Posts Tagged With False Claims

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Blood Testing Laboratory to Pay $6 Million to Settle Allegations of Kickbacks and Unnecessary Testing

On April 28, 2017, Quest Diagnostics Inc. agreed to pay $6 million to resolve an alleged False Claims Act violation for paying kickbacks to physicians and patients to induce the use of Berkeley HeartLab Inc., a Quest subsidiary, for blood testing services and unnecessary medical tests.  According to the complaint, Berkeley allegedly paid kickbacks to referring physicians disguised as “processing and handling” fees and allegedly paid kickbacks to patients by waiving copayments that certain patients ... Continue Reading

Pacific Pulmonary Services Agrees to Pay $11.4 Million to Resolve False Claims Act Allegations

On April 25, 2017, Branden Partners, L.P., doing business as Pacific Pulmonary Services, agreed to pay $11.4 million to resolve allegations that it and its general partner, Teijin Pharma USA LLC, violated the False Claims Act.  Pacific Pulmonary Services provides oxygen tanks and related supplies, and sleep therapy equipment, to patients’ homes.  The allegations were that, starting in 2004, Pacific Pulmonary Services began submitting claims for reimbursement to Medicare and other federal healthcare programs for ... Continue Reading

CA Inc. to Pay $45 Million for Alleged False Claims on Information Technology Contract

On March 10, 2017, CA Inc., an information technology management software and service company,  agreed to pay $45 million to resolve allegations that it made false statements and claims in the negotiation and administration of a General Services Administration (“GSA”) contract.  The agreement resolves claims that CA provided false information about commercial customer discounts for its software licenses and maintenance services to GSA contracting officers.  The allegations stemmed from a whistleblower lawsuit filed by a ... Continue Reading

Acting Assistant Attorney General Kenneth A. Blanco Speaks at the American Bar Association National Institute on White Collar Crime

On March 10, 2017, Acting Assistant Attorney General Kenneth A. Blanco addressed the 31st annual American Bar Association White Collar Crime conference about the Criminal Division, and in particular its efforts with respect to white collar crime and corruption in the international arena.  Blanco noted the Department’s success in its anti-money laundering and counter-terrorist financing efforts, as well as its continued efforts in preventing the abuse of shell companies.  Blanco then described the customer due ... Continue Reading

Shire PLC Subsidiaries Settle False Claims Act Allegations

On January 11, 2017, Subsidiaries of Shire PLC, a multinational pharmaceutical firm headquartered in Ireland, agreed to pay $350 million to settle federal and state False Claims Act allegations.  The allegations were that Shire and Advanced BioHealing (“ABH”), which Shire acquired in 2011, paid kickbacks in order to induce clinics and physicians to use a product for the treatment of diabetic foot ulcers called “Dermagraft.”  The kickbacks were alleged to be in a variety of ... Continue Reading

Forest Laboratories and Its Subsidiary Agree to Pay $38 Million to Resolve False Claims Act Allegations

On December 15, 2016, Forest Laboratories LLC and its subsidiary, Forest Pharmaceuticals Inc., agreed to pay $38 to resolve allegations that Forest violated the Anti-Kickback Statute of the False Claims Act.  The government contends that Forest provided improper inducements to a group of physicians in the form of payments and meals in connection with speaker programs, and that these benefits were provided for speaker programs that were cancelled or not attended by any licensed healthcare ... Continue Reading

Former Top Generic Pharmaceutical Executives Charged with Price-Fixing, Bid-Rigging and Customer Allocation Conspiracies

On December 14, 2016, Jeffrey Glazer and Jason Malek, the former CEO and President, respectively, of a generic pharmaceutical company were charged in the Eastern District of Pennsylvania for their roles in conspiracies to fix prices, rig bids, and allocate customers to particular generic drugs, including the antibiotic doxycycline hyclate and the diabetes medication glyburide.  The doxycycline hyclate conspiracy allegedly took place from as early as April 2013 until at least December 2015, while the ... Continue Reading

Jury Finds Allied Home Mortgage Entities and CEO Jim C. Hodge Liable for Civil Mortgage Fraud, Awards the United States over $92 Million in Damages

On November 30, 2016, a unanimous jury found Allied Home Mortgage entities (“Allied”) and Allied’s CEO Jim C. Hodge, liable for violating the False Claims Act (“FCA”) and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”) in connection with fraudulent misconduct in connection with the Federal Housing Administration’s mortgage insurance program.  Allied  and Hodge were found liable for operating undisclosed branch offices that originated FHA loans that were then attributed to the ... Continue Reading

Medical Device Maker Biocompatibles Pleads Guilty to Misbranding and Agrees to Pay $36 Million to Resolve Criminal and Civil Liability

On November 7, 2016, medical device manufacturer Biocompatibles Inc., which is a subsidiary of BTG plc, pled guilty to a misdemeanor charge for misbranding its LC Bead device.    LC Bead is an embolic device used to treat liver cancer and other diseases.  LC Bead was cleared by the U.S. Food and Drug Administration (FDA) as an embolization device, which is inserted in blood vessels in order to stop or lessen blood flow to tumors and ... Continue Reading

Nursing Home Pharmacy to Pay over $28 Million to Settle Kickback Allegations

On October 17, 2016, Omnicare Inc. agreed to pay over $28 million to resolve allegations that it solicited and received kickbacks from Abbott Laboratories in exchange for promoting their drug to its nursing home patients.  According to the complaint, Omnicare accepted payments from Abbott in return for promoting one of Abbott’s drugs, and then described the payments as “grants” or “educational funding.”  A global civil and criminal resolution was reached with Abbott in 2012, in ... Continue Reading

Utah-Based Lender Agrees to Pay $4.25 Million to Resolve Alleged False Claims Act Liability Arising from FHA-Insured Mortgage Lending

On October 3, 2016, SecurityNational Mortgage Co. (“SecurityNational”) agreed to pay $4.25 million to resolve allegations that it violated the False Claims Act by originating and underwriting loans insured by the Department of Housing and Urban Development (“HUD”) Federal Housing Administration (“FHA”) that did not meet FHA requirements.  SecurityNational has participated as a Direct Endorsement Lender (“DEL”) in the FHA insurance program since January 2006.  Although DELs are required to ensure that loans are in ... Continue Reading

Hospital Chain Will Pay over $513 million for Kickback Scheme

On October 3, 2016, the DOJ announced that Tenet Healthcare Corporation and two of its subsidiaries will pay over $513 million to resolve criminal charges and civil claims relating to a scheme to defraud the United States and to pay kickbacks.  The two subsidiaries, Atlanta Medical Center Inc. and North Fulton Medical Center Inc., have agreed to plead guilty to violations of the Anti-Kickback Statute.  In addition, Tenet Health System Medical Inc., a subsidiary of ... Continue Reading

Branch Banking & Trust Company Agrees to Resolve False Claims Act Allegations, Paying $83 Million

On September 29, 2016, Branch Banking & Trust Company (“BB&T”) agreed to pay $52.4 million to resolve allegations that it violated the False Claims Act in relation to its role as a direct endorsement lender (“DEL”) in the FHA insurance program.  As a DEL, BB&T was required to follow certain program rules, but was able to approve a mortgage loan for FHA insurance without review by the FHA.  As part of its settlement, BB&T admitted ... Continue Reading

Regions Bank Agrees to Resolve False Claims Act Allegations, Paying $52.4 Million

On September 13, 2016, Regions Bank agreed to pay $52.4 million to resolve allegations that it violated the False Claims Act in relation to its role as a direct endorsement lender (“DEL”) in the FHA insurance program.  As a DEL, Regions was required to follow certain program rules, but was able to approve a mortgage loan for FHA insurance without review by the FHA.  As part of its settlement, Regions has admitted that it certified ... Continue Reading

Principal Deputy Assistant Attorney General David Bitkower Delivers Remarks at American Bar Association Southeastern White Collar Crime Institute

On September 8, 2016, Principal Deputy Assistant Attorney General David Bitkower addressed the American Bar Association Southeastern White Collar Crime Institute to speak about the role of the DOJ Criminal Division, and specifically highlight the Criminal Division’s new approaches with respect to health care fraud, sophisticated financial fraud and FCPA matters.  Starting with health care fraud, Bitkower discussed the Medicare Fraud Strike Force, which operates in nine regions identified as “hot spots” for health care ... Continue Reading

Acting Associate Attorney General Bill Baer Delivers Remarks on Individual Accountability at American Bar Association’s 11th National Institute on Civil False Claims Act and Qui Tam Enforcement

In his remarks on June 9, Acting Associate Attorney General Bill Baer highlighted the significance of the qui tam provisions of the False Claims Act and reaffirmed DOJ’s commitment to investigating and charging individuals alongside companies for corporate misdeeds, noting that “companies act through their executives.”  Baer went on to explain DOJ’s expectations regarding corporate cooperation: “companies that are facing FCA allegations and want a settlement to credit their cooperation are expected to disclose all ... Continue Reading

Supreme Court Issues Universal Health Services False Claims Act Decision

On June 16, the Supreme Court issued its opinion in Universal Health Services, Inc. v. United States, No.15-7, a qui tam suit alleging that Universal Health had violated the False Claims Act (“FCA”) by implying false certifications and making material misrepresentations.  The Court held that, under some circumstances, an implied false certification theory can be a basis for FCA liability when a defendant submitting a claim makes specific representations about the services but fails ... Continue Reading

U.S. Attorney Announces $54 Million Settlement against Pharma Company for Kickbacks

On June 9, United States Attorney Preet Bharara, announced a $54 million settlement with Salix Pharmaceuticals over Anti-Kickback Statute and False Claims Act allegations in the Southern District of New York.  The lawsuit alleged that the company used a pattern of “speaker programs” to entertain physicians with expensive meals and social events, under the guise of educational events, in order to entice them to prescribe Salix-manufactured drugs and medical devices.  The government further maintained that ... Continue Reading

Pharmaceutical Companies to Pay $67 Million to Resolve False Claims Act Allegations

On June 6, DOJ announced a $67 million settlement with two pharmaceutical companies, Genentech Inc. and OSI Pharmaceuticals LLC, in connection with allegations that the companies made misleading claims regarding the effectiveness of the drug Tarceva in violation of the False Claims Act.  The government alleged that the companies had made representations to physicians and Medicaid that overstated the drug’s efficacy in treating small-cell lung cancer.  The case was initially brought by a former Genentech ... Continue Reading

UPS Agrees to Pay $25 Million to Settle Civil False Claims Act Violations

On May 19, United Parcel Service Inc. (“UPS”) signed a civil settlement resolving allegations that it violated the whistleblower provision of the False Claims Act.  In its contracts with several federal agencies, UPS guaranteed delivery of packages by a certain time and was accused of knowingly recording inaccurate delivery times to make it appear as if they had met these time constraints when the deliveries were late.  UPS was also charged with falsely using “exception ... Continue Reading

Two More Guilty Pleas and Indictment in Antitrust Department’s Investigation of Price Fixing and Bid Rigging in Automotive Parts Industry

  • On January 6, Makoto Horie, former Vice President of Sales at Toyoda Gosei North America, agreed to plead guilty in the Northern District of Ohio and to serve one year and one day in prison for his role in a conspiracy to fix prices and rig bids of automotive hoses installed in cars sold in the United States.  United States v. Horie, 15 Cr. 003 (N.D. Ohio). DOJ Press Release.
  • On January 22,
... Continue Reading

Daiichi Sankyo Inc. Agrees to Pay $39 Million to Settle Kickback Allegations Under the False Claims Act

On January 9, Daiichi Sankyo Inc., a global pharmaceutical company, agreed to pay the United States and state Medicaid programs $39 million to resolve allegations that it violated the False Claims Act by paying kickbacks to induce physicians to prescribe Daiichi drugs, including Azor, Benicar, Tribenzor, and Welchol.  The government alleged that Daiichi paid physicians improper kickbacks in the form of speaker fees between Jan. 1, 2005 and Feb. 4, 2011.  Allegedly, payments were made ... Continue Reading

Agilent Technologies, Inc. Resolves Fraud Allegations of Bid Rigging

On November 5, Agilent Technologies, Inc. agreed to pay $849,678 to resolve allegations that it submitted false claims to the United States in connection with the sale of electronic measurement instruments.  In March 2013, Agilent made a voluntary disclosure to the Inspector General of the Department of Defense that certain sales of electronic measurement instruments and systems to the government were the result of improper coordination of pricing and bid strategy between Agilent and its ... Continue Reading

Caremark Will Pay $6 Million to Resolve False Claims Act Allegations

On September 26, DOJ announced that Caremark L.L.C., a pharmacy benefit management company operated by CVS Caremark Corporation, will pay $6 million to settle allegations that Caremark knowingly failed to reimburse Medicaid for prescription drug costs paid on behalf of Medicaid beneficiaries who also were eligible for drug benefits under Caremark-administered private health plans.  The settlement arose from a lawsuit filed in the Western District of Texas by a former Caremark employee under the whistleblower ... Continue Reading

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