Monthly Archives: December 2013

Abbott Laboratories to Pay $5.475 Million to Settle False Claims Act Whistleblower Kickback Claims

Written December 30, 2013 by Janine Arno

Last week the U.S. Department of Justice announced that Abbott Laboratories has agreed to pay the United States $5.475 million to resolve allegations that it violated the False Claims Act by paying kickbacks to induce doctors to implant the company’s carotid, biliary and peripheral vascular products.  Abbott is a global pharmaceuticals and health care products company based in Abbott Park, Ill.
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Biotech Company Genzyme to Pay $22M in False Claims Act Whistleblower Actions

Written by Janine Arno

Genzyme Corp., a Massachusetts-based biotechnology company, has agreed to pay a $22.3 million settlement to resolve two False Claims Act lawsuits.   The lawsuits were initated by former Genzyme sales representatives in Tampa and Miami who alleged that the company marketed an inappropriate use for its surgery product, Seprafilm.
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Justice Department Recovers $3.8 Billion from False Claims Act Cases in Fiscal Year 2013

Written December 23, 2013 by Robert Lu

On Friday, December 20, 2013, the United States Justice Department announced that it had secured $3.8 billion in settlements and judgments from civil cases involving fraud against the government in the fiscal year ending Sept. 30, 2013.  This dollar amount, which is the second largest annual recovery of its type in history, brings total recoveries under the False Claims Act since January 2009 to $17 billion – nearly half the total recoveries since the Act was amended 27 years ago in 1986.
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Taylor Bean To Settle False Claims Act Lawsuit For $320 Million

Written December 20, 2013 by Robert Lu

According to news reports, Taylor, Bean & Whitaker Mortgage Corp.’s bankruptcy trustee is poised to settle a False Claims Act lawsuit brought by the U.S. Justice Department.  The lawsuit alleged that Taylor Bean submitted fraudulent mortgages to the Federal Housing Administration.  The settlement is expected to about $320 million.
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U.S Justice Department Intervenes in False Claims Act Lawsuit Alleging Overbilling of Physician Services by Ipc The Hospitalist Co. Inc.

Written December 15, 2013 by Robert Lu

On Monday, December 9, 2013, the United States Justice Department announced that it had intervened in a lawsuit against IPC The Hospitalist Co. Inc., and its subsidiaries, (IPC) alleging that IPC submitted false claims to federal health care programs. The lawsuit alleges that IPC physicians sought payment for higher and more expensive levels of medical service than were actually performed – a practice commonly referred to as “.” Specifically, the lawsuit alleges that IPC encouraged its physicians to bill at the highest levels regardless of the level of service provided, trained physicians to use higher level codes and encouraged physicians with lower billing levels to “catch up” to their peers. Upcoding is one of the most common and prevalent forms of Medicare fraud, and a fertile area for False Claims Act lawsuits.
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Northrop Grumman Corp. Pays $11.4 Million to Resolve Government Allegations

Written December 11, 2013 by Janine Arno

Yesterday the U.S. Department of Justice announced that Northrop Grumman Corp. has paid the United States 11.4 million to settle a government claim for penalties provided under the Federal Acquisition Regulation (FAR) and False Claims Act allegations stemming from its failure to abide by a 2002 settlement agreement with the Defense Contract Management Agency (DCMA). The government alleged that Northrop charged to its federal contracts certain costs for deferred compensation awards to key employees, even though it had promised not to do so as part of the earlier 2002 settlement.
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DOJ Files False Claims Act Complaint Against Subsidiary of URS Corporation and Bechtel National

Written December 10, 2013 by Robert Lu

On December 6, 2013, the United States Attorney’s Office for the Eastern District of Washington announced that it had filed a civil complaint under the False Claims Act alleging that Washington Closure Hanford LLC (WCH), and others, falsely claimed credit for awarding tens of millions of dollars-worth of federal subcontracting business to small business, including woman-owned business. WCH is a prime contractor of the Department of Energy (DOE), and is owned by URS Corporation, Bechtel National Inc., and CH2M Hill Companies Ltd.  In the complaint, the government alleges that WCH claimed such small businesses would perform subcontracted work when in fact those companies were used merely as pass-throughs and the actual work was performed by another subcontractor, Federal Engineers and Constructors Inc.

The Offices of Inspector General for both the DOE and the Small Business Administration Office, in conjunction with the United States Attorney’s Office, is investigating the case.

The complaint is captioned as United States of America ex rel. Salina Savage, Savage Logistics LLC, vs.

Washington Closure Hanford LLC, Federal Engineers and Constructors, Inc., Sage Tec LLC, and Laura Shikashio, EDWA-CV-10-5051-EFS.

False Claims Act For Tax Fraud: Will The Feds Follow The States?

Written December 9, 2013 by Robert Lu

Under section 3729(d) of the federal False Claims Act, tax violations may not be brought under the qui tam, or whistleblower provisions of the statute.  As such, any type of tax fraud committed against the federal government is outside the province of the federal FCA.  Civil enforcement of such fraud is usually left to the whistleblower provisions in the Internal Revenue Code, which (aside from its opacity) has largely been passive and benign.
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CVS Pays $4.25 Million to Resolve Medicaid Billing Charges in False Claims Act Settlement

Written December 3, 2013 by Robert Lu

On Monday, December 2, 2013, the U.S. Justice Department announced that Caremark LLC has agreed to pay $4.5 million to settle allegations it failed to reimburse Medicaid for patients’ drug costs that should have been paid by private health plans administered under the company’s pharmacy benefit management unit, or PBM.  Caremark is operated by CVS Caremark Corp., one of the largest PBMs and retail pharmacies in the country.  A PBMadministers and manages the drug benefits for clients who offer drug benefits under a health insurance plan.
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Lymphedema & Wound Care Institute of Texas Inc. Settles False Claims Act Lawsuit for $4.3 Million

Written by Robert Lu

The U.S. Justice Department on Monday, December 2, 2013, announced that Lymphedema & Wound Care Institute of Texas Inc., a Houston-area network of lymphatic disease clinics, has settled allegations that it submitted false Medicare claims for unauthorized treatments related to the treatment of lymphedema, a condition of fluid retention in the body affecting those with compromised lymphatic systems and frequently caused by cancer treatment.
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