United States District Court, N.D. Alabama, Southern Division
MEMORANDUM OPINION AND ORDER
VIRGINIA EMERSON HOPKINS United States District Judge
primary issue for the court to decide is which claims arising
under the False Claims Act (“FCA”) in Counts I-V
of the First Qui Tam Amended Complaint (the
“Amended Complaint”)(doc. 47) brought by
Plaintiff Relator Barry Taul (“Taul”) are
actionable against Defendants Nagel Enterprises, Inc. and Jed
Nagel (“Defendants”). As explained below, some of
Taul's claims are barred by their respective statutes of
limitations, while others are not. Additionally, Taul's
reverse FCA claims are due to be dismissed as inadequately
alleged. This court retains jurisdiction to decide Taul's
timely claims, and Defendants' Motion To Dismiss (doc.
85) is due to be GRANTED IN PART and DENIED IN PART.
commenced this action against Defendants on January 13,
2014.,  On May 19, 2015, Taul filed an Amended
Complaint, asserting five grounds for relief: violations of
(1) 31 U.S.C. § 3729(a)(1)(A); (2) 31 U.S.C. §
3729(a)(1)(C); (3) 31 U.S.C. § 3729(a)(1)(B); (4)
retaliation under 31 U.S.C. § 3730(h); and (5) FCA
violations based on violations of 42 U.S.C. §
1320a-7b(b)(2). (Doc. 47). On July 13, 2015, Defendants filed
their Answer, which raised the statute of limitations as an
affirmative defense. (Doc. 58). On July 30, 2015, Defendants
moved for summary judgment (Doc. 61), and on January 25,
2016, this court granted in part and denied in part
Defendants' Motion for Summary Judgment. (Doc. 80).
pending before the court are the following Motions:
1. Defendants' Motion To Dismiss, filed on October 7,
2016 (doc. 85);
2. Defendants' Motion To Quash Plaintiff's Second
Deposition Notice and Accompanying Request To Produce
Documents at Deposition, filed on October 21, 2016 (doc. 86);
3. Defendants' Motion To Strike/Defendants'
Objections to Plaintiff's Second Set of Interrogatories
and Requests for Production, filed on October 21, 2016 (doc.
4. Defendants' Motion To Amend/Correct his (doc. 86)
Motion To Quash, filed on October 21, 2016 (doc. 88);
5. Defendants' Motion for Leave To File a Response to
Plaintiff's Surreply, filed on November 23, 2016 (docs.
96 and 97).
November 4, 2016, Taul filed a Response to Defendants'
Motion To Dismiss for Lack of Jurisdiction. (Doc. 90). On
November 9, 2016, Defendants filed their Reply. (Doc. 92). On
November 21, 2016, Taul filed his Surreply. (Doc. 95). All of
the above Motions are now ripe for the court's
MOTION TO DISMISS STANDARD
12(b)(6) motion attacks the legal sufficiency of a complaint.
Fed.R.Civ.P. 12(b)(6) (“[A] party may assert the
following defenses by motion: (6) failure to state a claim
upon which relief can be granted[.]”). The complaint
must provide a short and plain statement of the claim that
will “give the defendant fair notice of what the
plaintiff's claim is and the grounds upon which it
rests.” Conley v. Gibson, 355 U.S. 41, 47, 78
S.Ct. 99, 103, 2 L.Ed.2d 80 (1957) (quoting Fed.R.Civ.P.
8(a)(2)), abrogated by Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 1965, 167
L.Ed.2d 929 (2007); see also Fed. R. Civ. P. 8(a)
(requiring that general pleading in a complaint include
“a short and plain statement of the claim showing that
the pleader is entitled to relief”).
plaintiff must set forth grounds for entitlement to relief to
survive a motion to dismiss. Twombly, 550 U.S. at
555, 127 S.Ct. at 1964 (citing Conley, 355 U.S. at
47, 78 S.Ct. at 103). Once a claim has been set forth
adequately, it may be “supported by showing any set of
facts consistent with the allegations in the
complaint.” Twombly, 550 U.S. at 563, 127
S.Ct. at 1969. If well-pleaded factual allegations support
the complaint, a court “should assume their veracity
and then determine whether they plausibly give rise to an
entitlement to relief.” Ashcroft v. Iqbal, 556
U.S. 662, 679, 129 S.Ct. 1937, 1950, 173 L.Ed.2d 868 (2009).
A claim is considered plausible when the plaintiff
“pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the
misconduct alleged.” Id. at 678. The complaint
must establish “more than a sheer possibility that a
defendant has acted unlawfully.” Id. (quoting
Twombly, 550 U.S. at 556, 127 S.Ct. at 1965).
STANDARD OF REVIEW FOR A STATUTE OF LIMITATIONS
Motion To Dismiss (doc. 85) does not specify under which
Federal Rule of Civil Procedure they seek to dismiss
Taul's claims as untimely. In this Circuit, “[a]
Rule 12(b)(6) motion to dismiss for failure to state a claim
is an appropriate method for raising a statute of limitations
defense. Mann v. Adams Realty Co., 556 F.2d
288, 293 (5th Cir. 1977); see also Edwards v. Apple
Computer, Inc., 645 F. App'x 849, 851 (11th Cir.
2016) (internal citations omitted)(“A complaint is
subject to dismissal when its allegations, on their face,
show that an affirmative defense bars recovery on the claim .
. . [t]hus, a motion to dismiss for failure to state a claim
is an appropriate method for raising a statute of limitations
defense.”). Accordingly, the court construes
Defendants' Motion To Dismiss as a challenge under Rule
12(b)(6) of the Federal Rules of Civil
Procedure. The court construes the Amended Complaint
in the light most favorable to Taul and takes the factual
allegations contained therein as true.
alleges the following facts in his Amended Complaint (doc.
10. Relator Barry Taul started working for Nagel-Abanks from
June 2006 until September 2009.
11. The owner and principal of Nagel-Abanks is Defendant Jed
12. The Alabama Organ Center is the only federally designated
Organ Procurement Organization for the State of Alabama.
13. The Alabama Organ Center coordinates the equitable use of
organs and tissues for life-saving transplants and medical
14. In and around June 2003, Nagel-Abanks and the Alabama
Organ Center, by and through their respective agents Jed
Nagel, Demosthenes “Dem” Lalisan (Director of the
Alabama Organ Center), and Richard Alan Hicks (Associate
Director of the Alabama Organ Center), entered into an
agreement to harvest tissue at Nagel's facility. This
agreement involved the harvesting of tissue, bone, muscle,
and tendons but not organs.
15. Under the agreement between Nagel and the Alabama Organ
Center, when a bone or tissue donor died, the organ center
called Abanks with the death information. Abanks, by and/or
at the direction of Nagel, would remove the donor from the
place of death and bring them to Abanks for harvesting. After
the tissue had been harvested the donor would then be
transported by Abanks to the funeral home of the
deceased's choosing. One particular division of the
Alabama Organ Center that was involved in the agreement was
the[n] called the gift of body program (hereinafter
16. After the harvesting, the GOB donor's remains were
cremated and returned to the donor family. Because
Nagel-Abanks also operated a crematory, this Defendant was
paid pursuant to the agreement to do the cremation.
17. In or around June 2003, Lalisan and Hicks convinced the
Alabama Organ Center to enter into the aforementioned
agreement with Nagel-Abanks by arguing that it would be more
cost efficient for the Center to perform all tissue
recoveries in Birmingham. Lalisan and Hicks reasoned that
they could have a tissue recovery team on the ready 24 hours
a day in Birmingham. Further, the Alabama Organ Center could
pay Nagel-Abanks to remove the donors from anywhere in the
state of Alabama and bring them to its Birmingham facility;
pay for the use of Nagel-Abanks' embalming room, pay for
tissue harvesting performed by Nagel-Abanks, and pay
Nagel-Abanks for cremations performed on the GOB donors.
18. In reality Lalisan and Hicks promoted the services of
Nagel-Abanks in exchange for kickback payments from
Nagel-Abanks. Consequently, from approximately June 2003
until approximately June 2011 Defendants Nagel-Abanks and Jed
Nagel made illegal kickback payments to Lalisan and Hicks in
exchange for the contractual referral business from the
Alabama Organ Center.
19. For each month from June 2003 until approximately June
2011, in Birmingham, Alabama, Lalisan and Hicks would meet at
Nagel-Abanks with Nagel to discuss the Alabama Organ
Center's bill for the previous month's services. At
these monthly meetings Lalisan, Hicks and Nagel would cook
the books by fabricating charges to the Alabama Organ Center.
20. For example, for each month from June 2003 until
approximately June 2011, in Birmingham, Alabama, Lalisan,
Hicks and Nagel would add miles onto transportation services.
Further, if a GOB donor was disqualified for tissue
harvesting, the books might indicate that the GOB donor did
have tissue harvested so the embalming room charge could be
used as well as the cremation charge.
21. It is standard in the death care industry to have a
removal fee for picking up a body from the place of death.
Usually this is a flat rate that includes a certain
geographical area. If the removal requires going outside that
area there is a per mile charge that takes place.
22. The Nagel-Abanks transportation, embalming, cremation and
harvesting charges to the Alabama Organ Center were well over
national averages and often were inflated. At the monthly
meetings of Nagel, Lalisan, and Hicks, they determined how
much the bills would be for the previous month. Consequently,
the bills were submitted to UAB (the University of Alabama
Birmingham) for payment. Once the bills were paid, twenty
percent of the bill would be given back to Hicks and Lalisan
by Nagel; Hicks and Lalisan received ten percent each of the
23. Under the kickback scheme, which violated both the False
Claims Act and the Anti-Kickback Statute (AKS), 42 U.S.C.
§ 1320a-7b(b), Lalisan and Hicks guaranteed that
Nagel-Abanks would be able to bill $50, 000.00 to $60, 000.00
each month to the Alabama Organ Center. This bill was paid
for with government grants, Medicare, and other federal and
taxpayer dollars as these donor services were free to the
24. In approximately the first week of June 2009, in
Birmingham, Alabama, Relator Barry Taul became of aware of
the aforementioned fraud and illegal kickbacks.
25. In approximately the first week of June 2009 Taul, an
employee of Nagel-Abanks and Nagel at that time, was sent
from Nagel-Abanks' Birmingham Alabama location to deliver
cremains to a funeral home in Columbiana, AL.
26. While Taul was on this delivery run the only person at
Nagel-Abanks was Jed Nagel.
27. When he arrived back at Nagel-Abanks' mortuary he
entered the back of the building. When Taul entered the
building he was not heard because the crematory, a very loud
machine, was in full operation.
28. As Taul walked to the front of the building, he heard
voices coming from the front office. Taul did not recognize
the voices at first so he paused before going into the office
area because he wanted to know if this was a family in the
office making cremation arrangements. If this was this case,
Taul didn't want to be disrespectful of a grieving family
and barge in on their arrangement conference.
29. In approximately the first week of June 2009, as he
approached however, Taul recognized the voices in the front
office as those of Lalisan, Hicks, and Nagel. Because Taul
was on a first name basis with all three individuals, he
approached the office to announce his return. At this point,
Taul overheard Nagel telling Lalisan and Hicks that if they
wanted to continue to get ten percent they were going to have
to pad “this bill a little more.” Taul knew these
comments were improper but didn't fully understand the
full scope of the conversation at that moment.
30. When Taul entered the office Nagel, Lalisan and Hicks
were shocked to see him. The three men stopped talking
immediately and then changed the subject. All three seemed
very nervous. Lalisan and Hicks left very shortly after.
Nagel then called Taul into the office and told him that he
didn't hear anything. Nagel told Taul that it takes a
little grease on some palms sometimes to make money. At this
point, Nagel informed Taul of the kickback scheme and
fraudulent billing referenced above in ¶¶15-29.
31. In approximately the first week of June 2009, Nagel told
Taul that if he (Taul) ever told anybody about the fraud and
the kickback scheme Taul had overheard, he (Nagel) would
cremate Taul alive and no one would ever find Taul's
32. Nagel is a huge man and Taul took Nagel's threat very
seriously. Nagel also said that he knew where Taul lived,
where Taul's parents lived and that he (Nagel) would also
torture or kill them as well. After these threats, Nagel
became very verbally abusive towards Taul during Taul's
everyday work environment.
33. Nagel also became physically abusive. For example,
between June 2009 and October 2009, in Birmingham, Alabama,
Nagel would kick doors into Taul. Also, Nagel often would
slap Taul open handed. Once, between June 2009 and October
2009, Nagel even threw an open embalming fluid bottle at Taul
resulting in embalming fluid, a very dangerous chemical,
spilling all over Taul.
34. During the same time frame, between June 2009 and October
2009, Nagel once threw feces from deceased individuals at
Taul. Also, during this same time frame Nagel once took a
full catheter bag from a deceased and emptied it on
Taul's back. This abusive behavior was designed to scare
and intimidate Taul so that he would be too fearful of the
consequences of disclosing the fraudulent scheme involving
Nagel-Abanks, Nagel, Lalisan and Hicks.
35. The foregoing behavior resulted in Taul fearing
retribution to himself and his family from Nagel if Taul were
to disclose what he knew about the aforementioned
36. After Relator Taul became aware of this fraud and
kickback scheme in approximately June 2009 and began
suffering abusive behavior from Nagel, Taul began to actively
look for employment at another funeral home. Subsequently, in
approximately October 2009, Taul found employment at Valhalla
funeral home in Midfield, Alabama.
37. In approximately, August 2010, Barry Taul informed the
FBI of the fraud and illegal kickback scheme described above
involving Lalisan, Hicks, [and] Nagel/Abanks.
38. Relator Taul disclosed the fraud and illegal kickback
scheme described above to the government before any public
disclosure was made and therefore Relator Taul is the
original source regarding said information.
39. Relator Taul has knowledge independent of the public
disclosure relating to this matter that “materially
adds” to the disclosure and said knowledge and/or
information was provided to the government before Relator
Taul filed his lawsuit.
40. Shortly after informing the FBI of the fraud and illegal
kickbacks described above, in or around August 2010, Taul
received a plain card hand addressed to him at Valhalla
funeral home in Midfield, Alabama. On one side the card
stated, “He knows it was you.” Taul gave this
card to the FBI and the FBI retained the card.
41. After this incident, in approximately October 2010,
Taul's regional manager at Valhalla funeral home talked
to him about an anonymous letter that had been received
stating that Taul was a thief. Shortly after this incident,
in or around February 2011, Taul was fired from Valhalla
funeral home. No good reason was given by Valhalla funeral
home for terminating Taul.
42. After he was terminated from Valhalla funeral home, it
became virtually impossible for Taul to get a job in the
funeral business in Birmingham, Alabama despite having worked