, summary

judgment was appropriate on Relators’ AKS theory of liability.

5. Retaliation

Both Relators bring FCA retaliation claims against Solvay alleging they

were terminated for filing internal complaints about Solvay’s alleged off-label

marketing scheme. The elements of an FCA retaliation claim are: (1) the

employee “engaged in protected activity,” (2) the “employer, or the entity with

11 As an initial matter, Solvay contends that Relators now rely on new evidence of

intent that they did not rely on in the district court, and thus we should not consider any

such evidence on appeal. We need not resolve this dispute, however, because, even if we

consider all of the evidence, Relators have not presented sufficient evidence to survive

summary judgment on their AKS theory of liability.

12 Relators also failed to create a genuine issue of material fact as to the AKS’s scienter

requirement. Proving a violation of the AKS requires evidence that “the defendant willfully

committed an act that violated the [AKS].” United States v. St. Junius, 739 F.3d 193, 210

(5th Cir. 2013). Because AKS liability is limited to prescriptions that were reimbursed by

the government, not private parties, 42 U.S.C. § 1320a-7b(b)(2)(A), satisfying the scienter

requirement of “willfully” requires evidence indicating that Solvay intended Medicaid to pay

for these prescriptions, see, e.g., Ruscher, 663 F. App’x at 374. Relators, however, do not cite

to evidence creating a genuine issue of material fact that Solvay intended for those physicians

to prescribe to Medicaid patients. As with causation, it would be speculation to infer that

Solvay specifically intended such prescriptions to be reimbursed by Medicaid. See, e.g., id. at

373 n.4 (“Relator’s arguments amount to mere speculation and are therefore insufficient to

create a genuine issue of material fact as to Omnicare’s intent.”).

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which he has contracted or serves as an agent, knew about the protected

activity,” and (3) “retaliat[ion] . . . because of his protected activity.” United

States ex rel. Bias v. Tangipahoa Par. Sch. Bd., 816 F.3d 315, 323 (5th Cir.

2016).

We “apply the McDonnell Douglas framework to the False Claims Act’s

anti-retaliation provision.” Diaz v. Kaplan Higher Educ., L.L.C., 820 F.3d 172,

175 n.3 (5th Cir. 2016); see McDonnell Douglas Corp. v. Green, 411 U.S. 792

(1973). Once an employee establishes a prima facie case, “the burden shifts to

the employer to state a legitimate, non-retaliatory reason for its decision. After

the employer states its reason, the burden shifts back to the employee to

demonstrate that the employer’s reason is actually a pretext for retaliation.”

Diaz, 820 F.3d at 176 (quoting LeMaire v. La. Dep’t of Transp. & Dev., 480 F.3d

383, 388–89 (5th Cir. 2007)). Here, Solvay stated that Relators were

terminated for creating unapproved marketing materials, and Relators admit

to violating Solvay’s marketing policies.13 The district court held that Relators

failed to produce enough evidence of causation to create a genuine issue of

material fact that Solvay’s reasons for terminating them were pretextual.14

We agree with the district court that neither King nor Drummond has

provided sufficient evidence of pretext to survive summary judgment. The

FCA prohibits adverse employment action taken “because of” protected activity

relating to an FCA suit. 31 U.S.C. § 3730(h)(1). Therefore, to survive summary

13 Ironically, given the allegations of improper marketing Relators make against

Solvay, Solvay provided supporting evidence to the district court indicating that King was

terminated for violating company policy by making unapproved alterations to promotional

materials that jeopardized Solvay’s relationship with another company, and that Drummond

was terminated for violating company policy by working on an unapproved letter campaign

and then attempting to solicit doctors to mail those letters out to patients.

14 The district court also determined that only King survived summary judgment on

the issue of protected activity. However, because we decide Relators’ FCA retaliation claim

on causation grounds, we do not reach the issue of protected activity.

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judgment, Relators must point to evidence creating a genuine issue of material

fact that their complaints were the but-for cause of their terminations. See

Gross v. FBL Financial Servs., Inc., 557 U.S. 167, 176 (2009) (holding that the

language “because of” requires a “‘but-for’ cause of the employer’s adverse

decision” under ADEA retaliation claims); see also Univ. of Tex. Sw. Med. Ctr.

v. Nassar, 133 S. Ct. 2517, 2528 (2013) (“Given the lack of any meaningful

textual difference between the text in this statute and the one in Gross, the

proper conclusion here, as in Gross, is that Title VII retaliation claims require

proof that the desire to retaliate was the but-for cause of the challenged

employment action.”). Relators argue in their opening brief that their evidence

allegedly showing temporal proximity between protected activities and their

terminations, Relators’ positive performance reviews, Solvay’s

disproportionate disciplinary response that departed from its procedures, and

the disparate treatment of other employees is sufficient to survive summary

judgment on causation.

As a threshold matter, Relators discussed only temporal proximity and

job performance in the district court, and made a brief, unsupported reference

to disproportionate discipline. Relators have not shown any extraordinary

circumstances for omitting the additional arguments asserted on appeal.

Therefore, Relators’ causation arguments based on Solvay’s alleged departure

from disciplinary procedures and the disparate treatment of other employees

are waived. See Diaz, 820 F.3d at 176–77 (declining to consider evidence of

pretext for an FCA retaliation claim because relator failed to raise the

argument in the district court and presented no extraordinary circumstances);

see also Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 915 (5th Cir. 1992)

(“Because the [nonmovant] failed to refer to [the evidence] in district court in

their summary judgment response, the [evidence was] not properly before that

court in deciding whether to grant the motion; therefore, [it] will not be

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considered here.”).15 Similarly, a bare assertion to the district court that their

termination was “disproportionate in light of the circumstances” without any

record citation or discussion for support does not sufficiently raise that

argument in the district court. See Diaz, 820 F.3d at 176–77; Skotak, 953 F.2d

at 915.16

Relators are left with the temporal proximity of their terminations to

their complaints and their positive performance reviews as evidence of

causation. “[T]emporal proximity alone is insufficient to prove but for

causation.” Strong v. Univ. Healthcare Sys., L.L.C., 482 F.3d 802, 808 (5th Cir.

2007). But “the combination of suspicious timing with other significant

evidence of pretext, can be sufficient to survive summary judgment.”

Shackelford v. Deloitte & Touche, LLP, 190 F.3d 398, 409 (5th Cir. 1999).17

This standard can be met when “the plaintiff had highly positive performance

reviews up until the complaint was leveled against the company, and then

suffered a sharp decline in treatment immediately after the protected conduct

occurred.” Khalfani v. Balfour Beatty Communities, L.L.C., 595 F. App’x 363,

15 The district court rejected Relators’ additional assertion that “both worked under

consistently underenforced company policies.” Because Relators only mention this argument

in their reply brief, it is abandoned. See Turner v. Kan. City S. Ry. Co., 675 F.3d 887, 892 n.3

(5th Cir. 2012) (“[T]his Court will not consider a claim raised for the first time in a reply

brief.”).

16 Even if we consider Relators’ evidence related to disproportionate disciplinary

action, it fails to create a genuine issue of material fact as to whether their termination was

a disproportionate response to Relators’ infractions. The evidence Relators cite shows that

termination was an appropriate disciplinary action for violating company policies. It is

undisputed that Relators violated company policies. Moreover, Relators point to no evidence

indicating that their infractions merited lesser punishment. Relators’ bare assertions that

these infractions were minor and therefore undeserving of termination do not suffice at the

summary judgment stage.

17 Although Strong and Shackelford are retaliation claims under Title VII, they inform

our causation analysis here because such claims involve the same “but-for” causation

requirement at issue in FCA retaliation claims. See Nassar, 133 S. Ct. at 2527–28.

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366 (5th Cir. 2014) (per curiam).18 In Shackelford, for example, the plaintiff

survived summary judgment because, in addition to showing “tight temporal

proximity” of being terminated within days of engaging in several protected

activities, there was also evidence of unfounded performance concerns by the

employer, warnings not to get involved in the protected activity, and disparate

treatment in job reviews. Shackelford, 190 F.3d at 408–09.

Here, Relators’ evidence of both being terminated at least three-and-ahalf

months after making their complaints and positive performance reviews

prior to their terminations does not create a fact issue as to pretext. Relators

admit that they violated Solvay’s marketing policies and that employees may

be terminated for marketing policy violations. Furthermore, they do not point

to any causation evidence that is similar to the evidence described in

Shackelford. See id. Relators point to no evidence that Solvay raised dubious

performance problems as a reason for their terminations, mistreated them

immediately after their protected activities, or knew of their policy violations

prior to Relators’ positive performance reviews.19 Simply put, Relators have

failed to show that a reasonable jury could conclude that their complaints were

the but-for cause of their terminations.

B. Taxable Costs

A district court may award certain taxable costs to a prevailing party.

See 28 U.S.C. § 1920; FED. R. CIV. P. 54(d)(1). “Taxable costs are limited to

relatively minor, incidental expenses” amounting to “a fraction of the

nontaxable expenses borne by litigants for attorneys, experts, consultants, and

18 Although Khalfani is not “controlling precedent,” it “may be [cited as] persuasive

authority.” Ballard v. Burton, 444 F.3d 391, 401 n.7 (5th Cir. 2006) (citing 5TH CIR. R. 47.5.4).

19 Moreover, as previously discussed, Relators waived any arguments of

disproportionate discipline, disparate treatment, and departure from company procedures

because they failed to make these arguments and identify supporting evidence before the

district court.

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investigators.” Taniguchi v. Kan Pac. Saipan, Ltd., 132 S. Ct. 1997, 2006

(2012). Taxable costs may include, among other things, “[f]ees for printed or

electronically recorded transcripts necessarily obtained for use in the case” and

“[f]ees for exemplification and the costs of making copies of any materials

where the copies are necessarily obtained for use in the case.” § 1920(2), (4).

Solvay sought taxable costs on both of these grounds, which the district

court granted in part. Relators argue on appeal that Solvay failed to show that

its costs were “necessarily obtained for use in the case.” Relators also contend

that the district court erred in overruling some of its specific objections to costs

related to deposition transcripts, photocopying, and e-discovery.

1. Materials Necessarily Obtained for Use in the Case

Relators claim that a document is only “necessarily obtained for use in

the case” if it “was actually used at trial or as a summary judgment exhibit.”

But we have interpreted “necessarily obtained for use in the case” to include

documents “reasonably expected to be used for trial or trial preparation” at the

time it was obtained. United States ex rel. Long v. GSDMIdea City, L.L.C., 807

F.3d 125, 130 (5th Cir. 2015). “Whether a deposition or copy was necessarily

obtained for use in the case is a factual determination within the district court’s

discretion, and ‘we accord the district court great latitude in this

determination.’” Id. (quoting Fogleman v. ARAMCO (Arabian Am. Oil Co.),

920 F.2d 278, 285–86 (5th Cir. 1991)); see also United States v. Kolesar, 313

F.2d 835, 840 (5th Cir. 1963).

To be sure, a party seeking to recover costs must explain why those costs

were necessary. See Fogleman, 920 F.2d at 286 (“While we certainly do not

expect a prevailing party to identify every xerox copy made for use in the course

of legal proceedings, we do require some demonstration that reproduction costs

necessarily result from that litigation.”). Here, Solvay submitted a declaration

listing costs incurred during the case and explaining why the court should

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allow it to recover those costs. The district court found that Solvay had shown

the necessity of some of its claimed costs and allowed Solvay to recover only

those costs.

Relators also claim that “[t]he vehicle for recovering the costs of

complying with discovery obligations is a protective order under Rule 26(e),”

and “section 1920 [and] Rule 54 . . . are not intended to govern the taxing of

discovery costs.” However, we have repeatedly said that “the authority of the

trial court to assess ‘necessary and reasonable’ costs incurred during discovery

‘can hardly be doubted.’” Rundus v. City of Dallas, 634 F.3d 309, 316 (5th Cir.

2011) (quoting Harrington v. Texaco, Inc., 339 F.2d 814, 822 (5th Cir. 1964)).

Discovery costs are recoverable under Rule 54 “if the party making the copies

has a reasonable belief that the documents will be used ‘during trial or for trial

preparation.’” Id. (quoting Fogleman, 920 F.2d at 285).

After reviewing Solvay’s declaration in support of its bill of costs, the

district court exercised its considerable discretion and determined that Solvay

adequately explained the necessity of its costs. Relators have failed to show

that the district court abused its discretion in making this determination.

2. Additional Objections to Solvay’s Costs

Relators objected to most of the costs billed for deposition transcripts,

photocopying, and e-discovery. Relators now appeal the district court’s

decisions overruling some of these objections.

As to the costs for deposition transcripts, Relators contend that the

district court should not have taxed any costs against them given the absence

of itemized invoices. We disagree. Solvay’s counsel explained why these

deposition transcripts were necessary to Solvay’s defense, and the district

court found Solvay’s justifications convincing and acted accordingly. In doing

so, the district court did not abuse its discretion.

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As to the photocopying costs, Relators claim that the district court should

not have awarded any photocopying costs because Solvay failed to provide

sufficient supporting documentation. The district court acknowledged that

Solvay’s invoices were not detailed but explained that, given nearly three

million pages of copies Solvay produced for its defense in this case, it would

have been impossible for Solvay to explain each page’s usefulness. The district

court also noted that Solvay had attested that the photocopying expenses were

necessarily incurred, had reduced its request to only fifty percent of the costs

actually incurred, and was not seeking costs for copies made by its employees.

In light of these circumstances, the district court found that the costs were both

necessary and reasonable.

We have previously affirmed awards for non-itemized photocopying

expenses. See, e.g., Long, 807 F.3d at 131; United Teacher Assocs. Ins. Co. v

Union Labor Life Ins. Co., 414 F.3d 558, 574–75 (5th Cir. 2005). District courts

have great latitude in making these determinations, and the district court here

did not abuse its discretion in exercising that latitude in determining

reasonable photocopying costs in light of the circumstances of this complex

case. See Rundus, 634 F.3d at 316.

As to the e-discovery costs, the district court disallowed the bulk of

Solvay’s request but did allow Solvay to recover for costs relating to (1) TIFF

image conversion, (2) scanning, (3) formatting electronic documents, and

(4) PDF conversion—per § 1920(4), which allows recovery for “exemplification”

and “making copies” of case materials. The district court explained that it

interprets § 1920(4) “narrowly” in this context but understands the statute to

allow a prevailing party to recover the costs of complying with an opposing

party’s request to reformat electronic documents or scan hard copies of

documents.

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Relators contend that Solvay did not provide sufficient information to

justify the necessity of these costs. To the contrary, Solvay explained their

necessity in its declaration of costs. The district court carefully considered

Relators’ objections and did not abuse its discretion by overruling those

objections.

Finally, Relators make a one sentence argument that “processing fees

paid to third-party providers to digitize large quantities of print materials or

to compile and convert electronic records”—that is, electronic formatting and

TIFF image conversion costs—are not costs related to “making copies” within

the meaning of § 1920(4). However, under similar circumstances, we have

previously held that a district court does not abuse its discretion in allowing

reimbursement of such costs. See Long, 807 F.3d at 131–32.

For the foregoing reasons, the district court’s grant of both summary

judgment and taxable costs to Solvay is AFFIRMED.

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