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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

CASE NO. 20-cv-60835-AHS

UNITED STATES OF AMERICA

ex rel. LAUREN LAU,

Plaintiff,

v.

FILED UNDER SEAL

ELLWOOD MEDICAL CENTER, LLC;

AMERICORE HEALTH, LLC; et al.,

Defendants.

____________________________________/

MEMORANDUM OF LAW IN SUPPORT OF

UNITED STATES’ UNOPPOSED EX PARTE FOURTH APPLICATION FOR AN

EXTENSION OF THE INTERVENTION PERIOD AND SEAL

The United States of America respectfully submits this memorandum in support of its 

unopposed ex parte application for an Order under the False Claims Act, as amended, 31 U.S.C. 

§ 3730(b)(3) (“FCA”), for a six-month extension of time from January 13, 2022, up to and 

including July 13, 2022, within which it must notify the Court of its decision regarding 

intervention in this qui tam lawsuit, and during which time the Complaint and other filings shall 

remain under seal. This is the United States’ fourth request for an extension of time. Relator 

concurs with this request. 

I. BACKGROUND

On April 23, 2020, Relator filed the qui tam Complaint in this case. On May 13, 2020, 

Relator completed service on the U.S. Attorney’s Office and the Attorney General. On July 15, 

2021, the Court granted the United States’ third request for an extension of time to intervene 

through and including January 13, 2022. D.E. 20. 

K.P. Jan 12, 2022 Miami

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According to Relator’s Complaint, Defendant Ellwood Medical Center, LLC 

(“Ellwood”), owned by Defendant Americore Health, LLC, (“Americore”) entered into an 

agreement with Defendants Verify Health and First Choice Labs USA (“First Choice”), to 

submit claims to Medicare for cancer genetic screening tests that were not actually performed by 

Ellwood. Relator alleges that the agreement provided that the cancer genetic screening tests 

would be performed by Verify Health and First Choice Lab but billed to Medicare by Ellwood. 

Relator alleges that Ellwood retained a percentage of the Medicare payment received for the 

cancer genetic screening tests, with the remainder being remitted to Verify Health and First 

Choice. Relator alleges that Verify Health and First Choice entered into this arrangement with 

Ellwood because Ellwood, as a rural community hospital, was exempt from Medicare’s 70/30 

rule for laboratory billing, which requires laboratories to perform at least 70% of the laboratory 

tests billed. Relator alleges that Defendants submitted or caused to be submitted claims to 

Medicare for improperly billed medical procedures that are in violation of the Anti-Kickback 

Statute. 

Since the United States’ last extension request, the United States has diligently continued 

its investigation in coordination with other ongoing investigations that involve overlapping 

subject matter and/or defendants. In October, the United States informed certain Defendants that 

they are under investigation for potential violations of federal law, including the False Claims 

Act. Defendant Dan Hurt has produced documents and provided information regarding the 

conduct alleged in the Complaint. The United States interviewed Robert Gerstein, who is a 

relator in an overlapping qui tam case and a defendant in the instant case, about his knowledge of 

ongoing use of Defendants First Choice and Sonoran Desert Pathology to perform and/or bill for 

cancer genetic screening tests. The United States also initiated conversations with counsel for 

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Defendant Michael Lewitt and received documents in response to an inquiry from the 

investigative team. The United States has also identified individuals not named in the qui tam 

Complaint that may have participated in the alleged conduct and have informed certain of those 

individuals about the United States’ investigation. These individuals have also produced 

documents and provided information to the Government. Additionally, the Department of 

Health and Human Services-Office of Inspector General has requested information from third 

parties that may have relevant information concerning the underlying conduct. The United 

States continues to interview fact witnesses, including beneficiaries that received services from 

the laboratory defendants or their affiliates, as well as other individuals that had business 

relationships with Defendants. 

II. ARGUMENT

A. Good Cause Exists to Extend the Seal and Intervention-Decision Period

The United States needs an extension of time to continue its investigation and to be able 

to make an informed election decision. The FCA provides that the United States may, for good 

cause shown, move the Court for extensions of time during which to intervene, and during which 

the seal remains intact. 31 U.S.C. § 3730(b)(3). The United States respectfully submits that it 

has good cause for an extension of time in this case. 

As set forth above, the United States is diligently investigating this case, but it needs 

more time to fully evaluate Relator’s allegations, gather and analyze documents, and contact 

witnesses. At the time the qui tam Complaint was filed, there were several ongoing 

investigations involving overlapping conduct and/or defendants, including several grand jury 

investigations. Typically, criminal investigations are accorded priority and care is taken not to 

interfere with covert efforts. In June 2020, the U.S. Attorney’s Office for the Southern District 

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of Florida was informed that the grand jury investigations were no longer covert. Accordingly, 

the United States began to take overt investigative actions, as described supra. The United 

States now seeks additional time to continue to receive and review documents and information 

from Defendants and other relevant third parties. If the Government’s investigation appears to 

corroborate the allegations of the qui tam Complaint or finds other fraud, the Government 

typically provides Defendants with a summary of its investigative findings and an opportunity to 

respond. This is a critical step to ensure that the Government has all relevant facts, to provide 

Defendants the opportunity to cooperate and remedy any fraudulent conduct, and to conserve 

judicial and Government resources required by litigation. These steps are necessary for the 

United States to fully evaluate Relator’s allegations and reach an informed decision concerning 

intervention. 

The United States also moves this Court to keep the Complaint and other filings under 

seal during the requested extension. There are sound reasons for keeping qui tam complaints 

under seal while the Government pursues its investigation, evaluates the evidence, and 

determines whether to intervene. Keeping the qui tam complaint under seal allows the 

Government an adequate opportunity to fully evaluate the private enforcement suit and 

determine both if the suit involves matters the Government is already investigating and whether 

it is in the Government’s interest to intervene and take over the civil action.

III. CONCLUSION

For the foregoing reasons, the United States respectfully requests an extension of time of

six months, up to and including July 13, 2022, within which it is required to notify the Court of 

its decision regarding intervention in the qui tam action, and during which period the Complaint 

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and other documents filed in this matter shall remain under seal.1 

Dated: January 12, 2022 Respectfully submitted,

JUAN ANTONIO GONZALEZ

United States Attorney

Southern District of Florida 

By: 

ROSALINE CHAN 

Assistant United States Attorney 

Fla. Bar No. 1008816 

United States Attorney’s Office

99 N.E. 4th Street, Third Floor 

Miami, Florida 33132 

Telephone: (305) 961-9335 

Facsimile: (305) 530-7139 

Rosaline.Chan@usdoj.gov 

JAMIE ANN YAVELBERG 

PATRICIA L. HANOWER 

SAMSON O. ASIYANBI 

Commercial Litigation Branch 

United States Department of Justice 

175 N Street, N.E., Suite 10.1305 

Washington, D.C. 20008 

Tel: (202) 353-1053 

Samson.Asiyanbi2@usdoj.gov 

Attorneys for United States of America 

1 The United States also notes that reporting requirements for FCA qui tam actions have recently 

changed. During proceedings of the Judicial Conference of the United States in March 2015, the 

Conference agreed to a Department of Justice proposal to amend the Civil Justice Reform Act 

(“CJRA”) reporting instructions to provide that the “pending date” for qui tam cases brought 

under the FCA be the date on which the case is first unsealed by the court. DOJ asked that the 

pending date be changed in this manner to ensure that CJRA reporting requirements do not enter 

into the decision of when to unseal the matter. Following the Conference’s adoption of this 

recommendation, FCA cases initially filed under seal no longer appear on pending case reports 

until such time as they are unsealed by the court. 

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