JOHAN ROSENBERG [Note 1] vs. JPMORGAN CHASE & CO. & others. [Note 2]

WENDLANDT, J. The Massachusetts False Claims Act, G. L. c. 12, §§ 5A-5O (MFCA), authorizes a private party to bring an action alleging that a person has committed a fraud on the Commonwealth in connection with a claim for payment under a government program. Such an action may be a valuable tool to shine a light on fraudulent behavior that otherwise might remain undiscovered. In return, the private party (known as a "relator") is rewarded a portion of the recovery from the misfeasors. Where the essential features of an individual's purported chicanery already have been illuminated, by contrast, affording a private party an incentive to bring suit is unwarranted, as it would add nothing to the Commonwealth's knowledge; in such circumstances, the MFCA prohibits such suits unless the Commonwealth intervenes. Specifically, the MFCA contains a public disclosure bar that generally requires dismissal of an action "if substantially the same allegations or transactions as alleged in the action . . . [previously have been] publicly disclosed" through certain enumerated sources. G. L. c. 12, § 5G (c). Applying this public disclosure bar to the complaint at issue here, a Superior Court judge dismissed the complaint. Because the complaint rested on information that already had been exposed to the light of day, we affirm. [Note 3]

1. Background. We recite the facts as set forth in the complaint, viewing all of the allegations as true and drawing all reasonable inferences in the plaintiff relator's favor. See Magliacane v. Gardner, 483 Mass. 842, 844 (2020), citing Revere v. Massachusetts Gaming Comm'n, 476 Mass. 591, 595 (2017).

a. Relator's claims. The relator, Johan Rosenberg, commenced

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this action on behalf of the Commonwealth against the defendants -- certain financial institutions and their subsidiaries, see note 2, supra -- alleging that the defendants collectively engaged in and conspired to engage in fraud in connection with resetting interest rates for certain municipal bonds, referred to as variable rate demand obligations (VRDOs). VRDOs are long-term, tax-exempt, variable rate bonds. The Commonwealth and its subdivisions [Note 4] issue VRDOs to finance long-term public projects or infrastructure, such as airports, ports, roads and bridges, and affordable housing. Because interest rates on the bonds are reset on a periodic basis, often weekly, by the remarketing agent, the bonds allow issuers, like the Commonwealth, to borrow money for long periods of time while paying short-term interest rates. The Commonwealth retained the defendants as remarketing agents to perform the requisite periodic resetting of the VRDO interest rates. According to the complaint, the contracts between the Commonwealth and the defendants required that the defendants "actively and individually market and price these bonds at the lowest possible interest rates" that would permit the sale of the VRDOs on a given rate determination date. [Note 5]

The relator maintains that the defendants did not perform these services as promised; instead, the defendants engaged in a rate setting scheme, which he refers to as "robo-resetting," whereby the defendants "mechanically set the rates en masse without any consideration of the individual characteristics of the bonds, the associated market conditions[,] or investor demand." The relator, who states that he has over twenty years of experience in advising municipalities

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on issuing securities, asserts that he confirmed his suspicions of this "bucket" rate-setting scheme through a forensic analysis of published interest rate data for these types of bonds. The interest rates for VRDOs are published daily on a publicly available website, Electronic Municipal Market Access (EMMA). [Note 6] The relator's analysis revealed that, for certain groups of VRDOs, [Note 7] the interest rates moved in lock step; the relator labels these groups "buckets" [Note 8] of VRDOs. This collective interest rate setting, he maintains, had no business justification, and demonstrates a lack of individualized judgment as to the lowest interest rate that would permit the sale of a given VRDO at the time the interest rate was reset. He argues that this collective rate setting thereby resulted in "artificially high interest rates on Massachusetts VRDOs," and violated the defendants' obligations to the Commonwealth to market the VRDOs at the lowest interest rate that would permit sale on a given rate determination date. Thus, the relator contends, the defendants fraudulently collected fees for services as remarketing agents that they did not perform.

The relator argues that the defendants also benefited in another manner from their approach to resetting interest rates. Specifically, the artificially high interest rates resulting from the defendants' scheme caused VRDO investors to hold the bonds rather than to exercise their "put" options. A put option allows an investor in a VRDO to redeem the VRDO at face value plus interest earned. When a put option is exercised, a remarketing agent becomes responsible for reselling the redeemed securities to new investors. If a remarketing agent is unable to find another investor, a liquidity provider must step in and purchase the VRDO from the redeeming investor. For this reason, VRDOs are backed by liquidity agreements, often letters of credit, to finance redemptions

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where no new investor is found. The same financial institution (here, the defendants) may serve as both the remarketing agent and the issuer of the letter of credit for a particular VRDO. According to the complaint, the defendants were paid fees by the Commonwealth to provide letter of credit services. By setting the interest rates for VRDOs artificially high, the defendants assured that the holders of the bonds would not exercise their put options and the defendants would not have to find other investors to purchase the bonds or to buy the bonds themselves.

As a result of these actions, the relator contends, the defendants collected millions of dollars in fees from the Commonwealth for remarketing services that they did not provide. He maintains that the defendants also extracted millions of dollars in fees as liquidity providers even though the chance of needing to draw on the letters of credit services was very low ("rarely, if ever, called upon") because bond holders were unlikely to exercise their put options in view of the artificially high interest rates. Because the interest rates were artificially high, the relator asserts, the Commonwealth paid extra interest on its VRDOs (some of which were owned by the defendants). [Note 9]

b. Procedural history. The relator filed his initial complaint in 2014; the Commonwealth declined to intervene. [Note 10] In 2017, the relator filed an amended complaint, and, in 2019, he filed a second amended complaint, now at issue before us.

The defendants filed a joint motion to dismiss, which the Commonwealth

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did not oppose. The judge allowed the motion, [Note 11] and the relator appealed. We then transferred the appeal to this court on our own motion.

2. Discussion. a. Standard of review. We review the allowance of a motion to dismiss de novo. Goodwin v. Lee Pub. Sch., 475 Mass. 280, 284 (2016), citing Curtis v. Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011). We "accept as true the factual allegations in the complaint and the attached exhibits, draw all reasonable inferences in the [relator's] favor, and determine whether the allegations 'plausibly suggest' that the [relator] is entitled to relief on that legal claim." Buffalo-Water 1, LLC v. Fidelity Real Estate Co., 481 Mass. 13, 17 (2018). See Revere, 476 Mass. at 595. "[M]atters of public record, orders, items appearing in the record of the case, and exhibits attached to the complaint, also may be taken into account" (quotation and citation omitted). Iannacchino v. Ford Motor Co., 451 Mass. 623, 631 n.14 (2008). See Golchin v. Liberty Mut. Ins. Co., 460 Mass. 222, 224 (2011), S.C., 466 Mass. 156 (2013), quoting Marram v. Kobrick Offshore Fund, Ltd., 442 Mass. 43, 45 n.4 (2004) ("Where . . . the [relator] had notice of [the extrinsic] documents and relied on them in framing the complaint, the attachment of such documents to a motion to dismiss does not convert the motion to one for summary judgment . . .").

In their motion to dismiss, the defendants argued that dismissal was required pursuant to the public disclosure bar of the MFCA because the transactions at issue previously had been disclosed to the public through news media and the relator was not an original source of the information concerning the fraud. This motion requires construction of the public disclosure bar, a matter of statutory interpretation that we review de novo. See Ortiz v. Examworks, Inc., 470 Mass. 784, 788 (2015), citing Commerce Ins. Co. v. Commissioner of Ins., 447 Mass. 478, 481 (2006).

b. Statutory background. The MFCA prohibits making fraudulent claims against the Commonwealth and its municipalities. See G. L. c. 12, §§ 5A-5O. The statute also permits enforcement of that prohibition by means of qui tam actions, in which "[a]n individual, hereafter referred to as a relator, may bring a civil action . . . on behalf of the relator and the [C]ommonwealth or

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any political subdivision thereof." G. L. c. 12, §§ 5A, 5C (2). The Commonwealth may intervene and take over the case. G. L. c. 12, §§ 5C (3), 5D. Successful relators are awarded a percentage of the funds recovered by the Commonwealth. G. L. c. 12, § 5F.

Qui tam actions have the "salutary purpose of encouraging the disclosure of fraudulent schemes." See United States ex. rel. Winkelman v. CVS Caremark Corp., 827 F.3d 201, 206 (1st Cir. 2016) (Winkelman). At the same time, "this statutory paradigm . . . creates perverse incentives for opportunists to seek compensation based on fraud already apparent from information in the public domain." Id. As does its counterpart, the Federal False Claims Act, 31 U.S.C. § 3730(e)(4)(A) (FFCA), the MFCA therefore includes a "public disclosure bar," G. L. c. 12, § 5G (c), which provides: [Note 12]

"The court shall dismiss an action or claim pursuant to [G. L. c. 12, §§ 5A-5O], inclusive, unless opposed by the [C]ommonwealth or any political subdivision thereof, if substantially the same allegations or transactions as alleged in the action or claim were publicly disclosed: (1) in a Massachusetts criminal, civil or administrative hearing in which the [C]ommonwealth is a party; (2) in a Massachusetts legislative, administrative, auditor's or inspector general's report, hearing, audit or investigation; or (3) from the news media, unless the action is brought by the attorney general, or the relator is an original source of the information."

The bar seeks to prevent "parasitic" suits, United States ex rel. Ondis v. Woonsocket, 587 F.3d 49, 53 (1st Cir. 2009) (Ondis), where a relator, "instead of plowing new ground, attempts to free-ride by merely repastinating previously disclosed badges of fraud," id., citing United States ex rel. Duxbury v. Ortho Biotech Prods., L.P., 579 F.3d 13, 26-27 (1st Cir. 2009), cert. denied, 561 U.S. 1005 (2010).

Where, as here, the Commonwealth chooses not to intervene, a multipart inquiry governs whether the public disclosure bar

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applies. [Note 13] "The first three parts of this inquiry ask: (1) whether there has been a prior, public disclosure of fraud; (2) whether that prior disclosure of fraud emanated from a source specified in the statute's public disclosure provision; and (3) whether the relator's qui tam action is [substantially the same as] that prior disclosure of fraud." United States ex rel. Poteet v. Bahler Med., Inc., 619 F.3d 104, 109 (1st Cir. 2010) (Poteet). See United States ex rel. Reed v. KeyPoint Gov't Solutions, 923 F.3d 729, 741 (10th Cir. 2019) (Reed); Ondis, 587 F.3d at 53. Where "all three questions are answered in the affirmative, the public disclosure bar applies unless the relator qualifies under the 'original source' exception." [Note 14] Poteet, supra at 109-110, quoting Ondis, supra at 53-54.

c. Application of the public disclosure bar. i. Prior public disclosure. We first consider whether the allegations or transactions identified in the complaint previously had been publicly disclosed at the time the complaint was filed. See Winkelman, 827 F.3d at 208. As discussed, a prior public disclosure occurs when the essential elements exposing the fraud are in the public domain. Poteet, 619 F.3d at 110. The disclosure must constitute either (a) a direct allegation of fraud or (b) a transaction from which readers or listeners may infer fraud. Id. See United States ex rel. Springfield Terminal Ry. Co. v. Quinn, 14 F.3d 645, 654 (D.C. Cir. 1994) (Springfield). Here, the defendants argued only that the latter theory was applicable, contending that the critical elements of the purported fraudulent transactions were in the public domain. Thus, to prevail on their motion to dismiss, the defendants must show a disclosure of the two critical elements of the transactions; specifically, the defendants must establish that "both [the] misrepresented state of facts and [the] true state of facts so that the listener or reader may infer fraud" were in the public domain when the intervener filed his claims. Poteet, supra.

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See Winkelman, supra; Springfield, supra ("[I]f X + Y = Z, Z represents the allegation of fraud and X and Y represent its essential elements. In order to disclose the fraudulent transaction publicly, the combination of X and Y must be revealed, from which readers or listeners may infer Z, i.e., the conclusion that fraud has been committed").

A. Misrepresented state of facts. According to the complaint, the asserted misrepresented state of facts comprised the defendants' representations that they would comply with their obligations as remarketing agents, as set forth in their agreements with the Commonwealth. Specifically, the relator alleges that the defendants misrepresented that they would "determine the applicable rate of interest that, in [their] judgment, is the lowest rate that would permit the sale of the [VRDOs] bearing interest at the applicable interest rate at par plus accrued interest, if any, on and as of the applicable Rate Determination Date." [Note 15] See, e.g., Winkelman, 827 F.3d at 209 (purported misrepresented state of facts comprised defendants' asserted compliance with requirement in Federal regulation that pharmacies charge generic drug prices equal to lowest prices charged to customers when in fact charged price was higher); Ondis, 587 F.3d at 52, 54 (asserted misrepresentation was statements in city's Federal grant applications that it would promote development of public housing when it planned to discourage such development).

The defendants' representations that they would comply with the obligations in their agreements with the VRDO issuers are set forth in several publicly available sources, including Municipal Securities Rulemaking Board (MSRB) [Note 16] rules that address remarketing agents' duties to VRDO issuers; Securities Industry Financial Markets Association (SIFMA) [Note 17] model disclosures; and the remarketing agreements, including remarketing circulars and

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official statements, reached between the defendants and the Commonwealth. See Poteet, 619 F.3d at 110, citing United States ex rel. Maxwell v. Kerr-McGee Oil & Gas Corp., 540 F.3d 1180, 1185 (10th Cir. 2008) (disclosure "is 'public' if it is generally available to the public"). These sources disclose that the defendants undertook (purportedly falsely) to comply with their obligations to obtain the lowest possible interest rates that would have permitted a sale on the market on a given rate determination date. Thus, the defendants have shown a prior public disclosure of the misrepresented state of facts alleged in the complaint.

B. True state of facts. Accordingly, we turn to whether the second element of fraud was disclosed, namely, whether there was a public disclosure of the "true state of facts so that the listener or reader may infer fraud." See Poteet, 619 F.3d at 110. The truth, according to the complaint, was that the defendants did not obtain the lowest interest rates that would have permitted the sale of the VRDOs, and instead "engaged in a practice of setting their VRDO rates mechanically and collectively, without any consideration of the unique attributes of each particular bond." See, e.g., Winkelman, 827 F.3d at 209 (true state of affairs was that defendant was not in fact billing correctly); Ondis, 587 F.3d at 52, 54 (true state of affairs was city's plan to oppose public housing while obtaining grants for its purported public housing projects on representation that it would promote public housing).

The information reflecting this asserted truth was discernable through the published EMMA data [Note 18] available to the public via the Internet. Indeed, the relator used the same data as that disclosed on the EMMA website to conclude that the defendants were not setting the lowest interest rates on the VRDOs because, his analysis showed, they were grouping unrelated bonds rather than setting the rate for each bond individually. See Winkleman, 827 F.3d at 209 ("Enough was revealed in the . . . disclosures to put the government on notice of the potential fraud without the aid of these relators"). Contrary to the relator's contention, neither the need to perform analysis on the publicly available information nor the benefit of his expertise renders the true state of affairs hidden. See Poteet, 619 F.3d at 111 ("If the materials necessary to ground an inference of fraud are generally available to the public, . . . there is nothing to prevent the government from

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detecting it. Concomitantly, the likelihood of parasitic qui tam actions in such circumstances is high, providing a reason for the public disclosure bar"); United States ex rel. Findley v. FPC-Boron Employees' Club, 105 F.3d 675, 688 (D.C. Cir.), cert. denied, 522 U.S. 865 (1997) (Findley), citing Springfield, 14 F.3d at 655 ("[I]f a relator merely uses his or her unique expertise or training to conclude that the material elements already in the public domain constitute a false claim, then a qui tam action cannot proceed"). "[T]he only question is whether the material facts exposing the alleged fraud are already in the public domain, not whether they are difficult to recognize." United States ex rel. Conrad vs. Abbott Lab., Inc., U.S. Dist. Ct., No. 02-11738-RWZ (D. Mass. Feb. 25, 2013), citing Ondis, 587 F.3d at 59-60. Thus, it suffices that other members of the public, albeit with sufficient expertise and after having conducted some analysis, could have identified the true state of affairs by conducting the same data-crunching exercise as did the relator, using the data publicly available on the EMMA website. See Findley, supra, citing Springfield, supra.

ii. Statutorily enumerated sources. Having determined that there was a public disclosure of the essential elements of the fraud, we turn to consider the second prong of the public disclosure bar: whether the prior disclosure "emanated from a source specified in the statute's public disclosure provision." Poteet, 619 F.3d at 109. "By its plain terms, the public disclosure bar applies to some methods of public disclosure and not to others." Schindler Elevator Corp. v. United States ex rel. Kirk, 563 U.S. 401, 414 (2011) (Schindler). Specifically, we must decide whether the forum in which the public disclosure was made falls within any of three sources enumerated in the statute -- (1) "a Massachusetts criminal, civil or administrative hearing in which the [C]ommonwealth is a party"; (2) "a Massachusetts legislative, administrative, auditor's or inspector general's report, hearing, audit or investigation"; or (3) "the news media." See G. L. c. 12, § 5G (c). We turn to consider each of the critical elements of the public disclosure set forth under the first prong of the public disclosure bar test -- first, the misrepresented state of affairs and, second, the true state of the facts.

A. Source of public disclosure of misrepresented state of affairs. According to the complaint, the first publicly disclosed element of the asserted fraud -- namely, the misrepresentation that the defendants would undertake to obtain the lowest interest

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rates that, in their judgment, would permit the sale of the VRDOs -- was disclosed in the governing remarketing agreements, including in the official statements. [Note 19] These official statements comprise Massachusetts "reports," [Note 20] one of the statutorily enumerated sources.

B. Source of public disclosure of the true state of affairs. The second publicly disclosed element of the fraud -- namely, the assertion that the defendants were not obtaining the lowest interest rate that would permit the sale of the VRDOs, and instead were remarketing the bonds en masse in a way that did not obtain the lowest rates -- was disclosed on the EMMA website. The defendants argue that EMMA constitutes "news media," the third enumerated source in the MFCA. The relator contends that because EMMA does not have editorial content, narrative, exposition, or analysis of the financial data it reports, it cannot constitute news media.

"A fundamental principle of statutory interpretation 'is that a statute must be interpreted according to the intent of the Legislature ascertained from all its words construed by the ordinary and approved usage of the language, considered in connection with the cause of its enactment, the mischief or imperfection to be remedied and the main object to be accomplished, to the end that the purpose of its framers may be effectuated." Harvard Crimson, Inc. v. President & Fellows of Harvard College, 445 Mass. 745, 749 (2006), quoting Hanlon v. Rollins, 286 Mass. 444, 447

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(1934). See Sullivan v. Brookline, 435 Mass. 353, 360 (2001). If the meaning of the "statutory language is clear and unambiguous, our inquiry ends." Commonwealth v. Garvey, 477 Mass. 59, 62 (2017).

Where, as here, a statutory term is undefined, we look to its ordinary meaning. See Ten Local Citizens Group v. New England Wind, LLC, 457 Mass. 222, 229 (2010). See Schindler, 563 U.S. at 407 (enumerated sources in FFCA take "ordinary meaning" of words). In ordinary usage, "news" is defined as (1) "a report of a recent event; intelligence; information"; (2) "the presentation of a report on recent or new events in a newspaper or other periodical or on radio or television"; and (3) "such reports taken collectively; information reported." Webster's New Universal Unabridged Dictionary 1295 (2003). "Media" is defined as "[t]he means of communication, as radio and television, newspapers, and magazines, that reach or influence people widely." Id. at 1193. Thus, the ordinary meaning of the words "news media" is quite broad and includes information shared through means of communication that reach or influence people widely. See United States ex rel. Osheroff v. Humana, Inc., 776 F.3d 805, 813 (11th Cir. 2015) (Osheroff) (court determined that "news media" includes newspaper articles and advertisements of clinical services).

Considering the public disclosure bar in the context of the statute as a whole confirms that "news media" is a broad category, albeit not unlimited. See Schindler, 563 U.S. at 408 ("to determine the meaning of one word in the public disclosure bar, we [also] must consider the provision's 'entire text,' read as an 'integrated whole'" [citation omitted]). On the one hand, unlike the other two sources of public disclosures in the MFCA, Massachusetts government reports and hearings, the term "news media" is not limited to Massachusetts-based knowledge. On the other hand, construing "news media" as a broad catch-all would eviscerate the plain language of the public disclosure bar, which applies only to disclosures from three enumerated sources. See id. at 414.

Because the breadth of the term "news media" -- in particular, whether it covers a publicly available website like EMMA -- is ambiguous based on the statutory language and the statutory scheme as a whole, "we turn to the history of the statute" to assist us in discerning the Legislature's intent in using these words. See Commonwealth v. Hamilton, 459 Mass. 422, 433 (2011). The

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history of the FFCA [Note 21] reflects decades of adjustments to the limitations on qui tam suits in "an effort to strike a balance between encouraging private persons to root out fraud and stifling parasitic lawsuits." Schindler, 563 U.S. at 413, quoting Graham County Soil & Water Conservation Dist. v. United States ex rel. Wilson, 559 U.S. 280, 295 (2010). The MFCA, originally enacted in 2000, largely has tracked the developments of the FFCA, including amendments in 2012 to follow the Federal amendments of 2010. See St. 2000, c. 159, § 18, inserting G. L. c. 12, §§ 5A-5O (originating as 2000 House Doc. No. 5100); St. 2012, c. 139, § 22-34, amending G. L. c. 12, §§ 5A-5C, 5F, 5G, 5I-5K, 5N. See also Makalusky, Blowing the Whistle on the Need to Clarify and Correct the Massachusetts False Claims Act, 94 Mass. L. Rev. 41, 41 (2012). These changes made the public disclosure bar at the same time both more and less exacting. Thus, the MFCA, as with the FFCA, reflects the Legislature's efforts to balance the promotion of qui tam actions while also discouraging parasitic suits. This legislative history further demonstrates the Legislature's intent that "news media" be given a broad but balanced construction. See Hamilton, 459 Mass. at 433.

Thus, "news media" is broad enough to encompass the many ways in which people in the modern world obtain financial news, including from publicly available websites on the Internet. See, e.g., United States ex rel. Repko vs. Guthrie Clinic, P.C., U.S. Dist. Ct., No. 3:04CV1556 (M.D. Pa. Sept. 1, 2011), aff'd, 490 Fed. Appx. 502 (3d Cir. Aug. 1, 2012) (online commercial financial software and Internet programs providing summaries or analysis of trends in market transactions were news media because "[t]hough they are not traditional news sources, they serve

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the same purpose as newspapers or radio broadcasts, to provide the general public with access to information"). [Note 22]

As discussed, see note 6, supra, EMMA is the "official repository for information on all municipal bonds." It provides updates to bond market information by means of the Internet. It is publicly available and widely disseminated. "The EMMA website was established to increase the transparency of the municipal securities market by providing free public access to municipal securities disclosures and data. EMMA provides investors, [S]tate and local governments and other market participants with key information and tools to put that information into context." EMMA, Overview, https://emma.msrb .org/AboutEmma/Overview [https://perma.cc/F78C-KQ8X]. In this respect, EMMA is much like traditional news sources that report market data and fall within the scope of the term. See Poteet, 619 F.3d at 110 (national newspaper falls within definition of news media). Accordingly, we conclude that the term "news media" in the public disclosure bar includes within its scope the EMMA website, which consists of publicly accessible financial data. [Note 23] See Osheroff, 776 F.3d at 813 ("Because the term 'news media' has a broad sweep, we conclude that

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the newspaper advertisements and the clinics' publicly available websites, which are intended to disseminate information about the clinics' programs, qualify as news media for purposes of the public disclosure provision"). [Note 24]

iii. Disclosure of substantially the same allegations or transactions. The third prong of the public disclosure inquiry is whether the public disclosure includes "substantially the same allegations or transactions as alleged in the action or claim." See G. L. c. 12, § 5G (c). [Note 25] "[W]e must compare the substance of the prior disclosures with the substance of the relator's complaint." Poteet, 619 F.3d at 114. "The operative question is whether the public disclosures were sufficient to set the government 'on the trail of the alleged fraud without [the relator's] assistance.'" Reed, 923 F.3d at 744, quoting United States ex rel. Fine v. Sandia Corp.,

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70 F.3d 568, 571 (10th Cir. 1995). "'Substantially the same' . . . connotes a standard that requires only the essentials of the relator's allegations to be identical to or of an identical type as those disclosed publicly." Reed, supra at 748 n.12. See United States ex rel. Boothe v. Sun Healthcare Group, Inc., 496 F.3d 1169, 1174 (10th Cir. 2007) ("complete identity of allegations" is unnecessary; it is enough for "essence" of relator's allegations to be "'derived from' a prior public disclosure"). A "complaint that targets a scheme previously revealed through public disclosures is barred even if it offers greater detail about the underlying conduct." Winkelman, 827 F.3d at 210, citing Poteet, 619 F.3d at 115.

As discussed, the complaint at issue here relies upon the defendants' obligations, disclosed in the official statements, and the interest rates, which are disclosed on EMMA, and which the relator analyzed to reveal the asserted failure of the defendants to meet their obligation individually to set interest rates for each VRDO. The relator contends that these are not substantially the same as his allegations because, he asserts, the rates were set through a mechanical, algorithmic approach that the relator has coined "robo-resetting." Yet defining "how" the rates were set does not change the essential shared substance between the public disclosures and the complaint. The crux of the alleged fraud is the failure individually to set rates and instead setting rates by grouping disparate VRDOs, a conclusion deciphered and decipherable from the public disclosures of the rates themselves. See Repko, U.S. Dist. Ct., No. 3:04CV1556 (M.D. Pa.), supra ("though not identical to [the] relator's complaint, the information publicly disclosed is substantially similar to the complaint"). In sum, the publicly disclosed information was sufficient to put the Commonwealth "on the trail of the alleged fraud" without the relator's assistance. See Reed, 923 F.3d at 744, citing Fine, 70 F.3d at 571.

d. Original source exception. Because the public disclosure bar is applicable in this case, the complaint must be dismissed unless the relator was an "original source." See Poteet, 619 F.3d at 109-110; Springfield, 14 F.3d at 656. General Laws c. 12, § 5A, defines two types of relators who may qualify as original sources:

"an individual who: (1) prior to a public disclosure under paragraph (3) of [§] 5G, has voluntarily disclosed to the [C]ommonwealth or any political subdivision thereof the information on which allegations or transactions in a claim

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are based; or (2) has knowledge that is independent of and materially adds to the publicly-disclosed allegations or transactions, and who has voluntarily provided the information to the [C]ommonwealth or any political subdivision thereof before filing a false claims action." [Note 26]

The relator argues that he qualifies as the second type of original source because, he contends, he has knowledge that both is "independent of" and "materially adds" to the publicly disclosed allegations or transactions.

The independent source exception is a "narrow category." See Winkelman, 827 F.3d at 211. The relator contends that his knowledge is "independent of" EMMA because the complaint does not allege that he relied on that website to obtain the data underlying his analysis; it suffices to defeat the defendants' motion, he argues, that the complaint alleges that his forensic analysis also used nonpublic, proprietary sources notwithstanding that the same data were available from EMMA. The relator cites no authority for the proposition that a relator may take advantage of the original source exception by using a nonpublic source to access the exact same data readily available from public sources. To the contrary, "when a relator's qui tam action is based solely on material elements already in the public domain, that relator is not an original source." Kennard v. Comstock Resources, Inc., 363 F.3d 1039, 1045 (10th Cir. 2004), cert. denied, 545 U.S. 1139 (2005). See United States ex rel. Fried v. West Indep. Sch. Dist., 527 F.3d 439, 443 (5th Cir. 2008) (Fried) (relator did not satisfy independent knowledge requirement despite his independent "sleuthing" that confirmed precise information already publicly disclosed through congressional investigation). Contrast United States ex rel. Hagerty v. Cyberonics Inc.,

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95 F. Supp. 3d 240, 260 (D. Mass. 2015), aff'd, 844 F.3d 26 (1st Cir. 2016) (relator satisfied independent knowledge requirement where he was source of information, later publicized in government report, regarding defendants' fraudulent sales practices). Nothing in the legislative history suggests a legislative intent to expand the scope of the original source exception as the relator suggests. Indeed, the history of the public disclosure bar, which exhibits a careful balance between encouraging individuals with previously unknown information to come forward and discouraging parasitic suits that add little to the information already in the public domain, see note 21, supra, supports the opposite conclusion.

The EMMA website publicly reported the same data upon which the relator relied, and the relator's analysis depended entirely on the interest rate data, which were available on EMMA. Thus, the relator's analysis cannot be said to be "independent of" the publicly disclosed transaction discussed supra. [Note 27] See Ondis, 587 F.3d at 59 ("Virtually by definition, a relator whose knowledge is dependent upon the public disclosure of allegedly fraudulent transactions cannot be said to have independent knowledge of the fraud"). Although the relator asserts that he spent considerable time analyzing the publicly available data to confirm his suspicions that the defendants were committing fraud, and that his endeavor was aided by his expertise in the field, this does not suffice to render his knowledge independent of the publicly disclosed transactions. [Note 28] See id. at 59-60, citing Fried, 527 F.3d at 443 ("Expertise that enables a relator to understand the significance of publicly disclosed information, without more, is insufficient to qualify him [or her] as an original source"); United States ex rel. Doghramji vs. Community Health Sys., Inc., U.S. Dist. Ct., Nos. 3:11 C 442, 3:14 C 2160, 3:15 C 110, 3:14 C 2195

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(M.D. Tenn. Apr. 1, 2020) (performing "unique statistical analysis," even if "proven helpful," cannot survive public disclosure bar). [Note 29]

The relator also argues that he materially added to the public disclosures because his investigation revealed the robo-resetting scheme -- that is, a mechanical, algorithmic approach to resetting rates. A relator "materially adds" to the public disclosure when his knowledge "is sufficiently important to influence the behavior of the recipient." Winkelman, 827 F.3d at 211. See United States ex rel. Advocates for Basic Legal Equality, Inc. v. U.S. Bank, N.A., 816 F.3d 428, 431 (6th Cir. 2016), cert. denied, 137 S. Ct. 2180 (2017) ("Materiality in this setting requires the claimant to show it had information '[o]f such a nature that knowledge of the item would affect a person's decision-making,' is 'significant,' or is 'essential'" [citation omitted]). [Note 30]

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Here, the explanation that the defendants used "robo-resetting" in order to avoid their obligations to set the interest rates for each VRDO individually was not material in the sense required by the MFCA; the salient information was that the defendants promised they would reset rates individually and failed to do so. How the defendants conducted the fraud -- purportedly in order to discourage holders of VRDOs from selling those bonds -- here through what the relator coins "robo-resetting," is a detail that would not influence the behavior of a recipient who already was armed with the knowledge of the salient elements of the fraud. [Note 31] See, e.g., Osheroff, 776 F.3d at 815 (addition of details on type of free services clinics were providing, i.e., manner in which fraud was committed, did not materially add to public information). See also Reed, 923 F.3d at 758 (whether "the . . . [question] how [the fraud was perpetrated] actually should be considered sufficiently significant or important to affect the government's actions regarding the fraudulent scheme" depends on facts and circumstances of case). [Note 32]

While the manner in which a defendant accomplished a particular fraud might aid the Commonwealth in its efforts to avert similar fraudulent schemes in the future, or might be material in some other circumstances, the allegation that the defendants used a mechanical, algorithmic mechanism here does nothing to bring

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to the Commonwealth's attention the existence of the purported fraud, namely, the defendants' asserted failure to set interest rates to the lowest rates the market would bear. Thus, the relator does not qualify as an "original source" for purposes of the MFCA's exception to the public disclosure bar.

Judgment affirmed.