Opinion
Case No. 00-3128-CV-S-4-ECF
November 15, 2000
ORDER
Presently before the Court are three related Motions. The Plaintiff, United States of America ("United States" or "Government"), has filed a Motion for Default Judgment. This Motion is opposed by the Defendant, NHC Health Care Corporation ("NHC"). NHC has also filed a Motion for Leave to File an Answer. Finally, the Government has filed a Motion to Strike certain affirmative defenses set forth in this proposed Answer offered by the Defendant.
I. Default
As to the Plaintiff's Motion for Default, the record reflects that the Defendant's original Answer was due on or about June 1, 2000, but Defendant did not file any responsive pleadings until June 20, 2000. On that date Defendant filed a Motion to Dismiss. On August 31, 2000, this Court entered an Order denying in part, and granting in part, the Defendant's Motion. Therefore, the Defendant's Answer then became due on or about September 20, 2000. The Answer was not timely filed and on October 6, 2000, the Plaintiff moved for a Default Judgment in the amount of $261,746.00. The Defendant filed an immediate opposition to the Motion and requested leave to file its Answer. The Defendant does not dispute that the Answer was not timely, but argues that dismissal is too drastic a remedy. The Defendant offers that its Answer was not timely filed because of an "inadvertent failure" by its counsel. While the Court certainly does not condone the dilatory manner in which the Defendant's counsel has litigated this case to date, it agrees that a default judgment would be a disproportionate remedy at this juncture. Therefore, the Court will deny the Motion for Default and allow the Defendant to file its Answer.
II. Motion to Strike
As to the proposed Answer filed by the Defendant, the Plaintiff has moved to strike the Defendant's affirmative defense of contributory and/or comparative fault. The Plaintiffs Complaint alleges that the Defendant billed the Medicare/Medicaid programs for acts or procedures which it did not perform. The Plaintiff has alleged, inter alia, violations of the False Claims Act, 31 U.S.C. § 3279 et seq. ("FCA") and common law breach of contract. To both of these claims the Defendant alleges that any damages are the direct and proximate result of the acts, omissions and/or negligence of the Plaintiff or other persons; in other words, comparative fault.
As to the FCA claim, the Eighth Circuit has made it clear that claims under the FCA are akin to common law fraud, making them intentional torts. United States v. Cooperative Grain Supply Co., 476 F.2d 47, 60 (8th Cir. 1973). A comparative fault defense is not proper under an intentional tort claim. Therefore, the Defendant cannot bring an affirmative defense of comparative fault under a claim brought pursuant to the FCA. See United States v. Lilley, 99-4106 (W.D.Mo. Order Striking comparative fault claim dated 9-26-00).
Defendant's argument to the contrary is premised on several unrelated points of law which are not syllogistically connected. First, Defendant notes that Plaintiff must prove Defendant "knowingly" (intentionally) submitted false claims. Knowingly is defined under the FCA as including a " reckless disregard for the truth." 31 U.S.C. § 3729(b) (emphasis added). Second, Defendant notes that under Missouri law, comparative fault claims are proper when "reckless" behavior is involved. See Allison Sverdrup Parcel Assoc., 738 S.W.2d 440, 451 (Mo.App. 1987) (holding that individual who attempts a rescue in a "reckless" manner and is injured is subject to the affirmative defense of comparative fault). From these two unrelated points of law the Defendant apparently reasons that because the word "reckless" is used in both the FCA and Missouri common law, there must be some connection. This is indeed a stretch. The term "reckless" as used in the Allison case has a completely different connotation as used in the FCA. Simply because one who acts in a reckless manner when conducting a rescue is subject to a comparative fault defense does not mean that a defendant sued under the FCA is subject to the same defense.
Likewise, Defendant has failed to prove that its comparative fault defense is proper under the claim for breach of contract. "It is well settled that contributory negligence is no defense to a breach of contract action." A. G. Edwards Sons, Inc., 978 S.W.2d 386, 391 (Mo.App. 1998). Although contributory negligence will not bar recovery, the defense may become relevant if mitigation of damages becomes an issue. Id. The Plaintiff has not plead mitigation of damages as a defense. Mitigation of contract damages is an affirmative defense which must be plead to be recognized. See Kauzlarich v. Atchison, Topeka, and Santa Fe Railway Co., 910 S.W.2d 254, 259 (Mo. 1995); Mo.R.Civ.P.55.08; Fed.R.Civ.P. 8(c). Therefore, the affirmative defense of contributory/comparative fault is not proper under either claim and must be stricken.
CONCLUSION
For the foregoing reasons, the Court hereby ORDERS as follows:
— the Defendant's Motion for Default is hereby DENIED;
— the Plaintiff's Motion for Leave to File Answer is GRANTED; and
— the Defendant's Motion to Strike is hereby GRANTED.
IT IS SO ORDERED
ORDER TO SHOW CAUSE
On October 26, 2000, plaintiff filed its Motion to Strike Defendant's Affirmative Defense of Estoppel. To date, no response has been filed by defendant. Accordingly, it isORDERED that defendant show cause within fifteen (15) days from the date of this Order why plaintiff's Motion to Strike Defendant's Affirmative Defense of Estoppel should not be granted.