Page:U.S. ex rel. Schutte v. SuperValu.pdf/5

2 The cases before us today involve a legal standard similar to that latter example: In certain circumstances, pharmacies are required to bill Medicare and Medicaid for their “usual and customary” drug prices. And, critically, these cases involve defendants (respondents here) who may have correctly understood the relevant standard and submitted inaccurate claims anyway. The question presented is thus whether respondents could have the scienter required by the FCA if they correctly understood that standard and thought that their claims were inaccurate.

We hold that the answer is yes: What matters for an FCA case is whether the defendant knew the claim was false. Thus, if respondents correctly interpreted the relevant phrase and believed their claims were false, then they could have known their claims were false.

The FCA permits private parties to bring lawsuits in the name of the United States—called qui tam lawsuits—against those who they believe have defrauded the Federal Government. §3730(b). Petitioners here brought two such lawsuits against respondents, which are companies that operate hundreds of retail drug pharmacies nationwide. In No. 21–1326, respondents are a group of companies that we collectively call SuperValu; in No. 22–111, respondent is Safeway, Inc. According to petitioners, respondents overcharged Medicare and Medicaid programs for years when seeking reimbursement for prescription drugs that the programs covered. In doing so, petitioners argue, respondents defrauded the Government and violated the FCA.

The claims at issue here relate to two federal benefits programs: Medicaid, which establishes a cooperative federal-state program that provides medical assistance to certain low-income individuals, see 42 U. S. C. §1396 et seq., and