UNITED STATES OF AMERICA ex rel. THOMAS PROCTOR v. Safeway, Inc.

United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
ON R EMAND FROM THE SUPREME C OURT OF THE U NITED STATES
Submitted July 5, 2023
Decided July 27, 2023
Before
DAVID F. HAMILTON, Circuit Judge*
AMY J. ST. EVE, Circuit Judge
No. 20-3425
UNITED STATES OF AMERICA ex rel.
THOMAS PROCTOR,
Plaintiff-Appellant,
v.
SAFEWAY, INC.,
Defendant-Appellee.
Appeal from the United States District
Court for the Central District of Illinois.
No. 11-cv-3406
Richard Mills,
Judge.
O R D E R
On April 5, 2022, we affirmed the district court’s grant of summary judgment in
this case because our decision in United States ex rel. Schutte v. SuperValu Inc., 9 F.4th 455,
465–67 (7th Cir. 2021), held that the scienter requirement the Supreme Court announced
in Safeco Insurance Co. of America v. Burr, 551 U.S. 47 (2007), for claims under the Fair Credit
Reporting Act, also applied to claims under the False Claims Act (FCA). United States ex
rel. Proctor v. Safeway, Inc., 30 F.4th 649, 658–59 (7th Cir. 2022). The Supreme Court granted
* Circuit Judge Michael S. Kanne was a member of the original panel in this case. He passed away
on June 16, 2022, and thus did not participate in the decision of this case on remand from the Supreme
Court. The case is now being resolved by a quorum of the panel under 28 U.S.C. § 46(d).
NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1

-- 1 of 2 --

No. 20-3425 Page 2
certiorari and on June 1, 2023, held that Safeco’s scienter requirement does not apply to
the FCA. United States ex rel. Schutte v. SuperValu Inc., 143 S. Ct. 1391, 1402–03 (2023).
Instead, the Supreme Court held that plaintiffs may establish scienter under the FCA by
showing that defendants “(1) actually knew that their reported prices were not their
‘usual and customary’ prices when they reported those prices, (2) were aware of a
substantial risk that their higher, retail prices were not their ‘usual and customary’ prices
and intentionally avoided learning whether their reports were accurate, or (3) were aware
of such a substantial and unjustifiable risk but submitted the claims anyway.” Id. at 1404
(citing 31 U.S.C. § 3729(b)(1)(A)). The Supreme Court vacated the judgment of this court
and remanded for further proceedings. Pursuant to Circuit Rule 54, the parties took the
position that we should vacate the June 15, 2020, judgment of the district court and
remand for further proceedings in light of the Supreme Court’s clarification of the proper
scienter standard.
We agree with the assessment of both parties. We thus VACATE the judgment of
the district court and R EMAND to the district court for the Central District of Illinois for
further proceedings in light of the Supreme Court’s opinion in Schutte. Further, the
district court relinquished its jurisdiction over the plaintiffs’ remaining state law claims
when it granted summary judgment on the FCA claims. On remand, the district court
should revisit the question of supplemental jurisdiction. See Stockton v. Milwaukee County,
44 F.4th 605, 621 n.4 (7th Cir. 2022).

-- 2 of 2 --