                                                                                  FILED
                                                                      United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                          Tenth Circuit

                             FOR THE TENTH CIRCUIT                          October 28, 2015
                         _________________________________
                                                                          Elisabeth A. Shumaker
                                                                              Clerk of Court
UNITED STATES OF AMERICA EX
REL. MARK TROXLER,

      Plaintiff - Appellant,

v.                                                          No. 14-5144
                                               (D.C. No. 4:11-CV-00808-TCK-FHM)
WARREN CLINIC, INC.; SAINT                                  (N.D. Okla.)
FRANCIS HEALTH SYSTEM, INC.,

      Defendants - Appellees.
                      _________________________________

                             ORDER AND JUDGMENT*
                         _________________________________

Before HARTZ, PORFILIO, and PHILLIPS, Circuit Judges.
                  _________________________________

      Mark Troxler brought this suit under the False Claims Act (“FCA”), 31 U.S.C.

§§ 3729, 3730, alleging that defendants Warren Clinic, Inc. and Saint Francis Health

System, Inc. (collectively “clinic”) were fraudulently billing the government for

services provided by non-physicians. The district court dismissed the suit under

Federal Rule of Civil Procedure 12(b)(6), and exercising jurisdiction under 28 U.S.C.

§ 1291, we affirm.

      *
        After examining the briefs and appellate record, this panel has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
submitted without oral argument. This order and judgment is not binding precedent,
except under the doctrines of law of the case, res judicata, and collateral estoppel. It
may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1
and 10th Cir. R. 32.1.
                                           I

      Dr. Troxler worked at the clinic from March 2010 through February 2011. He

alleged that during that time, he observed and protested the clinic’s practice of

having nurses and medical assistants collect patients’ “History of Present Illness” or

“HPI.” Aplt. App., Vol. 1 at 6. Dr. Troxler averred that HPI information is

necessary to select the proper billing code for “evaluation and management” or

“E/M” services and must be supported by a physician’s documentation. Id. at 10-11.

He further alleged that by having non-physicians collect and document HPI

information, the clinic was fraudulently obtaining reimbursements from federal and

state Medicare and Medicaid programs. Dr. Troxler therefore brought this suit on

behalf of the government under the FCA’s qui tam provisions, claiming the clinic

was knowingly presenting false or fraudulent claims to the government for payment,

and knowingly making or using false records to obtain payment for false or

fraudulent claims. See 31 U.S.C. § 3729(a)(1)(A), (B).1

      The district court dismissed the suit under Rule 12(b)(6).2 The court first

described the FCA’s statutory framework, which “‘recognizes two types of

actionable claims—factually false claims and legally false claims.’” Aplt. App.,

      1
       An individual may prosecute such claims on behalf of the government under
the FCA’s qui tam provisions and share in any recovery. See U.S. ex rel. Lemmon v.
Envirocare of Utah, Inc., 614 F.3d 1163, 1167 (10th Cir. 2010) (citing 31 U.S.C.
§ 3730(b), (d)).
      2
         The district court did not reach the clinic’s alternative argument that the
complaint was subject to dismissal under Federal Rule of Civil Procedure 9(b) for
failure to plead the claims with particularity. Our disposition obviates any need to
consider this issue.
                                           2
Vol. 2 at 220 (quoting U.S. ex rel. Conner v. Salina Reg’l Health Ctr., Inc., 543 F.3d

1211, 1217 (10th Cir. 2008)).3 Factually false claims, the court explained, are those

in which “‘the payee has submitted an incorrect description of goods or services

provided or a request for reimbursement for goods or services never provided.’” Id.

at 221 (quoting Conner, 543 F.3d at 1217).

      The court determined the complaint failed to plead a factually false claim

because Dr. Troxler did not allege that anything in the clinic’s claim forms was false,

nor did he dispute that the services were actually provided. Moreover, he did not

allege that the clinic failed to document HPI information or that the E/M billing

codes were incorrect; rather, he merely alleged that the nurses and medical assistants

who obtained HPI information were unqualified to do so. But because the complaint

did not allege the clinic was obligated to identify who collected the HPI information,

the court concluded the complaint failed to state a factually false claim.

      As for legally false FCA claims, the district court explained they may be either

express or implied and “require the relator to prove that ‘the defendant has certified

compliance with a statute or regulation as a condition to government payment, yet


      3
         The relevant provisions of the FCA provide for civil penalties and treble
damages against a defendant who “(A) knowingly presents or causes to be presented,
a false or fraudulent claim for payment of approval; [or] (B) 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). The scienter element is established if
the defendant has “(i) actual knowledge of the information; (ii) acts in deliberate
ignorance of the truth or falsity of the information; or (iii) acts in reckless disregard
of the truth or falsity of the information,” although “no proof of specific intent to
defraud” is required. Id. § 3729(b)(1); see U.S. ex rel. Burlbaw v. Orenduff, 548 F.3d
931, 945 & n.12 (10th Cir. 2008).
                                           3
knowingly failed to comply with such statute or regulation.’” Id. (quoting Conner,

543 F.3d at 1217). The court recognized that an express false certification claim

arises when “‘a [defendant] falsely certifies compliance with a particular statute,

regulation or contractual term, where compliance is a prerequisite to payment.’”

Id. at 221-22 (quoting Conner, 543 F.3d at 1217). But an implied false certification

claim “requires only the presentation of a false or fraudulent claim for payment or

approval without the additional . . . requirement of a false record or statement.”

U.S. ex rel. Lemmon v. Envirocare of Utah, Inc., 614 F.3d 1163, 1168 (10th Cir.

2010) (internal quotation marks omitted). When analyzing these implied false

certification claims, the focus is “‘on the underlying contracts, statutes, or

regulations . . . to ascertain whether they make compliance a prerequisite to the

government’s payment.’” Aplt. App., Vol. 2 at 222 (quoting Conner, 543 F.3d

at 1218).

       The district court concluded that the complaint failed to allege either an

express or an implied false certification claim. An express false certification theory

failed, the court ruled, because there were no allegations that the clinic certified its

compliance with any legally binding authority. A single paragraph in the complaint

alleged the clinic “repeatedly and falsely certified their continued compliance with

Medicare guidelines while knowingly rendering services not in compliance with

Medicare guidelines and while knowingly submitting false records or statements for

payment related to such services rendered.” Aplt. App., Vol. 1 at 20, ¶ 47. But this

conclusory statement, the court held, failed to identify any statement or certification

                                             4
of compliance with any legally binding authority. Although Dr. Troxler cited a

provision of the Department of Health and Human Services’ Evaluation and

Management Services Guide, the district court determined this document had no

legally binding effect and even if it did, there was no indication in the complaint how

the clinic certified its compliance with it.4 Apart from that, the court noted that

Dr. Troxler did not identify any false certification premised on the requirements of a

statute, regulation, or contract. This was fatal to his theory of an implied false

certification, the court explained, because without an underlying statute, regulation,

or contract, there was no authority to make compliance a prerequisite to the

government’s payment.

                                            II

      We review the district court’s dismissal de novo, Lemmon, 614 F.3d at 1167,

and agree that Dr. Troxler failed to plead a plausible FCA claim. The complaint fails

to state a factually false claim because there are no allegations that the clinic

submitted anything false to the government or that the services were not actually

provided. Dr. Troxler suggests the reimbursement requests were false because only

physicians can certify whether services are medically necessary, see Aplt. Br. at 17

(“reimbursements . . . are made only for services that are medically necessary” and


      4
        The “Medicare guidelines” that Dr. Troxler referenced in his complaint are
the 1997 Documentation Guidelines for Evaluation and Management Services, see
Aplt. App., Vol. 1 at 10 ¶17, 20 ¶ 47, which are appended to and appear to be part of
the Evaluation and Management Services Guide, see id. at 57-145. The clinic
attached these materials to its motion to dismiss, and the parties do not dispute their
authenticity. See Jacobsen v. Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002).
                                            5
are inappropriate “when a physician’s documentation fails to support the medical

necessity of a[n] . . . E/M service”), but there are no allegations that the services were

unnecessary. Rather, the complaint alleges that HPI information was collected by

unqualified personnel. But as the district court recognized, absent allegations that the

clinic was required to identify who collected HPI information, the complaint fails to

state a factually false claim.

       Likewise, the complaint fails to state a legally false claim. There are no

allegations to support an express false certification theory because the complaint does

not identify any expressly false certification or statement. Nor does the complaint

identify a statute, regulation, or contract requiring that only physicians collect HPI

information as a prerequisite to payment. This deficiency defeats an implied false

certification theory because without an underlying legal authority to make

compliance a prerequisite to payment, there can be no false certification. See

Conner, 543 F.3d at 1218. Although Dr. Troxler alludes to the 1997 Documentation

Guidelines for Evaluation and Management Services, Aplt. App., Vol. 1 at 96;

Aplt. Br. at 22, he does not allege—and we find no indication—that these guidelines

legally mandate and condition payment of services on a health-care provider’s

certification that HPI information was collected exclusively by physicians.

Moreover, without a statutory, regulatory, or contractual obligation to make this

certification, it is implausible that the allegations satisfy the scienter requirement

because there was nothing with which the clinic could have knowingly certified its



                                            6
false compliance.5 Under these circumstances, the district court correctly dismissed

the complaint.

      Accordingly, having reviewed the parties’ appellate materials, the relevant

legal authorities, and the record on appeal, we affirm the district court’s judgment for

substantially the same reasons stated by the district court in its decision dated

November 5, 2014.

                                                Entered for the Court



                                                Gregory A. Phillips
                                                Circuit Judge




      5
          Dr. Troxler reiterates his argument that a provision of the Evaluation and
Management Services Guide allows “ancillary staff” to collect and document certain
information. Aplt. App., Vol. 1 at 70. He insists that this expressly enumerated
allowance for non-physicians to collect specific information must mean that other
information, including HPI information, can only be collected by physicians. But
even if we could read this negative inference from the omission of language in the
Evaluation and Management Services Guide (which we do not), the district court
correctly recognized that this guide is not legally binding. Indeed, it expressly says
that it is merely a “reference tool” and “is not a legal document and does not grant
rights or impose obligations.” Id. at 58.
                                            7
