UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
UNITED STATES ex rel. GERALDINE
PETROWSKI,
Plaintiff,
v.

CASE NO: 8:15-CV-1408-T-30JSS

EPIC SYSTEMS CORPORATION,
Defendant.
____________________________________/

ORDER
THIS CAUSE comes before the Court upon Defendant’s Motion to Dismiss (Dkt. 46)
and Relator’s Memorandum of Law in Opposition (Dkt. 52). The Court, upon review of the
motion, response, and being otherwise advised in the premises, concludes that the motion
should be granted. As discussed more thoroughly below, the Court concludes that Relator
Geraldine Petrowski has failed to meet the heightened pleading requirement for claims
alleging fraud and that this conclusion alone warrants dismissal of her claims alleging False
Claim Act violations. Accordingly, the second amended complaint will be dismissed with
prejudice.
FACTUAL BACKGROUND
The following facts are taken from the second amended complaint (Dkt. 23). Relator
Geraldine Petrowski was employed by WakeMed Health, a healthcare provider, from
September 2008, to June 2014. Defendant Epic Systems Corporation offers health care

 software that supports healthcare providers in their provision of patient care. Epic also offers
billing systems that allow health care providers to generate bills that can be sent to private
insurers and/or government health care program payors, including Medicare and Medicaid.
During the relevant time, Petrowski worked for WakeMed Health as the Supervisor
of Physician’s Coding. WakeMed Health utilized Epic’s billing software. Petrowski served
as the hospital liaison regarding Epic’s implementation of its software at WakeMed Health.
Petrowski alleges that Epic’s software incorrectly bills anesthesia charges. Petrowski does
not allege specific dates as to when Epic’s software was implemented at WakeMed Health.
She alleges that she trained at Epic’s Wisconsin location for a week. She was trained on
Epic’s “Resolute Billing Charge Capture system.” (Dkt. 23 at ¶11). After the training, she
became certified as a “Charge Capture Analyst for Epic’s 2012 and 2014 systems in order
to more readily assist Epic’s implementation of its software with . . . WakeMed Health.” Id.
As part of this effort, Petrowski was involved in deciding which CPT codes to load,
“ensuring that pricing was correct, and verifying that documentation was completed and it
triggered the correct code which mapped to the same code on the claim form.” Id.1
Petrowski alleges that she “worked vigorously to ensure that Epic’s software code
regarding anesthesia billing and coding complied with Medicare and Medicaid guidelines.”
During “this process” she developed concerns regarding incorrect billing practices that were
caused by Epic’s billing software. Id. at ¶12. She avers that, effective January 1, 2012,

1

These allegations do not contain any specific dates as to when these events occurred.
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 Medicare changed its billing and reimbursement practices regarding anesthesia services. The
“units to be billed” required actual minutes, instead of the prior practice of 1 unit equaling
15 minutes. The new regulations provided that only the physician’s actual time on the
procedure should be submitted/billed on the claim form. Petrowski alleges that Epic’s
software, however, allowed hospitals to set up their anesthesia billing modules to include the
sum of the actual time, plus the base unit time. This resulted in the provider being
reimbursed twice for the base unit component. Id. at ¶13.
According to the second amended complaint, “[Petrowski] went so far as providing
examples to [Epic] representatives illustrating this unlawful practice.” Epic told her that “all
other hospitals are billing base units.” Petrowski “finally succeeded in forcing [Epic] to take
out the base units submission from the hospital’s anesthesia billing module, but once again
was told that they have ‘built all other systems with this feature included.’” Id. at ¶15.
Petrowski “believes” that Epic’s software continues to double bill for anesthesia services.
She alleges that it is “probable” that most of Epic’s software customers are using Epic’s
billing software “as written to double bill anesthesia.” Id. at ¶¶16-17. Petrowski does not
allege when any of these events took place.

She also does not identify the Epic

“representatives” she spoke to about the alleged unlawful billing practice.
The second amended complaint states that “The Epic Handbook on Billing Anesthesia
indicates that Epic continues to improperly include base units in its billing protocol thereby
resulting in overbilling of payors including Medicare and Medicaid.” Id. at ¶20. And that
this “unlawful billing protocol has resulted in the presentation of hundreds of millions of
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 dollars in fraudulent bills for anesthesia services being submitted to Medicare and Medicaid
as false claims.” Id. at ¶21.
The second amended complaint alleges three claims under the False Claims Act
(“FCA”). Each claim incorporates the prior claim’s allegations. Also, though pled as distinct
claims under the FCA, each claim alleges the same six paragraphs of legal conclusions. For
example, each claim, after incorporating by reference the allegations in each of the preceding
paragraphs, states: “As set forth above, Defendant knowingly, or acting with deliberate
ignorance and/or reckless disregard of the truth, made false representations about the
software it provided which led to fraudulent double billing of anesthesia.” Id. at ¶¶¶ 2, 8, 14.
Epic moves to dismiss the second amended complaint in its entirety.2 Epic argues, in
relevant part, that the claims fail to plead fraud with particularity under Federal Rule of Civil
Procedure 9(b), as required for FCA claims. The Court agrees.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(6) allows a complaint to be dismissed for
failure to state a claim upon which relief can be granted. When reviewing a motion to
dismiss, a court must accept all factual allegations contained in the complaint as true, and
view the facts in a light most favorable to the plaintiff. See Erickson v. Pardus, 551 U.S. 89,
93-94 (2007).

However, unlike factual allegations, conclusions in a pleading “are not

entitled to the assumption of truth.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009). On the

2

The United States declined to intervene in this action.
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 contrary, legal conclusions “must be supported by factual allegations.” Id. Indeed,
“conclusory allegations, unwarranted factual deductions or legal conclusions masquerading
as facts will not prevent dismissal.” Davila v. Delta Air Lines, Inc., 326 F.3d 1183, 1185
(11th Cir. 2003).
DISCUSSION
I.

The FCA
The FCA permits private individuals to file a civil action on behalf of the United

States—it is referred to as a qui tam action—against anyone (1) who knowingly presents, or
causes to be presented, a false or fraudulent claim for payment to the United States
government; (2) who knowingly makes, uses, or causes to be made or used, a false record or
statement material to a false claim; or (3) who knowingly makes, uses, or causes to be made
or used, a false record or statement material to an obligation to pay or transmit money or
property to the Government. 31 U.S.C. § 3729(a)(1)(A)-(B), (G).
The FCA was first enacted in 1863, and its purpose, “then and now, is to encourage
private individuals who are aware of fraud being perpetrated against the government to bring
such information forward.” United States ex rel. Clausen v. Laboratory Corp. of America,
Inc., 290 F.3d 1301, 1307 (11th Cir. 2002) (citing Ragsdale v. Rubbermaid, Inc., 193 F.3d
1235, 1237 n.1 (11th Cir. 1999)). To this end, the FCA provides that the government may
elect to take over the lawsuit and that the private plaintiffs who initially filed it, known as
relators, will share in the government’s recovery should there be any. 31 U.S.C. §
3730(d)(1). If the government elects not to intervene, as has happened here, a relator may
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 continue to pursue the claim individually and recover a percentage of the proceeds from any
judgment or settlement. 31 U.S.C. § 3731(d)(2).
Notably, “[l]iability under the False Claims Act arises from the submission of a
fraudulent claim to the government, not the disregard of government regulations or failure
to maintain proper internal policies.” Corsello v. Lincare, Inc., 428 F.3d 1008, 1012 (11th
Cir. 2005) (per curiam). In the healthcare context, a False Claims Act violation typically
involves billing for services not provided or not medically necessary. U.S. ex rel. Sanchez
v. Lymphatx, Inc., 596 F.3d 1300, 1302 (11th Cir. 2010) (per curiam).
II.

Rule 8(a)(2) and Rule 9(b)
At the pleading stage, a complaint alleging violations of the FCA must satisfy two

requirements. First, the complaint must include “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Second, the complaint
must satisfy Rule 9(b)’s heightened pleading requirement for claims alleging fraud. That is,
it must “state with particularity the circumstances constituting fraud or mistake.” Fed. R.
Civ. P. 9(b).
In the Eleventh Circuit, the complaint must particularize the fraud in several important
respects:
Rule 9(b) is satisfied if the complaint sets forth (1) precisely what
statements were made in what documents or oral presentations or
what omissions were made, and (2) the time and place of each such
statement and the person responsible for making (or in the case of
omissions, not making) same, and (3) the content of such
statements and the manner in which they misled the plaintiff, and
(4) what the defendants obtained as a consequence of the fraud.
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 Ziemba v. Cascade Intern., Inc., 256 F.3d 1194, 1202 (11th Cir. 2001) (quoting Brooks v.
Blue Cross Blue Shield of Florida, Inc., 116 F.3d 1364, 1371 (11th Cir. 1997)).
With respect to FCA claims, the Eleventh Circuit has stated the Rule 9 pleading
requirement more succinctly: to state a claim under the FCA, “a plaintiff must plead ‘facts
as to time, place, and substance of the defendant’s alleged fraud,’ specifically ‘the details of
the defendants’ allegedly fraudulent acts, when they occurred, and who engaged in them.’”
Clausen, 290 F.3d at 1310 (quoting United States ex rel. Cooper v. Blue Cross & Blue Shield
of Fla., 19 F.3d 562, 567-68 (11th Cir. 1994)). Moreover, because liability under the FCA
attaches not to underlying fraudulent activity, but to the submission to the government of a
claim for payment, the claims submitted to the government or the statements supporting those
claims must be pled with particularity. Id. at 1312 (citing concurring sister circuits)
(emphasis in original); see also United States ex rel. Matheny v. Medco Health Solutions Inc.,
671 F.3d 1217, 1225 (11th Cir. 2012). The submission of a false claim is “the sine qua non
of a False Claims Act violation.” Clausen, 290 F.3d at 1312; Corsello v. Lincare, Inc., 428
F.3d 1008, 1012 (11th Cir. 2005).
The key inquiry is whether the complaint includes “some indicia of reliability” to
support the allegation that an actual false claim was submitted. Clausen, 290 F.3d at 1311.
One way to satisfy this requirement is by alleging the details of false claims by providing
specific billing information—such as dates, times, and amounts of actual false claims or
copies of bills. See Hopper v. Solvay Pharm., Inc., 588 F.3d 1318, 1326 (11th Cir. 2009).
-7-

 Alternatively, the Eleventh Circuit has deemed indicia of reliability sufficient where the
relator alleged direct knowledge of the defendant’s submission of false claims based on her
own experiences and on information she learned in the course of her employment. See U.S.
ex rel. Walker v. R&F Props. Of Lake Cty., Inc., 433 F.3d 1349, 1360 (11th Cir. 2005).
However, the basis of this direct knowledge must be pled with particularity. See Sanchez,
596 F.3d at 1302-03, n.4.
III.

Analysis
The second amended complaint lacks the “indica of reliability” required to state a

claim under the FCA. As Epic points out in its motion, despite labeling each Count under
a different section of the FCA, Petrowski parrots the language of 31 U.S.C. § 3729(a)(1)(A)
for each Count, asserting that Epic purportedly “made false representations about [its]
software” and “presented or caused to be presented, a false or fraudulent claim for payment
. . .” “[a]s set forth above.” Yet, there are no allegations “set forth above” of representations
by Epic about its software, let alone misrepresentations to anesthesia providers or the
government. Nor are there any credible allegations that any false or fraudulent claim was
submitted to Medicare. Indeed, it is entirely unclear how Epic presented or caused to be
presented a false claim to Medicare because there are no supporting details. Petrowski does
not allege any facts about the alleged misrepresentation, like whether it was oral or written,
what it consisted of, who made it and to whom, when it was made, where it was made, what
claim was actually submitted to Medicare, by whom it was submitted, or when it was
submitted.
-8-

 In other words, the second amended complaint fails the most basic test for Rule 9(b)
particularity. See Clausen, 290 F.3d at 1310 (“a plaintiff must plead facts as to time, place,
and substance of the defendant’s alleged fraud, specifically the details of the defendant’s
allegedly fraudulent acts, when they occurred, and who engaged in them.” (internal
quotation omitted). Petrowski alleges only that Epic’s software could be used in such a way
that would allow its hospital customers to generate bills that cause the Medicare program to
double pay for certain aspects of professional anesthesia services. This is woefully deficient
because it is based on pure speculation. And the exhibits attached to the second amended
complaint do not fill these gaps because they do not support the allegations of purported
double-billing.3
It is important to underscore that, not only does Petrowski fail to identify specific facts
in support of Count I, she omits any allegations in support of the statutory requirements for
violations of §§ 3729(a)(1)(B) (Count II) and (G) (Count III). Thus, the allegations in
support of Counts II and III are insufficient even under the more lenient Rule 8(a)(2)
pleading requirements.
Petrowski’s training on the Epic billing software is also insufficient to state a claim
under the FCA because there are no facts as to how she knew how other healthcare providers
used the Epic billing software. Petrowski also does not allege any facts that her former

3

For example, Exhibit B appears to be a document that itemizes the receipt of payments
from Blue Cross for surgical and pathology services without any apparent reference to
anesthesia. Exhibit B does not support a plausible claim under the FCA.
-9-

 employer, WakeMed Health, actually submitted any false claims using Epic’s billing
software. Broken down, her allegations amount to no more than an assertion that the Epic
software theoretically could have been used to lead to incorrect billing.
In sum, the second amended complaint falls woefully short of stating a claim under
the FCA and will be dismissed with prejudice. Notably, Petrowski did not seek leave to
further amend her complaint. And her response in opposition to Epic’s motion to dismiss
does not request dismissal without prejudice to amend her complaint. Nor does her response
identify any further allegations in support of her claims that would make amendment
worthwhile. See Long v. Satz, 181 F.3d 1275, 1279-80 (11th Cir. 1999) (per curiam) (noting
that to properly request leave to amend, a plaintiff must (1) file a motion for leave to amend,
and (2) “either set forth the substance of the proposed amendment or attach a copy of the
proposed amendment.”); see also Wagner v. Daewoo Heavy Indus. Am. Corp., 314 F.3d 541,
542 (11th Cir. 2002) (en banc) (holding that a “district court is not required to grant a
plaintiff leave to amend his complaint sua sponte when the plaintiff, who is represented by
counsel, never filed a motion to amend nor requested leave to amend before the district
court.”).
It is therefore ORDERED AND ADJUDGED that:
1.

Defendant’s Motion to Dismiss (Dkt. 46) is granted.

2.

This action is dismissed with prejudice as to Relator Geraldine Petrowski. The
dismissal is without prejudice as to any FCA claims the United States may
assert against Defendant Epic Systems Corporation.
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 3.

The Clerk of Court is directed to close this case and terminate any pending
motions as moot.

DONE and ORDERED in Tampa, Florida on February 6, 2018.

Copies furnished to:
Counsel/Parties of Record

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