PHILADELPHIA – A federal appellate court has affirmed a lower district court’s decision, which granted summary judgment to three health care companies and dismissed an investigator’s lawsuit, over allegations he was terminated unfairly after uncovering allegedly fraudulent actions.
On Aug. 26, the U.S. Court of Appeals for the Third Circuit judges Stephanos Bibas, Paul B. Matey and Peter J. Phipps upheld the summary judgment ruling in favor of defendants Highmark Inc., Highmark Health Options and Gateway Health Plan, and against plaintiff Alastair Crosbie.
According to the complaint, Crosbie sought damages for an incident that took place while he was in the defendants’ employ. The case explained that the defendants established a payment integrity department and hired the plaintiff, who was a fraud expert, to look into the company’s third-party medical service providers.
Through the course of the plaintiff’s investigations, he says he discovered defects in Highmark Health Options’ provider-credentialing system, and found that there was a provider who was receiving reimbursement through the defendants even though he was not an approved provider.
The plaintiff alleged he reported the issue to his supervisors and upper management, but added that his concerns were not heeded, and the plaintiff and his team made a mandatory referral about the practices to the Delaware Department of Justice’s Medicaid Fraud Control Unit. However, the defendants allegedly continued working with the unapproved provider.
The plaintiff redoubled his efforts in September or October 2018 but was terminated soon afterward, due to another female co-worker who accused him of harassment that he claims he was innocent of. The plaintiff believed that his termination was for his involvement in uncovering the misconduct of the company, rather than the harassing conduct that the co-worker had accused him of.
Crosbie then sued Gateway and Highmark under the False Claims Act for retaliation, claiming they fired him because of his fraud reports. The employers replied that the people who had decided to fire Crosbie knew nothing about his fraud reports and that they had good reason to fire him. Agreeing, the District Court granted summary judgment.
According to the U.S. District Court for the Eastern District of Pennsylvania, Crosbie had not shown that the employers’ reason for termination was a mere pretext for retaliation. This led Crosbie to appeal to the Third Circuit.
Bibas authored the Court’s ruling in this matter.
“First, Crosbie objects that the investigation was slapdash. The investigator, he says, did not follow standard procedure, interview every witness, or look at the complainant’s history of baseless allegations. But sloppiness is not enough. The question is not whether Gateway conducted the ‘best, or even a sound’ inquiry, but whether the investigation was a sham, a mere pretext to retaliate,” Bibas said.
“This investigation was far from a facade. HR received a complaint from Crosbie’s coworker. They interviewed her, Crosbie and an eyewitness who corroborated the complainant’s account. At Crosbie’s urging, they also interviewed other witnesses who were aware of past issues between Crosbie and the complainant. Perhaps they could have done more. But Crosbie fails to show that the investigation was so thoroughly flawed that a jury could find it unbelievable.”
Bibas added that an investigation’s quality or timing can support an inference of pretext only if those running the investigation know of the protected activity – and since Crosbie conceded that HR did not know about his False Claims Act reports, that team could not have been using the investigation to cover their tracks because they had no reason to think that they had tracks to cover. And because HR did not know of his reporting, it could not have fired him in retaliation.
Bibas continued that Crosbie’s cat’s paw theory of retaliatory animus, communication and reliance failed on at least two of those three prongs of proof.
“Crosbie’s cat’s paw theory fails at both the first and third prongs. On animus, he offers some disputed evidence that [Manager Jim] Burgess disliked him. But he has no evidence that Burgess wanted him fired, much less that he wanted him fired because of his False Claims Act reporting. After all, Burgess told the investigator that he would have questioned the allegations, but for Crosbie’s behavior on their phone call about the investigation,” Bibas said.
“Crosbie’s reliance problem is worse. Even if he could show that Burgess meant to retaliate, he has no evidence that Burgess’s discussion with the investigator influenced the investigation or his firing. That train had left the station long before Burgess got involved. The investigator started investigating Crosbie before she ever talked to Burgess. By the time she got to Burgess, she had questioned several witnesses, including Crosbie himself and the complainant. There is no reason to think that Burgess’s comments caused the investigation to end early or changed the decision maker’s mind. Speculation is no substitute for evidence. Because Crosbie has no evidence that Burgess played a causal role in his firing, summary judgment was proper.”
Bibas concluded that Crosbie was also not prejudiced in the discovery process.
“Yet Crosbie’s proof of prejudice is speculative at best. He gives us little reason to think that extra discovery would have changed the outcome. True, the complainant’s personnel file could show that she had a history of making unfounded complaints about her coworkers. Even so, there still would not be enough evidence to show that HR was ‘plainly wrong’ to believe her complaint. HR decided based on an investigation that involved multiple witnesses, including an eyewitness who corroborated the complainant’s story. Plus, even finding dirt on the complainant would at most suggest that she was lying, not that managers were using her complaint as a pretext to retaliate,” Bibas stated.
“Crosbie says he was fired not because of his co-worker’s harassment complaint but because he had reported possible fraud. But he fails to show that the harassment investigation was a sham. Nor does he show that Burgess manipulated the investigation to get him fired in retaliation. So we will affirm.”
U.S. Court of Appeals for the Third Circuit case 21-1641
U.S. District Court for the Eastern District of Pennsylvania case 2:19-cv-01235
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com