Court Opinion

ID: 2660070
Source: CourtListenerOpinion
Date Created: 2014-04-03 04:06:22.173796+00
Date Added: 2024-06-11T13:02:44.491502
License: Public Domain

UNITED STATES DISTRICT COURT
                    FOR THE DISTRICT OF COLUMBIA
________________________________
                                  )
UNITED STATES ex rel.            )
ZIAD AKL, M.D.,                  )
                                  )
                Plaintiff,        )
                                 ) Civ. Action No. 12-03 (EGS)
     v.                           )
                                  )
VIRGINIA HOSPITAL CENTER–        )
ARLINGTON HEALTH SYSTEM          )
                                  )
                Defendant.        )
________________________________)

                       MEMORANDUM OPINION

     Relator-Plaintiff Ziad Akl, M.D., brings a qui tam action

against the Virginia Hospital Center-Arlington Health System

(“Defendant” or “VHC” or the “Hospital”) for allegedly filing

false cost reports with the United States Government in

violation of the False Claims Act (“FCA”), 31 U.S.C. § 3729.

The United States has declined to intervene.    See Notice of

Election to Decline Intervention. No. 12-cv-3, ECF No. 3.

Defendant has moved to dismiss the complaint.    Upon

consideration of Plaintiff’s complaint, Defendant’s motion to

dismiss, Plaintiff’s opposition and Defendant’s reply thereto,

the relevant case law, and the entire record, the Court hereby

GRANTS Defendant’s motion to dismiss Plaintiff’s complaint.

                                1
I.   BACKGROUND

     Dr. Akl is a physician specializing in internal medicine

and infectious diseases who is licensed to practice in the

District of Columbia, Virginia, and Maryland.    Compl. ¶ 6.   He

practiced medicine at VHC from September 2000, Compl. ¶ 10, to

August 3, 2004, 1 when the Hospital revoked his staff appointment,

Compl. ¶ 45.

     A.   Akl I

     On November 17, 2004, Dr. Akl filed a complaint against

Defendant in a case captioned Akl v. Virginia Hospital Center

Arlington Health System et al., Chancery No. 04-722A (“Akl I”), 2

in the Arlington County Circuit Court of Virginia.    Def.’s MTD,

Ex. B at 2.    Plaintiff alleged, inter alia, that Defendant’s

termination of his medical staff privileges violated his right

to due process, id. at 11-14; that Defendant tortiously

interfered with his “contractual relationship or business

expectancy with the Hospital and his patients,” id. at 15; that

1
  Paragraph 45 of the Complaint states that Plaintiff’s staff
appointment was revoked on August 3, 2006, but this seems to be
a typographical error in light of the sequence of foregoing
events, which all occurred in 2004.
2
 The Court will adopt the sequential naming scheme (e.g., “Akl
I,” “Akl II”) that parties use in their briefing to refer to
prior cases. Though only some of Mr. Akl’s actions are detailed
below, he has filed 12 previous suits in state and federal
courts in Maryland, Virginia, and the District of Columbia
arising out of his termination. Def.’s MTD at 1-2.

                                  2
Defendant breached its Medical Credentials Policy, id. at 16;

and that Defendant defamed him, id. at 17.

      On April 22, 2005, the sustained the Hospital’s demurrer

and dismissed Plaintiff’s due process and tortious interference

with contract claims with prejudice, and his defamation claim

without prejudice.   Id. at 21-22.   The court overruled the

Hospital’s demurrer as to Plaintiff’s breach of contract claim.

Id.   Dr. Akl subsequently filed an amended motion for judgment

on his remaining claims.   See Def.’s MTD, Ex. D.

      In response to “Plaintiff’s claims that the [hospital’s]

review panel was ‘fictitious’ or otherwise biased by virtue of

conflicts of interest,” Def.’s MTD, Ex. D. at 18, the court

conducted an in camera review of privileged documents regarding

Defendant’s review process leading up to its decision to revoke

Plaintiff’s staff appointment.   On February 10, 2006, the court

found that the documents showed that the review process and

investigation were “substantial” and that the evidence directly

refuted Dr. Akl’s claims to the contrary.    Id. at 19.   Dr. Akl

then moved for nonsuit on his remaining claims, which the court

granted in an October 2, 2006 order.    Id. at 28-29.   Plaintiff

was also ordered to pay Defendant $616,114.41 in attorney’s fees

and costs.   Id. at 33.

      On April 11, 2007, the Virginia Supreme Court refused

Plaintiff’s appeal, finding “no reversible error in the judgment

                                 3
complained of.”      Ex. D at 36.   Plaintiff then filed a petition

for writ of certiorari contesting the lower court decision with

the United States Supreme Court, which was denied on October 1,

2007.     Petition for Writ of Certiorari, Akl v. Virginia Hosp.

Ctr., 552 U.S. 887 (2007) (No. 07-39), 2007 WL 2000015, at *i;

Def.’s MTD, Ex. F at 39.

     B.      Akl V

     Dr. Akl again filed suit in the Arlington County Circuit

Court against the Hospital in 2006 in a case captioned Akl v.

Virginia Hospital Center et. al., Case No. CL06-633 (“Akl V”).

Def.’s MTD, Ex. F at 2.      In Akl V, Plaintiff again challenged

the revocation of his medical staff privileges at the Hospital

and raised claims of intentional misconduct, id. at 24;

defamation, id. at 26; tortious interference with economic

relationships, id. at 28; intentional infliction of emotional

distress, id. at 30; and civil conspiracy, id. at 31.       In an

order dated August 17, 2006, the court granted VHC’s demurrer as

to all five claims and dismissed the case in its entirety.       Id.

at 33-34.     Dr. Akl appealed; the Virginia Supreme Court denied

his appeal on December 11, 2006.         Id. at 37.

     C.      Akl VII

     On January 25, 2007, Dr. Akl filed Akl v. Va. Hosp. Ctr.

(No. 1:07-cv-73-CMH) (“Akl VII”) in the United States District

Court for the Eastern District of Virginia alleging violations

                                     4
of due process, Def.’s MTD, Ex. H at 25; equal protection, id.

at 29; Section 1 of the Sherman Act, id. at 30; breach of

contract, id. at 38; defamation, id. at 40; actual fraud, id. at

48; aiding and abetting fraud, id. at 54; civil conspiracy, id.

at 55; and tortious interference with economic relationships,

id. at 57.    He requested, inter alia, that the court void

Defendant’s revocation of his staff appointment at the hospital.

Id. at 63.    On July 18, 2007, the court granted Defendant’s

motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6) on all

counts.    Id. at 65.

      Plaintiff appealed that decision to the Fourth Circuit on

February 26, 2009.      Ex. H at 105.    On April 16, 2009, the Fourth

Circuit issued an order upholding the district court’s decision.

Id. at 106.

      D.    The Current Action

      On January 3, 2012, Plaintiff filed a sealed complaint

against Defendant in this Court.        See Compl. at 1.   Plaintiff

alleges that between 2003 and 2010, Defendant certified in its

annual cost reports to the Department of Health and Human

Services (“HHS”) that it had complied with all Medicare

conditions of participation, in violation of the FCA.         Compl. ¶

83.   Plaintiff contends that as a condition of participating in

Medicare, Defendant is required to enforce its own policies

under 42 C.F.R. § 482.22(c).      Compl. ¶ 85.    He argues that

                                    5
Defendant violated these conditions, thus rendering the

certifications false, when it knowingly (1) did not investigate

Plaintiff’s complaints against certain nurses in 2003, and (2)

conducted a “fictitious and forged” peer-review of Plaintiff’s

behavior before revoking his staff appointment with the Hospital

in 2004.    Compl. ¶¶ 87-88.   Plaintiff also claims that because

the peer-review was conducted improperly, Plaintiff is

technically still a member of the hospital staff.     See Compl. ¶

71.   Thus, Plaintiff alleges that in 2004, 2006, and 2010,

Defendant falsely reported to the National Practitioner Data

Bank of the HHS that Plaintiff’s staff appointment had been

revoked, in violation of 18 U.S.C. § 1001.     Compl. ¶¶ 67-70.   As

a result, Plaintiff argues that each certification of compliance

submitted by the Hospital between 2003 and 2010 is false in

light of Defendant’s alleged failure to abide by its own

policies.    Compl. ¶ 89.   Thus, Plaintiff argues that Defendant

violated the FCA every time it submitted a Medicare

reimbursement claim between 2003 and 2010.     Compl. ¶¶ 95-97.

      On July 9, 2012, the United States announced its decision

not to intervene in the case.     Notice of Election to Decline

Intervention No. 12-cv-3, ECF No. 3.     Following that

announcement, the Court unsealed the Complaint and ordered

Plaintiff to serve Defendant on July 23, 2012.     Id.

                                   6
      The Hospital moved to dismiss Plaintiff’s complaint on

October 2, 2012 on the basis of res judicata, the applicable

statute of limitations, and failure to state a claim.    Def.’s

MTD at 3.   In support of the motion, Defendant has submitted

copies of court records from Dr. Akl’s prior state and federal

actions that purport to show that his current action is an

attempt to relitigate claims that have previously been

adjudicated on the merits and decided against him.    See Def.’s

MTD, Ex.’s A-L; see also Def.’s Reply, Ex.’s A-B.    Defendant’s

motion is ripe for determination by this Court.

II.   STANDARD OF REVIEW

      A motion to dismiss pursuant to Federal Rule of Civil

Procedure 12(b)(6) tests the legal sufficiency of a complaint.

Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002).    A

complaint must contain “a short and plain statement of the claim

showing that the pleader is entitled to relief, in order to give

the defendant fair notice of what the . . . claim is and the

grounds upon which it rests.”   Bell Atl. Corp. v. Twombly, 550

U.S. 544, 555 (2007) (internal quotation marks and citations

omitted).   While detailed factual allegations are not necessary,

plaintiff must plead enough facts “to raise a right to relief

above the speculative level.”   Id.

      “In determining whether a complaint states a claim, the

court may consider the facts alleged in the complaint . . . and

                                 7
matters of which it may take judicial notice,” Stewart v. Nat’l

Educ. Ass’n, 471 F.3d 169, 173 (D.C. Cir. 2006), including

public documents, such as court records, without converting the

motion to dismiss into a motion for summary judgment, Pearson v.

District of Columbia, 644 F. Supp. 2d 23, 45 n.19 (D.D.C. 2009).

The Court must construe the complaint liberally in plaintiff’s

favor and grant plaintiff the benefit of all reasonable

inferences that can be derived from the complaint.      Kowal v. MCI

Commc’ns Corp., 16 F.3d 1271, 1276 (D.C. Cir. 1994).     However,

the Court need not accept plaintiff’s inferences that are

“unsupported by the facts set out in the complaint.”     Id.

“[O]nly a complaint that states a plausible claim for relief

survives a motion to dismiss.”    Ashcroft v. Iqbal, 556 U.S. 662,

679 (2009).

III. DISCUSSION 3

     Defendant argues that Dr. Akl’s complaint should be

dismissed on the basis of res judicata because the allegations

upon which he bases his FCA claims arise from the same common

nucleus of fact as his prior claims against Defendant, which

were dismissed on the merits.    Def.’s Reply at 6-7.   Dr. Akl

counters that res judicata is an affirmative defense that is

3
  Because the Court finds that Dr. Akl’s claims should be
dismissed because they are barred by res judicata, it does not
reach Defendant’s other grounds for dismissal.

                                  8
generally raised in a motion to dismiss, 4 and that his FCA claims

could not have been litigated earlier, because they arise in

part from events that occurred after Plaintiff filed his earlier

cases against Defendant.   Pl.’s Opp. at 4-8.

     “Under the doctrine of res judicata, or claim preclusion, a

subsequent lawsuit will be barred if there has been prior

litigation (1) involving the same claims or cause of action, (2)

between the same parties or their privies, and (3) there has

been a final, valid judgment on the merits, (4) by a court of

competent jurisdiction.”   Capitol Hill Group v. Pillsbury,

Winthrop, Shaw, Pittman, LLC, 569 F.3d 485, 490 (D.C. Cir. 2009)

(internal citations and quotation marks omitted).   Res judicata

does not only bar claims that were brought in a finally

adjudicated suit; it also “forecloses all that which might have

been litigated previously.”   I.A.M. Nat’l Pension Fund v. Indus.

Gear Mfg., 723 F.2d 944, 949 (D.C. Cir. 1983); see also U.S. ex

rel. Folliard v. Synnex Corp., 798 F. Supp. 2d 66, 77-78 (D.D.C.

2011) (finding that a 12(b)(6) dismissal of plaintiff’s qui tam

4
  This argument is devoid of merit. Although res judicata is an
affirmative defense that is generally pleaded in a defendant’s
answer, courts have also allowed parties to assert it in a Rule
12(b)(6) motion to dismiss. See Stanton v. D.C. Ct. of Appeals,
127 F.3d 72, 76-77 (D.C. Cir. 1997) (citing cases). “Res
judicata may be raised in a Rule 12(b)(6) motion to dismiss for
failure to state a claim when the defense appears on the face of
the complaint and any materials of which the court may take
judicial notice.” Koker v. Arora Loan Serv., 915 F. Supp. 2d
51, 58 (D.D.C. 2013).

                                 9
suit precluded his second qui tam suit against the same

defendant because he could have easily brought the second suit

in his first one).

     The only issue seriously in dispute in the instant action

is whether there is a common identity of causes of action in

this case and Dr. Akl’s prior lawsuits.   Whether two cases

involve the same cause of action turns on “whether the facts are

related in time, space, origin, or motivation, whether they form

a convenient trial unit, and whether their treatment as a unit

conforms to the parties’ expectations or business understanding

or usage.”   Apotex, Inc. v. Food & Drug Admin., 393 F.3d 210,

217 (D.C. Cir. 2004) (internal citations omitted).   “There is an

identity of causes of action when the cases are based on ‘the

same nucleus of facts,’ because ‘it is the facts surrounding the

transaction or occurrence which operate to constitute the cause

of action, not the legal theory upon which a litigant relies.’”

Folliard, 798 F. Supp. 2d at 77 (citing Page v. U.S., 729 F.2d

818, 820 (D.C. Cir. 1984)).

     Based on a comparison of the complaints filed in this case

and in Akl I, Akl V, and Akl VII, the Court finds that

Plaintiff’s FCA claims here share a common factual predicate:

the allegedly fictitious peer-review process and subsequent

revocation of Plaintiff’s staff appointment at the Hospital.

The Complaint here and the complaints in Akl I, Akl V, and Akl

                                10
VII each allege that in 2000, Plaintiff obtained staff

privileges to practice at the Virginia Hospital Center in

Arlington, Virginia, see Compl. ¶ 10; Def.’s MTD, Ex. B at 5 (¶

13) (Akl I); Def.’s MTD, Ex. F at 9 (¶ 34) (Akl V); Def.’s MTD,

Ex. H at 7 (¶ 25) (Akl VII); and that a Medical Staff

Credentials Policy governed the procedure by which staff

appointments were peer reviewed, see Compl. ¶ 11; Def.’s MTD,

Ex. B at 5 (¶ 14); Def.’s MTD, Ex. F at 9 (¶ 35); Def.’s MTD,

Ex. H at 7 (¶ 26).   Moreover, each complaint alleges a forged,

fictitious, or improper peer review process leading up to the

revocation of Plaintiff’s staff appointment, see Compl. ¶ 35-38,

43-44, 46-47; Def.’s MTD, Ex. B at 9-10 (¶¶ 42-50); Def.’s MTD,

Ex. F at 16-23 (¶¶ 88-107); Def.’s MTD, Ex. H at 17-21 (¶ 93),

and that Defendant failed to abide by its own Policy in

conducting a peer review of Plaintiff’s staff appointment, see

Compl. ¶ 47; Def.’s MTD, Ex. B at 16 (¶ 92); Def.’s MTD, Ex. F

at 18-22 (¶ 103); Def.’s MTD, Ex. H at 17-21 (¶ 93).    In each

complaint, Dr. Akl alleges that he was denied adequate

opportunity to defend himself.   See Compl. ¶¶ 47, 53, 61; Def.’s

MTD, Ex. B at 11 (¶¶ 57-58); Def.’s MTD, Ex. F at 18-22 (¶ 103);

Def.’s MTD, Ex. H at 17-21 (¶ 93).    Finally, Dr. Akl alleges in

each complaint that Defendant filed false reports with the

National Practitioner Data Bank regarding Plaintiff’s behavior.

See Compl. ¶ 67; Def.’s MTD, Ex. B at 17 (¶ 98); Def.’s MTD, Ex.

                                 11
F at 28 (¶ 134); Def.’s MTD, Ex H at 41 (¶ 225).    Because

Plaintiff’s FCA claims here arise from a set of alleged facts

that are “related in time, space, origin, [and] motivation,”

Apotex, 393 F.3d at 217, to those that Plaintiff alleged in

three prior lawsuits against Defendant, the Court finds that all

four cases share the same cause of action.

     Plaintiff’s argument that his FCA claims arise in part from

facts that had not occurred by the time he had filed his earlier

lawsuits also fails.    In Folliard, this Court barred a second

suit by a plaintiff-relator when “a brief perusal of relator’s

complaints reveal[ed] that he had all of the information he

needed to bring both suits at the time he brought the first.”

798 F. Supp. 2d at 78.    The same is true here.   Dr. Akl alleges

that Defendant falsely reaffirmed the accuracy of false reports

that it filed prior to 2007 in 2010, see Compl. ¶¶ 67-69, and

that doing so was, by itself, a false statement, Compl. ¶ 70.

The only way that Defendant’s 2010 statement could have been

false is if the earlier reports to which it referred were also

false.    Plaintiff had alleged the existence of these pre-2007

reports in his complaint in Akl VII.    Def.s’ MTD, Ex. H at 41 (¶

225).    Therefore, like the relator-plaintiff in Folliard, when

Plaintiff filed Akl VII in 2007, he already had all of the

information he needed to bring an FCA claim.

                                 12
IV.   CONCLUSION

      Dr. Akl has already had numerous opportunities to present

his claims arising out of his termination from Virginia Hospital

Center in state and federal court.    That he has never before

brought claims under the False Claims Act does not save the

present action because he was required to bring in a single suit

all claims arising from the termination of his staff privileges.

U.S. Indus. v. Blake Constr. Co., 765 F.2d 195, 203 (D.C. Cir.

1985).    Dr. Akl’s claims are thus barred by res judicata.   The

Court will therefore GRANT Defendant’s motion to dismiss and

hereby DISMISS Plaintiff’s complaint with prejudice.    An

appropriate Order accompanies this Memorandum Opinion.

      SO ORDERED.

SIGNED:    Emmet G. Sullivan
           United States District Court Judge
           September 16, 2013

                                 13