# In re Novartis Pharms. Corp.

Supreme Court of Texas, No. 24-0239

**In re Novartis Pharms. Corp., No. 24-0239, is before the Supreme Court of Texas. Key issue: The Court denied Novartis's petition for writ of mandamus challenging a qui tam suit under the Texas Medicaid Fraud Prevention Act (now the Texas Health Care Program Fraud Prevention Act) on relator standing and separation-of-powers grounds, and Justices Young and Sullivan issued a statement.**

Practice areas: fraud, texas constitution, civil procedure

## Key issues

- The Court denied Novartis's petition for writ of mandamus challenging a qui tam suit under the Texas Medicaid Fraud Prevention Act (now the Texas Health Care Program Fraud Prevention Act) on relator standing and separation-of-powers grounds, and Justices Young and Sullivan issued a statement.
- The statement said the issues are weighty and the Court might have set the case for argument, but denial is understandable because the new Fifteenth Court of Appeals has statewide jurisdiction and, under In re Sanofi-Aventis, may hear mandamus petitions like this one, so the Court awaits its written analysis of the Act's constitutionality.

## Factual History
Health Selection Group, LLC (HSG) sued Novartis Pharmaceuticals as a qui tam relator under the Act, alleging that Novartis bilked Texas Medicaid out of hundreds of millions of dollars through fraudulent marketing schemes; the State declined to take over the action but asserted a continuing interest and opposed Novartis's motion to dismiss (Young and Sullivan, JJ., statement, PDF p. 2).

## Procedural History
Novartis filed a plea to the jurisdiction and motion to dismiss arguing that HSG lacked standing, and the trial court denied it. The Sixth Court of Appeals denied mandamus without analysis on March 1, 2024. The Court issued a stay on August 30, 2024, requested merits briefs from Novartis, HSG and the State, and on October 24, 2025 denied the petition and lifted the stay.

## Issues Presented
Whether HSG lacks standing because Novartis's alleged violations did not injure it, and whether the Act's qui tam provisions violate the separation of powers under Article II, § 1 of the Texas Constitution by letting a private litigant represent the State (Young and Sullivan, JJ., statement, PDF p. 3).

## Legal Arguments
**Novartis (Relator):** the relator suffered no injury and the qui tam device unconstitutionally lets a private party represent the State in court. **HSG and the State (Real Parties in Interest):** the qui tam relator may proceed in the name of the person and of the State, and the State asserted a continuing interest in the case (Young and Sullivan, JJ., statement, PDF pp. 2-3).

## Stated Reasons the Court Should Take the Case
Not applicable—the petition was denied.

## Practice Area Tags
fraud, texas-constitution, civil-procedure

## Procedural Posture/Vehicle
Original petition for writ of mandamus after the court of appeals denied relief; stay lifted and petition denied October 24, 2025 (Docket).

## Amicus Involvement
None noted

## Court's Reasoning
The statement said analysis of standing would begin with Vermont Agency of Natural Resources v. Stevens, which turned on the government's injury in fact as assignor, but the Texas Act is a penalty scheme rather than a damages action, so the State may have only an injury in law; and that Justices in United States v. Polansky and Wisconsin Bell have doubted the constitutionality of qui tam actions, and the Texas Constitution assigns representation of the State to the attorney general and county and district attorneys. It observed that the Fifteenth Court held in Sanofi that a qui tam action is a matter brought by the State even when the State declines to intervene, suggesting Novartis could seek mandamus there, and expressed hope that court would issue a written opinion so that this Court can settle the constitutional questions in an appropriate case (Young and Sullivan, JJ., statement, PDF pp. 3-10).

## Disposition
Petition for writ of mandamus denied and stay order issued August 30, 2024 lifted (Docket).

## Vote Breakdown
Justices Young and Sullivan issued a joint statement respecting the denial (Young and Sullivan, JJ., statement, PDF pp. 1-10).

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Source: The SCOTX Report, https://scotxreport.com/cases/24-0239. AI-generated summary of the Court's opinion, orders and the parties' briefs, with pin cites to the page of each document; verify against the Court's own documents at search.txcourts.gov.