United States of America v. Amazon.com, Inc.

25-207
United States of America v. Amazon.com, Inc.
In the
United States Court of Appeals
for the Second Circuit
A UGUST TERM 2025
No. 25-207-cv
U NITED S TATES OF AMERICA, EX REL . MIKE D. H ENIG AND H ENIG F URS ,
INC.,
Plaintiffs-Appellants,
U NITED S TATES OF AMERICA,
Plaintiff,
v.
A MAZON.COM , INC., AND A MAZON.COM S ERVICES , LLC,
Defendants-Appellees.∗
On Appeal from the United States District Court
for the Southern District of New York
A RGUED: FEBRUARY 6, 2026
D ECIDED: MAY 20, 2026
∗ The Clerk of Court is directed to amend the caption as set forth above.

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Before: C ABRANES , NARDINI, and K AHN, Circuit Judges.
The False Claims Act, 31 U.S.C. §§ 3729(a)(1)(G) and (C),
respectively, imposes liability for both (1) “knowingly . . . caus[ing], to
be made or used, a false record or statement material to an obligation
to pay . . . the Government” and (2) “conspir[ing]” in the submission
of these so-called “reverse false claims.”
Plaintiffs-Appellants Mike D. Henig and Henig Furs, LLC, as
relators on behalf of the United States, allege that Defendants-
Appellees Amazon.com, Inc. and Amazon.com Services, LLC caused
and conspired with foreign manufacturers of fur products sold over
its e-commerce platform to submit reverse false claims to the United
States so that the manufacturers could avoid certain tariffs and import
fees.
The United States District Court for the Southern District of
New York (Edgardo Ramos, Judge) dismissed Plaintiffs’ operative
complaint in full, holding that it failed to properly allege two elements
needed to establish a “reverse false claim” under § 3729(a)(1)(G)—
knowledge and causation—or to plead the elements of a false claims
conspiracy under § 3729(a)(1)(C)—an agreement to enter into a
conspiracy to submit false claims and overt acts in furtherance thereof.
On appeal, we AFFIRM the District Court’s dismissal. We agree
that the District Court properly dismissed the § 3729(a)(1)(G) claim
because Plaintiffs did not sufficiently allege that Defendants had
knowledge of the foreign manufacturers’ false claims. We likewise
conclude that the District Court properly dismissed the § 3729(a)(1)(C)
conspiracy claim, as an agreement to enter into a reverse false claims
conspiracy could not be pleaded absent knowledge of the underlying
reverse false claims, and Plaintiffs otherwise failed to allege an overt

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act in furtherance of a conspiracy.
R ICHARD C. GODFREY , Quinn Emanuel
Urquhart & Sullivan, LLP, Chicago, IL
(Andrew H. Schapiro, Quinn Emanuel
Urquhart & Sullivan, LLP, New York, NY, on
the brief) for Plaintiff-Appellants,
D AVID M. G OSSETT, Davis Wright Tremaine
LLP, Washington, DC (Jim Howard and
Erwin Reschke, Davis Wright Tremaine LLP,
Seattle, WA; Stephen M. Nickelsburg and
Glen Donath, Clifford Chance US LLP,
Washington, DC; Sanaz Payandeh, Clifford
Chance US LLP, New York, NY, on the brief),
for Defendants-Appellees.

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JOSÉ A. C ABRANES , Circuit Judge: 1
We consider here a suit directed at Amazon’s business structure
and design under the False Claims Act (“FCA”), which imposes civil
liability on those who defraud the United States Government for
money or property.2 By bringing a “qui tam action”3 to enforce the
United States Government’s interests,4 private enforcers known as
1 Except as otherwise noted, all internal citations, quotation marks, and
brackets are omitted, and all factual allegations are drawn from Plaintiffs’ Second
Amended Complaint (“SAC”), Joint Appendix (“JA”) 417–34.
2 The FCA, 31 U.S.C. § 3729, provides, in pertinent part:
(a) Liability for certain acts.--
(1) In general.--Subject to paragraph (2), any person who--
(A) knowingly presents, or causes to be presented, a false or fraudulent claim for payment
or approval;
(B) knowingly makes, uses, or causes to be made or used, a false record or statement material
to a false or fraudulent claim;
(C) conspires to commit a violation of subparagraph (A), (B), (D), (E), (F), or (G);
* * *
(G) knowingly makes, uses, or causes to be made or used, a false record or statement material
to an obligation to pay or transmit money or property to the Government, or knowingly conceals or
knowingly and improperly avoids or decreases an obligation to pay or transmit money or property
to the Government,
is liable to the United States Government for a civil penalty of not less than $5,000 and not
more than $10,000, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990 (28
U.S.C. 2461 note; Public Law 104-410), plus 3 times the amount of damages which the Government
sustains because of the act of that person.
3 B LACK ’ S L AW D ICTIONARY 1368 (9th ed. 2024) (defining “qui tam action”)
(“An action brought under a statute that allows a private person to sue for a
penalty, part of which the government or some specified public institution will
receive.”).
4 Because the Government is the real party in interest in a qui tam action, it
is entitled to intervene and to take over the prosecution. 31 U.S.C. § 3730(b)(4)

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“relators”5 can collect on an alleged violator’s debts and then some on
the Government’s behalf.6 These relators are entitled to a share of the
proceeds from any judgment against or settlement with alleged
violators,7 who face liability for civil penalties and up to treble
(“Before the expiration of the 60-day period or any extensions obtained under
paragraph (3), the Government shall-- (A) proceed with the action, in which case
the action shall be conducted by the Government; or (B) notify the court that it
declines to take over the action, in which case the person bringing the action shall
have the right to conduct the action.”); see also United States, ex rel. Polansky v. Exec.
Health Res., Inc., 599 U.S. 419, 426–27 (2023). The Government notified the district
court that it declined to intervene in the instant action. See JA-63–64.
5 Vt. Agency of Nat. Res. v. United States ex rel. Stevens, 529 U.S. 765, 769 (2000)
(defining a “relator” under the FCA as “a private person” who “may bring a qui
tam civil action for the person and for the United States Government against the
alleged false claimant, in the name of the Government” (internal quotation marks
omitted)); see Woods v. Empire Health Choice, Inc., 574 F.3d 92, 97 (2d Cir. 2009) (“In
a qui tam action, a private plaintiff, known as a relator, brings suit on behalf of the
Government to recover a remedy for a harm done to the Government.”) (collecting
cases).
6 31 U.S.C. § 3730(b)(1) (“A person may bring a civil action for a violation of
section 3729 for the person and for the United States Government. The action shall
be brought in the name of the Government.”).
7 31 U.S.C. § 3730(d) provides:
Award to qui tam plaintiff.--(1) If the Government proceeds with an action brought by a
person under subsection (b), such person shall, subject to the second sentence of this paragraph,
receive at least 15 percent but not more than 25 percent of the proceeds of the action or settlement of
the claim, depending upon the extent to which the person substantially contributed to the prosecution
of the action. Where the action is one which the court finds to be based primarily on disclosures of
specific information (other than information provided by the person bringing the action) relating to
allegations or transactions in a criminal, civil, or administrative hearing, in a congressional,
administrative, or Government Accounting Office report, hearing, audit, or investigation, or from the
news media, the court may award such sums as it considers appropriate, but in no case more than 10
percent of the proceeds, taking into account the significance of the information and the role of the
person bringing the action in advancing the case to litigation. Any payment to a person under the first
or second sentence of this paragraph shall be made from the proceeds. Any such person shall also

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damages.8
Plaintiffs-Appellants Mike D. Henig and Henig Furs, LLC, as
relators on behalf of the United States, appeal from the final judgment
of the United States District Court for the Southern District of New
York (Edgardo Ramos, Judge), dismissing their qui tam action under
the FCA against Defendants-Appellees Amazon.com, Inc. and
Amazon.com Services, LLC (jointly, “Amazon”).
Cheating the Government violates the FCA whether the fraud
bilks the Government for more than it owes with a “false claim” or
receive an amount for reasonable expenses which the court finds to have been necessarily incurred,
plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall be awarded against
the defendant.
(2) If the Government does not proceed with an action under this section, the person bringing
the action or settling the claim shall receive an amount which the court decides is reasonable for
collecting the civil penalty and damages. The amount shall be not less than 25 percent and not more
than 30 percent of the proceeds of the action or settlement and shall be paid out of such proceeds.
Such person shall also receive an amount for reasonable expenses which the court finds to have been
necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall
be awarded against the defendant.
(3) Whether or not the Government proceeds with the action, if the court finds that the action
was brought by a person who planned and initiated the violation of section 3729 upon which the
action was brought, then the court may, to the extent the court considers appropriate, reduce the share
of the proceeds of the action which the person would otherwise receive under paragraph (1) or (2) of
this subsection, taking into account the role of that person in advancing the case to litigation and any
relevant circumstances pertaining to the violation. If the person bringing the action is convicted of
criminal conduct arising from his or her role in the violation of section 3729, that person shall be
dismissed from the civil action and shall not receive any share of the proceeds of the action. Such
dismissal shall not prejudice the right of the United States to continue the action, represented by the
Department of Justice.
(4) If the Government does not proceed with the action and the person bringing the action
conducts the action, the court may award to the defendant its reasonable attorneys' fees and expenses
if the defendant prevails in the action and the court finds that the claim of the person bringing the
action was clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.
8 See note 2, ante.

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shortchanges the Government with a so-called “reverse false claim.”9
The law targets both “false or fraudulent claim[s] for payment or
approval” to the federal government as well as “false record[s] or
statement[s] material to an obligation to pay” it.10 These statements
need only be made “knowingly,” not necessarily with intent to
defraud.11
The FCA does not limit liability to those who directly submit a
reverse false claim to the Government. In addition to those who
“make” or “use” such claims, the statute also imposes liability on any
person who (1) “knowingly . . . causes” a reverse false claim to be
“made or used” or (2) “conspires” in its submission.12
Plaintiffs accuse Amazon of both, and they claim relief for:
(1) Amazon “knowingly . . . caus[ing]” third-party sellers on its
9 A “reverse false claim” refers to action to avoid paying the Government
money it is owed. See Miller v. United States ex rel. Miller, 110 F.4th 533, 542 (2d Cir.
2024) (“[T]he FCA’s reverse false claim provision . . . covers claims of money owed
to the government, rather than payments made by the government.” (internal
quotation marks omitted)).
10 See note 2, ante, at (A), (G).
11 31 U.S.C. § 3729(b)(1) provides:
(1) the terms “knowing” and “knowingly” --
(A) mean that a person, with respect to information--
(i) has actual knowledge of the information;
(ii) acts in deliberate ignorance of the truth or falsity of the information; or
(iii) acts in reckless disregard of the truth or falsity of the information; and
(B) require no proof of specific intent to defraud.
12 See note 2, ante, at (G) & (C).

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site to submit false forms to avoid tariffs and import fees, in
violation of § 3729(a)(1)(G); and
(2) Amazon “conspir[ing]” in the third-party sellers’ fraudulent
scheme, in violation of § 3729(a)(1)(C).
We review the District Court’s dismissal of each claim for
error.13 Finding none, we AFFIRM.
BACKGROUND
Under federal law, fur importers must pay various taxes and
fees on shipments of their products that enter the United States. One
such charge is a mandatory Fish and Wildlife Service (“FWS”) import
fee for inspecting shipments upon entry into the United States.14
Another is a non-discretionary tariff at a rate determined by the
shipment’s country of origin and contents, which is calculated and
collected by the United States Customs and Border Patrol (“CBP”) as
a percentage of the shipment’s total value.15 The agency usually
calculates the tariff amount using the information that an importer
13 On appeal, Plaintiffs do not renew their argument that Amazon can be
held liable under § 3729(a)(1)(G) for “knowingly and improperly avoid[ing] or
decreas[ing] an obligation to pay the Government.” Compare Plts. Br., Dkt. No. 32-
01, at 4 (“Issues Presented for Review”) with SAC, at JA-430–31 ¶¶ 83–84
(distinguishing between Plaintiffs’ two distinct theories of liability under
§ 3729(a)(1)(G)). “[A]rguments not raised in an appellant’s opening brief . . . are not
properly before an appellate court . . . .” Gross v. Rell, 585 F.3d 72, 95 (2d Cir. 2009).
We accordingly do not consider that theory of liability here.
14 JA-421 ¶¶ 14, 16–20; see also 50 C.F.R. § 14.61 (on the reporting
requirements for fur imports). For the purpose of this appeal, we assume without
deciding that the imports at issue were subject to these fees.
15 JA-422 ¶¶ 21–31; see also U.S. Int’l Trade Comm’n, Harmonized Tariff
Schedule of the United States §§ 4303.10.00, 9903.88.03.

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provides on a “Customs Declaration” attached to the shipment.16
Plaintiffs allege that several foreign manufacturers of fur
products who marketed and sold through Amazon (the “Foreign
Manufacturers”) provided false information to avoid or decrease these
payment obligations. This alleged fraud was accomplished by
misstating the contents and value of shipments on Customs
Declarations, so as to pay artificially deflated tariffs, and omitting
forms needed to conduct FWS inspections and sending shipments
through ports without an FWS facility, so as to avoid paying FWS
inspection fees. The Foreign Manufacturers allegedly reaped the
benefits of this practice over the course of fifteen years. 17
Under the terms of its standard Business Services Agreement
(“BSA”) with the Foreign Manufacturers and other third-party sellers,
Amazon was not deemed the “importer of record” for these furs. The
BSA provided that each third-party seller must “list [itself] as the
importer/consignee and nominate a customs broker.”18 It also
provided that the importer of record was responsible for “paying the
import duties, taxes, and fees associated with the shipment.”19 To that
end, Amazon’s website advises third-party sellers that “Amazon,
16 JA-422 ¶¶ 29–31.
17 JA-431–32 ¶ 87.
18 JA-239. Plaintiffs attached the BSA to their First Amended Complaint but
not to their operative SAC. The Court deems the BSA “integral” to the operative
complaint because Plaintiffs do not pursue a theory of vicarious liability that
Amazon itself made or used the false statements, Plaintiffs have abandoned their
argument that Amazon itself had an obligation to pay the taxes and fees on appeal,
and the BSA seems to underlie Plaintiffs’ allegations that Amazon alerted suppliers
that it would not oversee importation. See post at n.27 and accompanying text.
19 JA-260.

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including [its] fulfillment centers, will not act as an [importer of
record].”20 And it is “[t]he importer of record” who “is responsible for
ensuring that the shipment is successfully imported into the
destination country.”21 This responsibility “include[s] filing legally
required documents and paying assessed import duties and taxes.”22
The furs at issue were marketed and sold as furs on the
Amazon.com website, and were stored and delivered to customers
from Amazon’s facilities. Amazon also remitted a share of the
revenues on these furs to the Foreign Manufacturers. But it is
undisputed that from manufacture to import to arrival at Amazon’s
facilities, the furs remained outside of the company’s custody. The
parties therefore agree that Amazon neither made the false statements
on the Customs Declarations nor controlled the process through which
the furs were imported.
Plaintiffs allege, however, that once the furs reached Amazon,
the company became aware of the Foreign Manufacturers’ false
claims—through either actual or constructive knowledge. Each
shipment of fur would have arrived at an Amazon warehouse with a
Customs Declaration and packing slip listing the wrong product and
price, which would contradict the information in the invoice included
with that shipment and the information Amazon used to market and
sell the products on its website. Plaintiffs also claim that the lack of
FWS inspection forms accompanying the shipments and other
indications that the shipments had not passed through FWS ports
notified Amazon that FWS inspection fees had not been paid. In
Plaintiffs’ view, these facts demonstrate Amazon’s actual knowledge
20 JA-286.
21 JA-221.
22 Id.

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of the false claims, or its deliberate ignorance or reckless disregard
with respect to those claims.
And yet, in a fifteen-year period over which the fraud
continued, Plaintiffs allege, Amazon never once rejected the Foreign
Manufacturers’ furs.23 Nor did it pay the Government the tariffs and
fees that are alleged to have been fraudulently avoided. Amazon
instead continued to market, sell, and deliver these furs to consumers,
all while remitting payment to the Foreign Manufacturers.
Rather than assert claims against the Foreign Manufacturers,
Plaintiffs brought the present action against Amazon. The District
Court dismissed their SAC under Federal Rule of Civil Procedure
12(b)(6) (“Rule 12(b)(6)”) for failure to state claims for relief. According
to the District Court:
(1) Plaintiffs failed to adequately allege the knowledge or
causation required for their § 3729(a)(1)(G) claim that
Amazon knowingly caused the Foreign
Manufacturers’ reverse false claims;24 and
(2) Plaintiffs failed to adequately allege an agreement
between Amazon and the Foreign Manufacturers to
violate the FCA or a non-duplicative overt act in
furtherance of that alleged agreement, as required for
their conspiracy claim under § 3729(a)(1)(C).25
23 JA-427 ¶ 59.
24 United States ex rel. Henig v. Amazon.com, Inc., No. 19-CV-05673 (ER), 2025
WL 27736, at *7–*10 (S.D.N.Y. Jan. 3, 2025).
25 Id. at *10–*12.

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This appeal followed.
DISCUSSION
We review de novo the District Court’s dismissal for failure to
state a claim pursuant to Rule 12(b)(6) and may affirm on any ground
supported by the record.26 At this posture, the reviewable record
includes the operative complaint; any documents attached to,
incorporated by reference in, or integral to it; and any facts of which
we may take judicial notice.27
Fraud claims must be pleaded both plausibly and with
particularity. An adequate complaint for claims sounding in fraud
must both set forth “the who, what, when, where and how of the
fraud”28 and contain “sufficient factual matter” to “plausibly give rise
to an entitlement to relief.”29 In reviewing the legal sufficiency of the
complaint, we assume the veracity of the complaint’s non-conclusory
factual allegations and draw all reasonable resulting inferences in its
favor.30
I
With these standards in mind, we turn to the question of
26 Sonterra Cap. Master Fund, Ltd. v. UBS AG, 152 F.4th 404, 409–10 (2d Cir.
2025).
27 Chambers v. Time Warner, Inc., 282 F.3d 147, 152–53 (2d Cir. 2002); Kramer
v. Time Warner Inc., 937 F.2d 767, 773 (2d Cir. 1991).
28 Miller, 110 F.4th at 544 (internal quotation marks omitted); see also F ED. R.
C IV. P. 9(b).
29 Lynch v. City of N.Y., 952 F.3d 67, 74, 75 (2d Cir. 2020).
30 Id. at 75.

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whether Plaintiffs have sufficiently pleaded that Amazon “knowingly
. . . cause[d] to be made or used . . . a false record or statement material
to an obligation to pay or transmit money or property to the
Government,” in violation of § 3729(a)(1)(G).
On appeal, the basic facts concerning the mechanics of the
alleged fur-import fraud are not in dispute. The issue is instead
whether Amazon (1) “knowingly” and (2) “caused” the asserted
reverse false claims.
We begin with the “knowingly” component. For purposes of
§ 3729(a)(1)(G), knowledge that the claims are false can be established
in three ways: (1) actual knowledge—i.e., the defendant is aware of the
falsity of the claims; (2) deliberate ignorance—i.e., the defendant is
aware of a substantial risk that the claims are false, but intentionally
avoids taking steps to confirm their validity; and (3) reckless disregard
of the truth or falsity of the claims—i.e., the defendant is “conscious of
a substantial and unjustifiable risk that their claims are false, but
submit the claims anyway.”31 “Rule 9(b) permits knowledge to be
averred generally, but plaintiffs . . . still must plead the factual basis
which gives rise to a strong inference of fraudulent intent.”32 This
strong inference can be established “either (a) by alleging facts to show
that defendants had both motive and opportunity to commit fraud, or
(b) by alleging facts that constitute strong circumstantial evidence of
conscious misbehavior or recklessness.”33
Plaintiffs have failed to plead knowledge under any of these
31 United States ex rel. Schutte v. SuperValu Inc., 598 U.S. 739, 750–51 (2023).
32 United States v. Strock, 982 F.3d 51, 66 (2d Cir. 2020) (internal quotation
marks omitted).
33 Id.

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three acceptable bases. Starting with actual knowledge, the SAC does
not identify any individual or entity at Amazon that consciously
acknowledged the existence of false information attached to the
Foreign Manufacturers’ fur shipments. Rather, the SAC notes only
hypothetical observations that certain Amazon employees could have
made about the Foreign Manufacturers’ shipments and inferences that
could have been drawn from these observations. These allegations are
insufficient to show that Amazon or its employees were aware of the
Foreign Manufacturers’ false claims.34 Nor does the SAC contain
sufficient circumstantial evidence to “give[] rise to a strong inference
of fraudulent intent.”35 In particular, the SAC does not detail conduct
on the part of Amazon that evinces knowledge of the Foreign
Manufacturers’ wrongdoing. As alleged, Amazon’s acceptance of the
Foreign Manufacturers’ fur shipments and subsequent efforts to sell
these products were merely part of the company’s ordinary business
practices with respect to any products. Amazon’s actions can just as
easily be explained by its unawareness of the Foreign Manufacturers’
false claims as it can by conscious awareness of them.36
Further, Amazon’s knowledge has not been established through
deliberate ignorance, because the SAC does not allege intentional steps
that Amazon or its employees took to avoid learning about the Foreign
Manufacturers’ false claims. Plaintiffs argue that Amazon “shut its
34 See SuperValu, 598 U.S. at 751.
35 Strock, 982 F.3d at 66.
36 To the extent that Plaintiffs maintain that knowledge was established by
Amazon and the Foreign Manufacturers’ mutual profit motive, this argument fails
because a generalized profit motive is insufficient to establish scienter under Rule
9(b). See Chill v. Gen. Elec. Co., 101 F.3d 263, 268 (2d Cir. 1996) (holding the same in
the context of a claim under section 10(b) of the Securities Exchange Act of 1934, 15
U.S.C. § 78j(b), and of Rule 10b–5, 17 C.F.R. § 240.10b–5, promulgated thereunder).

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eyes” to the truth of these claims by delegating the responsibility to
pay import tariffs to third-party suppliers.37 However, the SAC does
not allege that this delegation was made in response to a known and
substantial risk that false claims were being submitted. Plaintiffs
contend that the below-market prices on the Foreign Manufacturers’
furs alerted Amazon to the risk that FWS fees and import tariffs were
not being paid on these goods, as these prices were possible only
through avoidance of such charges. However, the SAC does not allege
that Amazon assessed third-party compliance risks by comparing the
prices on third-party products to those of market competitors. Nor
does it provide any basis to believe that Amazon would attribute the
Foreign Manufacturers’ low prices to avoidance of FWS fees and
import tariffs, as opposed to an innocent explanation like economies
of scale or lower labor costs. Below-market prices alone are therefore
insufficient in this case to show that Amazon was aware of a
substantial risk that the Foreign Manufacturers were submitting false
claims. And the SAC does not identify any other purported risk. Thus,
it does not establish that Amazon’s delegation of responsibilities to
third-parties to pay import duties was made in an effort to avoid
learning of false statements being made by outside suppliers.
Plaintiffs further argue that Amazon was deliberately ignorant
because it failed to institute oversight procedures for claims that the
Foreign Manufacturers were submitting. Once again, however, the
SAC contains no allegations suggesting that Amazon purposefully
decided not to implement these procedures. And while Plaintiffs’
briefing proposes steps that Amazon could have taken to learn about
the Foreign Manufacturers’ false claims, the mere existence of these
possible steps does not imply that Amazon intentionally avoided
taking them, much less that Amazon did so to keep itself in the dark
37 Plts. Br., Dkt. No. 32-01, at 26–27.

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with respect to a substantial risk that the Foreign Manufacturers were
making false claims.
Finally, Plaintiffs have not pleaded knowledge through reckless
disregard because the SAC does not allege that Amazon failed to make
an inquiry that was “reasonable and prudent under the
circumstances” to ascertain the truth of the Foreign Manufacturers’
claims to FWS and CBP.38 While the SAC alleges that Amazon could
have learned of the Foreign Manufacturers’ false claims by comparing
the invoices on the fur shipments—which reflected their true
contents—to the Customs Declarations affixed to those shipments—
which incorrectly identified their contents and values—it does not
establish that Amazon had a reason to do so. The SAC notes that the
Foreign Manufacturers’ fur shipments arrived in Amazon’s
warehouses after passing through points of entry where FWS
inspections were held. Thus, by the time Amazon first exercised
control over the fur shipments, the FWS inspections should have
already taken place. Amazon would thus have no reason to inspect the
shipments to ensure that the Foreign Manufacturers had paid FWS
fees. Similarly, Plaintiffs provide no explanation as to why Amazon
should have inspected the packaging slips and Customs Declarations
attached to the fur shipments to ensure that the Foreign Manufacturers
were paying the proper import tariffs. The SAC does not allege that
this was industry custom or called for by Amazon’s prior experience
with other third-party suppliers.39 Thus, under the circumstances
38 S. Rep. No. 99-345, at 20 (1986); accord U.S. ex rel. Williams v. Renal Care
Grp., Inc., 696 F.3d 518, 530 (6th Cir. 2012).
39 Plaintiffs also highlight Amazon’s admission from another matter that it
can monitor and control certain products that it markets, receives, and distributes
to ensure their safety for children. However, the relevant question is whether
Amazon acted unreasonably and imprudently in failing to monitor products sold

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pleaded in the SAC, Amazon did not act unreasonably or imprudently
in failing to inspect the Foreign Manufacturers’ fur shipments to
discern whether they contained indicia of false claims.
The cases on which Plaintiffs rely to argue that the SAC properly
pleaded reckless disregard are also inapposite. In United States v.
Krizek, 111 F.3d 934 (D.C. Cir. 1997), the D.C. Circuit held that a
psychiatrist had knowledge of thousands of false claims that his
bookkeeper—who was also his wife—prepared and submitted for
reimbursement to Medicare and Medicaid under a reckless disregard
theory.40 However, Krizek involved claims being prepared and
submitted by a solo-practitioner’s wife for reimbursement, whereas
the present matter involves oversight of sophisticated commercial
importers (the Foreign Manufacturers) by an online marketplace
(Amazon) during the course of an arms-length business relationship.
The unreasonableness of the failure to investigate is self-evident in the
former situation, but not in the latter. Plaintiffs also rely on Strock, 982
F.3d 51, where this Court held that the defendant could be liable for
structuring a company to fraudulently take advantage of government
subsidies reserved for small businesses owned by service-disabled
veterans.41 We concluded that the owner of the company’s knowledge
of the false claims could be inferred from, in part, the elaborate steps
that he took to ensure that the company was structured in a manner
that made it eligible for these subsidies.42 By contrast, here, the SAC
does not point to active steps that Amazon took to avoid learning of
over its platform, not whether it had the ability to do so. The SAC does not establish
that this was the case here.
40 United States v. Krizek, 111 F.3d 934, 942 (D.C. Cir. 1997).
41 Strock, 982 F.3d at 68.
42 Id. at 66–67.

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the truth of the Foreign Manufacturers’ statements. These cases thus
do not strengthen Plaintiffs’ case for knowledge.
In sum, the District Court properly dismissed Plaintiffs’
§ 3729(a)(1)(G) claim on Rule 12(b)(6) grounds.43
II
Plaintiffs likewise have not pleaded sufficient facts to allege that
Amazon agreed to a conspiracy to submit reverse false claims or that
it committed any overt acts “in furtherance” of the conspiracy. We
therefore conclude that the District Court did not err in dismissing
Plaintiffs’ conspiracy claim under § 3729(a)(1)(C).
The factual allegations supporting Plaintiffs’ conspiracy claims
are coextensive with those supporting their insufficient § 3729(a)(1)(G)
claim. And the SAC’s failure to plead knowledge of reverse false
claims necessarily implies that Amazon lacked the requisite mental
state to enter into a conspiracy to submit reverse false claims. Simply
put, Amazon could not have consciously entered into a conspiracy
where it lacked knowledge of the conspiracy’s underlying means and
aims. We also conclude that the SAC’s allegations describe nothing
more than Amazon’s routine business practices, which alone are
insufficient to state a claim for conspiracy.44 Amazon neither
43 As Plaintiffs acknowledge, this Court has not yet adopted a causation
standard for reverse false claims. We need not do so today, as Plaintiffs’ §
3729(a)(1)(G) claim fails regardless of whether the SAC adequately pleads
causation.
44 See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 557 (2007) (“A statement of
parallel conduct, even conduct consciously undertaken, needs some setting
suggesting the agreement necessary to make out [an antitrust conspiracy] claim;
without that further circumstance pointing toward a meeting of the minds, an

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affirmatively nor tacitly assented to the submission of the reverse false
claims through its routine business practices. Nor would continuing to
conduct business as usual constitute an overt act in furtherance of any
such conspiracy. By relying on these practices, Plaintiffs plead nothing
more than a failure to prevent fraud, not Amazon’s conspiracy in the
commission of alleged reverse false claims.
CONCLUSION
To summarize, we hold as follows:
(1) Plaintiffs failed to plead facts establishing Amazon’s
knowledge of the Foreign Manufacturers’ false claims, either
by virtue of actual knowledge, deliberate indifference, or
reckless disregard; accordingly, the District Court did not err
in dismissing Plaintiffs’ claim under § 3729(a)(1)(G) of the
FCA;
(2) Plaintiffs failed to allege an agreement to enter into a reverse
false claims conspiracy or an overt act in furtherance thereof;
therefore, the District Court did not err in dismissing
Plaintiffs’ conspiracy claim under § 3729(a)(1)(C) of the FCA.
For the foregoing reasons, we AFFIRM the judgment of the
District Court.
account of a defendant’s commercial efforts stays in neutral territory.”); see also
United States ex rel. Ibanez v. Bristol-Myers Squibb Co., 874 F.3d 905, 917 (6th Cir. 2017);
United States ex rel. Ladas v. Exelis, Inc., 824 F.3d 16, 27 (2d Cir. 2016).

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