United States ex rel., Goodstein v. McLaren Regional Med. Ctr.,
No. 97-CV-72992-DT (E.D.Mich. July 9, 2001)

The government, in a qui tam action, brought suit against a physician corporation, a related corporation, and a medical center for violations of Stark II (also known as the anti-kickback statute). Specifically, the government alleged that the physician corporation, through its related corporation, charged excessive rent to the medical center as part of an illegal referral scheme.

The question before the Eastern District Court of Michigan was whether to allow a government motion for judicial estoppel which would order that the physician corporation and the related corporation could not contest that the lease with the medical center was above fair market value. The court held that judicial estoppel would be appropriate if the government could show that the related corporation had taken the unequivocal position that its lease with the medical center was above fair market value and that this position had been accepted by the court. The court determined that the government had not pointed to any evidence which could suggest that either showing had been made, and the motion was denied.