Kuriyan v. HCSC Insurance Services et al

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
UNITED STATES OF AMERICA and
STATE OF NEW MEXICO ex rel.
JACOB KURIYAN,
Plaintiffs,
vs. No. CIV 16-1148 JB/KK
MOLINA HEALTHCARE OF NEW MEXICO,
INC.; PRESBYTERIAN HEALTH PLAN,
INC.; UNITEDHEALTHCARE OF NEW
MEXICO, INC., and HCSC INSURANCE
SERVICES CO. dba BLUE CROSS & BLUE
SHIELD OF NEW MEXICO,
Defendants.
MEMORANDUM OPINION1
THIS MATTER comes before the Court on Plaintiff/Relator Jacob Kuriyan’s Motion to
Alter or Amend the Judgment, and for Relief from a Judgment and Order, filed September 10,
2024 (Doc. 457)(“Motion to Amend”). The Court holds a hearing on October 25, 2024. See
Clerk’s Minutes at 1, filed October 25, 2024 (Doc. 470). The primary issues are: (i) whether the
Court should amend its Final Judgment, filed August 30, 2024 (Doc. 456), to allow Kuriyan’s
Counts I, II, and III, to proceed, because, according to Kuriyan, the Court has not properly
dismissed those Counts; and (ii) whether the Court should amend its Final Judgment to allow
Kuriyan’s Count IV to proceed, because, according to Kuriyan, the Court does not interpret the
New Mexico Fraud Against Taxpayers Act (“NMFATA”) correctly. The Court concludes that: (i)
1 On September 29, 2025, the Court enters an Order denying Plaintiff/Relator Jacob
Kuriyan’s Motion to Alter or Amend the Judgment, and for Relief from a Judgment and Order,
filed September 10, 2024 (Doc. 457). See Order at 1-2, filed September 29, 2025 (Doc. 469). In
the Order, the Court states that it will “issue a Memorandum Opinion at a later date more fully
detailing its rationale for this decision.” Order at 1 n.1. This Memorandum Opinion is the
promised opinion.
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rules 59 and 60 of the Federal Rules of Civil Procedure do not permit amendment of the final
Judgment as to Kuriyan’s Counts I, II, and III, because Kuriyan’s attorney states that Kuriyan is
not pursuing those Counts; and (ii) rules 59 and 60 of the Federal Rules of Civil Procedure do not
permit amendment of the Final Judgment as to Kuriyan’s Count IV, because the Court commits
no error in its interpretation of the NMFATA.
PROCEDURAL BACKGROUND
For several years, Kuriyan brought claims against the Defendants as a pro se party. See
Complaint at 1, filed October 18, 2016 (Doc. 1). As a result, the case is assigned to Magistrate
Judge Kirtan Khalsa. It is not until 2019 that Kuriyan retains his first attorney, Bryan Davis. See
Entry of Appearance at 1, filed January 14, 2019 (Doc. 19). Soon thereafter, Mr. Joel Androphy
substitutes as Kuriyan’s new counsel. See Motion to Substitute Counsel at 1, filed February 20,
2019 (Doc. 20).
On March 12, 2021, Magistrate Judge Khalsa enters the Agreed Order Staying Discovery
(Doc. 194). In the Agreed Order Staying Discovery, Magistrate Judge Khalsa stays discovery with
respect to the MCO Defendants pending the resolution of Kuriyan’s motion for an award from an
alternate remedy dispute. See Agreed Order Staying Discovery at 1.
On July 7, 2022, the United States files the United States’, the State of New Mexico’s, and
New Mexico Human Services Department’s Motion to Dismiss Relator’s Qui Tam Action under
the Public Disclosure Bar (Doc. 303)(“Public Disclosure MTD”). In the Public Disclosure MTD,
the United States seeks dismissal, because Kuriyan “is not an original source of the allegations in
his complaints.” Public Disclosure MTD at 2. Further, the United States argues that dismissal is
appropriate, because Kuriyan does not have knowledge or information about the Defendants’
scienter. See Public Disclosure MTD at 2. That same day, the United States files the United States
and the State of New Mexico’s Motion for Summary Judgment on Relator’s Demand for an
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Alternate Remedy and Memorandum in Support, filed July 7, 2022 (Doc. 305)(“Alternate Remedy
MSJ”). In the Alternate Remedy MSJ, the United States argues that to have a successful alternate
remedy theory, Kuriyan is required to prove that the New Mexico Human Services Department
recouped money from Defendants for or to prevent the same type of fraud or falsity that the FCA
and the NMFATA recognize and that the New Mexico Human Services Department used
Kuriyan’s information to recoup the funds at issue from the Defendants. See Alternate Remedy
MSJ at 1-2. It is the United States’ position that there is no evidence supporting either part of this
test. See Alternate Remedy MSJ at 2.
On August 28, 2023, Magistrate Judge Khalsa files the Proposed Findings and
Recommended Disposition (Doc. 409)(“PFRD”). In the PFRD, Magistrate Judge Khalsa
concludes that, as a matter of law, the False Claims Act’s, New Mexico Medicaid False Claims
Act’s, and New Mexico Fraud Against the Taxpayers Act’s public disclosure bars apply to
Kuriyan’s claims, and that Kuriyan has not presented evidence from which a reasonable jury could
conclude that he was an original source. See PFRD at 15. Magistrate Judge Khalsa also concludes
that Kuriyan has no right to recover a portion of any alternate remedy because the public disclosure
bars in the FCA, NMMFCA, and NMFATA bar his claims. See PFRD at 31. In the alternative,
Magistrate Judge Khalsa recommends that the Court grant the United States’ Alternate Remedy
MSJ:
In sum, Relator has failed to present sufficient evidence to allow a
reasonable juror to find that HSD’s reconciliation and recoupment processes had
been completed by the time he presented his MLR analysis, that his MLR analysis
had an impact on HSD’s or Mercer’s calculations or processes, or that HSD or
Mercer recouped monies based on his MLR analysis but hid that fact by attributing
the recoupments to the risk corridor or other calculations. He has therefore failed
to rebut the Government’s evidence to the contrary or show a triable issue of fact.
See Tesone, 942 F.3d at 994 (nonmovant who would bear burden of persuasion at
trial must adduce evidence creating question of fact to overcome movant’s evidence
negating an essential element of nonmovant’s claim). I therefore recommend that,
if it finds the Government’s Alternate Remedy Motion is not moot, the Court grant
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the Motion on its merits and enter summary judgment in the Government’s favor
on Relator’s alternate remedy claims.
PFRD at 37.
On September 9, 2023, Kuriyan retains Alan Grayson. See Notice of Appearance
at 1, filed September 9, 2023 (Doc. 411). On December 20, 2023, Kuriyan, with new
counsel, files Plaintiff-Relator’s Motion for Summary Judgment on 2014 New Mexico
Medicaid Overpayments (Doc. 423)(“Kuriyan MSJ”). Here, Kuriyan seeks summary
judgment against the Defendants under the FCA. See Kuriyan MSJ at 2. Kuriyan’s
argument in favor of his motion for summary judgment is that the Defendants had a legal
obligation to return overpaid funds but failed to do so within the time allowed by the 60-
Day Rule. See Kuriyan MSJ at 2.
On August 30, 2024, the Court files its Memorandum Opinion and Order Adopting the
Magistrate Judge’s Proposed Findings and Recommended Disposition (Doc. 455)(“MOO”).
Relevant here, the Court dismisses Counts I, II, and III, without prejudice:
The Court notes, however, that, although it does not dismiss Kuriyan’s FCA
and NMMFCA claims on the basis of the Public Disclosure Motion, Kuriyan has
represented that he does not intend to proceed to trial with these claims independent
of his alternative remedy claims. See, e.g., Plaintiff/Relator Jacob Kuriyan’s
Response to Defendants’ Motion to Dismiss Relator’s 3rd Amended Complaint
[ECF 144] at 1, filed November 19, 2020 (Doc. 145)(“As a preliminary matter,
Relator does not intend to seek further damages against Defendants once his
alternate remedy dispute with the United States and State of New Mexico
(collectively, ‘the Government’) has been resolved.”). That is, at this point,
Kuriyan seeks only to share in the monies from the reconciliation process on the
basis that this process represents an alternative remedy to his fraud claims. Because
the Court grants the Defendants’ Alternative Remedy Motion, this litigation has
concluded, because Kuriyan has represented that the alternative remedy claim
represents his sole pursuit. It therefore is appropriate for the Court to enter Final
Judgment, so that Kuriyan can pursue an appeal of the Court’s ruling on the
alternative remedy issues.
MOO at 64. Further, the Court dismisses Count IV with prejudice under the NMFATA’s public
disclosure bar. See MOO at 63-64.
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On September 10, 2024, Kuriyan, now with new counsel, files Relator’s Motion to Alter
or Amend the Judgment, and for Relief from a Judgement and Order (Doc. 457)(“Motion to
Amend”). In the Motion to Amend, Kuriyan asks the Court to Amend its Final Judgment which
dismisses Counts I, II, III, and IV. See Motion to Amend at 3. First, Kuriyan argues that the Court
should amend the Final Judgment that dismisses Counts I, II, and III, because, “whatever
[Kuriyan’s] counsel may have speculated, four years ago, about the course of future litigation,
neither [Kuriyan] nor [Kuriyan’s] counsel is in a proper position to ‘waive’ a valid claim against
Defendants on behalf of the taxpayers . . . .” Motion to Amend at 7. Second, Kuriyan argues that
the Court should amend the Final Judgment that dismisses Counts I, II, and III, because Kuriyan
told his then lead-counsel not to tell the Court that Kuriyan does not want to pursue Counts I, II,
and III. See Motion to Amend at 8. Third, Kuriyan argues that the Court’s dismissal of these
Counts is improper, because “counsel could not have anticipated four years ago that document
production would yield, in a single document, demonstrable evidence of the Defendants’ FCA and
NMMFCA liability under Medicaid’s 60-Day Rule.” Motion to Amend at 9. Finally, Kuriyan
argues that the Court should amend the Final Judgment that dismisses Count IV, because the Court
does not exercise properly NMFATA’s discretion when deciding to dismiss Count IV in the MOO.
See Motion to Amend at 13.
On September 24, 2024, the United States files the Response to Relator’s Motion to Alter
or Amend (Doc. 459)(“U.S. Response”). In the U.S. Response, the United States contends that
the Court should deny the Motion to Amend, because Kuriyan seeks to proceed with claims he
does not allege in his Third Amended Complaint. See U.S. Response at 1. According to the United
States,
allowing [Kuriyan] to proceed on such claims for reconciliations unrelated to the
Medical Loss Ratio would necessarily conflict with the Court’s holdings that the
Government’s normal-course contractual reconciliation process is not an alternate
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remedy to [Kuriyan’s] claims of Medical Loss Ratio overpayments because, among
other reasons, [Kuriyan] did not allege claims for overpayments based on the
reconciliation calculation in his qui tam complaint.
U.S. Response at 2.
On September 28, 2024, Kuriyan files the Relator’s Reply to the Government’s Response
to Motion to Alter or Amend the Judgment, and for Relief from a Judgment and Order (Doc.
461)(“1st Reply”). Kuriyan states that, “aside from Footnote One, the remainder of the
Government’s so-called “response” is impenetrable nonsense that has no discernible relationship”
to the issues which the Motion to Amend raises. 1st Reply at 3. Kuriyan again argues that it is
improper for the Court to dismiss Counts I, II, and III, because Kuriyan’s former counsel makes
an unauthorized statement regarding how former counsel “prognosticated the case going forward.”
1st Reply at 2. Kuriyan also contends that it is disappointing that the United States does not address
the Court’s dismissal of Count IV in the U.S. Response. See 1st Reply at 4 (“What is particularly
unfortunate about the Government’s mumbling of obscurantist talking points is that it misses an
opportunity to address a very important issue presented by [Kuriyan’s] Motion, i.e. whether or not
dismissal of [Kuriyan’s] fourth claim comports with ‘the best interest of the parties involved and
the public purposes behind the Fraud Against Taxpayers Act.”).
On October 8, 2024, the Defendants UnitedHealthcare of New Mexico, Inc., HCSC
Insurance Services Co., Molina Healthcare of New Mexico, Inc., and Presbyterian Health Plan,
Inc., (collectively “the MCO Defendants”) file Defendants’ Joint Opposition to Relator Kuriyan’s
Motion to Alter or Amend the Judgment (Doc. 462)(“Defendants’ Response”). First, the MCO
Defendants argue that:
the Court already precluded liability against the MCOs when it held -- in a portion
of the opinion that Kuriyan does not ask the Court to reconsider -- that Kuriyan
could not establish that the $221 million in recoupments stemmed from false
certifications or improperly retained payments (as would be required for FCA,
NMMFCA, and NMFATA liability) and that those recoupments instead were part
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of the ordinary-course contractual reconciliation process. The Court’s conclusion
on that score necessarily precludes Kuriyan’s further prosecution of his fraud
claims based on the recoupments.
Defendants’ Response at 2. Second, the MCO Defendants argue that the Court should not amend
the Final Judgment as to Counts I, II, and III, because “the Court properly considered as part of its
analysis Kuriyan’s many representations in written filings and in open court that he would not
pursue any recovery against the MCOs.” Defendants’ Response at 3. Third, the MCO Defendants
contend that the Court should not amend its dismissal of Count IV, because a rule 59 or 60
amendment is not available when Kuriyan is repeating the same argument the Court already
rejects. See Defendants’ Response at 4.
On October 22, 2024, Kuriyan files the Relator’s Reply in Support of Motion to Alter or
Amend the Judgment (Doc. 469)(“2nd Reply”). In the 2nd Reply, Kuriyan concedes that his
former attorney inaccurately represents to the Court that Kuriyan does not intend to seek further
damages against MCO Defendants once the Court resolves his alternate remedy dispute with the
United States and the State of New Mexico. See 2nd Reply at 4. Kuriyan argues, however, that
the MCO Defendants take that statement out of context. See 2nd Reply at 5. Further, Kuriyan
contends that the MCO Defendant’s argument that the Court already precludes liability against the
MCOs in the MOO is unsound, because that would be the equivalent of granting a motion for
summary judgment that the Defendants do not file. See 2nd Reply at 5. Kuriyan also notes that
the Defendants do not respond to his argument that, under the FCA, the Court is the steward of the
taxpayer’s interest. See 2nd Reply at 10. Finally, Kuriyan argues that the Defendants “have
nothing to say about [Kuriyan’s] argument that there was no ‘waiver’ here because there was no
‘intentional relinquishment or abandonment of a known right.’” 2nd Reply at 11 (quoting United
States v. Olivas-Perea, 297 F. Supp. 3d 1191, 1209 (D.N.M. Oct. 31, 2017)(Browning, J).
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LAW REGARDING MOTIONS FOR RECONSIDERATION
Courts may treat motions for reconsideration as a rule 59(e) motion when the movant files
within twenty-eight days of a court's entry of judgment. See Price v. Philpot, 420 F.3d 1158, 1167
n.9 (10th Cir. 2005). If the movant files outside that time period, courts should treat the motion as
seeking relief from judgment under rule 60(b). See Price v. Philpot, 420 F.3d at 1167 n.9. “[A]
motion for reconsideration of the district court's judgment, filed within [rule 59's filing deadline],
postpones the notice of appeal's effect until the motion is resolved.” Jones v. United States, 355
F. App’x 117, 121 (10th Cir. 2009).2 Rule 59(e)’s time limit is now twenty-eight days from the
entry of a judgment. See Fed. R. Civ. P. 59(e).
Whether a motion for reconsideration is a motion under rule 59 or under rule 60 is not only
a question of timing, but also “depends on the reasons expressed by the movant.” Commonwealth
Prop. Advocs., LLC v. Mortg. Elec. Registration Sys., Inc., 680 F.3d 1194, 1200 (10th Cir. 2011).
Where the motion “involves ‘reconsideration of matters properly encompassed in a decision on
the merits,’” a court considers the motion under rule 59(e). Phelps v. Hamilton, 122 F.3d 1309,
1323-24 (10th Cir. 1997)(“Phelps”)(quoting Martinez v. Sullivan, 874 F.2d 751, 753 (10th Cir.
2Jones v. United States, is an unpublished opinion, but the Court can rely on an unpublished
United States Court of Appels for the Tenth Circuit opinion to the extent its reasoned analysis is
persuasive in the case before it. See 10th Cir. R. 32.1(A)(“Unpublished decisions are not
precedential, but may be cited for their persuasive value.”). The Tenth Circuit states:
In this circuit, unpublished orders are not binding precedent, . . . and we have
generally determined that citation to unpublished opinions is not favored.
However, if an unpublished opinion or order and judgment has persuasive value
with respect to a material issue in a case and would assist the court in its disposition,
we allow a citation to that decision.
United States v. Austin, 426 F.3d 1266, 1274 (10th Cir. 2005). The Court concludes that Jones v.
United States, United States v. Austin, and Xiong v. McCormick have persuasive value with
respect to a material issue, and will assist the Court in its disposition of this Memorandum Opinion
and Order.
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1989)). In other words, if the reconsideration motion seeks to alter the district court's substantive
ruling, then it is a rule 59 motion and is subject to rule 59's constraints. See Phelps, 122 F.3d at
1324. A court should grant a rule 59 motion if there is (i) an intervening change in the controlling
law; (ii) new evidence previously unavailable; or (iii) the need to correct clear error or prevent
manifest injustice. See Servants of the Paraclete v. Does, 204 F.3d 1005, 102 (10th Cir. 2000).
In contrast, rule 60(b) provides:
On motion and just terms, the court may relieve a party or its legal
representatives from a final judgment, order, or proceeding for the following
reasons:
(1) mistake, inadvertence, surprise, or excusable neglect;
(2) newly discovered evidence that, with reasonable diligence, could
not have been discovered in time to move for a new trial under Rule
59(b);
(3) fraud (whether previously called intrinsic or extrinsic),
misrepresentation, or misconduct by an opposing party;
(4) the judgment is void;
(5) the judgment has been satisfied, released or discharged; it is based
on an earlier judgment that has been reversed or vacated; or applying
it prospectively is no longer equitable; or
(6) any other reason that justifies relief.
Fed. R. Civ. P. 60(b).
Rule 59 and rule 60 motions for reconsideration are “inappropriate vehicles to reargue an
issue previously addressed by the court when the motion merely advances new arguments, or
supporting facts which were available at the time of the original motion.” Servants of the Paraclete
v. Does, 204 F.3d at 1012. “Grounds warranting a motion to reconsider include (1) an intervening
change in the controlling law, (2) new evidence previously unavailable, and (3) the need to correct
clear error or prevent manifest injustice.” Servants of the Paraclete v. Does, 204 F.3d at 1012.
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“[A] motion for reconsideration is appropriate where the court has misapprehended the facts, a
party's position, or the controlling law.” Servants of the Paraclete v. Does, 204 F.3d at 1012. A
district court has considerable discretion in ruling on a motion to reconsider. See Phelps, 122 F.3d
at 1324.
LAW REGARDING THE FALSE CLAIMS ACT, NEW MEIXICO MEDICAID FALSE
CLAIMS ACT, AND NEW MEXICO FRAUD AGAINST TAXPAYERS ACT CLAIMS
The False Claims Act, 31 U.S.C. §§ 3729-33 (“FCA”), “allows for the recovery of civil
penalties and treble damages from anyone who defrauds the [federal] government by submitting
fraudulent claims for payment.” United States ex rel. Reed v. KeyPoint Gov’t Sols., 923 F.3d 729,
735-36 (10th Cir. 2019)(“Reed”). See 31 U.S.C. § 3729(a)(i)(A). “Liability also attaches to
anyone who ‘knowingly makes, uses, or causes to be made or used, a false record or statement
material to a false or fraudulent claim.’” Reed, 923 F.3d at 736 (quoting § 3729(a)(1)(B)). In
addition, the FCA imposes liability for attempts to reduce an obligation owed to the United States.
U.S. ex rel. Bahrani v. Conagra, Inc., 465 F.3d 1189, 1194-95 (10th Cir. 2006)(“Bahrani”);
31 U.S.C. § 3729(a)(1)(G). Thus, “an individual who makes a material misrepresentation to avoid
paying money owed the Government would be equally liable under the Act as if he had submitted
a false claim to receive money.’” Bahrani, 465 F.3d at 1194-95 (10th Cir. 2006)(quoting S.Rep.
No. 99-345, at 18, 1986 U.S.C.C.A.N. at 5283). “To enforce its provisions, the Act empowers
individuals to file suits on behalf of the government alleging that a third party made a fraudulent
claim for payment to the government.” Reed, 923 F.3d at 736. See 31 U.S.C. § 3730(b)(1).
“These suits are known as ‘qui tam’ suits, and the individual plaintiffs are called ‘relators.’” Reed,
923 F.3d at 736.
Like the FCA with respect to the federal government, the New Mexico Medicaid False
Claims Act, N.M.S.A. §§ 27-14-1 to -15 (“NMMFCA”), and New Mexico Fraud Against
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Taxpayers Act, N.M.S.A. §§ 44-9-1 to -14 (“NMFATA”), permit a relator to bring an action on
the State of New Mexico’s behalf for false or fraudulent claims. See N.M.S.A. § 27-14-7(B); id.
§ 44-9-5. In relevant part, the NMMFCA imposes liability on one who: (i) “presents, or causes
to be presented, to the state a claim for payment under the medicaid program knowing that such
claim is false or fraudulent”; (ii) “makes, uses or causes to be made or used a record or statement
to obtain a false or fraudulent claim under the medicaid program paid for or approved by the state
knowing such record or statement is false”; or, (iii) “makes, uses, or causes to be made or used a
record or statement to conceal, avoid or decrease an obligation to pay or transmit money or
property to the state, relative to the medicaid program, knowing that such record or statement is
false.” N.M.S.A. § 27-14-4(A), (C), (E).
Similarly, the NMFATA provides, in relevant part, that a person shall not: (i) “knowingly
present, or cause to be presented, to an employee, officer or agent of the state or a political
subdivision . . . a false or fraudulent claim for payment or approval”; (ii) “knowingly make or use,
or cause to be made or used, a false, misleading or fraudulent record or statement to obtain or
support the approval of or the payment on a false or fraudulent claim”; or, (iii) “knowingly make
or use, or cause to be made or used, a false, misleading or fraudulent record or statement to conceal,
avoid or decrease an obligation to pay or transmit money or property to the state or a political
subdivision[.]” N.M.S.A. § 44-9-3(A)(1), (2), (8). Courts look to FCA case law to construe the
NMMFCA and NMFATA. See State ex rel. Foy v. Austin Capital Management, Ltd., 2015-
NMSC-025, ¶ 25, 355 P.3d 1, 9 (stating that the NMFATA “closely tracks the longstanding
federal” FCA); United States v. Dental Dreams, LLC, 307 F. Supp. 3d 1224, 1240 (D.N.M.
2018)(Herrera, J.)(“New Mexico state courts have also looked to federal precedent construing the
FCA to provide guidance on the [NM]MFCA.”); State ex rel. King v. Behavioral Home Care, Inc.,
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2015-NMCA-035, ¶ 17, 346 P.3d 377, 384, cert. dismissed, 2015-NMCERT-004, 348 P.3d 695
(Apr. 3, 2015)(same).
The FCA, NMFATA, and NMMFCA bar a relator’s claim if the claim is based on or
substantially the same as publicly disclosed allegations or transactions. See 31 U.S.C.
§ 3730(e)(4)(A); N.M.S.A. § 27-14-10(C); id. § 44-9-9(D). If the “public disclosure bar” applies,
NMFATA claims may be dismissed. N.M.S.A. § 44-9-9(D). On the other hand, the FCA and
NMMFCA provide that, even if the public disclosure bar applies, a relator may proceed with a qui
tam claim if the relator is an “original source” of the allegations in the complaint. 31 U.S.C.
§ 3730(e)(4)(A), (B). See N.M.S.A. § 27-14-10(C).
If a relator’s claims are not barred, the FCA and NMFATA provide for an award to the
relator, under certain circumstances, if the State of New Mexico obtains an award through an
“alternate remedy.” N.M.S.A. § 3730(c)(5); id. § 44-9-6(H). See generally United States ex rel.
Kuriyan v. HCSC Ins. Servs. Co., No. CIV. 16-1148, 2021 WL 5998603, at *18-21 (D.N.M. Dec.
20, 2021)(Browning, J.)(“Kuriyan I”)(discussing FCA, NMFATA, and NMMFCA). The
NMMFCA does not provide for an award to relators based on an alternate remedy. See N.M.S.A.
§ 3730; id. § 27-14-9. See United States ex rel. Kuriyan v. HCSC Ins. Servs. Co., No. CIV 16-
1148, 2022 WL 704130, at *1-3 (D.N.M. Mar. 9, 2022)(“Kuriyan II”)(discussing FCA, NMFATA,
and NMMFCA).
1. FCA.
The FCA “imposes significant penalties on those who defraud the government,” Universal
Health Servs., Inc. v. United States, 579 U.S. 176, 136 S. Ct. 1989, 1995 (2016), and imposes civil
liability on “any person who . . . knowingly presents, or causes to be presented, a false or fraudulent
claim for payment or approval,” Universal Health Servs. v. United States ex rel. Escobar, 136 S.
Ct. at 1999 (quoting 31 U.S.C. § 3729(a)). The FCA’s purpose is “encourag[ing] ‘whistleblowers
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to act as private attorneys-general’ in bringing suits for the common good.” Walburn v. Lockheed
Martin Corp., 431 F.3d 966, 970 (6th Cir. 2005)(quoting United States ex rel. Taxpayers Against
Fraud v. GE., 41 F.3d 1032, 1041-42 (6th Cir. 1994)). The FCA “limit[s] . . . the court’s power to
hear certain duplicative qui tam suits.” United States ex rel. Grynberg v. Koch Gateway Pipeline
Co., 390 F.3d 1276 (10th Cir. 2004). The FCA also recognizes the need “to discourage
opportunistic plaintiffs from bringing parasitic lawsuits whereby would-be relators merely feed
off a previous disclosure of fraud.” Walburn v. Lockheed Martin Corp., 431 F.3d at 970. See
United States ex rel. Grynberg, 390 F.3d at 1278 (noting that the FCA’s “qui tam provisions are
designed to encourage private citizens to expose fraud but to avoid actions by opportunists seeking
to capitalize on public information.”); Hill v. Vanderbilt Capital Advisors, LLC, 834 F. Supp. 2d
1228, 1242 (D.N.M. 2011)(Browning, J.).
An FCA action may commence in one of two ways. First, the United States itself may
bring an action against an alleged false claimant. See 31 U.S.C. § 3730(a). Second, a private
person -- known as a relator -- may bring a qui tam action against the alleged false claimant “for
the person and for the United States Government,” and “in the name of the Government.” 31
U.S.C. § 3730(b). “Qui tam” is short for the Latin phrase “qui tam pro domino rege quam pro se
ipso in hac parte sequitur,” which translates to “who pursues this action on our Lord the King’s
behalf as well as his own.” Vermont Agency of Nat. Res. v. United States ex rel. Stevens, 529
U.S. 765, 769, n.1 (2000). Qui tam actions “appear to have originated around the end of the 13th
century, when private individuals who had suffered injury began bringing actions to the royal
courts on both their own and the Crown’s behalf.” Vermont Agency of Nat. Res. v. United States
ex rel. Stevens, 529 U.S. at 774. Although the Attorney General may bring suit for § 3729
violations under § 3730, § 3730 states that a person may bring suit on the United States’ behalf
and that the qui tam plaintiff is entitled to a portion of the damages if the United states declines to
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intervene. See 31 U.S.C. § 3730(d). Although the United States suffers the injury, a qui tam
relator under the FCA has Article III standing to pursue their claim. See Vermont Agency of Nat.
Res. v. United States ex rel. Stevens, 529 U.S. at 777. Under the FCA, however, States are not
subject to qui tam liability. See Vermont Agency of Nat. Res. v. United States ex rel. Stevens, 529
U.S. at 783.
Under the FCA, a qui tam relator may not recover if the relator’s action relies on public
information. See 31 U.S.C. § 3730(e)(4)(A). The so-called “public disclosure bar” states that a
court “shall dismiss an action or claim under this section, unless opposed by the Government, if
substantially the same allegations or transactions as alleged in the action or claim were publicly
disclosed” in either: (i) a “Federal criminal, civil, or administrative hearing in which the
Government or its agent is a party”; (ii) “in a congressional, Government Accountability Office,
or other Federal report, hearing, audit, or investigation”; or (iii) “from the news media.” 31 U.S.C.
§ 3730(e)(4)(A). The public-disclosure bar does not bar, however, actions that the Attorney
General brings or actions that a private person who is “an original source of the information”
brings. 31 U.S.C. § 3730(e)(4)(A).
By its terms, the original-source exception contemplates that some qui tam actions should
survive the public-disclosure bar even though their allegations are “substantially the same as
publicly disclosed allegations,” because they involve information that “materially add[s]” to the
publicly disclosed information. United States ex rel. Reed v. KeyPoint Gov’t Sol. 923 F.3d 729,
757 (10th Cir. 2019). To qualify as an original source, a qui tam relator must demonstrate that:
(i) they have “direct and independent knowledge of the information on which the allegations are
based”; and (ii) they “voluntarily provided such information to the government prior to filing suit.”
United States ex rel. Precision Co. v. Koch Indus., Inc. 871 F.2d 548, 553 (10th Cir. 1992). In
other words, to recover, a qui tam relator must “bring something to the table that would add value
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for the government.” United States ex rel. Maur v. Hage-Korban, 981 F.3d 516 (6th Cir. 2020).
To meet its burden to show that it is an original source, see Kennard v. Comstock Res., Inc., 363
F.3d 1039, 1044 (10th Cir. 2004), a qui tam relator must provide more than “‘unsupported,
conclusory allegations,’” United States ex rel. Stone v. Rockwell Int’l Corp., 282 F.3d 787, 800
(10th Cir. 2002)(quoting United States ex rel. Hafter D.O. v. Spectrum Emergency Care, Inc., 190
F.3d 1156, 1162 (10th Cir. 1999)). See Kuriyan I, 2021 WL 5998603, at *38-49 (discussing FCA,
NMFATA, and NMMFCA); Kuriyan II, 2022 WL 704130, at *1-3 (discussing FCA, NMFATA,
and NMMFCA).
2. NMFATA.
In 2007, the New Mexico Legislature passed the NMFATA, a false claims act with a qui
tam provision. See N.M.S.A. §§ 44-9-1 to -14. The NMFATA contains a first-to-file provision,
stating: “When a person brings an action pursuant to this section, no person other than the attorney
general on behalf of the state may intervene or bring a related action based on the facts underlying
the pending action.” N.M.S.A. § 44-9-5E. The NMFATA also contains the following non-
exclusivity clause: “The remedies provided for in the Fraud Against Taxpayers Act are not
exclusive and shall be in addition to any other remedies provided for in any other law or available
under common law.” N.M.S.A. § 44-9-14.
The federal analog to the NMFATA is the FCA, 31 U.S.C. §§ 3729-33, which has as its
purpose “encourag[ing] ‘whistleblowers to act as private attorneys-general’ in bringing suits for
the common good.” Walburn v. Lockheed Martin Corp., 431 F.3d 966, 970 (6th Cir.
2005)(quoting United States ex rel. Taxpayers Against Fraud v. Gen. Elec. Co., 41 F.3d 1032,
1041-42 (6th Cir. 1994)). It acts as a “jurisdictional limit on the court’s power to hear certain
duplicative qui tam suits.” United States ex rel. Grynberg v. Koch Gateway Pipeline Co., 390 F.3d
1276 (10th Cir. 2004). The FCA also recognizes the need “to discourage opportunistic plaintiffs
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from bringing parasitic lawsuits whereby would-be relators merely feed off a previous disclosure
of fraud.” Walburn v. Lockheed Martin Corp., 431 F.3d at 970. See United States ex rel.
Grynberg, 390 F.3d at 1278 (“The False Claims Act’s qui tam provisions are designed to encourage
private citizens to expose fraud but to avoid actions by opportunists seeking to capitalize on public
information.”). A NMFATA violator is liable for three times the actual losses that the State
suffered, a civil penalty between $5,000.00 and $10,000.00, the cost to litigate the action, and
reasonable attorney’s fees. See N.M.S.A. § 44-9-3C. “Up to another thirty percent of the damage
award is allocated to reward the qui tam plaintiff for exposing fraud and corruption in state
government.” State ex rel. Foy v. Austin Capital Mgmt., Ltd., 2015-NMSC-025 ¶ 40, 355 P.3d 1,
1 (citing N.M.S.A. § 44-9-7(B)). See Kuriyan I, 2021 WL 5998603, at *38-49 (discussing FCA,
NMFATA, and NMMFCA); Kuriyan II, 2022 WL 704130, at *1-3 (discussing FCA, NMFATA,
and NMMFCA); Hunt v. Cent. Consol. Sch. Dist., 951 F. Supp. 2d 1136, 1242-46 (D.N.M.
2013)(Browning, J.)(discussing NMFATA’s whistleblower protections); Hill v. Vanderbilt Cap.
Advisors, LLC, 834 F. Supp. 2d 1228, 1261-62 (D.N.M. 2011)(Browning, J.)(discussing
NMFATA’s disclosure bars).
LAW REGARDING STATUTORY CONSTRUCTION
When interpreting statutes, the Court must start with the plain language. See, e.g., Been v.
O.K. Industries, Inc., 495 F.3d 1217, 1227 (10th Cir. 2007)(“We review issues of statutory
construction de novo, interpret[ing] the words of the statute in light of the purposes Congress
sought to serve.”). “It is well established that ‘when the statute’s language is plain, the sole
function of the courts -- at least where the disposition required by the text is not absurd -- is to
enforce it according to its terms.’” Lamie v. U.S. Trustee, 540 U.S. 526, 534 (2004)(quoting
Hartford Underwriters Ins. Co. v. Union Planters Bank, N. A., 530 U.S. 1, 6 (2000)). “Courts
indulge ‘a strong presumption that Congress expresses its intent through the language it chooses.
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Therefore, when the terms of a statute are clear and unambiguous, our inquiry ends and we should
stick to our duty of enforcing the terms of the statute as Congress has drafted it.’” United Kingdom
Ministry of Defence v. Trimble Navigation Ltd., 422 F.3d 165, 171 (4th Cir. 2005)(quoting
Sigmon Coal Co. v. Apfel, 226 F.3d 291, 305 (4th Cir. 2000)). See Public Lands Council v.
Babbitt, 167 F.3d 1287, 1314 (10th Cir. 1999)(Seymour, C.J.)(“In examining . . . [statutory]
language, we assume that the words chosen by Congress are employed in their ordinary sense and
accurately express Congress’ [ ] legislative purpose.”). See, e.g., United States v. Delorme, No.
CR 19-2322, 2023 WL 8020262, at *17-20 (D.N.M. Nov. 17, 2023)(Browning, J.); United States
v. Teston, No. CR 22-1400, 2023 WL 3390968, at *8-16 (D.N.M. May 5, 2023)(Browning, J.);
United States v. Janzad, No. CR 23-0346, 2024 WL 3552404, at *9-24 (D.N.M. July 26,
2024)(Browning, J.).
LAW REGARDING DIVERSITY JURISDICTION AND ERIE
Under Erie, a federal district court sitting in diversity applies “state law with the objective of
obtaining the result that would be reached in state court.” Butt v. Bank of Am., N.A., 477 F.3d
1171, 1179 (10th Cir. 2007). Accord Mem. Hosp. v. Healthcare Realty Tr. Inc., 509 F.3d 1225,
1229 (10th Cir. 2007). The Court has held that, if a district court exercising diversity jurisdiction
cannot find a Supreme Court of New Mexico “opinion that [governs] a particular area of
substantive law[,] . . . [the district court] must . . . predict how the Supreme Court of New Mexico
would [rule].” Guidance Endodontics, LLC v. Dentsply Int’l., Inc., 708 F. Supp. 2d 1209, 1224-
25 (D.N.M. 2010)(Browning, J.). “Just as a court engaging in statutory interpretation must always
begin with the statute’s text, a court formulating an Erie prediction should look first to the words
of the state supreme court.” Peña v. Greffet, 110 F. Supp. 3d 1103, 1132 (D.N.M.
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2015)(Browning, J.).3 If the Court finds only an opinion from the Court of Appeals of New
Mexico, while “certainly [the Court] may and will consider the Court of Appeal[s’] decision in
making its determination, the Court is not bound by the Court of Appeal[s’] decision in the same
way that it would be bound by a Supreme Court decision.” Mosley v. Titus, 762 F. Supp. 2d 1298,
1332 (D.N.M. 2010)(Browning, J.)(noting that, where the only opinion on point is “from the Court
of Appeals, . . . the Court’s task, as a federal district court sitting in this district, is to predict what
the Supreme Court of New Mexico would do if the case were presented to it”)(citing Wade v.
EMCASCO Ins., 483 F.3d 657, 666 (10th Cir. 2007)(explaining that, “[w]here no controlling state
decision exists, the federal court must attempt to predict what the state’s highest court would do”
and that, “[i]n doing so, it may seek guidance from decisions rendered by lower courts in the
relevant state”)).4 The Court also may rely on Tenth Circuit decisions interpreting New Mexico
3In performing its Erie-mandated duty to predict what a State supreme court would do if
faced with a case, see Comm’r v. Estate of Bosch, 387 U.S. 456 (1987), a federal court may
sometimes contradict the State supreme court’s own precedent if the federal court concludes that
the State supreme court would, given the opportunity, overrule its earlier holding, see Anderson
Living Tr. v. WPX Energy Prod., LLC, 27 F. Supp. 3d 1188, 1247 n.30 (2014)(Browning, J.).
Courts should, obviously, be reticent to formulate an Erie prediction that conflicts with State-court
precedent; even if the prediction turns out to be correct, such predictions produce disparate results
between cases filed in State and federal courts, as the old State supreme court precedent usually
binds State trial courts. The factors to which a federal court should look before making an Erie
prediction that a State supreme court will overrule its prior precedent vary depending upon the
case, but some consistent ones include: (i) the age of the State supreme court decision from which
the federal court is considering departing -- the younger the State case is, the less likely it is that
departure is warranted; (ii) the amount of doctrinal reliance that the State courts -- especially the
State supreme court -- have placed on the State decision from which the federal court is considering
departing; (iii) apparent shifts away from the doctrine that the State decision articulates, especially
if the State supreme court explicitly has called an older case’s holding into question; (iv) changes
in the composition of the State supreme court, especially if mostly dissenting justices from the
earlier State decision remain on the court; and (v) the decision’s patent illogic or its inapplicability
to modern times. See Peña v. Greffet, 110 F. Supp. 3d at 1132 n.17. In short, a State supreme
court case that a federal court Erie predicts will be overruled is likely to be very old, neglected by
subsequent State-court cases -- perhaps because it is in a dusty corner of the common law which
does not get much attention or have much application -- and clearly wrong.
4The Supreme Court addresses what the federal courts may use when there is not a decision
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on point from the State’s highest court:
The highest state court is the final authority on state law (Beals v. Hale, 4 How. 37,
54 . . . ; Erie Railroad Co. v. Tompkins, 304 U.S. 64, 78 . . . ), but it is still the duty
of the federal courts, where the state law supplies the rule of decision, to ascertain
and apply that law even though it has not been expounded by the highest court of
the State. See Ruhlin v. New York Life Insurance Co., 304 U.S. 202, 209. . .
[(1938)]. An intermediate state court in declaring and applying the state law is
acting as an organ of the State and its determination, in the absence of more
convincing evidence of what the state law is, should be followed by a federal court
in deciding a state question. We have declared that principle in West v. American
Telephone and Telegraph Co., 311 U.S. 223 . . . [(1940)], decided this day. It is
true that in that case an intermediate appellate court of the State had determined the
immediate question as between the same parties in a prior suit, and the highest state
court had refused to review the lower court’s decision, but we set forth the broader
principle as applicable to the decision of an intermediate court, in the absence of a
decision by the highest court, whether the question is one of statute or common law.
. . . .
We have held that the decision of the Supreme Court upon the construction of a
state statute should be followed in the absence of an expression of a countervailing
view by the State’s highest court (Erie Railroad Co. v. Hilt, 247 U.S. 97, 100
. . . [(1918)]; Erie Railroad Co. v. Duplak, 286 U.S. 440, 444 . . . [(1932)]), and we
think that the decisions of the Court of Chancery [the New Jersey trial court] are
entitled to like respect as announcing the law of the State.
. . . .
The question has practical aspects of great importance in the proper administration
of justice in the federal courts. It is inadmissible that there should be one rule of
state law for litigants in the state courts and another rule for litigants who bring the
same question before the federal courts owing to the circumstance of diversity of
citizenship. In the absence of any contrary showing, the rule [set forth by two New
Jersey trial courts, but no appellate courts] appears to be the one which would be
applied in litigation in the state court, and whether believed to be sound or unsound,
it should have been followed by the Circuit Court of Appeals.
Fid. Union Tr. Co. v. Field, 311 U.S. 169, 177-80 (1940)(footnotes omitted). The Supreme Court
has softened this position over the years; federal courts are no longer bound by State trial or
intermediate court opinions, but “should attribute [them] some weight . . . where the highest court
of the State has not spoken on the point.” Comm’r v. Estate of Bosch, 387 U.S. at 465 (citing King
v. Order of United Commercial Travelers, 333 U.S. 153, 159 (1948)). See 17A James Wm. Moore
et al., Moore’s Federal Practice § 124.20 (3d ed. 1999)(“Moore’s”)(“[F]ederal courts should
follow decisions of intermediate state appellate courts unless persuasive data indicate that the
highest state court would decide the issue differently . . . [and] federal courts should give some
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law. See Anderson Living Tr. v. WPX Energy Prod., LLC, 27 F. Supp. 3d 1188, 1243 & n.30
(D.N.M. 2014)(Browning, J.).5 Ultimately, “the Court’s task is to predict what the state supreme
weight to state trial courts decisions.”).
5In determining the proper weight to accord Tenth Circuit precedent interpreting New
Mexico law, the Court must balance the need for uniformity between federal court and State court
interpretations of State law with the need for uniformity among federal judges. If the Court adheres
too rigidly to Tenth Circuit case law, ignoring changes to a State’s law in the ensuing years, then
parties litigating State law claims will be subject to a different body of substantive law, depending
on whether they litigate in State court or federal court. This result frustrates the purpose of Erie,
which held that federal courts must apply State court interpretations of State law, rather than their
own, in part so that parties achieve a consistent result regardless of the forum. This consideration
pulls the Court toward according Tenth Circuit precedent less weight and according State court
decisions issued in the ensuing years more weight. On the other hand, when the State law is
unclear, it is desirable for there to at least be uniformity among federal judges as to its proper
interpretation. Otherwise, different federal judges within the same Circuit -- or even the same
district, as district courts’ decisions are not binding, even upon themselves -- would be free to
adopt differing interpretations of a State’s law. This consideration pulls the Court towards a
stronger respect for vertical stare decisis, because a Tenth Circuit decision on point -- regardless
whether it accurately reflects State law -- at least provides consistency at the federal level, so long
as federal district judges must follow it.
The Court must decide how to weigh Tenth Circuit case law against more recent State court
decisions, choosing a point on the spectrum between the two extremes: rigidly adhering to Tenth
Circuit precedent unless there is intervening case law directly on point from the State’s highest
court, on one end, and independently interpreting the State law, regarding the Tenth Circuit
precedent as no more than persuasive authority, on the other. The Court notes that, in striking this
balance, it is generally more concerned about systemic inconsistency between the federal courts
and the State courts than it is about inconsistency among federal judges. Judges, even those within
a jurisdiction with ostensibly identical governing law, sometimes interpret and apply the law
differently from one another; this inconsistency is part and parcel of a common-law judicial
system. More importantly, litigants seeking to use forum selection to gain a substantive legal
advantage cannot easily manipulate such inconsistency: cases are assigned randomly to district
judges in this and many federal districts; and, regardless, litigants cannot know for certain how a
given judge will interpret the State law, even if they could determine the identity of the judge pre-
filing or pre-removal. All litigants know in advance is that whomever federal district judge they
are assigned will look to the entirety of the State’s common law in making his or her
determination -- the same as a State judge would. Systemic inconsistency between the federal
courts and State courts, on the other hand, not only threatens the principles of federalism, but
litigants may more easily manipulate the inconsistency. When the Tenth Circuit issues an opinion
interpreting State law, and the State courts subsequently shift away from that interpretation,
litigants -- if the district courts strictly adhere to the Tenth Circuit opinion -- have a definite
substantive advantage in choosing the federal forum over the State forum, or vice versa.
The Court further notes that district courts may be in a better position than the Tenth Circuit
to be responsive to changes in State law. Tenth Circuit decisions interpreting a particular State’s
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law on a specific issue are further apart in time than the collective district courts’ decisions are.
More importantly, the Tenth Circuit typically does not address such issues with the frequency that
the State’s courts do. Accordingly, Tenth Circuit precedent can lag behind State law
developments -- developments that the district courts may be nimble enough to perceive and adopt.
Additionally, much of the benefit of having a consistent Tenth Circuit-wide interpretation of a
particular State’s law is wasted. Other than Oklahoma, every State encompassed by the Tenth
Circuit contains only one federal judicial district, and there is relatively little need for federal
judges in Wyoming and Kansas to have a uniform body of New Mexico law to which to look.
Last, the Court notes, respectfully, that district courts may be in a better position than the Tenth
Circuit to develop expertise on the State law of the State in which they sit. Every federal judicial
district in the nation, except the District of Wyoming, covers at most one State. It is perhaps a
more workable design for each district court to keep track of legal developments in the State law
of its own State than it is for the Tenth Circuit to monitor separate legal developments in eight
States. The Tenth Circuit used to follow this rationale in applying a clearly erroneous standard of
review to district judges’ State law decisions with no controlling State supreme court precedent.
See Weiss v. United States, 787 F.2d 518, 525 (10th Cir. 1986); Rawson v. Sears, Roebuck, &
Co., 822 F.2d 908, 923 (10th Cir. 1987)(McKay, J., dissenting)(collecting cases). Since the mid-
1980s, however, the Tenth Circuit has abandoned that rationale and applied a de novo standard of
review to district judge decisions applying State law with no governing State supreme court
precedent. See Rawson v. Sears, Roebuck, & Co., 822 F.2d at 908. See also id. at 923 (McKay, J.,
dissenting)(noting that the majority had abandoned the “sanctified” clearly erroneous standard or
the “so-called local-judge rule” in its analysis). The Court regrets the Tenth Circuit’s retreat from
the clearly erroneous standard.
Having outlined the relevant considerations, the Court concludes that the proper stance on
vertical stare decisis in the context of federal court interpretations of State law is as follows: the
Tenth Circuit’s cases are binding as to their precise holding -- what the State law was on the day
the opinion was published -- but lack the positive precedential force that its cases interpreting a
federal statute or the Constitution of the United States of America possess. A district court
considering a State law issue after the publication of a Tenth Circuit opinion on point may not
come to a contrary conclusion based only on State court cases that the Tenth Circuit had available
and considered, but it may come to such a conclusion based on intervening State court cases.
When interpreting State law, the Tenth Circuit does not and cannot issue a case holding
that x is the law in New Mexico; it holds that the proper interpretation of New Mexico law, at the
time the opinion is released, is x. Its holdings are descriptive and not prescriptive -- interpretive
and not normative. Because federal judicial opinions lack independent substantive force on State
law issues, but possess such force regarding federal law issues, the Court concludes that the
following is not an unfair summary of the judicial interpretive process: (i) when interpreting
federal law, the federal appellate courts consider the existing body of law, and then issue a holding
that both reflects and influences the body of law; that holding subsequently becomes a part of the
body of law; but (ii) when interpreting State law, the federal appellate courts consider the existing
body of law, and then issue a holding that only reflects the body of law; that holding does not
subsequently become a part of the body of law. The federal district courts are bound to conclude
that the Tenth Circuit’s reflection of the then-existing body of law was accurate. The question is
whether they should build a doctrine atop the case and use the existence of the Tenth Circuit’s case
to avoid any responsibility to consider independently the whole body of State law that exists when
the time comes that diversity litigants raise the issue in their courtrooms. Giving such effect to the
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Tenth Circuit’s interpretations of State law is at tension with Erie, giving independent substantive
effect to federal judicial decisions -- i.e., applying federal law -- in a case brought in diversity.
Erie’s purpose is well-known and simple, and the Court should not complicate it beyond
recognition: it is that the same substantive law governs litigants’ cases regardless whether they are
brought in a federal or State forum. For simplicity’s sake, most courts have settled on the
formulation that “the federal court must attempt to predict how the States’ highest court would rule
if confronted with the issue.” Moore’s § 124.22[3] (citing Comm’r v. Estate of Bosch, 387 U.S.
at 465 (“[A]n intermediate appellate State court [decision] is a datum for ascertaining State law
which is not to be disregarded by a federal court unless it is convinced by other persuasive data
that the highest court of the State would decide otherwise.” (quoting West v. Am. Tel. & Tel. Co.,
311 U.S. 223, 237 (1940))(emphasis in Comm’r v. Estate of Bosch)). This statement may not be
the most precise formulation if the goal is to ensure identical outcomes in State and federal
court -- the Honorable Milton I. Shadur, former United States District Judge for the Northern
District of Illinois, looks to State procedural rules to determine in which State appellate circuit the
suit would have been filed were it not in federal court, and then applies the State law as that State
circuit court interprets it, see Abbott Labs. v. Granite State Ins. Co., 573 F. Supp. 193, 196-200
(N.D. Ill. 1983)(noting that the approach of predicting the State supreme court’s holdings will
often lead to litigants obtaining a different result in federal court than they would in State court,
where only the law of the State circuit in which they filed -- and certainly not nonexistent,
speculative State supreme court law -- governs) -- but it is a workable solution that has achieved
consensus. See Allstate Ins. Co. v. Menards, Inc., 285 F.3d 630, 637 (7th Cir. 2002)(“[W]e adhere
today to the general rule, articulated and applied throughout the United States, that, in determining
the content of State law, the federal courts must assume the perspective of the highest court in that
state and attempt to ascertain the governing substantive law on the point in question.”). This
formulation, built out of ease-of-use, does not relieve courts of their Supreme Court-mandated
obligation to consider State appellate and trial court decisions. To the contrary, even influential
authors’ non-judicial writings, State supreme court justices’ statements, the closeness of the vote
on a prior case addressing the issue, and personnel changes on the court -- considerations that
would not inform properly a federal court’s analysis of federal law -- validly may come into play.
The question is whether the district courts must abdicate, across-the-board, the “would decide”
aspect of the Erie analysis to their parent appellate courts when the Court of Appeals has declared
an interpretation of State law.
The Erie doctrine results in federal cases that interpret State law withering with time. While
cases interpreting federal law become more powerful over time -- forming the groundwork for
doctrines, growing upward from one application (Congress may create a national bank) to many
(Congress may set quotas on wheat-growing for personal consumption), expanding outward from
the general (States must grant criminal jury trials) to the specific (the jury need not be twelve
people, nor must it be unanimous) -- federal cases interpreting State law often become stale. New
State court cases -- even when not rebuking directly the federal court’s statement of law -- alter
the common-law legal landscape with their dicta, their insinuations, and their tone. The Supreme
Court, which picks its cases sparingly and for maximum effect, almost never grants certiorari to
resolve issues of State law.
The Court’s views on Erie, of course, mean little if the Tenth Circuit does not agree. In
Wankier v. Crown Equipment Corp., 353 F.3d 866 (10th Cir. 2003), the Tenth Circuit says:
Where no controlling state decision exists, the federal court must attempt to predict
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what the state’s highest court would do. In performing this ventriloquial function,
however, the federal court is bound by ordinary principles of stare decisis. Thus,
when a panel of this Court has rendered a decision interpreting state law, that
interpretation is binding on district courts in this circuit, and on subsequent panels
of this Court, unless an intervening decision of the state’s highest court has resolved
the issue.
Wankier v. Crown Equip. Corp., 353 F.3d at 866. This passage indicates that the Tenth Circuit
permits a district court to deviate from its view of State law only on the basis of a subsequent case
“of the state’s highest court.” The American Heritage Dictionary of the English Language 1402
(William Morris ed., New College ed. 1976)(defining “unless” as “[e]xcept on the condition that;
except under the circumstances that”). A more aggressive reading of the passage -- namely the
requirement that the intervening case “resolv[e] the issue” -- might additionally compel the
determination that any intervening case law must definitively and directly contradict the Tenth
Circuit interpretation to be considered “intervening.”
It is difficult to know whether the limitation of the Honorable Michael W. McConnell,
then-United States Circuit Judge for the Tenth Circuit, in Wankier v. Crown Equip. Corp. of
“intervening decision” to cases from the highest State court was an oversight or intentional. Most
of the Tenth Circuit’s previous formulations of this rule have defined intervening decisions
inclusively as all subsequent decisions of “that state’s courts,” a term which seems to include trial
and intermediate appellate courts. Even Koch v. Koch Industries, Inc., 203 F.3d 1202, 1231 (10th
Cir. 2000), the primary authority upon which Wankier v. Crown Equipment Corp. relies, uses the
more inclusive definition. In fact, Wankier v. Crown Equipment Corp. quotes its relevant passage:
In the absence of intervening Utah authority indicating that a plaintiff is not
required to prove a safer, feasible alternative design, we are bound to follow the
rule of Allen [v. Minnstar, Inc., 8 F.3d 1470 (10th Cir. 1993), a Tenth Circuit case
interpreting an issue of Utah law], as was the district court. “Following the doctrine
of stare decisis, one panel of this court must follow a prior panel’s interpretation of
state law, absent a supervening declaration to the contrary by that state’s courts or
an intervening change in the state’s law.” Koch v. Koch Indus., Inc., 203 F.3d at
1231.
Wankier v. Crown Equip. Corp., 353 F.3d at 867.
Regardless whether the decision to limit the intervening authority a district court can
consider was intentional or not, the Tenth Circuit has picked it up and run with it. In Kokins v.
Teleflex, Inc., 621 F.3d 1297 (10th Cir. 2010), the Tenth Circuit, quoting Wankier v. Crown
Equipment Corp., refused to consider an opinion from the Court of Appeals of Colorado holding
directly the opposite of an earlier Tenth Circuit interpretation of Colorado law. See Kokins v.
Teleflex, Inc., 621 F.3d at 1297 (“[T]he Colorado Court of Appeals decided Biosera[, Inc. v. Forma
Scientific, Inc., 941 P.2d 284 (Colo. Ct. App. 1998)], so it is not an ‘intervening decision of the
state’s highest court.’” (emphasis in original)(quoting Wankier v. Crown Equip. Corp., 353 F.3d
at 866)).
The Tenth Circuit has set forth a stringent restriction on its district courts’ ability to
administer independently the Erie doctrine. More importantly, the Tenth Circuit’s view may be at
tension with the above-quoted Supreme Court precedent, as well as with its own prior case law.
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court would do.” Wade v. EMCASCO Ins. Co., 483 F.3d at 666.
ANALYSIS
The Court undertakes its analysis in two sections. First, the Court determines that rules 59
and 60 of the Federal Rules of Civil Procedure do not permit the Court to amend the Final
Judgment as to Kuriyan’s Counts I, II, and III, because Kuriyan’s attorney states that Kuriyan is
not pursuing those Counts. Second, the Court concludes that rules 59 and 60 do not permit the
Court to amend the Final Judgment as to Kuriyan’s Count IV, because the Court commits no error
in its interpretation of the NMFATA.
I. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO COUNTS I,
II, AND III.
Kuriyan first asks this Court to amend the Final Judgment as to Counts I, II, and III. See
Motion to Amend at 1. Kuriyan asserts four arguments. First, Kuriyan argues that the Final
Judgment’s dismissal of Counts I, II, and III’s is improper, because neither he nor his counsel at
the time are in a proper position to “waive,” on the taxpayers behalf, a valid claim against the
MCO Defendants. See Motion to Amend at 7. Second, Kuriyan contends that the Court should
amend the Final Judgment, because the Court denies the Motion By All Defendants to Dismiss
Relator’s Third Amended Complaint, filed November 5, 2020 (Doc 144)(“Motion to Dismiss”).
Motion to Amend at 8. Third, Kuriyan argues that the Court should amend the Final Judgment,
because Kuriyan objects to his former counsel’s statements that Kuriyan will not pursue Counts I,
II, and III. See Motion to Amend at 8. Fourth, Kuriyan contends that the Court should amend the
Final Judgment, because his current counsel could not have anticipated that document production
Moore’s lists the Tenth Circuit as having been, at one time, a “court[ that] hold[s] that a prior
federal appellate decision [interpreting state law] is persuasive.” Moore’s § 124.22[4] (citing State
Farm Mut. Auto. Ins. v. Travelers Indem. Co., 433 F.2d 311, 312 (10th Cir. 1970)). Still, the Court
is bound to abide by the Tenth Circuit’s interpretation of Erie.
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“would yield demonstrable evidence of the Defendants’ FCA and NMMFCA liability under
Medicaid’s 60 Day Rule.” Motion to Amend at 9. Addressing each argument in turn, the Court
concludes that it will not amend the Final Judgment as to Counts I, II, and III.
Because the Court enters a Final Judgment, the Court must analyze any amendment under
rule 59 or rule 60. Servants of the Paraclete v. Does, 204 F.3d at 1012. Rule 59 and rule 60
motions for reconsideration are “inappropriate vehicles to reargue an issue previously addressed
by the court when the motion merely advances new arguments, or supporting facts which were
available at the time of the original motion.” Servants of the Paraclete v. Does, 204 F.3d at 1012.
Under rule 59, “grounds warranting a motion to reconsider include (1) an intervening change in
the controlling law, (2) new evidence previously unavailable, and (3) the need to correct clear error
or prevent manifest injustice.” Servants of the Paraclete v. Does, 204 F.3d at 1012. “[A] motion
for reconsideration is appropriate where the court has misapprehended the facts, a party's position,
or the controlling law.” Servants of the Paraclete v. Does, 204 F.3d at 1012. A district court has
considerable discretion in ruling on a motion to reconsider. See Phelps, 122 F.3d at 1324. In
contrast, rule 60(b) provides:
On motion and just terms, the court may relieve a party or its legal
representatives from a final judgment, order, or proceeding for the following
reasons:
(1) mistake, inadvertence, surprise, or excusable neglect;
(2) newly discovered evidence that, with reasonable diligence, could
not have been discovered in time to move for a new trial under Rule
59(b);
(3) fraud (whether previously called intrinsic or extrinsic),
misrepresentation, or misconduct by an opposing party;
(4) the judgment is void;
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(5) the judgment has been satisfied, released or discharged; it is based
on an earlier judgment that has been reversed or vacated; or applying
it prospectively is no longer equitable; or
(6) any other reason that justifies relief.
Fed. R. Civ. P. 60(b).
A. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO
COUNTS I, II, AND III, BASED ON KURIYAN’S WAIVER ARGUMENT.
Kuriyan argues that the Court should amend its Final Judgment dismissing Counts I, II,
and III, because his former counsel, Mr. Androphy, is not in a proper position to “waive” valid
claims against the Defendants. Motion to Amend at 7. He contends that no waiver occurs, because
there is no “intentional relinquishment or abandonment of a known right.” Motion to Amend at 9.
Although Kuriyan is correct that he has not waived these claims for purposes of future litigation,
the Court will not amend the Final Judgment, because Kuriyan abandons those claims in this
action.
To obtain relief, Kuriyan must satisfy either rule 59 or rule 60. Under rule 59, he must
show: (i) an intervening change in controlling law; (ii) previously unavailable evidence; or (iii) the
need to correct clear error or prevent manifest injustice. See Servants of the Paraclete v. Does,
204 F.3d at 1012. Rule 60(b), in turn, permits relief for “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or other limited circumstances. Fed. R.
Civ. P. 60(b). Although Kuriyan does not invoke either rule expressly, his argument fits only
within rule 59’s clear-error prong and rule 60’s “mistake” provision, because he identifies no
intervening change in law, no newly discovered evidence, and no fraud or other extraordinary
circumstance. The Court commits no clear error, and its ruling is not mistake, inadvertence,
surprise, or excusable neglect.
In the MOO, the Court dismisses Counts I, II, and III, because Kuriyan represents that he
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does not intend to proceed to trial with those claims independent of his alternative remedy claims.
See MOO at 64. Kuriyan maintains those counts for a single purpose: to preserve a qui tam action
on an alternate-remedy theory. See Plaintiff/Relator’s Opposed Third Motion for Award from
Alternate Remedy at 12, filed February 5, 2021 (Doc. 173). Once the Court resolves the qui tam
theory, it dismisses Counts I, II, and III so that Kuriyan can pursue an appeal on what he describes
as his “sole pursuit.” MOO at 64. Based on those representations, the Court concludes that
Kuriyan intentionally abandons Counts I, II, and III in this action. The Supreme Court has
instructed that “waiver is the ‘intentional relinquishment or abandonment of a known right.’”
United States v. Olano, 507 U.S. 725, 733 (1993)(quoting Johnson v. Zerbst, 304 U.S. 458, 464
(1938)). Tenth Circuit cases illustrate this principle.
In United States v. Gambino-Zavala, 539 F.3d 1221 (10th Cir. 2008), the defendant seeks
appellate review on whether the contraband he possesses is in plain view. See 539 F.3d at 1227.
The Tenth Circuit determines that he abandons that argument, because the defendant’s attorney
does not contest the prosecutor’s statement that it is undisputed that the contraband is in plain
view. See 539 F.3d at 1227. The Tenth Circuit later explains: “Defendant counsel obviously knew
of the issue. By his action, the defendant ‘affirmatively abandoned his challenge to the officers’
testimony about the contraband and waived any claim on appeal.’” United States v. Zubia-Torres,
550 F.3d 1202, 1205 (10th Cir. 2008)(analyzing United States v. Gambino-Zavala, 539 F.3d 1221
(10th Cir. 2008)).
By contrast, in LKL Associates, Inc. v. Union Pacific Railroad Company, 17 F.4th 1287
(10th Cir. 2021), the Tenth Circuit finds no abandonment where the record reflects a
misunderstanding rather than an intentional relinquishment. See 17 F.4th at 1304. The Tenth
Circuit states: “The court thought that counsel would make the case go away by distilling the
complaint down to a few core counts and abandoning the rest. Meanwhile, counsel intended to
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make the case go away by obtaining a ruling on an important legal issue that would rapidly resolve
the remaining claims.” 17 F.4th at 1303. According to the Tenth Circuit, “counsel was clearly
trying to expedite the litigation by resolving a central legal question -- and not offering his clients’
causes of action as bargaining chips.” 17 F.4th at 1304. Importantly, counsel said nothing about
abandoning the claims at any point in any hearing. See 17th F.4th at 1304. Instead, counsel’s
phrasing contemplates only a simplified and expedited resolution:
For example, reviewing some of the language the district court relied upon in
finding abandonment, counsel said that a ruling regarding the easement's scope
would “resolve this whole case” and obviate the need for a trial. . . . A claim that
need not be tried to be resolved, or that is effectively determined by ascertaining a
fundamental legal principle, is very different from a claim that has been abandoned.
As this case illustrates, only the former can be appealed on its merits.
17 F.4th at 1304.
The Court determines that the statements and filings by Kuriyan’s former counsel, Mr.
Androphy and others, are more akin to the situation in United States v. Gambino-Zavala than to
the one in LKL Associates, Inc. v. Union Pacific Railroad Company. The record shows repeated,
unequivocal representations that Kuriyan will not pursue Counts I, II, and III. Kuriyan originally
files this case on October 18, 2016. See Complaint at 1 (Doc. 1). On February 22, 2019, Mr.
Androphy enters as Kuriyan’s counsel. See Order Granting In Part Plaintiff’s Motion to Substitute
Counsel at 1 (Doc. 21). Thereafter, Mr. Androphy repeatedly states that Kuriyan will not seek
further damages and will not litigate those counts, but instead is maintaining them for a qui tam
action on an alternate-remedy theory. See Plaintiff/Relator’s Opposed Third Motion for Award
from Alternate Remedy at 12. See Plaintiff/Relator Jacob Kuriyan’s Consolidated Response to
Defendants’ Motions to Dismiss at 1 (Doc. 130)(“As a preliminary matter, Relator does not intend
to seek civil penalties or further damages against Defendants once his alternate remedy dispute
with the United States and State of New Mexico [] has been resolved.”); Plaintiff/Relator Jacob
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Kuriyan’s Response to Defendants’ Motion to Dismiss Relator’s 3rd Amended Complaint at 1
(Doc. 145); Joint Status Report and Provisional Discovery Plan at 4 (Doc. 181)(“Once Relator’s
pending alternate remedy motion has been fully resolved (including any appeals related to it), this
case will essentially have concluded. Relator will not litigate further damages against
Defendants.”); Agreed Order Staying Discovery at 1 (Doc. 194); Transcript of Hearing at 56:3-9
(taken October 28, 2022)(Lieff), filed January 24, 2024 (Doc. 402)(“October 28, 2022, Tr.”).
Kuriyan’s former counsel says:
And I haven’t figured out yet, frankly, why the insurance companies are even here,
since we’ve said to them: Thank you very much, you paid the money to the federal
government, to the State of New Mexico. Go on home. Why are you spending more
money for attorneys’ fees? Really -- but it makes you wonder what they are doing.
October 28, 2022, Tr. at 56:3-9 (Lieff). These are not ambiguous statements about efficiency or
case management. They are express disclaimers of any intent to pursue the claims. Unlike in LKL
Associates, Inc. v. Union Pacific Railroad Company, where counsel’s statements are susceptible
to misunderstanding, Kuriyan’s former counsel’s statements consistently and unmistakably
disavowed further litigation of Counts I, II, and III. See 17 F.4th at 1304. They mirror United
States v. Gambino-Zavala, where counsel knowingly abandons an issue.
Moreover, the parties and the Court rely on those representations. All parties -- including
Kuriyan -- agree to stay discovery against the MCO Defendants in this matter. See Agreed Order
Staying Discovery at 1, filed March 12, 2021 (Doc. 194). Only after years of litigation, and after
Magistrate Judge Khalsa issue dispositive proposed findings, does Kuriyan’s new counsel file an
eleventh-hour motion for summary judgment on those counts. See Proposed Findings and
Recommended Disposition, filed August 28, 2024 (Doc. 409); Kuriyan MSJ at 1. A late change
in litigation strategy does not rewrite the record or negate prior abandonment. See Cashner v.
Freedom Stores, Inc., 98 F.3d 572, 577 (10th Cir. 1996)(holding that relief is not available when
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the alleged mistake stems from an attorney’s deliberate litigation tactics).
The Court agrees with Kurian, however, that he does not waive Counts I, II, and III for
purposes of future litigation. When a party waives a claim, they waive their ability to litigate that
claim’s merits. See Harris v. City Cycle Sales, Inc., 112 F.4th 1272, 1285 (10th Cir.
2024)(“Typically, a waived claim is dead and buried.”). Here, Counts I, II, and III are neither dead
nor buried. The Court dismisses them without prejudice only after Kuriyan repeatedly represents
that he will not pursue them, as their sole purpose is to preserve a qui tam action on an alternate-
remedy theory. See Plaintiff/Relator’s Opposed Third Motion for Award from Alternate Remedy
at 12. Once the Court resolves the alternate-remedy issue, it dismisses the Counts without
prejudice, leaving Kuriyan free to appeal the alternate-remedy ruling. See MOO at 64. Because
Kuriyan remains able to litigate Counts I, II, and III’s merits of in a separate action, he has not
waived the Counts in a separate action. Having preserved his right to litigate these Counts
elsewhere, Kuriyan cannot now recast their dismissal as an improper waiver, much less as clear
error, or mistake under rules 59 or 60.
Finally, allowing amendment here undermines a core premise of judicial administration:
that district courts must be able to rely on counsel’s representations in managing their dockets.
Courts routinely make consequential case-management decisions -- staying discovery, narrowing
issues, and structuring proceedings -- based on what attorneys tell them. See Kovacs v. Hershey
Co., 2006 WL 2781591, at * 8 (D. Colo. September 26, 2006)(Daniel, J.,)(“[T]he Court is entitled
to rely on representation of counsel as an officer of the Court . . . .”). If parties later can disavow
those representations after the Court and opposing parties have relied on them, and even dismissed
the case, orderly adjudication would become unworkable. The Court therefore denies the Motion
to Amend insofar as it relies on Kuriyan’s waiver argument.
B. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO COUNTS I,
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II, AND III, BASED ON KURIYAN’S ARGUMENT THAT THE COURT DENIES
THE MOTION TO DISMISS.
Kuriyan next contends that, because MCO Defendants file a Motion to Dismiss and the
Court denies it, MCO Defendants must “live with that” result, requiring the Court to amend its
Final Judgment to allow him to pursue Counts I, II, and III. Motion to Amend at 8. Kuriyan also
asserts that MCO Defendants “circled back” during a later oral argument to extract a concession
on those counts but fail, which, in his view, further supports amendment. Motion to Amend at 8.
Neither argument shows that the Court commits clear error or mistake.
To obtain relief, Kuriyan must satisfy either rule 59 or rule 60. Under rule 59, he must
show: (i) an intervening change in controlling law; (ii) previously unavailable evidence; or (iii) the
need to correct clear error or to prevent manifest injustice. See Servants of the Paraclete v. Does,
204 F.3d at 1012. Rule 60(b), in turn, permits relief for “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or other limited circumstances. Fed. R.
Civ. P. 60(b). Although Kuriyan does not invoke either rule expressly, his argument fits only
within rule 59’s clear-error prong and rule 60’s “mistake” provision, because he identifies no
intervening change in law, no newly discovered evidence, and no fraud or other extraordinary
circumstance. The Court commits no clear error, and its ruling is not mistake, inadvertence,
surprise, or excusable neglect.
Kuriyan’s suggestion that his opposition to dismissal of Counts I, II, and III shows he
always intends to pursue those claims is unpersuasive. Kuriyan maintains that, although he does
not intend to proceed against MCO Defendants, he can prevail against the State of New Mexico
on his alternate-remedy theory only if he maintains a valid qui tam action. See Plaintiff/Relator’s
Opposed Third Motion for Award from Alternate Remedy at 12. He therefore opposes dismissal
of Counts I, II, and III -- not to pursue them -- but because he opines that having his MCO
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Defendant claims are necessary to preserve his claim against the State. Aside from conclusory
assertions, Kuriyan offers no explanation -- or citation -- showing how this argument establishes
the Court’s clear error or mistake in dismissing those counts.
Nor is there support for Kuriyan’s suggestion that Mr. Androphy signals an intent to pursue
Counts I, II, and III by refusing to concede them in a hearing. Although Kuriyan provides no
citation for his proposition, the Court understands him to rely on the following exchange:
Hamilton [Counsel for the Defendant Health Care Services Corporation]:
We’d like a stipulation no fraud.
Court: No fraud. But nobody is going to stand up in a moment, the
MCOs -- and I’m not trying to skip you -- nobody is going
to stand up and say the MCOs think that Mr. Androphy has
to prove your fraud to recover in this case action; right?
Hamilton: We did ask for a stipulation that the MCOs didn’t commit
fraud.
Court: Right.
Hamilton: We could basically stay by the wayside.
Court: Right.
Hamilton: Relator’s counsel does not agree to that. And we understand
that, but that was put out there.
Court: Well, maybe if everybody is in agreement that they don’t
have to prove it, they might be a little more flexible on that
just for purposes of the case. But we’ll see, we’ll see.
February 2, 2022 Transcript at 51:2-21, filed April 11, 2022 (Doc. 264). This argument is the
same argument as the waiver argument in different form. The Court does not speculate about
counsel’s subjective beliefs; the question is whether Kuriyan intends to pursue these claims. On
multiple occasions, Kuriyan’s attorney Mr. Androphy represents that he does not intend to pursue
Counts I, II, and III, and that they exist solely to maintain a valid qui tam action. See
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Plaintiff/Relator Jacob Kuriyan’s Consolidated Response to Defendants’ Motions to Dismiss at 1
(Doc. 130)(“As a preliminary matter, Relator does not intend to seek civil penalties or further
damages against Defendants once his alternate remedy dispute with the United States and State of
New Mexico [] has been resolved.”); Plaintiff/Relator Jacob Kuriyan’s Response to Defendants’
Motion to Dismiss Relator’s 3rd Amended Complaint at 1 (Doc. 145); Joint Status Report and
Provisional Discovery Plan at 4 (Doc. 181)(“Once Relator’s pending alternate remedy motion has
been fully resolved (including any appeals related to it), this case will essentially have concluded.
Relator will not litigate further damages against Defendants.”); Agreed Order Staying Discovery
at 1 (Doc. 194); Transcript of Hearing at 56:3-9 (taken October 28, 2022)(Lieff), filed January 24,
2024 (Doc. 402)(“October 28, 2022, Tr.”). Neither Kuriyan nor Mr. Androphy altered that
position before the United States and the State of New Mexico submit dispositive motions. Having
taken that position, Kuriyan must lie in the bed he makes. The Court therefore denies the Motion
to Amend insofar as it relies on Mr. Androphy prevailing on the Motion to Dismiss.
C. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO COUNTS I,
II, AND III, BASED ON KURIYAN’S ARGUMENT THAT HE OBJECTED TO HIS
FORMER COUNSEL MAKING STATEMENTS THAT KURIYAN WILL NOT
PURSUE COUNTS I, II, AND III.
Kuriyan contends that the Court should amend its Final Judgment dismissing Counts I, II,
and III, because he is unaware of Mr. Androphy’s statement in Kuriyan’s Response to Defendants’
Motion to Dismiss Relator’s 3rd Amended Complaint, filed November 19, 2020 (Doc.
145)(“Defendants’ Response”), that he will not pursue those Counts. See Motion to Amend at 8.
The Defendants counter that Kuriyan’s alleged ignorance to that one statement is immaterial,
because Mr. Androphy represents to the Court on several occasions that he will not pursue Counts
I, II, and III and Kuriyan does not claim ignorance to those statements. See Defendants’ Response
at 16. The Court agrees with the MCO Defendants that Kuriyan’s claimed ignorance to one
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statement is immaterial, because his former counsel represents to the Court on several occasions
that he will not pursue Counts I, II, and III.
To obtain relief, Kuriyan must satisfy either rule 59 or rule 60. Under rule 59, he must
show: (i) an intervening change in controlling law; (ii) previously unavailable evidence; or (iii) the
need to correct clear error or prevent manifest injustice. See Servants of the Paraclete v. Does,
204 F.3d at 1012. Rule 60(b), in turn, permits relief for “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or other limited circumstances. Fed. R.
Civ. P. 60(b). Although Kuriyan does not invoke either rule expressly, his argument fits only
within rule 59’s clear-error prong and rule 60’s “mistake” provision, because he identifies no
intervening change in law, no newly discovered evidence, and no fraud or other extraordinary
circumstance. The Court commits no clear error, and its ruling is not mistake, inadvertence,
surprise, or excusable neglect.
Even accepting Kuriyan’s claim of ignorance as true, it is immaterial; the Defendants’
Response is not the only instance where his counsel disclaims Counts I, II, and III. The Defendants
point to a hearing where Kuriyan is present as his attorney states that he will not pursue those
Counts against the Defendnats:
Lieff: By the way, these answers were to be given by Mercer by June 30,
2015. That’s the period of time after the 2014 year. The qui tam
case was filed, I believe, in October or November of 2016. Then,
suddenly, the insurance companies paid back the money. And I
haven’t figured out yet, frankly, why the insurance companies are
even here, since we’ve said to them: Thank you very much, you paid
the money to the federal government, to the State of New Mexico.
Go on home. Why are you spending more money for attorneys’
fees? Really -- but it makes you wonder what are they doing?
Transcript of Hearing at 55:23-56:9 (taken October 28, 2022)(Lieff), filed January 24, 2024 (Doc.
402).
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Numerous other filings reflect the same position, and Kuriyan -- a very smart man who is
detail oriented -- does not assert ignorance of them. See Plaintiff/Relator Jacob Kuriyan’s
Consolidated Response to Defendants’ Motions to Dismiss at 1 (Doc. 130)(“As a preliminary
matter, Relator does not intend to seek civil penalties or further damages against Defendants once
his alternate remedy dispute with the United States and State of New Mexico [] has been
resolved.”); Plaintiff/Relator Jacob Kuriyan’s Response to Defendants’ Motion to Dismiss
Relator’s 3rd Amended Complaint at 1 (Doc. 145); Joint Status Report and Provisional Discovery
Plan at 4 (Doc. 181)(“Once Relator’s pending alternate remedy motion has been fully resolved
(including any appeals related to it), this case will essentially have concluded. Relator will not
litigate further damages against Defendants.”); Agreed Order Staying Discovery at 1 (Doc. 194).
Moreover, under Tenth Circuit precedent, there is nothing novel about the “harshness of penalizing
[a] [client] for his attorney’s conduct.” Gripe v. City of Enid, Okla., 312 F.3d 1184, 1189 (10th
Cir. 2002). Kuriyan’s ignorance argument therefore does not lead the Court to find an error or
mistake that warrants amendment under rules 59 or 60. The Court therefore denies the Motion to
Amend insofar as it relies on Kuriyan’s asserted ignorance.
D. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO COUNTS I,
II, AND III, BASED ON KURIYAN’S ARGUMENT THAT HIS FORMER
COUNSEL COULD NOT HAVE ANTICIPATED THAT DOCUMENTS
PRODUCTION WOULD YIELD EVIDENCE SUPPORTING FCA AND NMMFAC
LIABILITY UNDER MEDICAID’S 60-DAY RULE.
Kuriyan contends that the Court should amend its Final Judgment dismissing Counts I, II,
and III, because Mr. Androphy could not have anticipated four years ago that document production
would yield “demonstrable evidence of the Defendants’ FCA and NMMFCA liability under
Medicaid’s 60 Day Rule.” Motion to Amend at 9. That argument is not sound. New counsel’s
review of existing documents -- and a different strategic assessment -- does not alter the fact that
Kuriyan’s former counsel represents to the Court that Kuriyan would not pursue Counts I, II, and
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III when the United States and the State of New Mexico submit dispositive motions.
To obtain relief, Kuriyan must satisfy either rule 59 or rule 60. Under rule 59, he must
show: (i) an intervening change in controlling law; (ii) previously unavailable evidence; or (iii) the
need to correct clear error or prevent manifest injustice. See Servants of the Paraclete v. Does,
204 F.3d at 1012. Rule 60(b), in turn, permits relief for “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or other limited circumstances. Fed. R.
Civ. P. 60(b). Although Kuriyan does not invoke either rule expressly, his argument fits only
within rule 59’s clear-error prong and rule 60’s “mistake” provision, because he identifies no
intervening change in law, no newly discovered evidence, and no fraud or other extraordinary
circumstance.
It does not matter that Kuriyan’s new counsel believes that Counts I, II, and III are viable.
Kuriyan’s former counsel repeatedly represents that Kuriyan will not pursue those Counts in this
action. See Plaintiff/Relator Jacob Kuriyan’s Consolidated Response to Defendants’ Motions to
Dismiss at 1 (Doc. 130)(“As a preliminary matter, Relator does not intend to seek civil penalties
or further damages against Defendants once his alternate remedy dispute with the United States
and State of New Mexico [] has been resolved.”); Plaintiff/Relator Jacob Kuriyan’s Response to
Defendants’ Motion to Dismiss Relator’s 3rd Amended Complaint at 1 (Doc. 145); Joint Status
Report and Provisional Discovery Plan at 4 (Doc. 181)(“Once Relator’s pending alternate remedy
motion has been fully resolved (including any appeals related to it), this case will essentially have
concluded. Relator will not litigate further damages against Defendants.”); Agreed Order Staying
Discovery at 1 (Doc. 194). Whatever new counsel now thinks of the evidence, those prior
representations control the course of this litigation at the time the United States and the State of
New Mexico file dispositive motions. The Court honors those representations. It resolves the
alternate-remedy dispute and enters Final Judgment so that Kuriyan can pursue an appeal if he
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chooses. See MOO at 64. That sequence does not supply a basis for relief under rule 59 or rule
60.
Finally, if Kuriyan believes a document establishes liability under Counts I, II, or III, he
remains free to file a new complaint. The Court dismisses those Counts without prejudice because
Kuriyan chooses not to pursue them during this litigation. If Kuriyan now believes he has a
“smoking gun,” he may fire it -- but not to reopen this case. The Court therefore denies the Motion
to Amend insofar as it relies on his document production argument.
II. THE COURT WILL NOT AMEND THE FINAL JUDGMENT AS TO COUNT IV.
Kuriyan’s final argument is that the Court should amend its Final Judgment dismissing
Count IV, because the Court should exercise its discretion under N.M. Stat. § 44-9-9(D) to preserve
Kuriyan’s NMFATA claim. See Motion to Amend at 13. He contends that the Court fails to
weigh the parties’ best interest and the public purposes behind the Fraud Against Taxpayers Act
when deciding to dismiss Count IV. See Motion to Amend at 14. Kuriyan misinterprets N.M.
Stat. § 44-9-9(D).
To obtain relief, Kuriyan must satisfy either rule 59 or rule 60. Under rule 59, he must
show: (i) an intervening change in controlling law; (ii) previously unavailable evidence; or (iii) the
need to correct clear error or prevent manifest injustice. See Servants of the Paraclete v. Does,
204 F.3d at 1012. Rule 60(b), in turn, permits relief for “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or other limited circumstances. Fed. R.
Civ. P. 60(b). Although Kuriyan does not invoke either rule expressly, his argument fits only
within rule 59’s clear-error prong and rule 60’s “mistake” provision, because he identifies no
intervening change in law, no newly discovered evidence, and no fraud or other extraordinary
circumstance.
Importantly, the Tenth Circuit holds that motions to reconsider are “not available to allow
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a party to merely reargue an issue previously addressed by the court . . . .” Cashner v. Freedom
Stores, Inc., 98 F.3d 572, 576 (10th Cir. 1996). In the Relator’s Objection to Magistrate Judge’s
Indefinite Postponement of Summary Judgment Briefing, filed January 9, 2024 (Doc. 439),
Kuriyan makes this same argument that N.M. Stat. § 44-9-5(A)’s “best interest” standard should
apply to § 44-9-9(D). Relator’s Objection to Magistrate Judge’s Indefinite Postponement of
Summary Judgment Briefing at 1. In the MOO, the Court rejects this argument. See MOO at 63.
For this reason alone, amendment under rule 59 and rule 60 is improper.
Nevertheless, looking at Kuriyan’s statutory argument, he misinterprets § 44-9-9(D). N.M.
Stat. § 44-9-9(D) states: “[A] court may, in its discretion, dismiss an action brought pursuant to
Section 44-9-5 NMSA 1978 if the elements of the alleged false or fraudulent claim have been
publicly disclosed in the news media or in a publicly disseminated governmental report at the time
the complaint is filed.” N.M. Stat. § 44-9-9(D). Kuriyan asserts that this State statute means that
the Court must apply the best-interest standard under N.M. Stat. § 44-9-5(A): “[T]aking into
account the best interest of the parties involved and the public purposes behind the Fraud Against
Taxpayers Act.” Motion to Amend at 13 (quoting N.M. Stat. § 44-9-5(A)). This argument is not
sound, because § 44-9-9(D) makes no reference to § 44-9-5(A)’s best interest standard. Rather,
the Court reads § 44-9-9(D) as giving it discretion to determine whether the elements of the alleged
false or fraudulent claim have been disclosed publicly, and if the elements have been disclosed, to
dismiss the Complaint. The Court determines in its MOO that the LFC Report is publicly disclosed
and therefore dismisses the claim. See MOO at 63. The Court therefore denies Kuriyan’s Motion
to Amend the Final Judgment as to Count IV.
IT IS ORDERED that: (i) Plaintiff/Relator Jacob Kuriyan’s Motion to Alter or Amend
the Judgment, and for Relief from a Judgment and Order, filed September 10, 2024 (Doc. 457), is
denied; (ii) the Court denies Kuriyan’s request to amend the Final Judgment as to Counts I, II, and
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III; and (iii) the Court denies Kuriyan’s request to amend the Final Judgment as to Count IV.
________________________________
UNITED STATES DISTRICT JUDGE
Counsel:
Alan Grayson
Alan Grayson, Esq.
Indialantic, Florida
Attorneys for the Plaintiff/Relator
David W. Tyler
Carol Wallack
Civil Division
United States Department of Justice
Washington, D.C.
-- and --
Ryan Ellison
First Assistant United States Attorney
Ruth Fuess Keegan
Assistant United States Attorney
United States Attorney’s Office
Albuquerque, New Mexico
Attorneys for Interested Party United States of America
Raúl Torrez
Attorney General
Zachary Asher Shandler
Assistant Attorney General
New Mexico Department of Justice
Santa Fe, New Mexico
Attorneys for Interested Party State of New Mexico
Michael R. Hoernlein
Alston & Bird LLP
Charlotte, North Carolina
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-- and --
Robert E. Hanson
Matthew E. Jackson
Peifer, Hanson, Mullins, & Baker P.A.
Albuquerque, New Mexico
Attorneys for Defendant UnitedHealthcare of New Mexico, Inc.
Tina M. Gooch
Sutin, Thayer & Browne
Albuquerque, New Mexico
-- and --
Jarrad Lucian Wood
Reed Smith LLP
Los Angeles, California
-- and --
Steven Hamilton
Jason T. Mayer
Reed Smith LLP
Chicago, Illinois
Attorneys for Defendant HCSC Insurance Services Co.
Julia L. Allen
Steven Ragland
Keker, Van Nest & Peters LLP
San Francisco, California
-- and --
Gregory Marshall
Jeanne Y. Sohn
Snell & Wilmer LLP
Albuquerque, New Mexico
Attorneys for Defendant Molina Healthcare of New Mexico, Inc.
Winston Y. Chan
Charles J. Stevens
Gibson, Dunn & Crutcher LLP
San Francisco, California
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-- and --
Charles K. Purcell
Rodey, Dickason, Sloan, Akin & Robb, P.A
Albuquerque, New Mexico
Attorneys for Defendant Presbyterian Health Plan, Inc.
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