United States District Court, S.D. California
ORDER DENYING DEFENDANT'S MOTION [DOC. 119] FOR
James Lorenz, United States District Judge.
before the Court is Defendant Millennium Laboratories,
Inc.'s (“Millennium”) motion for summary
judgment. (MSJ [Doc. 119].) Pursuant to Civil Local Rule
7.1(d)(1), the Court decides the matter on the papers
submitted and without oral argument. For the reasons stated
below, the Court DENIES Millennium's
is in the business of providing drug testing products and
services for medical providers concerned with pain
management. One of Millennium's products is a urine Point
of Collection cup (“POC cup”) that comes lined
with multiple test strips. When exposed to a urine sample,
the test strips will indicate whether the sample tests
positive for certain drugs. If a provider wants to confirm
the onsite result produced by a POC cup, he or she can send
the sample to Millennium for laboratory testing.
required that medical providers using its laboratory testing
services fill out a Custom Profile form by checking boxes
next to the names of certain drugs for which Millennium
offers testing. When a provider would submit a urine sample
to Millennium for laboratory testing and check a box labeled
“Use Custom Profile”, Millennium would test, and
bill, for each drug checked in that provider's Custom
2011, Millennium directed its sales force to pressure
providers to include at least twelve drugs on their Custom
Profiles. Thus, inclusion of at least twelve drugs became a
condition to providers opening an account with Millennium;
continuing an existing account with Millennium; and receiving
free POC cups. Because this strategy involved encouraging use
of default custom profiles on all of a provider's
patients, it does not appear that this sales push was
concerned with providing for individual patients'
specific medical needs. Rather, the purpose appears to have
been a desire to increase profit margins, as Millennium earns
more per sample by billing for more tests.
as a Medicare Part B biller, harvested a substantial amount
of revenue by billing the federal government for laboratory
testing performed in accordance with Custom Profiles that did
not account for individual patients' needs. It is illegal
to bill Medicare for drug testing that is not necessary or
specifically targeted to the needs of a patient. 42 U.S.C.
§ 1395y(a)(1)(a). Accordingly, Plaintiff Ryan Uehling
(“Plaintiff”), Millennium's Western Regional
Sales Director at the time, approached Millennium's
President Howard Appel (“Appel”) on two occasions
with concerns regarding the legality of this practice.
one month after Plaintiff and Appel's second
conversation, Millennium fired Plaintiff. Plaintiff then
approached the government with evidence that Millennium was
submitting false claims and, as a qui tam plaintiff,
filed a complaint against Millennium with the United States
District Court, District of Massachusetts, alleging
violations of the Federal False Claims Act
(“FCA”), 31 U.S.C. § 3729 et seq.,
through, inter alia, fraudulent billing and
retaliation in the form of firing him for engaging in FCA
protected activity. U.S.A. ex rel Ryan Uehling, v.
Millennium, 1:12-cv-10631-NMG (D. Mass.) The government
elected to intervene, and Millennium paid $256 million to
settle the fraudulent billing claims against it. (Settlement
Agreement [Doc. 125-8].) That settlement did not resolve
Plaintiff's retaliation claim, which the Massachusetts
court severed and transferred to this Court. (Severance [Doc.
1]; Transfer [Doc. 26].) Millennium now moves for summary
judgment. (MSJ [Doc. 119].) Plaintiff opposes. (Opp'n
judgment is appropriate under Rule 56(c) where the moving
party demonstrates the absence of a genuine issue of material
fact and entitlement to judgment as a matter of law.
See Fed. R. Civ. P. 56(c); Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986). A fact is material
when, under the governing substantive law, it could affect
the outcome of the case. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). A dispute about a
material fact is genuine if “the evidence is such that
a reasonable jury could return a verdict for the nonmoving
party.” Anderson, 477 U.S. at 248.
party seeking summary judgment bears the initial burden of
establishing the absence of a genuine issue of material fact.
Celotex, 477 U.S. at 323. The moving party can
satisfy this burden in two ways: (1) by presenting evidence
that negates an essential element of the nonmoving
party's case; or (2) by demonstrating that the nonmoving
party failed to make a showing sufficient to establish an
element essential to that party's case on which that
party will bear the burden of proof at trial. Id. at
322-23. “Disputes over irrelevant or unnecessary facts
will not preclude a grant of summary judgment.”
T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors
Ass'n, 809 F.2d 626, 630 (9th Cir. 1987).
district court may limit its review to the documents
submitted for the purpose of summary judgment and those parts
of the record specifically referenced therein.”
Carmen v. San Francisco Unified Sch. Dist., 237 F.3d
1026, 1030 (9th Cir. 2001). Therefore, the court is not
obligated “to scour the record in search of a genuine
issue of triable fact.” Keenan v. Allan, 91
F.3d 1275, 1279 (9th Cir. 1996) (citing Richards v.
Combined Ins. Co. of Am., 55 F.3d 247, 251 (7th Cir.
1995). If the moving party fails to discharge this initial
burden, summary judgment must be denied and the court need
not consider the nonmoving party's evidence. Adickes
v. S.H. Kress & Co., 398 U.S. 144, 159-60 (1970).
moving party meets this initial burden, the nonmoving party
cannot defeat summary judgment merely by demonstrating
“that there is some metaphysical doubt as to the
material facts.” Matsushita Elect. Indus. Co., Ltd.
v Zenith Radio Corp., 475 U.S. 574, 586 (1986). Rather,
the nonmoving party must “go beyond the
pleadings” and by “the depositions, answers to
interrogatories, and admissions on file, ” designate
“specific facts showing that there is a genuine issue
for trial.” Celotex, 477 U.S. at 324 (quoting
making this determination, the court must view all inferences
drawn from the underlying facts in the light most favorable
to the nonmoving party. See Matsushita, 475 U.S. at
587. “Credibility determinations, the weighing of
evidence, and the drawing of legitimate inferences from the
facts are jury functions, not those of a judge, ...