By Kristin Graham Koehler, Jaime L.M. Jones, Joshua J. Fougere, and Brenna E. Jenny, partners with Sidley Austin LLP. They would like to thank Matthew Bergs (Senior Managing Associate) and Joseph Katz (Associate) for their invaluable help with this Legal Opinion Letter.

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The Department of Justice (“DOJ”) and private whistleblowers continue to leverage the Anti-Kickback Statute (“AKS”) in support of federal False Claims Act (“FCA”) suits against healthcare and life sciences companies seeking millions of dollars in damages and penalties. Often, one of the central disputes in these cases is the causal nexus that plaintiffs must establish between the alleged AKS violation and a claim for reimbursement submitted to the federal government. We wrote previously about the deepening circuit split over this question,¹  and, on February 18, 2025, the U.S. Court of Appeals for the First Circuit issued a decision in United States v. Regeneron Pharmaceuticals, Inc.² weighing in. With that ruling, the clear trend among the circuit courts requires plaintiffs to show “but for” causation.

By way of background, the key statutory language from the AKS provides: “a claim that includes items or services resulting from a violation of [the AKS] constitutes a false or fraudulent claim” under the FCA. ³ It was added to the AKS in 2010 through the Patient Protection and Affordable Care Act (“PPACA”) and made a direct connection between AKS violations and the FCA. 

It took a few years for the causation issue—specifically, how to interpret the “resulting from” language—to work its way to the circuit courts and for the split to develop. The Third Circuit was first, in 2018. It held that a claim “results from” an alleged kickback if there is a “link” between the alleged kickback and a subsequent claim. ⁴ Relying heavily on a review of legislative histories of the AKS and FCA, the court concluded that requiring “but for” causation would undermine the purpose of the two statutes. ⁵

The courts of appeals have uniformly disagreed with that view ever since. In 2022, the Eighth Circuit first held that a claim “results from” an alleged kickback only if it is the “but for” cause of a subsequent claim for payment. Giving little weight to legislative histories, the court found instead that, under recent Supreme Court precedent, the statutory phrase “results from” requires “but for” causation. In this context, that means that DOJ and whistleblowers have to establish that defendants “would not have included particular ‘items or services’ absent the illegal kickbacks.” ⁶ The Sixth Circuit joined the Eighth Circuit in 2023. ⁷

The First Circuit’s recent decision brought the circuit-court tally to 3-1 in favor of a but-for standard, showing that a clear consensus has emerged. In all of the but-for cases, moreover, arguments for a lesser causal nexus have been handily rejected. In Regeneron, for example, DOJ conceded that it did not have any textual arguments and instead advanced three contextual arguments based on: (1) what is required to prove an AKS violation; (2) the statutory history of the 2010 PPACA amendment; and (3) the legislative history of the PPACA amendment. ⁸ The First Circuit brushed these aside because none offered a “contextual reason to deviate from the default presumption that the phrase ‘resulting from’ as used in the 2010 amendment imposes a but-for causation standard.”⁹

As we explained in our prior Legal Opinion Letter, in our view, the consensus position from the Eighth, Sixth, and First Circuits is the right one. It is the best reading of the statutory text. And the lesser standard from the Third Circuit and DOJ is unworkable: taken to the extreme, it would allow for FCA liability even when an alleged kickback had no influence over a patient or healthcare provider’s decision to use an item or service. Indeed, DOJ conceded as much in Regeneron when it “posit[ed] that [false claims] can ‘result from’ a kickback even if that kickback had no causal impact whatsoever on a patients decision to opt for [the drug].”¹⁰ “But for” causation, by contrast, is a concrete standard that provides appropriate protection to defendants but also is not “so difficult to establish . . . that the 2010 amendment would have no practice effect.”¹¹ 

With the growing circuit split, it becomes more likely that the Supreme Court will have to step in and resolve the issue. We of course do not know when that will happen. The Court denied certiorari from the Sixth Circuit’s 2023 decision,¹² and we do not yet know whether DOJ will even petition for review of the First Circuit’s decision.

In the meantime, the Regeneron decision carries several implications for healthcare and life sciences companies. First, to state the obvious, companies with nationwide operations should understand that the causation standards that they could face will depend on where an AKS/FCA case is filed. And, in jurisdictions that have not yet addressed the AKS causal nexus requirement, the First Circuit’s decision offers additional support for application of the “but for” causation standard. Given the trend, moreover, defendants can argue forcefully that any undecided jurisdictions should adopt that standard.  

Second, the “but for” causation standard may influence how parties litigate AKS/FCA cases. Plaintiffs will have to gather additional evidence of causation, including circumstantial evidence and expert testimony addressing the influence that alleged kickbacks had on prescribing decisions made by healthcare providers. For defendants, obtaining testimony from patients and prescribers regarding the factors that influenced their decisions could become even more important in rebutting causation.

Third, increased adoption of the “but for” causation standard may force DOJ and whistleblowers to rethink the types of AKS/FCA cases that they pursue. Fringe cases might include those in which (1) the alleged kickbacks were de minimis in value; (2) alleged kickbacks were paid for legitimate services rendered; and (3) the alleged kickbacks were paid to induce prescriptions of drugs necessary to treat deadly diseases. Theories like these should become even more difficult to prove and less appealing to bring.  

Finally, the Regeneron opinion observes differences between theories of FCA liability premised on the AKS’s direct connection language, and more traditional false certification theories—calling them “separate track[s]” for potential liability.¹³ And false certification theories, the panel explained, do “not require proof of causation to demonstrate falsity.”¹⁴ Relators may leverage this observation to reframe AKS-based FCA claims under express or implied certification theories. Defendants should be on the lookout for such changes and understand the potential shift in discovery that could result. 

The First Circuit’s decision in Regeneron represents yet another defendant-friendly development in the ongoing debate over the causation standard required to establish FCA liability based on AKS violations. Unless and until the Supreme Court weighs in, healthcare and life sciences companies should remain vigilant in their compliance efforts and be prepared to deploy this decision in future litigation and enforcement actions.

Notes

1. Kristin Graham Koehler, Jaime L.M. Jones, Joshua J. Fougere, Brenna E. Jenny, and Joseph R. LoCascio, The Deepening Circuit Split Over the Causal Connection Between AKS Violations and FCA Liability, WLF Legal Opinion Letter, May 25, 2023.
2. United States v. Regeneron Pharmaceuticals, Inc., 128 F.4th 324 (1st Cir. 2025).
3. 42 U.S.C. § 1320a-7b(g) (Emphasis added).
4. United States ex rel. Greenfield v. Medco Health Sols., Inc., 880 F.3d 89, 100 (3d Cir. 2018).
5. Id.
6. United States ex rel. Cairns v. D.S. Med. LLC, 42 F.4th 828, 835 (8th Cir. 2022).
7. United States ex rel. Martin v. Hathaway, 63 F.4th 1043 (6th Cir. 2023).
8. United States v. Regeneron Pharmaceuticals, Inc., 128 F.4th 324, 330-33 (1st Cir. 2025).
9. Id. at 336.
10. Id. at 331.
11. Id. at 335.
12. United States ex rel. Martin v. Hathaway, 144 S. Ct. 224 (2023) (cert. denied).
13. 128 F.4th at 334.
14. Id. at 333.