ready to hear from the pound i take it you've broken up your argument mr mo you're going to take seven minutes and a department of justice will take five of the opening remarks yes  me make a comment to you at the outset prefatory comment this court is reluctant to consider ex parte the agreement which you submitted in response to o to do that and so if you want to stick in sidor that it seems to us that you want to share it with them under some confidential arrangement are you prepared to do that i think if the court  were to say that the agreement would be material to its resolution of the motion to dismiss and we leave it to you to decide whether you want us to consider and i'm simply saying if you do we think in fairness they ought to be able to review it i'll be aside the jury's verdict after a month long trial one the court asserted that the government kept paying the defendants despite knowing about their fraudulent practices but there was no evidence that the government knew about defendants medicare up coding and ramping and it is undisputed that the medicaid surveys that defendants rely on focused soley on quality of care not on billing fraud to the court described the fraud as paperwork the fact that it didn't deprive the government of the benefit of its bargain but substantial evidence showed that rug up coding and ramping deceived the government into e description of the evidence in judge mary days order as to the care plans of it's correct no your honor you you read my mind and anticipated what i was about to say which is that there was also care plans were a critical part of what the government expected to receive for its medicaid dollars and let me just explain why that's so unlike under medicare where a provider gets more money for providing more services under medicaid the provider gets a flat fee per day and so the incentive on the part of the provider is to cut corners and provide less care and still receive that same flat fee the way that medicaid protects against this is to create a requirement that the care be provided pursuant to a comprehensive plan of care and that way medicaid has assurance that it is getting what it is bargaining for and namely that the care be provided pursuant to a plan the plan reflecting the actual needs of the patients and there was substantial evidence about the importance of these click care plans at trial there was also frankly direct evidence that the failure to create care plans would cause the government to refuse like to see embarrassment it would be helpful for me if we broke up broke out medicare for medicaid yes ron let's assume it might be the flow of the argument might be easier and we might be able to digest rather more effective by piece as for the medicare yes as i understand the guts of the fraud you claim one that they were involved systematically and what you characterize as being up coding yes we had two aspects to it one submitting bills to medicare with elevated rugs that is greater number of therapy minutes declared than were actually provided and there was another piece of that  as well and then with respect to the other portion of your claim it was ramping up in connection with this matter as well as the facilities provided more therapy for patients than they actually needed or actually received correct you are right now the district judge threw out the medicare verdict which is huge verdict in this case basically two grounds one materiality and to see enter those with the arguments as i understand it right that was the basis for dumping the medicare claim may st note as we set out in our brief that neither of those issues was actually preserved because if you look at the motions for a new trial under rule fifty a you will not find an argument about materiality with respect to medicare or knowledge with respect to medicare and the reason is that throughout the entire trial it was recognized by both sides both in terms of counsel's arguments and witness testimony that the materiality with respect to medicare was quite obvious with respect so now in answer to your honor's question the evidence of materiality with respect to medicare is  way that the entire medicare reimbursement system works if you report say are you x as your rug score you are representing to medicare that you provided you the middle letter seven hundred and twenty at least seven hundred and twenty minutes of therapy if in fact you only provided five hundred minutes of therapy you should have reported a different score and had you reported that score you would have been paid less so the entire scheme is oriented around these reports these representations that the provider is obligated to make truthfully about how much it's actually provided and so if you up code you in the words of defendant's own witness giuliano would definitely influence payments that's a pen dix page six hundred and ninety three dollars defendant's own experts police and wrestle also acknowledge that if you up code you are causing the government to pay you more than you otherwise should that's it at are blue grease  depends on what score you report the same is true of ramping what ramping is essentially is a kind of slightly more sophisticated form of up coding you're actually providing to use my example five hundred minutes of therapy and then the minute you know that the government's actually watching you in this assessment period you artificially inflate it to seven hundred and twenty dollars to make it look like that's the amount of therapy that you're providing the entire time that too obviously causes the government to pay more because it's left with the impression that you're providing seven hundred and twenty minutes the entire time when in fact you're only providing five hundred dollars and that's why c m s guidance as we point out in our reply brief at sixteen dollars seventeen cents states very clearly that ramping is an abuse of practice defendant's own chief compliance officer griffin acknowledged that ramping is quote completely inappropriate in every setting that's in reply i reply brief but page seventeen so again the reason this argument wasn't preserved in the st place is it was uncontroversial that materiality that the medicare fraud was material it was also uncontroversial that the defendants knew that because the whole point of the fraud was to make more money the fraud here it was that the management which superintended the billing practices of all the facilities imposed what they euphemistically called rug quota rug budgets which were really wasn't properly preserved as i understand it in their renewed motion for judgment as a matter of law the pollies advanced three arguments for setting aside the verdict the st was that related or had failed to establish a materiality of any medicare or medicaid violations is not so and they argue that in the district court in their fifty be motion your honor yes but the reason it's not preserved is that a fifty b motion can only has to be medicare and as i understand it the thrust there was that the apple e's failed to maintain a comprehensive care plan on file for each medicaid resident was at the beginning middle and the end of the medicaid or was there more than that that they failed to create and also to maintain comprehensive right to create and maintain a comprehensive care plan on file for each resident correct on where's the fraud in that help me what's happening sure your honor the fraud is that the comprehensive plan of care is part of what medicaid bargains for under this per  fee arrangement that i was alluding to before that medicaid needs to know that the providers have actually planned out the care that's needed for each patient so that they can't cut corners in the way that i was saying that they have the incentive to and so it's in both the federal and florida medicaid rules and regulations that this care plan is an express condition of payment if you don't have it you can't get paid and it's not just you know contrary to my friend's arguments the fact that there is in the law books there was also testimony at trial from people who know the practices in this area that and i'm going to quote our expert if the state discovers a violation of the care plan provision it will automatically deny payment defendants own expert who is a former c m s official in charge of surveys said care plans quote do need to be in place for payment cheryl mcnally who was a regional reimbursement supervisor for a loop the management the management entity said inadequate care plans may sway claims in a negative direction and that was in the context of the defendants trying scrambling when auditor's came or surveyors came to backdate documents to create care plans where none had existed all in recognition of the fact that this is a fundamental part of what medicaid bargains for when it agrees to pay billions and billions of dollars every year for care of these  behalf of the united states the united states has participated as amakosa in this case because among other issues with the district court's opinion the district court fundamentally misunderstood the legal test for materiality as the supreme court explained in escobar the relevant question in looking at materiality is just the common law test and the statutory definition and that test looks at whether or not the information was important in determining the government's decision making with regard to the transaction in question the transaction in question is the important part there because in a case where the allegation or the proof is that the defendant has submitted false bills to medicare the transaction is medicare's payment of the bill not medicare's decision one hundred and one thousand five hundred and twenty years down the road whether or not it's going to pursue recoupment or some other enforcement action it may be that medicare is enforcement and twenty years down the road could be relevant evidence there may be circumstances where they have some probative value but at the end of the day there probative value has to go to what the government would have done at the time of payment and once you understand that fundamental legal error it's very very clear that as to the medicare side of this case that of course these things are material if you take up coding when you tell medicare that you provided seven hundred and twenty minutes of therapy to get six hundred dollars when in fact you only provided five hundred minutes of therapy and you're only entitled to four hundred dollars of course by reporting seven hundred and twenty minutes instead of four hundred minutes you cause the government to pay you out more money than you are entitled and there's no real dispute about fact that's not even an escobar issue because it's not implied certification it's just i think that's right i think your honor has hit upon the point that escobar is entire discussion of materiality is about materiality  when trying to determine whether or not something that's an implied certification is an implied statement about something that is material as opposed to here where we just have a straight up claim that says i provided seven hundred and twenty minutes of therapy or you know this person was are you when in reality they were r v x or some other code that got less money and that's why as to the medicare side it frankly we don't understand or at least it's very hard to see how any reasonable jury could have reached any conclusion except that this fraud was material now as to the medicaid side it gets a little bit more complicated but that's only because you can make an argument that the evidence was on multiple sides but at the end of the day this court is reviewing a jury verdict and the question is not what this court as a fact finder would have concluded the question was just applying the holistic test for materiality as set out in escobar is there sufficient evidence that a jury could have concluded that this was material and we laid out in our brief a number of reasons why there evidence was there and that included evidence for example that this was a condition of payment which escobar says is relevant evidence and additionally it included evidence that this was important to florida medicaid for the reasons that the relator as identified in her argument and for the reasons that the testimony set out which is that if you don't have these care plans in place then there is a real risk that a provider is going to under of i'd care to the medicaid population and there was substantial evidence in this case that the entities were doing just that that they were deliberately not providing care to medicaid patients precisely because they were getting this flat fee and maybe the defendants have arguments why despite all of these problems florida medicaid wouldn't have cared about this and that's why it was a fact question for the jury and it's inappropriate for a viewing court to simply just relay the evidence i'd be happy to talk about the causation issue as well which is another issue that the united states has a pint on i don't think there's really any dispute he here that the relevant test is proximate cause and then once you get to proximate cause we think the district court simply misapplied that test the way to apply that test is to apply it the way the common law is always understood that understood it here as we've said on our brief there are a number of reasons to think that the management and the proximity caused the submission of a number of false claims can we go back to the care plan sure so you know as judges we know that people get prosecuted all the time for overcharging medicare and that and as many of us are relatives of doctors we know that there is great fear in the medicare in the physician community and in the health care services community medicare prosecution over overcharging but what about the care plans is that something that has been the subject of prosecutions or not so your honor i want to be clear when we're talking about care plans i think it least insofar as they're relevant to this case i don't think the relator relied on care plans to establish medicare fraud i think we're talking about middle which is at the heart of the medicaid medicaid yes i'm sorry it up i apologize and medicaid prosecution medicaid i have a care plan and so i don't know one way or another whether regulatory enforcement action so i don't know whether they have been any federal in foresman actions but here is important to recognize that the relevant pay or was actually the state agency it was florida and so the relevant question was was this something that florida would have considered material if the record is silent as to whether or not florida engaged in prosecutions then it's silent as to that particular issue but here we think that there was sufficient evidence is there in this record from which a jury could reasonably and for medicaid fraud flowing simply and solely from the failure to prepare a comprehensive care plan so why would it be material to florida may i say yes so there were several pieces of evidence evidence would have to be sufficient to establish that what is there that would have allowed a reasonable juror to conclude that the evidence was pushing as to materiality regarding the failure to produce and prepare they put it to prepare and maintain the comprehensive care plans absolutely in your honor i see my time is up i'm so happy to answer your honor's question i think there were several pieces of evidence and i'd be happy to go through them keeping in mind that materiality is a holistic inquiry and no one factor is dispositive in keeping that in mind one piece of evidence and this is a piece of evidence that escobar itself said would be relevant is whether or not the relevant paper would consider important and central to the bargain here the relator presented evidence that would permit that difference that included the fact that h h s the office of inspector general has issued guidance on the importance of care plans it said that it's essential to policing fraud there's also the commonsense aspect of this and commonsense is also something that the supreme court ask a bar said you could look to why is the comprehensive care plan necessary for that purpose you asserted as a high order of abstraction as does the i g but it doesn't jump off the page at me you know the reason comes from the fear as opposed to saying we build it for seven hundred minutes when in truth and in fact they only provided three hundred and fifty  that's easy and your honor i think there's a there may be a reason why nobody is contending here that they care plans were essential to the medicare scheme i'm not asking right a medic and i think that's my only asking about medicaid and speaking for myself i did not see how the failure to prepare and the failure to maintain comprehensive care plans was material to the fraud itself sure and i began to be happy t action that didn't jump off the page at me your honor and i'd be happy to walk through all of the evidence let's start with why would this be essential and why would the office of inspector general say that and the answer comes from the fixed fee nature of the medicaid payments  where you're only giving someone a fixed fee regardless of the amount of services that they provide to the patient there is a very substantial risk and indeed a risk that was borne out in this very case that the provider is not going to meet all of the needs of the patient what the care plan does is it forces the provider to document that need so that a the provider has to recognize that need and hopefully meet it but to that if the provider doesn't document that need and meet it then when people go back and look it they can see that the provider has not met that need and that provides an essential enforcement mechanism and so it's at least reasonable for a jury to conclude based on that that the care plan was essential but your honor if that's not jumping out of the page at you and if you don't even think a reasonable jury could rely solely on that there was other evidence in this case that included the testimony of a number of witnesses that florida medicaid would automatically deny payment if they learned that the care plans were not in place it was also the evidence that florida medicaid treated this as a condition of payment all of these pieces of relevant evidence were before the jury now the defendants have their arguments also point out that i think when the defendants are telling you about the government making payment despite actual knowledge they're saying that because they're not applying the correct legal test for materiality by how long a period of time did they fail to provide comprehensive put your i don't know that we have direct evidence of continuing practices in this case i think what you have in this case is evidence that within a period of time where the relator had evidence and presented that evidence at trial there were some situations where there were no care plans and i would defer to my colleague my colleague litigated this case below as to whether i'm missing any evidence for my understanding is after a certain point the evidentiary record is just silent as to the presence or absence of care plans now the defendants are saying hey some state surveyors came in they found out in some isolated instances there weren't these care plans but that does not mean a that florida medicaid failed to pay the past instances or would have had they known at the time of payment that they wouldn't have paid so in other words if you put yourself in a situation where you said you submit your bill to florida medicaid but at the time you submit your bill you call them up and you say hey florida medicaid i'm submitting this bill to you but just so you know i'm submitting a bill for someone who doesn't have a comprehensive care plan and if the answer to that hypothetical is that florida medicaid will say wait a nd you don't have a comprehensive care plan i can make that payment or i'm not going to make that payment or i've got to think really seriously about whether or not i can make that payment if that's florida medicaid's answer that it's material but isn't that doesn't that go to karros question what enforcement actions have there been in this missing care plan arena because if the government truly cares that there are no care plans that certainly very easy to find out  interested in in billing surveyors who were interested in patient safety that when they found in some instances violations of care plans that they noted those violations i'm not sure that the record says one way or another about the specific kind of  enforcement actions that florida medicaid has taken but even if the record is silent on that that just means that there was one potential form of proof that we don't have information about there are other for tensional forms of proof that we do have information about that was presented to the fact finder and the fact finder was entitled to without evidence thank you much so i'll go straight to the point the relator tried a case that would have been affected prior to june of two thousand and sixteen inside me ask you do you want to be in with your motion to dismiss your honor we have brought what we need or not but i seems that you might begin because you claim that whatever else they did with our us it didn't new did them of having standing in a constitutional sense although the argument seems to me to be more like you're saying what we used to call a statutory standing and now look at in terms of does it state a claim you know and i think you framed it well if you're excused saying there is no constitutional standing here that a n fairness you want to be able to see it under some a confidentiality agreement but i don't know that it's necessary in any event they they assert with respect to that that what they effectively did was a four percent of their share of the ultimate recovery there's no dispute about that if that be the case i'm at a loss to see why they are didn't newt it of standing in a constitutional sense looks to me that they'd have injury in fact they'd have traceability and redress ability what am i missing seems to me what your argument really is is different from standing in a justice should billet he sense what you're really saying is they ought not to be able to proceed as an appropriate quiett template of if they've sold off a piece of the action or a piece of the recovery that doesn't say they don't have standing that says something else that seems to me to be the heart of your argument but i just want to be clear that i understand what it is you're saying on the front end thank you your honor and i appreciate the framing of the question  the false claims act under the supreme court's teaching in the vermont agency says that admiral later who would otherwise lack standing to bring a claim on behalf of the united states can secure that standing through the efficacy of the assignment so that is a partial assignment to pursue the government's interests it is the government that has standing the relator only has standing to stand in the shoes of the government relator meets the requirements that set by the statute there are no authorizations and the limit of the assignment is clear that it would only be that lie with the statute they have not a mind in the sense that they filed their application under seal they had to wait sixty days we had to see whether the government in fact was going to proceed or whether it wouldn't intervene we got the answer to that no other suit was filed based on the underlying facts as they were planned and filed they were later did not rely on a previous public disclosure in bringing the case  bringing a claim as a relate or they filed no complaint under seal or otherwise what is it that they did not comply with in the statute other than saying the overall thrust of the statute must mean that they cannot partially assign a piece of their recovery which i think is the heart of your argument it is your honor they why can't they partially assign a piece of the recovery th not signing away the cause of action they're not signing away the control of the cause of action they're just they claim i've given up potentially four percent of the recovery or maybe a little bit less than that i think is how they phrase it st your honor they have no authority to make the assignment lacking the authority to make you sign meant the rest of that simply did from his own what should be the remedy but there is it's beyond i the real challenge that nothing in the false claims act allows a related or anything a false claims act that prohibits it no because it's not necessary an assignment is limited by its terms and absent either an agreement by the party or an extension statute these time it cannot be abrogated or it met meted out to others this this is why it does pose potential constitutional concerns we're not suggesting that is a constitutional deficiency but in the vermont agency case the court took special care to speak to the circumstances under which a relator could proceed on behalf of the government when they were later exceeds that which  given by the assignment the relator is assigning a part of the government's claim the writer has no right to the benefits or the from winning of the case until a judge also agrees what that percentage should be so easy to assign an expectancy requires an assignment of the government's claim that the relator is now pursuing so to the standing if the relating has now breached her agreement with the united states and there's every evidence that she has because she has exceeded that which the assignment allows the relator is no longer a qualified relator and should that be allowed it raises the v fascinating that one might have expected that argument to be made by the united states of america if they were concerned we heard not a word from the government saying they could not partially assign a piece of the recovery the silence is deafening iran has a true it's a very big problem for them they rely on later if they don't say something to them but they do not seem to think it provides the problem you do they do not have the authority to allow related to farm out cases to maybe not but i just say it's interesting that they've said nothing so an interesting case and i think it's important i think there's a very important motion because it does test the bounds by which we can have essentially a shadow treasury funding claims against citizens of the united states employing a quasar i credit all statute as this one has been described for their own profit they don't have to have suffered any individual harm fact the whole point of standing here is simply standing in the shoes of the government and therefore the notion of a shadow treasury that could be used to come out of ties are we i sort of i agree with you it's an important question but  and on the other hand it wanted to balance that against what it might characterize this die feeling parasitic lawsuits so they created their own balance and they said i quit team suit can go forward with a related or if a b c f and g but notably they said nothing about h to wit that they couldn't sell or assign a piece of the recovery you want to read that into the structure of the f c a even though the f c c is silent on prohibiting it and i'm simply asking you what there is in the f c a that would yield that result even there is silence on this precise issue st your honor i believe that the assignment is limited by its terms and cannot be unilaterally changed so the f c a didn't have to preclude all these things the f c a creates in the supreme court's vermont agency reasoning a limited partial assignment of the united states interest sufficient to allow it related to go forward and without involving t care clause and the appropriate considerations by the united states of control of a case that was also very clear that it is a limiting assignment because the court was quite concerned about abuses under private attorneys general statutes and and other circumstances there were argued in that case as suggesting a constitutional infirmity in the creation of a related so the fabric of the assignment is you can do only that which the statute authorizes you do not get to unilaterally decide because the statute prohibits it it doesn't mean it means that i'd let me ask you just one final question i don't want to really belabor it and let you get really to the heart all of it doesn't really matter what the amount is so we don't really have to quarrel with the details of how much right correct ok i've got it so then that the document itself becomes less important or maybe an important  in the context of the argument he would agree with that i would agree that any assignment of however small right or show this united states claim is not true abby because if indeed they had signed away the totality of their recovery then i'm not sure they would have constitutional standing that is to say i'm not sure that they could show any injury in fact that was concrete but we don't have that problem they have asserted in their briefs that have been they say one we maintain complete control over the litigation to we've maintained the expectancy interest in the overwhelming bulk of any recovery that we might get but it is true that we bargained away for some consideration a little less than four percent and you say accepting those facts is true they cannot do that under the f c a and while it's not a question of whether they have standing in  constitutional sense they can no longer state a claim as an appropriately we're later that's your argument do i have it right that that is correct your honor i think it implicates standing with yes that that is the argument your honor ok i want to go right to the  issues that brought us here with respect to the determination by the district court judge and let's break it down into medicare on the one hand and medicaid on the other the district court basically dumped the case claiming a no materiality and b no c enter that was the beginning the middle and the end of the reasons on medicare but your honor that is exactly what the court found and the court recognized what the or later in the government chooses not to do which is e opinion deals with that but a unanimous court went on further to address materiality and they did not address it only in terms of implied certification fact it's very interesting and i read it again this morning and to supporting your question and it's a good one the court goes and further away now wall to speak to materiality to establish a false claim and the materiality they speak to includes express false claims that in which there is a full and absolute misrepresentation of the fact and the court even addresses the gun that wouldn't shoot as an example of the type of express false claim that should be considered under materiality the last point reasonable person material to the buyer and sellers relationship that they're buying something they know will meet its fundamental purpose the mistake that deborah later made was suggesting as has been argued here today that for medicaid a care plan is what the government wants a camp plan isn't what the government wants ok we got one so fair i thought let's start with that what start with medicare before we medicare medicare before we go to medicaid and let me ask the question this way why wouldn't it be exceedingly relevant and material for medicare to know the minutes that were actually being  declared for the therapy that was being performed when you bill if you billing them for seven hundred hours a seven hundred minutes of therapy and in fact only three hundred and fifty dollars would perform what could be more material to the pay or didn't know that there was really only three hundred and fifty rather than seven hundred well it depends on the context of the medicare claim st medicare is a prospective payment system the prospective payment systems established by an assessment period for the so called rub score so as to ramping the allegation in let's start with up coding why it will start with up coding we then go to the next principle of medicare which is that medicare will only pay for that care which is reasonable and necessary sometimes called medical necessity the relator put on zero evidence of medical necessity in fact they made it very clear they were not challenging medical necessity and when mrs bradley their expert who was a damages expert spoke to in consistencies and or deficiencies in the record the judge asked and she made clear she was not speaking to whether or not those what amount let me does it my question to simple terms at least for me if medicare is providing for ten hours of physical therapy at one hundred dollars an hour and in fact only five hours is provided but you bill them for ten wouldn't the bill that asserts ten hours of physical therapy be material possibly and what or what possible theory could it not be relevant and material in my you build medicare for ten hours of physical therapy i had a bad knee and in fact you only gave him five but the bill said ten hours one hundred bucks an hour one thousand dollars in fact you would do and owing only five hundred dollars because you only gave him five hours wouldn't the bill itself that reflected ten hours be most but tiriel critical to the determination of how much money to pay if it were paid on the basis as you describe your honor yes but that's not how medicare pays in this situation medicare doesn't pay by the unit of service it pays by an estimate of services care claims is what the claim have been paid by the government not whether or not they kept the records and the he case here is absolutely clear and the record is absolutely clear that medical necessity was not challenged what that means is those claims qualified for payment they did not fail their fundamental purpose so to judge marcus's question what about the buy him of therapy provided in some settings that is how medicare pays but not here now did they misrepresent care that was provided on the so called up coding claim aside from ramping based on this so what the relator testified to was she saw a ramping up coding but it's very generalized and the claims that she's describing here do show discrepancies at two facilities based upon her observation of the number essentially the qualification the patient but that level of therapy and that that there are people is not provided as the conditions suggested that may or may not be material to the government's decision but the uncontested testimony  denied based on these kind of discrepancies it very important fact and i'm sorry going to the table but i think it's important to understand given the vast record the the provision of services that was considered and that bradley assessed bradley assessed it to determine where there are discrepancies in the time charts she had virtually nothing to say about how or why or further things or corrections in other words the other elements of a false claim were not present and they were all however attributed to fifty three facilities using no more than three hundred claims and there is no evidence that there was a as the court noted a top down directive so the causation element is based upon no more than budgets a profit incentive and occurrence to put a patient in the highest category and i'd like to transition to the medicaid plan because though i have no evidence offered my time here your honour's it's really important i think that we look at this condition treatment plan issue because that is is probably the easiest to resolve we know that the treatment plan could not have been material to the government's decision to pay not only was there no decision what was it that testimony in the case to the effect that as far as the state of florida was concerned it would not pay one dime if the comprehensive plans were not submitted and in fact they were not submitted here well no actually they were there were they were surveyed they saw that plants in fact relator herself participate in the self disclosure to the state that a treatment plan had not been secured adequately for them this and the uncontested testimony is that there was never  they don't do that we won't pay there is a condition of payment yes it is exists just as it does in the medicare side that you know you need to have in the on the medicaid side a treatment plan but that's exactly payment is relevant too but not dispositive of the issue there needs to be something more and when asked well what does the government do when it has the information that there is a treatment plan that's inadequate and they did response from the related repeatedly was well we don't know what the government does we just know what they say so into k should all of the roles the state of florida says a violation of virtually any law anywhere constitutes grounds for not paying the claim but they don't do that and they don't do it for a very simple reason they need to have care provided to these patients yes they pay a lot of money for it they have a lot of residents you don't turn out the facility or the resident on the treatment plan what it's never been shown in this evidence that they would not have paid in practice and that's what whether or not a comprehensive plan was submitted or submitted that's exactly right you're ok let me ask you just one final question we've gone over our time the district court determination setting aside the verdict and the district courts determination granting the motion for a new trial turned on but to reality and see enter those were the reasons and the only reasons the district court never said did it never reach the conclusion did it that the methodology employed by hannahs to calculate damages was insufficient or an error i think because th sample of three hundred medicare resident days with three hundred medicaid resident days was too small or was otherwise improvidently drawn that was not the reason or the reasons that were offered to i thought write partly on there are thirty three considerations i think that the court had one has the court questioned the application of the damages methodology for the use of establishing damages and liability of the corporate defendants so the app but i know there was a lot of discussion about it but i'm talking about when i sam and the district court judge marriage days order granting the relief that you sought to would set aside the verdict or in the alternative give us a new trial the reasons given by the district court were materiality and c enter those were the failures and that's why he reached the conclusion that he did not because the sample was too small or was improperly drawn or anything like that i do have that correct  the twenty three dollars page order that judge married a entered on january the th two thousand and eighteen that said word one about the calculus of damages i believe that the court said somewhere your honor that the question of whether or not he had improvidently allowed the introduction of the evidence that voice he used as proof of damages the court also did however expressly reserve on that point its reliance upon our brief and we did call into question the manner in which twenty six dollars claims could have resulted in thirty million dollars as damages as being not not supported it's not a matter of one comment that i make for you at the outset mr ho in respect of what i had asked st whether or not you had an objection to share that the agreement that you entered into confidentially with isp seems to me to be of no moment given what your colleague has said his argument does not dispute whether it's four percent or forty percent his argument simply is you can't sign away anything by way of recovery even if you had control so i don't know that that really is an issue any longer but i leave it to you if you for some reason want us to consider it you'll st have to decide whether you'll give  to them otherwise we won't understand ok yes your honor judge marcus i'm a police court if i may make two quick points about medicare and then turn to medicaid the medicare fraud and let me ask again the final question i asked mr lewis let me ask you there's nothing in the district court order going to the methodology by woods by which panels calculated damages is there that's before us now your honor is correct that that  was not the basis for the relief that although he turns around and he says but there's sort of this and the magic pregnant open line from the district court and for the other reasons asserted by  they argue specifically something about the calculus of damages at least before the district court when he said set aside the verdict or give me a new trial so to two responses to that your honor st again i think it emblematic of the district court's failure to heed the federal rules of civil procedure there was a very very limited motion in the st instance for a new trial it related only to an alleged inconsistency between the damages awarded pursuant to the medicaid piece of the case and the number of false claims and as we say in our brief that inconsistency argument was waived because it was not  made before the jury was rice charged count the argument didn't go to the medicare calculus i'm sorry no it did not go to the medicaid care part of the case medicare portion i'm talking that that's correct there was no no request for a new trial based on trial issue will take them one by one yes trotter with respect to jail m o l as your honor knows the law is you have to make an emotion prior to the verdict under rule fifty nine dollars and you can only renew that motion after rule fifty nine dollars under rule fifty b with respect to that there was no argument made preverb act with respect to the materiality of the medicare fraud or with respect to knowledge and yet the district court granted j m o l on materiality with respect to medicare and with respect to knowledge that was procedurally in error even before you get to the question of whether the district court properly applied the standard under rule fifty to construe the evidence in the light most favorable to the verdict then there's the separate issue of the new trial motion so the new trial motion which was in the record was limited really stripping a out than the conclusory arguments the new trial motion was limited to one point and that was that there was thirty million dollars and medicaid damages and only twenty six dollars false claims and the defendants said how could this be this is inconsistent well that was not properly preserved because that argument should have been made before the jury was discharged and that way we could have gone back to the jury and said well which is it is it thirty million dollars or twenty six dollars false claims because that seems somewhat inconsistent they waive that then the the district court on its own motion granted a new trial on on other grounds including all the grounds that we've talked about today materiality et that was a violation of rule fifty nine b because under rule five thousand and ninety the district court was not entitled to sue a sponsor a grant a new trial after twenty eight days so again procedurally we have some real problems with respect i understand but let's go to the merits with respect to medicare to your honor's hypothetical about the physical therapy this is actually worse than your hypothetical because of what mr luce alluded to when he was at the podium it's just that the provider gets paid for ten hours when he only provided five for that actual day of services because of the prospective nature of the medicare payment system the provider will get paid for ten hours for the rest of the month based on a misrepresentation about what was actually provided in that  reflect something like while there isn't documentation to support the number of three or so are we talking about i think one of the problems here is the one hand almost sounds like what we're just talking about missing documentation  honor what she did if she looked at the number of minutes that was reported in the rug codes let's say it was are you so that's a representation as your honor lou to before that seven hundred and twenty minutes have been provided she found the actual physical therapy logs for that patient for that period and she looked and she said how many minutes were actually provided based i'm going to just know it's like a database log absolutely based on the nurses notes there isn't a regulatory obligation on the part of the we said with a regulatory obligation just finish the thought yes so the claim was seven hundred and twenty minutes she looked to see what in fact was provided and concluded that seven hundred and twenty minutes was not provided that's right and your honor is absolutely right the defendants got up in front of the jury and said well it's not that these minutes weren't provided it's just that they're not in the notes well the response to that is there is a regulatory obligation to keep accurate documentation of the number of minutes that's actually provided there was no evidence put on by the defendants from say the nurses that provided the care that yes in fact i provided seven hundred and twenty minutes but i just forgot to write it down and there was a plethora of evidence as we've put in our brief that there was this top down rug quote a practice on the part of the management company to require  threat of terminations of these nurses that they meet these drug quotas irrespective of what the patient actually needed and so the jury quite reasonably came to the conclusion this is not just people forgot to put value judgments about whether therapy should have been provided or was necessary if it was on the log judge bradley credited it she made no effort to say that there was therapy that was provided that was not reasonably necessary so when we examined the spreadsheets in detail we will discover a the numerator of seven hundred and twenty minutes build the in fact only three hundred and forty minutes actually before that's that that is the core of her missing minutes but dr via nello translates that into the difference in the number of dollars that medicare would have paid for if they had known the truth st so i just want to make sure i understand the process as it existed as you put it on it's a trial she made an examination of some of them and concluded in multiple instances that bills were submitted for work not performed correct your honor  turned that into a dollar amount yes your honor and honesty and extrapolated from three hundred dollars resident days to a one million and a half or a sentence that correct with respect to the care plans i think the most succinct way to understand it is that the quid pro quo to use a phrase that's in common parlance nowadays was that medicaid would pay a flat fee for all the care that the patient needed and that's the critical part the care plan is the document by which medicare medicaid rather knows what it was entitled to and what the patient needed if there's no care plan medicaid doesn't know what it's paying for because nobody has bothered to figure out in a writ in the kind of rigorous way that medicaid demands what this patient actually needs and so that's why it is central  the bargain that's why the inspector general says that it's important and that's why all these witnesses testified at trial including defendants and witnesses that if you don't have the care plan you're not going to get paid you don't  necessarily in the patient files but i wasn't sure about the care plans was there also evidence that the care plans had been submitted but for some reason they were not hard copies the patient files i don't recall evidence to that effect your honor standing here right now though i confess i don't recall anything to that effect i had a hard time keeping the acronym straight there are a lot of forms involved in this case  to the questions about whether there is evidence of post hoc regulatory enforcement there is not for one important reason which is that we tried to get in evidence and twelve and the district court ruled that all evidence post two thousand and twelve was irrelevant and so wouldn't let any of that evidence in we don't think and i think the government supports us in this regard that that evidence is necessary because again there was direct testimony at trial that if you don't have these care plans payment will automatically be denied in the words of ms laurie morris which was one of our witnesses and  just quote again from dr pellets which was a defense witness who is a former c m s official when you were in charge of surveys at c m s m d s and care plans did need to be in place for a payment actual practice if you didn't have this core document that was the is the foundation of what the government is bargaining for under medicaid you don't get  thank you much when the final observation is hearing if you want us to consider that which you submitted to us in camera and ex parte you will have to tell us that in five days and agree to make that available to mr otherwise we will not consider it we will advise the court one way or the other within five days thank you thank counsel thank you for that we will be in