Last week, Antoine Dental Centers of Houston and Harlingen Family Dentistry of Harlingen brought a motion before the Travis County District Court to unseal the massive Christine Ellis qui tam suit filing that in redacted form appears to have 46 pages of defendants. Lawyers for the plaintiff, Tony Canales and Jason Ray, brought the motion as the full qui tam filing is needed for the defense of their clients. A PDF of the file is available for download.
From the filing:
Upon information and belief, the above named parties believe that they are actually undisclosed defendants in this unsealed Texas Medicaid Fraud Prevention Act (“TMFPA”) lawsuit. Both Harlingen Family Dentistry (‘HFD”) and Antoine Dental Center (“ADC”) are the subject of completed administrative payment hold hearings at SOAR The State and the Relator are not permitted to maintain a TMFPA complaint under seal once the purposes sought to be achieved by the sealing have evaporated.'” Having already brought administrative charges against HFD and ADC, there is no legitimate reason for the case to remain under seal.
A. Events prior to this ease being partially unsealed.
This is a qui tam lawsuit, filed pursuant to TEX. HUM. RES. CODE § 36.102 et seq. (The Texas Medicaid Fraud Prevention Act, or “TMFPA”). It was filed under seal on April 24, 2012 by Dr. Christine Ellis (also referred to as the “Relator”). One month later, on June 25, 2012, the State of Texas intervened and joined the lawsuit. Because it was filed under seal, no Defendants were served with the lawsuit and no Defendant was informed that it had been sued. Apparently, the relator and the State of Texas have persuaded this Court that the case should remain under seal for over a year. The case generally involves allegations of fraud and misrepresentations by Medicaid dental providers.
Meanwhile, the State, through the Texas Health and Human Services, Office of the Inspector General (HHSC-OIG), has been pursuing separate administrative sanctions/remedies against HFD and ADC.
On or about September 2011, the OIG instituted an administrative “payment hold” against HFD. A payment hold temporarily freezes future Medicaid payments to a provider, despite the provider’s ongoing participation in the Medicaid program. The payment hold against HFD was issued pursuant to what the OIG called a “credible allegation of fraud” regarding HFD’s past Medicaid billings. HFD requested an expedited administrative hearing limited to determining whether the State had a credible allegation of fraud, and if so, what level of payment hold, if any, was justified on the facts. The payment hold hearing was held at the State Office of Administrative Hearings on April 24-25, 2012—the same day that this TMFPA case was filed by the relator. On August 15, 2012, an administrative law judge found that the HHSC-OIG had no evidence that was “credible, reliable, or verifying, or that has indicia of reliability, that I-IFD committed fraud or misrepresentation.” That proposal for decision was adopted in full by the HHSC and became final on February 6, 2013.2
On or about April 4, 2012, the 010 instituted a “payment bold” against ADC; the payment hold against ADC was issued pursuant to what the OIG called a “credible allegation of fraud” regarding ADC’s past Medicaid billings. ADC requested an expedited hearing limited to determining whether the State had a credible allegation of fraud, and if so, what level of payment hold, if any, was justified on the facts. The administrative hearing was set for May 28, 2013. Three weeks before that hearing, in a move that appeared highly unusual at the time, the HHSC¬OIG sought and received approval from the Attorney General to retain outside counsel to prosecute the administrative case.3 The outside counsel in the ADC ease was Dan Hargrove (and his law firm) and Jim Moriarty (and his law firm).4 The ADC payment hold hearing was held at the State Office of Administrative Hearings on May 28-31, 2013. Final written closing arguments will probably be submitted within the next 45 days.
B. This lawsuit is now partially unsealed as to two defendants, but not HFD or ADC.
On June 6, 2013, this Court considered and granted what was misleadingly titled as an “Agreed Motion to Partially Unseal” the petition as to one of the Defendants. That Defendant is “M&M Orthodontics, Diana T. Malone, DDS, et al.” (the “Malone Defendants”). As a result of that order, a heavily redacted copy of the petition was provided to the Malone Defendants’ counsel. No other defendants in this case were unsealed or notified of the case, but it is clear from the 125 page petition (which includes 46 pages of redacted defendant names), that the Relator and State have chosen to bring their claims against many, many dental providers. The timing of the partial unsealing of this lawsuit as to the Malone Defendants is now obvious—the Malone Defendants are set to proceed to an administrative adjudication claims in the next 60 days.
The order partially unsealing the lawsuit as to the Malone Defendants expressly permitted the State and the Relator to pursue their claims in this lawsuit through the pending administrative hearing. The attorneys that filed this civil TMFPA ease on behalf of the Relator are Dan Hargrove and Jim Moriarty—the same attorneys that substituted late into the ADC administrative ease as outside counsel.
On June 18, 2013, this Court considered and granted a second misleadingly titled “Agreed Motion to Partially Unseal,” but this time as to another set of Defendants (collectively referred to as the “National Defendants.”). The National Defendants are set for an administrative hearing on August 19, 2013. Again, this court’s order partially unsealing the lawsuit as to the National Defendants expressly permitted the State and the Relator to pursue their TMFPA claims in this lawsuit through the pending administrative hearing. However, unlike the Malone Defendants, the National Defendants have never received a redacted copy of the petition that actually reveals that they are actually Defendants in this lawsuit.
In response to the June 6, 2013 Order Unsealing the Petition on the Malone Defendants, on July 19, 2013 the Malone Defendants filed in this court a document titled “Malone Defendants” Motion to Vacate. In an attempt to prevent this court from reviewing its earlier orders or determining whether the Relator was barred from bringing this suit in any forum, the State filed a June 24, 2013 Notice of Nonsuit as to the TMFPA claims against the Malone Defendants and the National Defendants in this case. Subsequently, the State filed at SOAH a notice of its intent to pursue its TMPFA claims in that administrative forum as to both the Malone Defendants and National Defendants.