On May 2, 2024, the Boston Bar Association convened its fifth annual White-Collar Crime Conference. Among the impressive group of panelists were government attorneys from the U.S. Attorney's Office (USAO) for the District of Massachusetts and the Massachusetts Attorney General's Office (AGO).
The conference kicked off with a conversation with Joshua Levy, who has been Massachusetts' Acting U.S. Attorney since May 2023. The second panel of the day featured Abraham George, Chief, Civil Division, USAO, and Kevin Lownds, Deputy Chief, Medicaid Fraud Division, Massachusetts AGO, who had a lively discussion with members of the defense bar about False Claims Act (FCA) enforcement trends and corporate cooperation. Some of the more spirited debate revolved around FCA liability of private equity firms, Department of Justice's influence (or lack thereof) over the imposition of corporate integrity agreements, and the appropriate causation standard for Anti-Kickback Statute violations, which is currently in flux in Massachusetts (see Regeneron (adopting "but for" causation) and Teva (rejecting "but for" causation)), and among other circuits more broadly. Later panels delved deeper into corporate and individual cooperation, a prominent theme of the day due in part to the continued confusion about the FCA Guidelines released by the Civil Division in May 2019.
Health care is still the specialty and focus of the Massachusetts USAO, with 17 Assistant U.S. Attorneys (AUSAs) dedicated to such matters. As Levy explained, the Massachusetts USAO has prioritized cases with significant victim harm or market integrity issues. Levy also noted a recent focus in the rare disease and genetic testing spaces and teased "significant" announcements in the next 60-90 days. Lownds shared that the state has seen a huge uptick in spending on applied behavioral analysis providers and recently announced two resolutions late last year. Lownds also highlighted enforcement activity in the long-term care space where there is "deliberate understaffing" of facilities, and also teased a significant announcement in the coming weeks.
Cooperation credit remains a source of confusion and debate. While members of the defense bar expressed the need for more clarity about the steps their clients should take to ensure they receive cooperation credit and certainty about what that credit will be, the government attorneys view the determination of cooperation as more of an art than a science. As Levy responded when asked what companies can do to ensure cooperation credit, "You know it when you see it." While the formal guidance provides cold comfort, the panelists offered some practical tips. As to when a company or individual should consider cooperating, consistent with our experience, panelists from the defense bar explained that it is imperative to know who you are dealing with at the USAO. Only then should a client consider cooperating, noting that, in the corporate context, it is safest to do so in situations where there is isolated misconduct by a rogue employee and the company has already identified and resolved the issue.
Once a company or individual decides they want to cooperate, both Levy and Amanda Strachan, Chief, Criminal Division, USAO, emphasized that it is important for them to address the bad facts head-on; identify and highlight key documents in productions; and respond in a timely fashion. Strachan urged defense counsel to engage in discussions with the AUSAs about their cooperation early on in the case to ensure they are not missing the mark. What is clear is that neither the Massachusetts USAO nor the Massachusetts AGO view compliance with a subpoena as cooperation or view cooperation as a get out of jail free card.
A couple more interesting points from the day:
- Massachusetts is watching what happens with the Southern District of New York's recently launched Whistleblower Pilot Program with interest, but has no plans to launch its own program at the moment.
- Litigation in the Massachusetts USAO is at a historic high. George indicated that AUSAs are "cutting their teeth" in the courtroom, warning, "if things need to be litigated, we are prepared to do so."
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