Health Selection Group, LLC ("HSG") is affiliated with National Health Care Analysis Group ("NHCAG"), a New Jersey-based organization that -- according to court filings from a related federal case -- mines publicly available Medicaid and Medicare data and creates single-purpose entities like HSG to file qui tam actions against pharmaceutical companies, typically targeting manufacturer-sponsored programs that provide free nurse/administrative support to medical providers, which NHCAG-affiliated relators characterize as illegal kickbacks. HSG sued Novartis Pharmaceuticals under the Texas Medicaid Fraud Prevention Act (TMFPA), which authorizes a private person to bring a civil action "for the person and for the state."
Novartis moved to dismiss and pleaded to the jurisdiction, arguing (1) the district court lacked subject-matter jurisdiction because HSG suffered no personal injury from the alleged conduct, and (2) the TMFPA's qui tam mechanism violates the Texas Constitution's separation of powers (Article IV, Sec. 22; Article V, Sec. 21). The 71st District Court of Harrison County (Hon. Brad Morin) summarily denied both. Novartis sought mandamus in the Sixth Court of Appeals (Texarkana), which denied relief in a two-page opinion. Novartis then sought mandamus in the Supreme Court; the Court granted a temporary stay and ordered merits briefing, but ultimately denied the petition, with Justices Young and Sullivan filing a separate statement suggesting the newly created Fifteenth Court of Appeals was the appropriate forum to consider the petition first. Novartis then sought mandamus in the Fifteenth Court of Appeals, which denied relief in a memorandum opinion -- over a 27-page dissent from Chief Justice Brister, who concluded mandamus was warranted and that HSG lacks standing and the TMFPA is unconstitutional. Novartis has now sought mandamus in the Supreme Court a second time, with oral argument set for February 11, 2027.
Relator (Novartis Pharmaceuticals Corporation): HSG cannot establish standing as an assignee or representative of the State, and statutory standing under the TMFPA cannot substitute for the constitutional standing requirement that a plaintiff show its own concrete injury. Under this Court's precedent, only elected state attorneys may control litigation brought in the State's name; the TMFPA's qui tam provisions impermissibly hand that control to private parties -- here, a professional relator business built around monetizing qui tam statutes for a share of any recovery -- in violation of Article IV, Section 22 and Article V, Section 21 of the Texas Constitution. Mandamus is appropriate because these are threshold jurisdictional and constitutional defects that should be resolved before the case proceeds further, rather than after a full trial.
Real Party in Interest (Health Selection Group, LLC): Mandamus is an extraordinary remedy unavailable here because Novartis has an adequate remedy through ordinary appeal, and the Fifteenth Court of Appeals correctly said so; a mature trial record, not an interlocutory mandamus proceeding, is the appropriate vehicle for resolving Novartis's separation-of-powers challenge. On the merits, HSG has standing either by relying on the State's own undisputed injury as an assignee (drawing on the U.S. Supreme Court's Vermont Agency of Natural Resources v. Stevens framework) or in its statutory capacity as a qui tam relator, which doesn't require an individually alleged injury because the State itself has standing. The TMFPA doesn't violate separation of powers because state attorneys retain unfettered control over all TMFPA litigation and remain free to accept or reject a qui tam relator's participation at any point; the statute enjoys a presumption of constitutional validity that Novartis must overcome beyond any reasonable doubt.
Yes. Novartis expressly invokes this Court's own prior statement (by Justices Young and Sullivan, on the first mandamus petition) describing the constitutional questions here as "weighty" and "important," and argues the case presents a recurring, statewide-significant separation-of-powers question about who may control litigation brought in the State's name -- with a dissenting Chief Justice below already having concluded mandamus is warranted.
fraud, texas-constitution, civil-procedure
Original proceeding for writ of mandamus (Novartis's second mandamus petition to this Court on this same underlying case, after an earlier petition was denied and the matter was referred to the newly created Fifteenth Court of Appeals). Relator / Real Parties in Interest (Health Selection Group, LLC and the State of Texas). Set for oral argument February 11, 2027. Not yet decided.
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