UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA, ex rel. EPHRAIM FUCHS, Plaintiff, v. No. 20-cv-3242 (DLF)

JOHNS HOPKINS UNIVERSITY et al., Defendants.

MEMORANDUM OPINION

Relator Ephraim Fuchs brings this qui tam action against defendants Johns Hopkins

University (“JHU”) and Children’s National Medical Center under the False Claims Act, see

et seq. Fuchs alleges that the defendants defrauded the federal government by

submitting a grant application with material falsities to obtain funding from the National Institutes

of Health (“NIH”) for bone marrow transplant research. Before the Court are the defendants’

motions to dismiss. Dkts. 43, 44. For the reasons that follow, the Court will grant the motions.

I. BACKGROUND

A. Statutory Background

The False Claims Act (“FCA”) “impose[s] liability for fraud against the government.”

United States v. Honeywell Int’l Inc.,

(D.C. Cir. 2022) (internal quotation marks

omitted). The Act’s presentment clause,

(a)(1)(A), bars knowingly submitting

false or fraudulent claims to the United States for payment, United States ex rel. Head v. Kane Co.,

, 195–96 (D.D.C. 2011). The Act’s false statement clause,

(a)(1)(B), bars knowingly making or using false records or statements to support a false claim. The latter clause is “complementary” to the former and is “designed to prevent those

who make false records or statements . . . from escaping liability solely on the ground that they

did not themselves present a claim for payment.” United States ex rel. Totten v. Bombardier Corp.,

(D.C. Cir. 2004).

The FCA is “enforced through a unique public-private scheme” that permits private

parties—relators—to bring qui tam actions on behalf of the federal government against defendants

who submit false claims or make or use materially false records. United States, ex rel. Polansky

v. Exec. Health Res., Inc.,

, 424–25 (2023); see

(b)(1). The FCA

“effects a partial assignment of the Government’s own damages claim.” Polansky, 599 U.S. at

425 (cleaned up). If an action under the FCA is successful, a relator may receive up to 30 percent

of the total recovery, depending on the nature of the relator’s contribution. See

(d)(1)–(2).

Because the government remains the “real party in interest” in a qui tam action, a relator is

subject to certain procedural restrictions beyond those imposed on other civil litigants. See United

States ex rel. Eisenstein v. City of New York,

(2009). To commence an FCA

action, a relator must file his complaint under seal to provide the government an opportunity to

investigate the claims and determine whether to intervene. See

(b)(2); United

States ex rel. Cimino v. Int’l Bus. Machines Corp.,

(D.C. Cir. 2021). The

government must notify the Court if it decides not to intervene, and only then may the relator

proceed with the action on his own. See

(b)(4), (c)(3).

B. Factual Background 1

1 In evaluating a motion to dismiss, the Court considers “any documents either attached to or incorporated in the complaint and matters of which we may take judicial notice.” EEOC v. St. Francis Xavier Parochial Sch.,

(D.C. Cir. 1997). The Court will evaluate the

2 NIH solicits applications for research grants known as “Program Project Grants,” which

fund “integrated, multiproject research programs involving a number of independent investigators

who share knowledge and common resources.” Am. Compl. ¶ 6, Dkt. 15. Each Program Project

Grant application proposes multiple projects, often run by independent investigators, related to a

central research objective.

NIH convenes panels of subject-matter experts to evaluate grant

applications under a two-tier review process. First, three members of the NIH panel evaluate each

individual project on a 9-point rating scale (where 1 is exceptional and 9 is poor) considering

factors such as scientific and technical merit and potential impact. Id. ¶ 8. The entire panel assigns

the grant application an overall impact score ranging from best possible score of 10 to a worst

possible score of 90. Id. Second, applications recommended by the panel are reviewed by the

appropriate national Advisory Council or Board. See NIH, Funding Opportunity Announcement

No. PAR-18-290 (Oct. 27, 2017), https://grants.nih.gov/grants/guide/pa-files/par-18-290.html.

This case concerns a May 2017 grant application submitted by JHU and Children’s

National to obtain NIH funding for bone marrow transplant research. Am. Compl. ¶ 7; see

Submission, Dkt. 40-1. The application proposed four projects, two of which—Project 3 and

Project 4—lie at the heart of this dispute. On initial submission, Project 3 received a score of 2.3

(out of a best possible score 1), Project 4 received a score of 1.7, and the overall application

received a score of 21 (out of a best possible score of 10). Am. Compl. ¶ 9; Submission Rev. at

2–3, Dkt 40-2. The application was not approved. Am. Compl. ¶ 9. In June 2018, the defendants

resubmitted a 1,107-page application (the “Resubmission”) proposing the same four projects. Id.

grant submissions that Fuchs has incorporated into his complaint. See Submission, Dkt. 40-1; Resubmission, Dkt. 40-3. It also takes judicial notice of publicly available information about the NIH grant application process. See Masek v. United States, No. 22-cv-03574 (RC),

, at *7 (D.D.C. Mar. 22, 2024). 3 ¶ 10; see Resubmission, Dkt. 40-3. In April 2019, the Resubmission was approved—Project 3

received an improved score of 1.7, Project 4 received the same score of 1.7, and the overall

application received an improved score of 17. See Resubmission Rev. at 1–2, Dkt. 40-4. NIH

committed to providing approximately $11 million over five years to fund 16 clinical trials

proposed under the grant. Am. Compl. ¶ 63; see generally Resubmission.

Relator Fuchs is a professor of oncology and immunology at the JHU School of Medicine.

Am. Compl. ¶ 3. Fuchs served as a co-leader for Project 4, an investigator for Project 3, and a

contributor to the grant application. See Resubmission at 168, 640. Six months after NIH funded

the grant, Fuchs suggested changes to one of the clinical trials approved as part of Project 4. Am.

Compl. ¶¶ 25, 47. Other investigators expressed concerns that Fuchs’s proposal raised potential

conflicts of interest arising from his connections to a for-profit business. See Resubmission at 80–

81; Am. Compl. ¶ 25, at 15. Fuchs’s proposed changes were adopted in part, but Fuchs was

removed as an investigator from the trial. Am. Compl. ¶¶ 49–52. In June 2020, Fuchs wrote a

letter to JHU’s Research Integrity Office detailing concerns about the Resubmission.

.

C. The Resubmission

Fuchs’s letter and his current action allege that the Resubmission contained material

falsities related to trials in Project 3 and Project 4. The Court will describe the proposals and

alleged falsities in turn.

1. Project 3, “RESOLVE” Trial – Arm A

The RESOLVE Trial in Project 3 involved therapies for patients suffering from high-risk

forms of leukemia. Am. Compl. ¶ 57. Investigators hypothesized that after leukemia patients

received bone marrow transplants, infusions of T lymphocyte cells (white blood cells) taken from

the marrow donor could trigger an immune response or prevent relapse in leukemia patients.

4 Under Arm A of the RESOLVE Trial, investigators proposed to test the safety of increasing

doses of T cell infusions in post-transplant patients who were already suffering leukemia relapse.

. The “primary objective of Arm A was ‘to determine the safety of administering [T cell

therapy]’” to relapsed patients.

, at 34 (emphasis added). The secondary objective was to

assess patient “response”—that is, the therapy’s efficacy.

The study categorized efficacy of

patient response as “Complete Remission,” “Partial Remission,” “Mixed response,” or “Stable

Disease.”

Upon review of the initial grant application, one reviewer noted that “no sufficient

data have been generated to show the sustained benefit of [T cell therapy]” and that Arm A was

only “[i]ncremental building of a project that has been going on for a while.” Am. Compl. ¶ 62,

at 35–36.

Fuchs alleges that the Resubmission contained false efficacy data about patient responses

to Arm A. The Resubmission asserted that “preliminary data” in an ongoing study indicated that

T cell therapy had induced remission in 87.5% of relapsed patients, which was “unprecedented for

any cell therapeutic” for post-transplant leukemia patients. Resubmission at 599 (“TAA-T induced

CR in 87.5% relapsed patients post BMT”); Am. Compl. ¶ 62, at 36. The project description later

asserted that seven out of eight—or 87.5 % of—patients in the ongoing trial had achieved complete

or partial remission. See Resubmission at 604 (“Responses of evaluable patients (n=12) are:

progressive disease (n=2), stable disease (n=2), CR (n=8) and PR (n=1) with 7/8 AML patients

achieving CR/PR.”); see Am. Compl. ¶ 62, at 36. According to Fuchs, that 87.5% number

contradicted a paper presented by RESOLVE investigators at a May 2017 conference of the

International Society of Cell & Gene Therapy. Am. Compl. ¶ 62, at 39. The number also

contradicted the data in the 2020 progress report submitted to NIH.

, at 36. The May 2017

paper reflected that only three out of five (or 60% of) relevant patients had achieved remission.

5

, at 39. In June 2020, Fuchs emailed Jones and other investigators about the inconsistency.

Jones replied that the issue had been identified by auditors and corrected in the 2020 progress

report submitted to NIH.

An corrected table of patient outcomes was included in the 2020

progress report.

. Project 3, “RESOLVE” Trial – Arm C

Under Arm C of the RESOLVE Trial, investigators proposed injecting post-transplant

leukemia patients with donor T cells within 44 days of transplant, to determine whether the therapy

would prevent or delay relapse. Am. Compl. ¶ 57. Relapse risk is heightened in the period

immediately following transplant, and Arm C proposed to study the therapy’s effects beginning in

this elevated risk period. Fuchs alleges that investigators failed to comply with the proposed trial

design and manipulated the sample of enrolled patients by enrolling post-transplant patients who

had already gone several months without experiencing negative health events.

. According

to Fuchs, enrolling this “highly selected, favorable [patient] cohort” resulted in “clinically

meaningless” data, and NIH likely would have downgraded the project had they known Arm C

“would produce only this meaningless comparison.”

. Project 4, Trial 2 (the “Nivolumab Trial”)

Trials 1 and 2 of Project 4 were interrelated and involved the use of bone marrow

transplants to treat certain high-risk solid tumors.

. If patients enrolled in Trial 1 had a

positive reaction to transplant and met certain conditions, they would become eligible to enroll in

Trial 2. See

Trial 2 patients would receive bi-weekly doses of Nivolumab, an expensive

antibody treatment manufactured by Bristol-Myers Squibb.

The initial grant application

proposed only Trial 2 and requested funding.

. Just before the Resubmission in June 2018,

JHU entered into a sponsored research agreement with Bristol-Myers Squibb, under which the

6 company would provide the necessary quantities of Nivolumab for free and subsidize other trial

costs.

¶¶ 28–29. But after patient enrollment in Trial 2 fell below expectations, around

November 2019, Bristol-Myers Squibb informed JHU it would no longer provide Nivolumab or

subsidize new enrollees.

. In the 2020 grant progress report, investigators did not disclose

that Bristol-Myers Squibb had withdrawn financial support.

.

4. Project 4, Trial 3 (the “Prostate Cancer Trial”)

Trial 3 (the “Prostate Cancer Trial”) was co-led by Richard Jones, the principal investigator

of the overall grant.

. The trial proposed to use bone marrow from female donors to treat

male patients with metastatic prostate cancer.

. Following transplant, patients would

receive testosterone injections, under the hypothesis that testosterone would trigger an immune

response from the donated female marrow cells directed toward metastatic prostate cancer cells.

Efficacy would be evaluated by measuring any decrease in the patient’s prostate-specific

antigen, a protein associated with prostate cancer progression.

The Prostate Cancer Trial was proposed in the initial grant application and NIH reviewers

highlighted some potential concerns.

. As a general matter, bone marrow transplants carry

serious risks of graft-versus-host-disease, a potentially fatal condition caused by donor cells

attacking a patient’s normal issues.

. A reviewer noted that “development of [graft-versus-

host-disease] and [transplant-related mortality] may remain major hurdles” to the Prostate Cancer

Trial therapy.

. A reviewer also noted that the proposed therapy could backfire: if the

therapy “d[id] not adequately induce endogenous T cell [immune] responses in a timely fashion,

the cancers may progress rather than regress.”

. By the time of the Resubmission,

investigators had tried the proposed therapy on three patients.

. The Resubmission asserted

that 2 of those patients had shown a “dramatic” response: “3 patients have been enrolled (first 2

7 with dramatic decreases in [prostate-specific antigen], 1 just starting).” Resubmission at 749

(emphasis added). In response to initial reviewers’ concerns about cancer progression, the

Resubmission again noted that “the first 2 patients showed dramatic responses to [the therapy],

but we will continue to carefully monitor [cancer progression] in our first-in-human study.”

(emphasis added).

Fuchs alleges that the assertions about a “dramatic” response contradicted underlying

patient records, and he further challenges the Resubmission’s failure to disclose that both patients

suffered graft-versus-host-disease. Am. Compl. ¶ 25, at 13. Fuchs points to an email sent around

March 2020, from a Prostate Cancer Trial investigator, expressing pessimism about patient

enrollment and noting that “none of the first three patients had anything that looked like a

significant response to the transplant.”

In an email to Jones, Fuchs challenged the trial results

and asserted that neither patient had met the “protocol-defined criterion” for response based on

prostate-specific antigen measurements.

, at 16. Jones disagreed: he responded that “the

first patient absolutely had a response, no question,”

, at 14, and that the patient “told

[Jones] a month or so before he died, he was sure he had only survived 3 years because of the

transplant,”

, at 17. Jones further stated that the second patient was “doing well and in fact

showing a response.”

He sent accompanying data showing that the second patient’s prostate-

specific antigen measurements dropped from 276.4 in December 2017 to 158.8 in April 2018.

, at 18.

* * *

After JHU failed to act on his letter, Fuchs filed suit on November 6, 2020. Dkt. 1. He

asserts claims under the FCA’s presentment clause (Count I), false statement clause (Count II),

and reverse false claims clause (Count III). Am. Compl. ¶¶ 72–86. The United States declined to

8 intervene. See Dkt. 21. The defendants move to dismiss. JHU Mot. to Dismiss, Dkt. 43;

Children’s Hosp. Mot. to Dismiss, Dkt. 44.

II. LEGAL STANDARDS

Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a defendant may move to

dismiss a complaint for failure to state a claim. Fed. R. Civ. P. 12(b)(6). To survive a Rule

12(b)(6) motion, a complaint must contain factual matter sufficient to “state a claim to relief that

is plausible on its face.” Bell Atl. Corp. v. Twombly,

(2007). A facially plausible

claim “allows [a] court to draw the reasonable inference that the defendant is liable for the

misconduct alleged.” Ashcroft v. Iqbal,

(2009). Well-pleaded factual

allegations are “entitled to [an] assumption of truth,”

, and the Court construes the

complaint “in favor of the plaintiff, who must be granted the benefit of all inferences that can be

derived from the facts alleged,” Hettinga v. United States,

(D.C. Cir. 2012)

(internal quotation marks omitted). But the Court need not accept “a legal conclusion couched as

a factual allegation” nor an inference unsupported by the facts alleged in the pleadings. Trudeau

v. FTC,

(D.C. Cir. 2006) (quoting Papasan v. Allain,

(1986)).

Fraud claims brought under the FCA must also satisfy Rule 9(b)’s heightened pleading

standard, which requires the plaintiff to “state with particularity the circumstances constituting

fraud or mistake.” Fed. R. Civ. P. 9(b); see Totten, 286 F.3d at 551–552. A plaintiff must “state

the time, place and content of the false misrepresentations, the fact misrepresented and what was

retained or given up as a consequence of the fraud.” Kowal v. MCI Commc’ns Corp.,

(D.C. Cir. 1994) (internal quotation marks omitted).

III. ANALYSIS

9 A. Presentment and False Statement Claims

To allege a presentment or false statement claim under the FCA, a plaintiff must show that

(1) the defendant submitted a claim or made a statement to the government; (2) the claim or

statement was false; and (3) the defendant knew the claim or statement was false. Pencheng Si v.

Laogai Rsch. Found.,

(D.D.C. 2014) (Jackson, J.). Courts have also read a

materiality standard into the falsity element. United States v. DynCorp Int’l, LLC,

, 98–99 (D.D.C. 2017). In other words, a presentment or false statement claim under the FCA

requires proof of falsity, materiality, and scienter.

The first element, falsity, requires an “objective falsehood,” and “imprecise statements,”

“differences in interpretation,” or “subjective” statements do not qualify. United States ex rel.

Wilson v. Kellogg Brown & Root, Inc.,

, 376–77 (4th Cir. 2008) (citing Lamers v.

City of Green Bay,

(7th Cir. 1999)). A defendant’s omission also can amount

to a false statement, but that omission must be “misleading.” Universal Health Servs., Inc. v.

United States ex rel. Escobar,

, 186–87 (2016). The Act “does not impose liability

for omissions unless the defendant has an obligation to disclose the omitted information.” United

States ex rel. Milam v. Regents of Univ. of California,

(D. Md. 1995). The

second element, materiality, inquires whether the falsity would have “a natural tendency to

influence, or be capable of influencing,” the “behavior of the recipient of the alleged

misrepresentation.” Escobar, 579 U.S. at 182–83 (internal quotation marks omitted). Materiality

is a “rigorous” and “demanding” standard because the FCA is not “an all-purpose antifraud statute

or a vehicle for punishing garden-variety breaches.” Id. at 192. Materiality “is not ‘too fact

intensive’ for courts to resolve on a motion to dismiss.” United States ex rel. Gardner v. Vanda

Pharm., Inc., No. 17-cv-00464 (APM),

, at *8 (D.D.C. May 19, 2020) (quoting

10 Escobar,

n.6). Third, the element of scienter requires the defendant to have “actual

knowledge” of the falsity, or “deliberate ignorance or reckless disregard” for the truth. United

States v. TDC Mgmt. Corp.,

(D.C. Cir. 1994) (internal quotation marks omitted).

The FCA also permits a plaintiff to proceed under a fraudulent inducement theory. See

Pencheng Si, 71 F. Supp. 3d at 87–88; United States ex rel. Bettis v. Odebrecht Contractors of

Cal., Inc.,

(D.C. Cir. 2005). Under that theory, a plaintiff must show that the

defendant’s contract with the government was procured by fraud, and that the government “never

would have entered the contract, and no payments would have been made,” had the fraudulent

inducement been known. United States ex rel. Hockett v. Columbia/HCA Healthcare Corp.,

, 69 n.33 (D.D.C. 2007).

1. Project 3, “RESOLVE” Trial – Arm A

Fuchs challenges allegedly fraudulent data about the efficacy of Arm A of the RESOLVE

Trial. The Resubmission asserted that 7 out of 8 (or 87.5% of) patients had experienced complete

remission after T cell therapy. Resubmission at 599, 604 (T cell therapy had “induced [complete

remission] in 87.5% relapsed patients,” and “7/8 . . . patients achieve[d] [complete remission or

partial remission].”). According to Fuchs, those statements were fraudulent because the 87.5%

number contradicted data in a later 2020 grant progress report and in a separate paper presented at

a scientific conference in 2017, and because the Resubmission did not disclose that patients in

continuing remission were included in the “Complete Remission” category. 2 Am. Compl. ¶¶ 59,

2 Fuchs raises new allegations in his opposition brief about the proportion of grant funding allocated to the RESOLVE Trial. Opp’n at 33–34, Dkt. 57 (estimating that Project 3 would consume 28.6% of overall grant funding). But in evaluating a motion to dismiss, the Court cannot consider factual allegations raised for the first time in an opposition brief. Pappas v. District of Columbia,

, 81 n.5 (D.D.C. 2021) (“[A plaintiff] cannot amend his or her complaint by the briefs in opposition to a motion to dismiss.”) (citation and internal quotation marks omitted). 11 62, at 36–37. Even accepting that the preliminary patient data was false—which the Court assumes

without deciding—Fuchs fails to plausibly allege that it was material to NIH’s funding decision.

Comments on the Resubmission show that fully-informed NIH reviewers did not view the

preliminary data as material, nor did they heavily rely on efficacy projections in approving the

grant. One reviewer noted that “[i]t is not expected that durable remissions will be achieved in

80% of [treated] patients,” reflecting an understanding that the 87.5% remission rate was not

expected to be maintained. Resubmission Rev. at 32. Another reviewer described the challenged

data as “not clear and hard to interpret,” and pointed out an arithmetic error in the patient numbers

in the Resubmission.

(“Responses of evaluable patients (n=12) are: progressive disease (n=2),

stable disease (n=2), CR (n=8) and PR (n=1) with 7/8 AML patients achieving CR/PR. It is stated

that there are 12 evaluable patients, but then the numbers for PD, SD, CR, and PR add up to 13.”).

Despite expressing skepticism about the accuracy and predictive value of the efficacy data, the

reviewers nonetheless awarded a high grade to Project 3 and approved the overall grant. The

reviewers’ notes also show that the agency understood safety determinations to be the central

contribution of Arm A, and efficacy to be a secondary concern. See Am. Compl. ¶ 62 (“The

primary objective of Arm A was to determine the safety of administering [T cell therapy to] . . .

transplant recipients.”); Resubmission at 600, 675 (under “NIH principles,” trials categorized as

Phase I (like Arm A) are “physiologic, toxicity, and dose-finding studies,” in contrast to Phase II

efficacy trials). That evaluating efficacy was the “secondary” objective of Arm A further suggests

that the preliminary efficacy data was immaterial. Escobar,

(“Materiality . . .

cannot be found where noncompliance is minor or insubstantial.”).

That NIH continued funding after the 2020 grant progress report provided corrected patient

response data is strong evidence that the data inconsistencies were not material to the agency. See

12 Escobar,

(“[I]f the Government pays a particular claim in full despite its actual

knowledge that certain requirements were violated, that is very strong evidence that those

requirements are not material.”). Although Project 3’s grade improved from 2.3 to 1.7 following

the Resubmission, taken as a whole, even in the light most favorable to the relator, the complaint

and incorporated documents fail to raise a plausible inference that the efficacy data was material

to the overall grant, which included four discrete projects consisting of 16 ongoing and anticipated

clinical trials. Am. Compl. ¶ 7.

To the extent that Fuchs relies on the defendants’ omission of any corrective statement

about that data, that claim would also fail for the same lack of materiality. See United States ex

rel. Westrick v. Second Chance Body Armor Inc.,

(D.D.C. 2015) (a relator

must plead that “omitted information was material”).

Accordingly, the presentment and false statement claims with respect to Arm A of the

RESOLVE Trial will be dismissed without prejudice.

2. Project 3, “RESOLVE” Trial – Arm C

Next, the Court turns to the alleged falsities about Arm C of the RESOLVE Trial. Fuchs

alleges that the Resubmission represented that enrolled patients would receive T cell infusions

within 44 days of bone marrow transplant, when in reality, some enrolled patients did not receive

infusions until months later. Am. Compl. ¶¶ 57–58. He further alleges that alterations to the Arm

C design rendered the resultant data “clinically meaningless.” Id. ¶ 58.

But the record reveals that the Resubmission contained minor discrepancies about the Arm

C trial design: it asserted at various points that patients would receive T cell infusions within 30

days, 44 days, or 60 days of transplant. See Resubmission at 607 (“TAA-L will be given post-

BMT, prior to relapse, at day 30 ± 14 days” (emphasis added)); 621 (study timeline for RESOLVE

13 Cohort C aims to “[t]reat 26 patients with high risk AML/MDS with TAA-T cells within 60 days

post BMT” (emphasis added)); 625 (“TAA-L will be given posttransplant, prior to relapse, on day

30.” (emphasis added)). While the Resubmission was pending, investigators submitted an

amended protocol to the JHU institutional review board, extending the timeframe for infusions to

within five months of transplant. See Opp’n at 22. Thus, the Arm C timeline, as implemented,

varied from the Resubmission’s proposed timeline by roughly three to four months, and the

extension was not disclosed in the Resubmission or 2020 grant progress report. Id.

Fuchs has not plausibly alleged that the undisclosed protocol modifications rose to the level

of fraud. See Pencheng Si, 71 F. Supp. 3d at 86–87. As a matter of law, “[d]isagreements over

scientific methodology do not give rise to False Claims Act liability.” Milam,

(citing United States ex rel. Anderson v. N. Telecom, Inc.,

, 815–16 (9th Cir. 1995)).

Fuchs does not allege that the investigators manipulated the study data or falsely reported the

study’s results. He instead alleges that a modification to a clinical protocol affected the scientific

significance of study results. Am. Compl. ¶ 58 (alleging that the 3-month discrepancy ultimately

went to the “clinical[]” significance of the study). But the “legal process is not suited to resolving

scientific disputes,” and the FCA “is concerned with ferreting out ‘wrongdoing,’ not scientific

errors.” Milam,

(quoting Wang v. FMC Corp.,

(9th Cir.

1992)). Disputes about study methodology—even if they render statements “scientifically

untrue”—are not “lie[s]” under the FCA. Id.; see also United States ex rel. Jones v. Brigham and

Women’s Hosp.,

(1st Cir. 2012) (“[T]he decision as to which measurement method

to employ was a question of scientific judgment.”). Accordingly, the Court concludes that the

modifications to the Arm C study design could not amount to falsities under the FCA, and it will

dismiss without prejudice the claims based on Arm C.

14 3. Project 4 — Nivolumab Trial

Next, Fuchs claims that the defendants’ failure to disclose Bristol Myers Squibb’s

withdrawal of funding from the Nivolumab Trial in Project 4 amounted to a material omission

from the 2020 grant progress report. Am. Compl. ¶ 37. This claim also fails because Fuchs has

failed to allege that the investigators had any obligation to disclose that withdrawal of funding

under the terms of the grant or under any other NIH policy. See Milam,

(to

sustain a fraud claim based on an omission, a relator must allege that “the defendant has an

obligation to disclose the omitted information”). 3

4. Project 4 — Prostate Cancer Trial

Fuchs further contends that the Resubmission was materially false because (1) it

characterized the first two patients’s responses to the Prostate Cancer Trial therapy as “dramatic,”

Resubmission at 749, and (2) it failed to disclose that both patients suffered graft-versus-host-

disease. In support, Fuchs relies on data from patient records.

As alleged in the complaint, the first patient’s prostate-specific antigen measurements

dropped, following a May 2017 transplant, from 8.4 to 7.7 (or rough 9%) before rising. Am

Compl. ¶ 25, at 11. The second patient’s measurements dropped, following a December 2017

transplant, from 276.4 to 158.8 in April 2018 (or roughly 43%) before rising. Id. ¶ 25, at 19.

According to Fuchs, neither decrease was fairly characterized as “dramatic” because neither

3 In the alternative, even if the defendants did have an obligation to disclose the withdrawal of the Bristol Myers Squibb funding, Fuchs fails to allege that the funding was material to the approval of the grant. According to Fuchs, materiality can be inferred because the initial, unapproved submission did not include the funding, while the approved Resubmission did. Am. Compl. ¶¶ 27, 33. But Project 4’s unchanged grade in the Resubmission vitiates that inference: on initial submission, Project 4 received the same score of 1.7 as it did for the Resubmission. This entirely consistent scoring suggests that the funding had no impact on NIH’s assessment of Project 4. Fuchs provides no other basis for his “information and belief” that the funding was material. Id. ¶ 33. 15 patient had met the “protocol-defined criterion” of a 50% drop in prostate-specific antigen. Am.

Compl. ¶ 25, at 16. Both patients suffered from graft-versus-host disease, and both ultimately

died. Id. ¶ 25, at 17.

The principal investigator on the trial, Jones, disagreed that neither patient responded to

the treatment. Jones asserted that the first patient initially “had a response, no question and that

the patient attributed his 3-year survival to the transplant and subsequent therapy.” Id. ¶ 25, at 14.

Jones also provided data showing the second patient’s 43% decrease in prostate-specific antigen

measurements. Id. ¶ 25, at 19. He further explained that graft-versus-host disease is an expected

response following bone marrow transplant, and that the patient population eligible for enrollment

in the study faced inherently high risks of mortality, given the nature of their prostate cancer. Id.

¶ 24 (“If you take pre-dead patients, they are not going to be cured (short of divine intervention –

imantinib doesn’t cure blast crisis CML, CAR T cells cure end-stage ALL or lymphoma).”).

Characterizing the first two patients’ responses to the therapy as “dramatic” was not

materially false because, as a general matter, “[e]xpressions of opinion, scientific judgments, or

statements as to conclusions about which reasonable minds may differ cannot be false.” Jones,

. The term “dramatic” is an imprecise adjective, and thhere may be a “wide

difference of opinion of what is, and what is not” dramatic because the term is “not precise or

measurable.” United States v. Southland Mgmt. Corp.,

(5th Cir. 2003). The

complaint highlights a reasoned disagreement between two scientists about how to describe the

data and holistic patient responses. Am Compl. ¶ 25, at 14–17. While Fuchs asserts that

“dramatic” was inappropriate to describe a measurement that did not meet a certain protocol

definition, id. ¶ 25, at 16, the relevant statements in the Resubmission never claimed to meet that

definition or any other specific numerical cutoff. In these circumstances, the Court is reluctant to

16 attribute falsity to an adjective expressing a subjective scientific judgment on which reasonable

minds may differ. Jones,

.

But even if the use of the term “dramatic” was improper in this context, it does not rise to

a material falsity. The initial grant application did not use the term or include the patient results,

and yet Project 4 still received a score of 1.7 (out of a best possible score of 1). See Submission

at 567; Submission Rev. at 2. The Resubmission included both the term and the results, and the

project received the same score. See Resubmission at 749; Resubmission Rev. at 3. Project 4’s

unchanged score undermines any inference that the “dramatic” statements were material,

particularly to the NIH reviewers’ decision to fund the overall grant, which included three

additional projects.

Similarly, the defendants’ failures to mention the patients’ graft-versus-host disease were

not omissions rising to material falsities. As Fuchs himself alleges, bone marrow transplants are

broadly understood to present a “substantial risk” of fatal graft-versus-host disease. Am. Compl.

¶ 14. And NIH expert reviewers’ comments reflected that they understood the high likelihood that

enrolled patients would suffer from the disease. Id. ¶ 21 (“[D]evelopment of GVHD and TRM

[transplant-related mortality] may remain major hurdles for this approach” and “[d]evelopment of

GVHD and risk of TRM are a concern.”). Given the wide-spread scientific consensus, it cannot

be said that the defendants’ failure to mention an expected side-effect of transplant was

“misleading” for expert reviewers. Escobar,

.

Accordingly, the Court will dismiss the claims based on the Prostate Cancer Trial without

prejudice.

17 B. Reverse False Claims

A reverse false claim action “involves a defendant knowingly making a false statement in

order to avoid having to pay the government when payment is otherwise due.” Pencheng Si,

(citing United States v. Caremark, Inc.,

, 814–815 (5th Cir. 2011));

see 31 U.S.C. 3729(a)(1)(G). Fuchs alleges that the defendants improperly avoided payments to

the government by not refunding the money obtained under the allegedly fraudulent NIH grant.

Am. Compl. ¶¶ 83–84. But this kind of avoidance does not state a reverse false claim as a matter

of law. See United States v. Newman, No. 16-cv-01169 (CKK),

, at *9 (D.D.C.

Aug. 17, 2017) (“[T]he allegation that Defendants fraudulently concealed their original false claim

. . . and thereby prevented the government from discovering that fraud is not by itself enough to

establish an ‘obligation’ to return the credit for the purposes of a reverse false claim action.”).

Because Fuchs relies on the same conduct to support his presentment and false statement claims,

he does not assert an actionable avoidance under the reverse false claims clause. See Pencheng Si,

. Accordingly, Count III will be dismissed with prejudice.

CONCLUSION

For the above stated reasons, the defendants’ motions to dismiss are granted. A separate

order accompanies this memorandum opinion.

________________________ DABNEY L. FRIEDRICH March 31, 2025 United States District Judge

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