JESSE M. FURMAN, District Judge.
In this qui tam case, familiarity with which is presumed, Relator John R. Borzilleri alleges a wide-ranging scheme between pharmaceutical manufacturers and companies acting as "Pharmacy Benefit Managers" ("PBMs") to defraud Medicare Part D, a federal prescription-drug program, in violation of the False Claims Act ("FCA" or the "Act"), 31 U.S.C. § 3729 et seq., and various state laws. Docket No. 148 ("SAC"). The United States (the "Government") declined to intervene in the case and now moves to dismiss the action. See Docket Nos. 19, 274.
Although the FCA permits private plaintiffs to bring claims under the Act in the name of the United States, see 31 U.S.C. § 3730(b)(1), the Government retains significant control over any such litigation. As relevant here, the Act provides that "[t]he Government may dismiss" an action brought under its provisions "notwithstanding the objections of the person initiating the action if the person has been notified by the Government of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion." 31 U.S.C. § 3730(c)(2)(A). Lending truth to the Supreme Court's observation that "[t]he False Claims Act's qui tam provisions present many interpretive challenges," Kellogg Brown & Root Servs., Inc. v. United States ex rel. Carter, 135 S.Ct. 1970, 1979 (2015), the statute is silent as to what standard of review, if any, applies to a decision by the Government to dismiss a case brought under the Act, and courts of appeals are divided on the issue. The Ninth and Tenth Circuits have held that the Government must demonstrate a "valid government purpose" for dismissal and "a rational relation between dismissal and accomplishment of [that] purpose." United States ex rel. Sequoia Orange Co. v. Baird-Neece Packing Corp. ("Sequoia Orange"), 151 F.3d 1139, 1145 (9th Cir. 1998) (internal quotation marks omitted); accord Ridenour v. Kaiser-Hill Co., 397 F.3d 925, 936 (10th Cir. 2005). By contrast, the D.C. Circuit has described the Government's right to dismiss a relator's action under the FCA as "unfettered" (even as it noted that a "fraud on the court" might permit a court to look into the Government's reasons for dismissal). Swift v. United States, 318 F.3d 250, 252-54 (D.C. Cir. 2003). The Second Circuit has not yet weighed in on the issue. See, e.g., United States ex rel. Piacentile v. Amgen Inc., No. 04-CV-3983 (SJ), 2013 WL 5460640, at *3 (E.D.N.Y. Sept. 30, 2013); United States ex rel. Pentagen Techs. Int'l Ltd. v. United States, No. 00-CV-6167 (DAB), 2001 WL 770940, at *7 (S.D.N.Y. July 10, 2001).
The Court need not take a side in the dispute, however, because it concludes that the Government may dismiss the case even under the more stringent standard articulated in Sequoia Orange. That is, the Government demonstrates at least one "valid government purpose" for seeking dismissal: Borzilleri's continued prosecution of the case — assuming it would survive the other motions to dismiss pending before the Court — would impose substantial burdens on government resources.
Borzilleri's arguments to the contrary are unpersuasive. The fact that the Government could recover more in damages than it expends in resources, if he were to eventually prevail, see Docket No. 281 ("Relator Mem."), at 10, does not mean that avoiding resource expenditures now is not a "valid government purpose." Indeed, courts applying the Sequoia Orange standard have made clear that the Government's cost concerns are a valid justification for dismissal even where "the FCA claims against the defendants [are] meritorious." Sequoia Orange, 145 F.3d at 1143; see, e.g., United States v. EMD Serono, Inc., 370 F.Supp.3d 483, 490-91 (E.D. Pa. 2019) 490-91 (reiterating that "[p]reserving litigation costs is a valid interest even where the claims may have merit," and collecting cases); United States ex rel. Sibley v. Delta Reg'l Med. Ctr., No. 4:17-CV-000053 (GHD), 2019 WL 1305069, at *4 (N.D. Miss. Mar. 21, 2019) (same).
Because the Government offers a valid purpose for dismissal, the burden shifts to Borzilleri to show that the dismissal is nonetheless "fraudulent, arbitrary and capricious, or illegal." Sequoia Orange, 145 F.3d at 1145 (internal quotation marks omitted). This he fails to do. Borzilleri offers a hodgepodge of theories, the most coherent subset of which can be lumped together as a "failure to investigate" — in a nutshell, that the Government's decision to dismiss the case, like its decision not to intervene, is arbitrary because the Government failed to thoroughly investigate his allegations in the first place.
Borzilleri's remaining arguments fare no better. First, the Government's inability or unwillingness to provide him with a non-fraudulent explanation for "massive" increases in Defendants' drug prices, Relator Mem. 19, does not demonstrate that its stated reason for dismissing the case is somehow fraudulent, arbitrary and capricious, or illegal. Second, Borzilleri fails to clearly articulate how (1) the Government's proffered rationale for not intervening in his case was "false" and (2) the Government "verif[ied]" the entire massive scheme he alleges, but then declined to act on it. See id. at 18-19. And finally, his allegations of stonewalling by CMS and conflicts of interest among its leadership, see id. at 20-21, do not rise above the level of speculation, see United States ex rel. Nasuti v. Savage Farms, Inc., No. 12-CV-30121 (GAO), 2014 WL 1327015, at *12 (D. Mass. Mar. 27, 2014) (rejecting a relator's allegations that "nepotism or political connections played [a] role in the Government's decision" to dismiss as "little more than unsupported speculation"). In sum, nothing put forward by Borzilleri suggests, let alone shows, that the Government's stated reason for dismissing this action is fraudulent, arbitrary and capricious, or illegal. And because he fails to even "present[] a colorable claim" on that score, he is not entitled to discovery or an evidentiary hearing. See, e.g., Ridenour, 397 F.3d at 931 (noting that a relator is not entitled to a hearing absent a showing of "substantial and particularized need" (internal quotation marks omitted)); accord United States ex rel. Nicholson v. Spigelman, No. 10 C 3361, 2011 WL 2683161, at *3 (N.D. Ill. July 8, 2011); Toomer, 2018 WL 4934070, at *6.
By its terms, the FCA vests the Government with broad discretion to end this action "notwithstanding" Borzilleri's "objections." 31 U.S.C. § 3730(c)(2)(A). Under either Swift or Sequoia Orange, the Government has exercised that discretion appropriately, and Borzilleri has "been . . . provided . . . with an opportunity for a hearing" on the Government's motion. 31 U.S.C. § 3730(c)(2)(A); see, e.g., Greene v. IRS, No. 1:08-CV-0280 (LEK), 2008 WL 5378120, at *2 (N.D.N.Y. Dec. 23, 2008) ("This Court's consideration of the arguments raised in the Plaintiffs' opposition has provided them with an opportunity to be heard on the Government's Motion."), aff'd, 348 Fed. App'x 625 (2d Cir. 2009). That is all the statute requires. Accordingly, Borzilleri's FCA claims must be and are dismissed.
For the foregoing reasons, the Government's motion to dismiss is GRANTED, and Borzilleri's claims are dismissed (with prejudice in the case of his claims under the FCA and without prejudice to re-filing in state court as to his claims under state law).
SO ORDERED.