Labor & Employment Law Daily Wrap Up, PROCEDURE—W.D.N.Y.: Relation-back doctrine saves second amended complaint, (Jul 23, 2025)

By Sherri M. Schroeder, J.D.

In this False Claims Act retaliation case, the entities named in the second amended complaint and the past corporate defendants were related entities that all shared the same counsel.

The relation-back doctrine contained in Rule 15(c) of the Federal Rules of Civil Procedure (FRCP) has saved some of the claims of a nurse claiming illegal retaliation under the federal False Claims Act and its New York state counterpart (FCA). The nurse’s second amended complaint (SAC), in which she endeavored to list her employer, the owner-operator of the facility at which she worked, and the owner of that owner-operator, did not name any of the present defendants, which implicated the relation-back doctrine found in FRCP Rule 15(c). The court first found that the SAC was not subject to dismissal on statute of limitations grounds because the amendments related back to the original complaint, with the court noting that the name entities and the past corporate defendants were related entities sharing the same counsel. The court then went on to find the nurse had properly pleaded an employer-type relationship with the owner-operator of her worksite but failed to plead such a relationship with the owner of that owner-operator. Therefore, the court allowed the claims against the owner-operator to proceed but dismissed the claims against the owner-operator's owner (Nolan v. Post Acute Partners Management, No. 15-CV-99S (W.D.N.Y. July 15, 2025)).

Background. A nurse filed a qui tam action alleging illegal retaliation and termination under the federal and New York state False Claims Act because she reported numerous unlawful and fraudulent practices intended to maximize payments from federally and state funded health insurance programs. Following a first amended complaint (FAC), partial settlement, and joint stipulations, she filed the SAC at issue, naming Post Acute Partners Management, LLC (PAPM); Elderwood Administrative Services, LLC (EAS); and 1818 Como Park Boulevard Operating Co., LLC (1818), as defendants. In each of her three complaints, the nurse endeavored to name the nursing facility at which she worked (her employer), the owner-operator of that facility, and the owner of that owner-operator. Due to a “complicated corporate structure,” a “subsequent acquisition,” and a “name change,” the nurse initially misidentified her employer and others, although she always maintained she endeavored “in good faith to identify and name her employer and those entities responsible for retaliating against her, with the named parties consistently being either predecessors or affiliates of one another.”

Relate-back doctrine. According to the court, there was no dispute that the nurse filed her SAC outside the three-year statute of limitations period. The question for the court was whether her SAC related back to her original complaint such that they would be deemed timely under federal law under Rule 15(c), which requires that the party being brought in by amendment receive notice of the action such that it will not be prejudiced in defending on the merits and that the party being brough in knew or should have known that the action would have been brought against it but for a mistake concerning the proper party’s identity. After first noting that there was no dispute that the amendments at issue arose out of the conduct, transaction, and occurrence set out in the original complaint, the court stated that the SAC, aside from the identification of new defendants, simply added detail to the previously pleaded retaliation allegations. The court found insufficient basis to conclude the nurse intentionally omitted her employer from the original complaint; rather, she had mistakenly named the predecessor entity.

As to the argument that none of the defendants had timely notice or any indication that the nurse would bring retaliation claims against them, the court stated that it was undisputed that the current defendants and the past corporate defendants were related entities that all shared the same counsel. According to the court, “it must have been known to them through [the nurse’s] past pleading that she consistently endeavored to bring retaliation claims against the facility at which she worked (her employer), the owner-operator of that facility, and the owner of that owner-operator. That much was plain and consistent from the original complaint and [FAC].” Although the nurse had misidentified and misnamed the various corporate entities, “the real parties in interest were known or should have been known to counsel and the relevant corporate structure,” stated the court. Therefore, the lack-of-notice argument was unpersuasive. Therefore, the relation-back doctrine applied, and the court denied the motion to dismiss on statute of limitations grounds.

Failure to state claim. The defendants next argued that the SAC must be dismissed as against EAS and PAPM because the nurse failed to state claims against them because the FCA permits claims against only employing entities. Here, the court stated that although liability lies against employers and not against individuals either personally or in official capacity, liability may also lie against parent corporations or other corporate relations, “if there exists a high level of control and commonality of ownership. That is, an ‘employer-type’ relationship must exist.” (citation omitted) The nurse alleged that she reported the unlawful practices she observed to her immediate supervisor and to the corporate office; she also alleged other contact with the “corporate office” and “corporate representatives.” Therefore, the court found that the SAC’s allegations were sufficient to state retaliation claims against EAS for purposes of FRCP Rule 12(b)(6), as it was reasonable in infer that EAS is the “corporate office” alleged in the SAC given the allegation that EAS owned and operated 1818 and its predecessor. However, the nurse’s allegations were insufficient as to PAPM, “which is alleged to be one-step removed from [1818], as simply the owner of EAS, without any plausible employer-related connection to [the nurse] or day-to-day working relationship with [1818],” according to the court. Therefore, the claims against PAPM were dismissed.

The case is No. 15-CV-99S.

Judge: Skretny, W.

Attorneys: Amy Okereke, U.S. Attorney's Office, for U.S. Thomas Schleif, New York State Office of the Attorney General, for State of New York. David Butler Harrison (Spiro Harrison & Nelson) for Jean Nolan. Brian Marc Feldman (Aurelian Law PLLC) for Post Acute Partners Management, LLC, 1818 Como Park Boulevard Operating Co., LLC and Elderwood Administrative Services LLC.

Companies: State of New York; Post Acute Partners Management, LLC; 1818 Como Park Boulevard Operating Co., LLC; Elderwood Administrative Services LLC

Cases: Procedure Whistleblowers NewYorkNews