NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 23 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
RALPH VASSALLO, Relator; et al., No. 19-15225
Plaintiffs-Appellants, D.C. No. 2:15-cv-00119-SRB
v.
MEMORANDUM*
RURAL/METRO OPERATING
COMPANY LLC; RURAL/METRO
(DELAWARE) CORPORATION,
Defendants-Appellees,
v.
UNITED STATES OF AMERICA,
Movant.
Appeal from the United States District Court
for the District of Arizona
Susan R. Bolton, District Judge, Presiding
Argued and Submitted March 4, 2020
Phoenix, Arizona
Before: HAWKINS, CLIFTON, and OWENS, Circuit Judges.
Relators Ralph Vassallo and Laura Spahn appeal from the district court’s
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
summary judgment in favor of Defendants-Appellants Rural/Metro Operating
Company LLC and Rural/Metro Corporation in this qui tam action under the False
Claims Act (FCA). We have jurisdiction under 28 U.S.C. § 1291. As the parties
are familiar with the facts, we do not recount them here. We affirm.
We review de novo the district court’s interpretation of the FCA as well as
its grant of summary judgment. See United States v. Bourseau, 531 F.3d 1159,
1164 (9th Cir. 2008); U.S. ex rel. Aflatooni v. Kitsap Physicians Serv., 314 F.3d
995, 1000 (9th Cir. 2002). The elements of FCA liability are: “(1) a false
statement or fraudulent course of conduct, (2) made with scienter, (3) that was
material, causing (4) the government to pay out money or forfeit moneys due.”
U.S. ex rel. Hendow v. Univ. of Phoenix, 461 F.3d 1166, 1174 (9th Cir. 2006).
Relators argue: (1) that the district court articulated the wrong standard for
scienter under the FCA, and (2) that there was sufficient evidence of scienter to
defeat summary judgment. To satisfy the scienter requirement, Relators must
show that Rural/Metro acted “knowingly” when it submitted false claims or made
false statements. See 31 U.S.C. § 3729(a)(1). The FCA provides three alternative
standards for “knowing” and “knowingly”: (1) “actual knowledge,” (2) “deliberate
ignorance of the truth or falsity of the information,” and (3) “reckless disregard of
the truth or falsity of the information.” Id. § 3729(b)(1)(A).
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Viewing the facts in the light most favorable to Relators, and drawing all
justifiable inferences in Relators’ favor, a de novo review of the record indicates
that, under any standard relating to scienter, Relators have failed to demonstrate
any genuine issues of material fact. See Kitsap, 314 F.3d at 1000. As for
deliberate ignorance, the district court correctly concluded that Relators’ evidence
of “inexperienced coders, glitchy billing software, imperfect training practices, and
even post-transition billing and coding errors” does not demonstrate that
Defendants sought to avoid learning about coding issues. Nor does this evidence
make out a case of reckless disregard – as the district court found, it “does little
more than second-guess the wisdom” of Rural/Metro’s compliance efforts. At
best, Relators made out a case of negligence, which is insufficient for FCA
purposes. See, e.g., Gonzalez v. Planned Parenthood of L.A., 759 F.3d 1112, 1115
(9th Cir. 2014). Accordingly, the district court’s summary judgment was
appropriate.
AFFIRMED.
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