Third Circuit Holds that Heightened “But For” Causation is Required for FCA Retaliation Claims
In United States ex rel. DiFiore v. CSL Behring, LLC, the U.S. Court of Appeals for the Third Circuit held that the anti-retaliation provision of the False Claims Act (“FCA”) requires a whistleblower to show that the whistleblower’s protected activity was not merely a “motivating factor” in an adverse employment action, but was in fact the “but for” cause of the alleged adverse action. In so holding, the Third Circuit adds to the growing body of cases following the United States Supreme Court’s Nassar decision that reject a “mixed motive” standard in favor of “but for” causation to sustain a cause of action under the FCA’s anti-retaliation provision.
The FCA’s anti-retaliation provision provides that an employee can sue if she was “discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts” conducted in furtherance of an FCA action. 31 U.S.C. § 3730(h)(1) (emphasis added). In DiFiore, the parties disputed the meaning of the “because of” language: the plaintiff argued that it only required that the whistleblowing activity be a mere “motivating factor” or “mixed motive” for the adverse employment action, while the defendant contended that the whistleblowing activity must be the “but for” cause of the adverse employment action.
Plaintiff Marie DiFiore worked for CSL Behring, a pharmaceutical company that produces and markets plasma protein biotherapeutics. DiFiore acted as a Director of Marketing and her duties involved the commercialization and launch of three pharmaceutical products: RiaSTAP, Beriplex, and Corifact. RiaSTAP is used to treat acute bleeding episodes in patients with congenital fibrinogen deficiency. While at CSL, DiFiore became concerned about the activities of CSL and its employees in marketing drugs for off-label use. Specifically, DiFiore alleged that CSL pushed RiaSTAP for acquired bleeding – an unauthorized use of the drug – and expected DiFiore to support those efforts in the marketing of RiaSTAP, despite her strong objections.
DiFiore alleged that as a consequence of her protected conduct, she suffered several adverse employment actions – two warning letters, a negative mid-year performance review, and placement on a Performance Improvement Plan. Ultimately, DiFiore alleged, she was forced to resign from CSL.
After her resignation, DiFiore filed suit alleging wrongful discharge under Pennsylvania law and retaliation under the FCA. The U.S. District Court for the Eastern District of Pennsylvania granted summary judgment in CSL’s favor on the state law claim, and permitted DiFiore’s FCA claim to proceed to trial. At trial, U.S. District Judge Gerald A. McHugh instructed the jury that the FCA’s anti-retaliation provision required that protected activity be the “but for” cause of adverse actions against DiFiore. The jury found in favor of CSL. DiFiore appealed, arguing that the District Court should not have applied the “but for” standard of causation and instead should have used the “motivating factor” standard.
Proof of “but for” causation – the standard the District Court required of DiFiore – requires the plaintiff to prove that the adverse employment action would not have happened if not for the improper retaliatory motive. “Motivating factor” or “mixed motive” causation, on the other hand, would permit a plaintiff’s claim to proceed even if the improper retaliatory motive was just one among other legitimate non-discriminatory reasons (for example, poor work performance) for the adverse action.
The Third Circuit’s Application of a Heightened “But For” Causation Standard
The Third Circuit affirmed Judge McHugh’s ruling, holding that a plaintiff in an FCA anti-retaliation case must show that her protected activity was the “but for” cause of the adverse employment action. Largely relying on the U.S. Supreme Court’s interpretation of similar ADEA and Title VII anti-retaliation provisions in Gross v. FBL Fin. Services Inc., 557 U.S. 167 (2009), and University of Texas Southwestern Medical Center v. Nassar, 133 S. Ct. 2517 (2013), the court held that because the FCA retaliation provision uses “because of” and not language specific to a standard of causation, the statute requires that DiFiore show that her protected conduct was the “but for” cause of her resignation.
The Third Circuit also distinguished its recent decision in Egan v. Delaware River Port Authority, 851 F.3d 263 (3d Cir. 2017), which examined “but for” causation in the context of anti-retaliation claims brought under the Family and Medical Leave Act. The Egan Court lessened the causation standard in FMLA retaliation cases. However, the Court distinguished the language of the FMLA anti-retaliation regulation from the language of the FCA retaliation provision, and therefore held that Egan did not apply.
Implications for Defendants Facing FCA Anti-Retaliation Claims
As a practical matter, the causation standard that courts apply to anti-retaliation claims is extraordinarily important. And it is typically much easier to show that illegal motivation may have been just one of many factors contributing to the adverse job action, as opposed to the “but for” cause. Thus, the Third Circuit’s DiFiore decision is favorable to employer defendants, and will be relied upon to dismiss FCA anti-retaliation claims, making it easier for employers to argue that the plaintiff would have been subject to adverse action regardless of the FCA-protected conduct.