Case Explained: RELATOR, LLC V. ERSKINE, ET AL.

Court: United States Court of Appeals for the Ninth Circuit

Filed: 2026-07-15

Docket: 3:22-cv-01158-

The Ninth Circuit reversed the district court’s dismissal of Relator, LLC’s qui tam action under the False Claims Act (FCA) and remanded the case for further proceedings. The panel held that the FCA’s public disclosure bar, 31 U.S.C. § 3730(e)(4)(A), did not bar the claim because the information publicly disclosed on PandemicOversight.gov was not “substantially the same” as Relator’s allegations regarding CalCon Mutual Mortgage, LLC’s eligibility for Paycheck Protection Program funds. The court reasoned that while the website disclosed CalCon’s NAICS code indicating it was a mortgage lender, this disclosure did not conclusively establish ineligibility because federal regulations contained exceptions for certain mortgage servicing companies; therefore, the relator’s specific allegations addressing why those exceptions did not apply were not publicly disclosed. Additionally, the panel concluded that CalCon’s own website did not qualify as “news media” under the statute, as it primarily served a business purpose rather than disseminating news about recent events to the general public. Regarding the district court’s finding that Relator failed to plausibly allege false statements regarding employee headcount, the Ninth Circuit agreed that the current pleading was speculative and based on unreasonable inferences. However, the panel determined that the district court abused its discretion by denying Relator leave to amend the complaint. The court noted that a single voluntary amendment does not automatically render further amendment futile, and the district court should have provided an opportunity for Relator to cure the pleading deficiencies before dismissing the claim with prejudice. The practical consequence of this decision is that the case returns to the Southern District of California for further proceedings. The district court must address whether Relator can amend its complaint to provide factual support for the employee headcount theory and determine if the remaining theories of misrepresentation are subject to the public disclosure bar, as the panel did not resolve those specific issues on appeal.

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