United States District Court, D. Massachusetts
UNITED STATES OF AMERICA ex rel. JAMES F. ALLEN, Plaintiff,
ALERE HOME MONITORING, INC., ROCHE HEALTH SOLUTIONS, INC., ADVANCED CARDIO SERVICES, CARDIOLINK CORP., MD INR, LLC, PATIENT HOME MONITORING, INC., TAMBRA INVESTMENTS, INC., and U.S. HEALTHCARE SUPPLY, LLC, Defendants.
MEMORANDUM AND ORDER
B. Saris Chief United States District Judge
a False Claims Act (“FCA”) case involving
Medicare reimbursements for at-home blood-testing kits for
patients receiving blood-thinning treatment. In August 2018,
the Court issued a memorandum and order dismissing the claims
against several Defendants, while permitting claims against
three Defendants to go forward. See generally United States
ex rel. Allen v. Alere Home Monitoring, Inc., 334
F.Supp.3d 349 (D.Mass. 2018). What follows assumes
familiarity with that decision.
to issuing the decision, the Court had twice stayed
proceedings against Defendant Tambra Investments
(“Tambra”) pending settlement discussions. The
most recent stay expired before the Court issued its
decision. But the Court's decision did not address the
claims against Tambra in light of the prior stays and the
parties' representations that they were attempting to
settle the matter.
before the Court is a motion by Relator James Allen to
enforce a purported settlement agreement, filed two days
after the Court issued its decision. Relator claims that
Tambra and he reached an enforceable settlement agreement
prior to the Court's opinion. Tambra counters that no
such agreement existed because its consent was contingent on
the government agreeing to release Tambra's corporate
officers from liability -- a proposal the government
ultimately rejected. Without an enforceable settlement
agreement, Tambra asks the Court to rule on its motion to
reasons that follow, the Court agrees with Tambra that the
parties never reached a meeting of the minds on the scope of
the release from the government that Tambra sought. Because
this was a material term of the contemplated settlement, they
did not reach an enforceable agreement. Thus, the motion to
enforce (Dkt. No. 154) is DENIED.
merits, Tambra's motion to dismiss (Dkt. No. 101) is
material facts are drawn from written communications between
the parties submitted in connection with the motion to
enforce a settlement. They are not subject to genuine
dispute. Facts relating to the underlying litigation are set
forth in more detail in the Court's prior opinion. See
Allen, 334 F.Supp.3d at 352-54.
Initial Settlement Offer
made his initial settlement offer to Tambra in a February
2018 letter, which proposes that Relator obtain a monetary
payment, and that Tambra agree to allow the blood testing at
issue in the case to be done at the frequency independently
chosen by a prescribing physician. Dkt. No. 155-1 at 3. In
exchange, Tambra would receive a “release of all
claims of the United States related to conduct alleged
by the Amended Complaint through the date of the settlement
agreement.” Id. (emphasis added).
letter contains a full paragraph describing the importance of
government approval to the settlement process. Relator stated
that “the United States remains the real party in
interest in this action, and any proposed settlement will
require the consent of the Department of Justice.”
Id. at 2. The letter later reiterated that the
settlement proposal “is necessarily contingent upon
approval from the Department of Justice.” Id.
attorneys for Relator and Tambra continued to negotiate the
terms of a possible monetary payment into March and April
2018. In a March 2018 email, Tambra's counsel proposed a
monetary payment in exchange for “a broad mutual
release” and the dismissal of the case against Tambra
with prejudice. Dkt. No. 198-1 at 13. Relator's attorney
said these terms were “generally fine (subject, as
always, to the government's blessing).”
Id. In a subsequent March 2018 settlement offer,
Tambra's counsel again stated, “Naturally there
must be a full release and dismissal with prejudice.”
Id. at 12.
April 2018, the parties jointly asked the Court for a stay.
Dkt. No. 128. Tambra's counsel wrote, “I agree with
the idea of staying as to [Tambra] so we can close on
settlement.” Dkt. No. 155-2 at 3. At this juncture,
Relator's counsel remained cognizant of the fact that the
parties would still need “to get [the settlement
agreement] by the government.” Id. This
understanding was also reflected in the motion for a stay.
Dkt. No. 128 ¶¶ 2-6. The motion stated,
“Allen and [Tambra] agree that, if for some reason, the
government objects to the settlement and the settlement
cannot be effectuated, the stay may be lifted, and the case
against [Tambra] will proceed . . . .” Id.
¶ 8. The Court allowed the motion. Dkt. No.
April and May 2018, the federal government became involved in
the settlement talks. See Dkt. No. 168-4 at 1; Dkt.
No. 198-1 at 5. The parties agreed to begin drafting a
settlement agreement using a government template. Dkt. No.
198-1 at 5. The government later provided Tambra's
counsel with a first draft of a proposed settlement
agreement, cautioning that the settlement “remain[ed]
currently under consideration by the United States.”
Dkt. No. 168-4 at 1.
2018, the government “approved the settlement
parameters.” Dkt. No. 155-3 at 2. The agreement still
lacked “[f]inal approval” from the Department of
Justice (“DOJ”) and the United States
Attorney's Office, but such approval could come only
after Relator and Tambra finalized the draft from their end.
the same time, the parties' initial 60-day stay expired.
They sought, and received, a second stay on June 4, 2018.
Dkt. Nos. 151, 152.
2018, settlement discussions faltered. On July 3, 2018,
counsel for Tambra sent a redline draft of the settlement
agreement to the assistant United States attorney working on
the case. Dkt. No. 168-5 at 2. In the email accompanying the
draft, Tambra's attorney stated that his “primary
concern relate[d] to the scope of the release.”
Individual officers, directors, and employees, acting in
their respective corporate capacities, need to be included in
the scope of the release. I can't have a world where the
company is dismissed and released, and then one week later,
the officers, directors, and employees are sued for the exact
same thing. Need to include everyone.
Id. Counsel for Relator was copied on this email.
an hour later, the government's attorney responded (again
copying Relator's counsel), stating that
“many” of Tambra's proposed edits remained
“very problematic” for the government. Dkt. No.
168-6 at 2.
5, 2018, the government's attorney sent a new draft. Dkt.
No. 168-7 at 2. Despite the government's prior email,
this version accepted Tambra's proposed release
for officers and directors. Id. However, the
government's email again concluded with the caveat that
DOJ would still need to review and accept the draft
agreement. Id. Relator's attorney, who was
copied on this email, approved the new draft. Id. at
6, 2018, the government's attorney retracted his
acceptance of the release. Dkt. No. 168-9 at 2. He informed
the parties that releasing the individual officers or
directors would violate a DOJ policy instituted in a 2015
memorandum by former Deputy Attorney General Sally Yates.
Id. He ...