False Claims Act - Whistleblowers Blog» False Claims Act – Whistleblowers Blog

TAF Expects $9 Billion to be Recovered in 2012

mam@pietragallo.com — Tue, 17 Jan 2012 14:06:16 +0000

Taxpayers Against Fraud foresees more than $9 billion in False Claims Act recoveries, “…counting civil, state and criminal fines – is within the realm of possible for FY 2012,” stated Patrick Burns of TAF. The cases settled or lined up for settlement included: Merck ($950 million); GlaxoSmithKline ($3 billion); Abbott ($1.5 billion); Amgen ($780 million); Oracle ($200 million); New York City ($70 million); LHC Groups ($65 million); Pfizer ($500 million); Ranbaxy ($400 million); Sandoz ($150 million); Maxim ($150 million); Johnson & Johnson ($1 billion); Agility/Public Warehouse ($500 million); WellCare Health Plans ($137 million); and Medtronic ($23 million).

For more information see: http://www.corporatecrimereporter.com/taf01092012.htm

Merck Settles Massachusetts Medicaid Fraud Allegations for $24 Million—Total Recovery Now $47 Million

mam@pietragallo.com — Thu, 29 Dec 2011 20:04:50 +0000

Merck & Co, Inc., the second largest drug manufacturer in the nation, agreed to pay $24 million to the Commonwealth of Massachusetts to settle allegations that it knowingly reported inflated drug prices to the Massachusetts Medicaid program. The $24 million settlement is the largest single payment made to the Commonwealth for any one Medicaid fraud case in the state’s history, and comes as part of a suit filed against thirteen drug manufacturers over inflated drug prices that has led to the recovery over $47 million for the Commonwealth.

For more information see: http://www.boston.com/Boston/businessupdates/2011/12/merck-pay-overcharging-case/Yl0JbNWVCc6pU3ERImxOSP/index.html

CVS Caremark to Pay $19.9 Million to Settle State FCA Claims

mam@pietragallo.com — Wed, 21 Dec 2011 21:06:44 +0000

CVS agreed to pay $19.9 million to settle three separate qui tam suits in three separate states that it defrauded state prescription drug plans. The whistleblower suits, which were filed by two former CVS pharmacists, alleged that CVS Caremark fraudulently resold returned drugs, changed plan members submitted prescriptions to make more money, and falsely reported to the states how long it took to provide plan members’ prescriptions to avoid paying contractual penalties or losing state contracts. Of the $19.9 million settlement, almost $7 million will go to the State of California, $4 million to the State of Illinois, and $3 million to the State of Florida.

For more information see: http://latimesblogs.latimes.com/money_co/2011/12/cvs-caremark-to-pay-20m-to-three-states-over-fraud-allegations.html

KV Pharmaceutical to Pay $17 Million for Unapproved Drug Reimbursement

mam@pietragallo.com — Fri, 09 Dec 2011 21:02:24 +0000

KV Pharmaceutical Company, the St. Louis parent corporation of the now defunct Ethex Corporation, has agreed to pay $17 million to the federal and state governments to resolve allegations that Ethex fraudulently received reimbursement for two of its drugs from federal healthcare programs. According to allegations made by relator Constance Conrad in U.S. ex rel. Conrad v. Ethex Corporation, et al., No. 02-11738-RWZ (D. Mass.), Ethex submitted false quarterly reports to the Center for Medicare and Medicaid Services (CMS) regarding the qualification for two of its drugs for federal health care reimbursement. Although the active ingredients in the drugs, Nitroglycerin ER, and Hyoscyamine Sulfate ER, had been in products on the market for a number of years, the FDA had previously decided that those drugs were ineligible for reimbursement by federal healthcare programs. Nevertheless, the U.S. alleges that Ethex deliberately mislead the government regarding the eligibility of those drugs for federal healthcare reimbursement. Under the terms of the settlement, the U.S. will receive $10,158,695, and the state Medicaid programs will receive $6,841,305. For her role in bringing the fraud to light, Conrad will receive a share of $1,523,804.

For more information see: http://www.justice.gov/opa/pr/2011/December/11-civ-1579.html

Pennsylvania Needs a False Claims Act to Fight Fraud

mam@pietragallo.com — Tue, 06 Dec 2011 21:09:53 +0000

In an excellent op-ed piece written for the Lehigh Valley’s Morning Call, David Williams of Kline & Specter describes why Pennsylvania needs a False Claims Act to combat fraud against the state. Citing a 2005 study by the Pennsylvania attorney general’s office, Williams notes that fraudulent activities have consumed more than ten percent of Pennsylvania’s healthcare costs. This $1.7 billion lost in Medicaid fraud alone could be reduced if Pennsylvania enacted a strong False Claims Act. The federal False Claims Act has been shown to recover $15 for every $1 invested in healthcare enforcement activities and more than $28 billion has been recovered through the federal False Claims Act. Additionally, more than $7 billion has been recovered under the 27 state False Claims Acts.

To read the full article see: http://articles.mcall.com/2011-11-29/opinion/mc-false-claims-act-williams-yv–20111129_1_medicaid-fraud-federal-law-amendments

Big Apple Settles False Claims for $70 million

mam@pietragallo.com — Mon, 07 Nov 2011 19:17:39 +0000

New York City has agreed to pay the federal government $70 million to settle claims that it allegedly overbilled Medicaid by improperly approving home care for elderly clients. As part of the settlement, NYC admitted that it reauthorized treatment of a number of patients without having first obtained required assessments from doctors, nurses and social workers. The allegations came to light as the result of a whistleblower, Dr. Gabriel Feldman, who was an independent medical reviewer under contract with NYC. Dr. Feldman filed a lawsuit under the False Claims Act and stands to recover $14.7 million of the settlement.

Medical Equipment Provider to Pay $600,000 for False Claims Act Violations

mam@pietragallo.com — Wed, 26 Oct 2011 14:05:05 +0000

The U.S. Attorney for the Southern District of Indiana announced on October 19, 2011, that Premier Home Care, a durable medical equipment provider in Southern Indiana, had agreed to pay $600,000 to the United States and to the State of Indiana for violations of the False Claims Act. This qui tam suit was filed in 2008 by a former Premier employee who alleged that the company violated the False Claims Act by falsely certifying its compliance with state licensing requirements when it used unlicensed personnel to set up respiratory ventilation machines for patients.

Premier will pay $578,820 to the United States and $21,180 to the State of Indiana, both of which are more than twice the estimated damages resulting from the False Claims Act violations. The announcement also noted that the whistleblower is entitled to between 15 and 25% of the government’s recovery under the False Claims Act.

For more information see: http://www.justice.gov/usao/ins/press_releases/Pressrelease11/Premier.20111019.pdf

Customs Fraud Scheme Reaches FCA Settlement

mam@pietragallo.com — Tue, 06 Sep 2011 18:25:08 +0000

A $3.85 million settlement involving a customs fraud scheme carried out by a Hong-Kong based jewelry manufacturer and its partners has recently been made public. Kirby McInerney LLP filed the action under the FCA on behalf of its client, a whistleblower who learned about the fraudulent conduct. The whistleblower will receive approximately 19% of the $3.85 million settlement.

Noble Jewelry Ltd., a global jewelry company based in Hong Kong, and certain New York affiliates, was accused of being involved in a scheme in regards to submitting false customs declarations and false invoices on shipments. The Manhattan U.S. Attorney’s Office and the Office of U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations performed a thorough investigation of the whistleblower’s complaint. Then the United States filed its own civil complaint and entered into a settlement with the defendants requiring them to pay $3.85 million plus interest in damages and penalties under the False Claims Act.

Fulbright Scholar Program Administrator gets “Detention” for False Claims Liability

mam@pietragallo.com — Wed, 06 Jul 2011 18:27:22 +0000

The US Attorney for the Southern District of New York announced the filing and settlement of a false claims act lawsuit against the administrator of the US Department of State’s Fulbright Scholar’s program. The US Attorney alleged that over an 8-year period, the administrator, the Institute of International Education (IIE) did not comply with grant requirements and repeatedly made false claims for payments by inflating its labor costs incurred. The case was settled for a payment of $1 million.

Paralysis of the IRS Whistleblower Program

mam@pietragallo.com — Wed, 29 Jun 2011 12:22:45 +0000

The Tucson Sentinel reports that despite Congressional expansion of the IRS whistleblower program in 2006, the program does not live up to its expectations. In the four years since Congress passed the new program, only one whistleblower has purportedly collected an award—an accountant who collected $4.5 million for reporting a $20 million tax underpayment. In the meantime, the IRS continues its practice of refusing to communicate with whistleblowers concerning the status of investigations, and the investigations themselves seem to be excessively long.

The US Government Accountability Office and the IRS Inspector General are currently auditing the program to determine its efficacy. Senator Charles Grassley, the champion of the whistleblower program remains concerned about paralysis in the program due to the IRS’s concerns about taxpayer privacy. There also seems to be dissension in the ranks of the IRS concerning the desirability of the whistleblower program. Attorneys for whistleblowers credit the IRS program; but place blame for the impediments with the IRS chief counsel, who has erected significant roadblocks. Some of these attorneys believe that the secrecy and slowness of the claims process has deterred viable whistleblowers from coming forward with tips.

For more information see: http://www.tucsonsentinel.com/nationworld/report/062211_irs_whistleblowers/red-tape-old-guard-slow-whistleblowing-corporate-tax-cheats/