Whistleblower Hotlines

As a law firm who routinely handles whistleblower cases we have a whistleblower hotline.  The line enables potential whistleblowers to confidentially and freely discuss their potential qui tam claim.  As whistleblower lawyers who only represent individuals who expose fraud, not the companies that commit them, we are dedicated to prosecuting the claims of the people we represent if it’s a case we think is actionable and a fit for our firm.

However, internally within companies, the employer has its own whistleblower hotline to ostensibly report fraud within the company.  Take a step back and think how silly that is.  Yes, some companies probably earnestly want to do the right thing, but many other don’t, that’s why they committed the fraud itself.  When you call a company “whistleblower hotline” the information is received by the company who don’t have the whistleblowers best interest in mind.  Instead they are interested in protecting the company.  Even at the end of the day lines that are supposed to be anonymous and “protect the employee” oftentimes do not.

Inadvertently, when providing information, it is either singular in nature or so limited in nature that a company who wants to go on a mole hunt for the insider can easily do so.  Plus, since the well intentioned person used the internal mechanisms, the company will assume that the person doesn’t have a qui tam lawyer and try to lock them into statements that will damage their own case if they wanted to proceed, or worse yet, document things to try to retaliate and fire the whistleblower.

In short, while calling a company whistleblower hotline may seem like a good idea, it’s perilous.  If you feel the need to call one, ask them first whose interested they will be protecting – your or the company’s?   I’ll tell you now it’s the company, not you that they are paid from and working for, it’s not you.

The company may encourage you to report all sorts of fraud.  If it’s in the health care industry it can be Medicare Fraud, Medicaid Fraud, Insurance Fraud, SEC Fraud, Cryptocurrency Fraud, with many different subsects such as:

Opioid Over Prescription (a priority of the government)

Medicare Fraud – Billing for Services Not Rendered

Medicare Fraud – Upcoding

Performing Unnecessary Surgery

Unlicensed Individuals Billing for Medical Work

Pharmaceutical Whistleblowing – Diluted or Inert Batches. Falsifying Data.

SEC Whistleblower Fraud – Companies not having the best interest of the client in mind.

Another distinction between calling a whistleblower law firm and an internal hotline is that if you file certain types of cases with the use of counsel you stand to receive a whistleblower award which could be as high as 30% of the recovery.

If you know about a company committing fraud, call our whistleblower line at (877) 561-0000 before calling the company one.  You can speak with our qui tam lawyers free of charge and confidentially and we’re not paid unless we win your case.

The Stark Act has Stark Remedies – $237 Million False Act Judgment

In July 2018, the Department of Justice announced the enforcement of a $237 Million Dollar Judgment against a Healthcare System for Medicare Fraud – a judgment that was entered in May of 2013. The basis of the Medicare Fraud stemmed from violations of the Stark Act in which the medical system is forbidden from self-dealing. It is unlikely the government will see all that money however, as per the terms of the settlement the government will receive roughly $72 million dollars and the offending facilities will be sold off.

The Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division stated, “Secret sweetheart deals between hospitals and physicians, like the ones in this case, undermine patient confidence and drive up healthcare costs for everybody, including the Medicare program and its beneficiaries “This case demonstrates the United States’ commitment to ensuring that doctors who refer Medicare beneficiaries to hospitals for procedures, tests and other health services do so only because they believe the service is in the patient’s best interest, and not because the physician stands to gain financially from the referral. The Department of Justice is determined to prevent the kind of abuses uncovered in this case, and we are willing to take such cases to trial to protect the integrity of the Medicare program.”

The Stark Law prohibits hospitals from billing Medicare for certain services (including inpatient and outpatient hospital care) that have been referred by physicians with whom the hospital has an improper financial relationship. The Stark Law has exceptions and exceptions to the exceptions so it is important to consult with a whistleblower law firm if you have knowledge of what you think may be improper self-dealing or a potential kickback type of situations.

At trial the government introduced evidence that the defendant required physicians to refer their outpatient procedures to them and then in turn overpaid them from Medicare for the referred procedures. They did so despite being cautioned that this could constitute medicare fraud and violations of the Stark Law. A jury heard the evidence and ruled for the government which was affirmed by the Fourth Circuit Court of Appeals.

The case was initiated by a physician who had the courage to refuse to sign the illegal contract and thus retained a Whistleblower Law Form to commence a qui tam under the False Claims Act. The statute provides the whistleblower up to 30% recovery with 20% being the norm, and in this case the Doctor will receive a whistleblower award of roughly $18 million dollars for having the courage to do the right thing.

“The type of abusive compensation arrangements at issue in this case is precisely what the physician self-referral law was designed to prevent,” said Inspector General Dan Levinson of the Department of Health and Human Services-Office of the Inspector General (HHS-OIG). “Patients need and deserve to know that the hospital services they receive are the product of sound medical judgment, rather than motivated by the physician’s financial interests. The extensive litigation and settlement in this case should send a signal to the hospital industry that these tainted financial relationships simply will not be tolerated.”

If you know of any similar type of Medicare Fraud or are unsure about whether an arrangement in the health care field is legal or illegal you should consult with a whistleblower law firm like the JTB Law Group, LLC at (877) 561-0000. Generally, whistleblower lawyers are only paid if they win your case and can provide free confidential consultations.

Twenty Two Million Dollar Settlement for False Claims Act (FCA) Liability for Medically Unnecessary Services and Therapy

Healogics, Inc. entered into a settlement with the DOJ to pay roughly $22 million to put to rest allegations it violated the False Claims Act (FCA) for overbilling Medicare for medically unneeded and medically unnecessary therapy.  Specifically, it was alleged that Healogics, a medical company, that supervises nearly 700 hospital-based wound care centers across the country, improperly billed for its hyperbaric oxygen (“HBO”) therapy.  It is not alleged that the therapy wasn’t administered, but instead that it was not needed.  Whistleblower lawyer Jason T. Brown commented that, “This was an excellent settlement.  One has to ask oneself which is worse though – submitting fraudulent Medicare claims for services not rendered, or actually performing those services on people who don’t need them to justify the alleged Medicare fraud.”

HBO therapy is covered by Medicare as an oxygen enriching treatment to wound care that is supposed to be used in certain well defined circumstances.  Oftentimes, a medical company will push its services and products to marshal greater profits and create a buzz about it to generate further use even if its not medically necessary.

According to the settlement, the Defendant agreed to pay $17.5 million up front to settle claims for a four year period.  The agreement also calls for an additional $5 million if certain contingencies occur.

“Civil healthcare fraud enforcement has always been a core part of the mission of our office,” said United States Attorney Maria Chapa Lopez for the Middle District of Florida.  “With this settlement, our Civil Division confirms its commitment to our nation’s critical struggle against practices that put public health programs at risk.”

Sometimes in resolving whistleblower cases under the False Claims Act, defendants enter into Corporate Integrity Agreements with the Department of Health and Human Services Office of Inspector General.  These agreements include monitoring with things like claims and system reviews conducted by independent reviewers often at the entities expense.

In recent years whistleblowers have been handsomely rewarded with a percentage of the recovery and in this whistleblower the case the relator is set to recover up to $4,276,900 as a whistleblower award.  In order to bring a False Claims Act case and obtain a reward, however, the whistleblower must use whistleblower counsel.


The case citations are United States ex rel. Van Raalte, et al. v. Healogics, Inc., 14-cv-283 (M.D. Fla.) and United States ex rel. Wilcox. v. Healogics, Inc., et al., 15-cv-1510 (M.D. Fla.).

Owner of Nursing Facilities to Pay $30-million to settle False Claims Act allegations

Two former employees turned whistleblowers succeeded early this month in helping the US government recover millions of misspent health funds and hopefully dissuade similar cases from happening.

In a statement June 8, the Department of Justice said Signature HealthCARE, LLC, owner and operator of approximately 115 skilled nursing facilities from Louisville, Kentucky, agreed to pay $30 million to resolve allegations that it violated the False Claims Act. Specifically, according to the whistleblowers and the US government, Signature HealthCARE engaged in practices that allowed it to submit claims for “unreasonable, unnecessary, and unskilled services” to Medicare patients.

Among others, these include placing patients in the highest therapy reimbursement level by presumption rather than individual evaluation of the level of care they actually need; providing the shortest amount of time required for Signature HealthCARE to bill at a given reimbursement level, and discouraging provision of more therapy beyond this required minimum time; pressuring therapists and patients to complete the planned minutes of therapy even when patients were sick or refusing such therapy.

U.S. Attorney Cochran for the Middle District of Tennessee thanked the teams of civil enforcement attorneys and the relators or whistleblowers who report fraud such as this.

“When we determine that companies are cheating the taxpayers, we will hold them accountable as we have in this case,” Cochran said.

The Justice Department considers the settlement as another demonstration of their efforts to ensure the beneficiaries of government-funded healthcare programs are actually receiving what they clinically need, and not what companies’ profits dictate.

“Signature was charged with illegally boosting profits by providing excessive amounts of therapy to patients whether they needed it or not,” said Special Agent in Charge Derrick L. Jackson for the U.S. Department of Health and Human Services, Office of Inspector General. “The decision to provide therapy should never be based on corporate financial considerations rather than a patient’s medical needs,” he added.

The settlement resolves the lawsuit originally filed by former Signature therapy employees, in federal court in Nashville, Tennessee on March 2015.  They filed the lawsuit under the qui tam, or whistleblower, provisions of the False Claims Act (FCA), which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  The Act also allows the government to intervene and take over the action, as it did in this case.

Ms. Emerson and Ms. Tuesca will receive a portion of the $30 million recovered funds. Whistleblower awards under the False Claims act can be as high as 30% without government intervention and 25% with but generally settling in around 20%, so the whistleblowers in the instant matter could receive around $6 million dollars for their courage in exposing an alleged fraud against the government for overbilling Medicare.

The case is captioned United States ex rel. Emerson and Tuesca v. Signature HealthCARE, LLC, et al., Case No. 1:15-cv-00027 (M.D. Tenn.).  The claims resolved by the settlements are allegations only, and there has been no determination of liability.

If you have knowledge of Medicaid Fraud, Medicare Fraud, Fraud against the Government, SEC Violations, call our whistleblower lawyers at Call Toll Free (877) 561-0000.

Whistleblower Receives Award in latest string of False Claims Act Settlements

Since 2013, various hospitals have been caught allegedly defrauding the taxpayers to the tune of millions of dollars a year.  In an effort to avoid full exposure, they have paid millions of dollars to settle allegations of False Claims Act (FCA) violations that stemmed from a single whistleblower’s lawsuit in Arkansas. Last week the latest of these settlements was announced by the Justice Department.

In a statement June 5, The Justice Department said Allegiance Health Management, Inc., (Allegiance), a post-acute healthcare management company based in Shreveport, Louisiana, and four hospitals it owned and operated, have agreed to pay more than $1.7 million to resolve False Claims Act allegations that it submitted claims for reimbursement from Medicare for medically unreasonable or unnecessary services.

Since 2005, Allegiance arranged with numerous hospitals throughout the Southeastern United States to provide Intensive Outpatient Psychotherapy (IOP) services to patients on their behalf.  Allegiance established an Inspirations Outpatient Counseling Center in each of these hospitals where its employees and those under its direction and control identified potential patients, created patient treatment plans, and performed IOP services, among others.

This settlement resolves allegations that at each of the Inspirations Outpatient Counseling Centers, Allegiance provided IOP services to Medicare beneficiaries that did not qualify for Medicare reimbursement because 1) the patients’ medical condition(s) did not call for IOP treatment; 2) the patients’ treatments were not provided through an individualized treatment plan designed to help individual patients address specific mental health needs and reach achievable goals; 3) the patients’ progress was not being adequately tracked or documented; 4) the patients received an inappropriate level of treatment; or 5) the therapy provided was primarily recreational or diversional in nature, and not therapeutic.

The Allegiance hospitals that entered the settlement are: Allegiance Health Management, Inc.; Allegiance Behavior Health Center of Plainview, LLC; Allegiance Specialty Hospital of Kilgore, LLC; North Metro Medical Center a/k/a Allegiance Hospital of North Little Rock, LLC, and Sabine Medical Center a/k/a Allegiance Hospital of Many, LLC.

Before this, more than 20 other hospitals reached settlements to resolve the same False Claims Act allegations. Sixteen of these hospitals and their respective corporate parents collectively agreed to pay $15.69 million in May 2015. Two years before that, in October 2013, LifePoint Hospitals Inc. and two of its subsidiaries, PHC-Minden L.P., doing business as Minden Medical Center, and PHC-Cleveland Inc., doing business as Bolivar Medical Center, collectively paid more than $4.67 million.

As the whistleblower who brought the fraud to the federal government’s attention, he reportedly receives 17 percent of the settlement. Ladner filed a lawsuit in the Eastern District of Arkansas under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery.  The individual commencing the action on behalf of the government is known as the relator and individuals must file a qui tam lawsuit with whistleblower counsel.

In this $1.7 million settlement, the awarded whistleblower stands to receive around $300,000. In the previous settlements, he has already received more than $3 million. The qui tam relator used to work for Allegiance. He was Program Manager at the Inspirations Outpatient Counseling Center located at Wesley Medical Center in Hattiesburg, Mississippi.

All in all, the string of settlements combine amounted to more than $22 million payments from various hospitals in at least seven states. Though these payments resolved the FCA cases, the allegations involved still remain as allegations.

Acting Assistant Attorney General Chad D. Readler for the Civil Division said they will continue to hold accountable “those who waste taxpayer dollars and place profit above the legitimate needs of patients.”

“Entities that bill for needless services – as alleged here – cheat taxpayers and threaten the integrity of government health programs,” said Special Agent in Charge CJ Porter for the Office of Inspector General of the U.S. Department of Health and Human Services.

The claims settled by the current agreement are allegations only, and there has been no determination of liability.  The lawsuit is captioned U.S. ex rel Ladner v. Allegiance Health Management, Inc., et al, No. 4:10-CV-170 (E.D. Ark.). #

If you have knowledge of Medicare Fraud, Medicaid Fraud, or any other fraud against the government, don’t hesitate to Call Toll Free (877) 561-0000.

Three laboratory bosses to pay $114-M for violations of False Claims Act, paying kickbacks

Cases separately brought to court by three whistleblowers in 2015 continue to generate significant financial recoveries for federal health care programs and considerable whistleblower awards for the relators that brought them. Last week, the United States District Court in the District of South Carolina entered judgment amounting to more than $111 million against LaTonya Mallory, Floyd Calhoun Dent III and Robert Bradford Johnson, plus more than $3 million against Johnson and Dent. As provided by the False Claims Act, the amount represented three times the amount the three individuals illegally profited by submitting their false claims. The Court trebled the damage amounts, offset settlement payments received from the laboratories that submitted the false same claims, and with the whistleblower award computations awarded $63.8 million in penalties as requested by the United States, for a total qui tam judgment of more than $114 million.

Last January, Mallory, Dent, and Johnson were found liable of violating the False Claims Act (FCA) when they paid physicians in exchange for patient referrals to their laboratories. The court found them in violation of the Anti-Kickback Statute and related to this, causing their laboratories to bill federal health care programs for medically unnecessary testing. This judgment followed at least two settlements separately inked in the case by other involved laboratories in recent years.

Based on government investigations and the cases brought by the whistleblowers, the government presented evidence showing these individuals paid physicians in exchange for referrals that benefited their laboratories through financial claims to Medicare and Tricare. The government said the remuneration came disguised as processing and handling fees of between $10 and $17 for each patient referred to the blood testing laboratories:  Health Diagnostics Laboratory Inc. (HDL), of Richmond, Virginia; and Singulex Inc., of Alameda, California.

Add to this, the government also showed evidence that the said kickback scheme resulted in physicians referring patients to HDL and Singulex for medically unnecessary tests, which were then billed to federal health care programs.

The judgment says Mallory, HDL’s former CEO, and Johnson and Dent, were liable for causing the HDL’s submission of 35,074 false claims, worth $16,601,591, to Medicare and TRICARE. The jury also found Dent and Johnson liable for an additional 3,813 false claims, worth $467,935, submitted by Singulex.

Also resolved through this court’s order were three lawsuits originally filed by Dr. Michael Mayes, Scarlett Lutz, Kayla Webster, and Chris Reidel under the qui tam, or whistleblower, provisions of the False Claims Act.  Under the FCA, private citizens can bring suit on behalf of the government for false claims and they can share in any recovery.

The False Claims Act permits the United States to intervene in and take over the whistleblower suit, as the United States partially did in the three consolidated actions against Mallory, Dent, Johnson, and others in August 2015.

How much of the recovery will go to the whistleblowers is not yet known as of this writing, but whistleblowers can recover up to 30% of the recovered funds, but generally settle in around 20% when the government intervenes.  A whistleblower recovery of 20% of $114 million still could be around $25 million dollars, a large whistleblower award for those that the courage to come forth and report these wrongdoings.

The government gave recognition to the whistleblowers and anyone who takes steps to help uncover similar cases of health fraud. In a statement from the Justice Department on Tuesday, May 29, Acting Assistant Director of the Criminal Investigative Division Chris Hacker vowed that “The FBI will continue to aggressively investigate allegations of criminal misconduct between companies and individuals who engage in kickback schemes at the expense of the U.S. government.”

“We recognize the importance of those who came forward and brought allegations to light and realize that we cannot do our work without the public’s help,” Hacker also said.

The cases are captioned United States ex rel. Mayes v. Berkeley HeartLab Inc., et al., Case No. 9:11-CV-01593-RMG (D.S.C.); United States ex rel. Riedel v. Health Diagnostic Laboratory, Inc., et al., Case No. 1:11-CV-02308 (D.D.C.); and United States, et al. ex rel. Lutz, et al. v. Health Diagnostic Laboratory, Inc., et al., Case No. 9:14-CV-0230-RMG (D.S.C.). 

US intervenes in False Claims Act cases of whistleblowers against opioid-selling Insys

Five cases brought up by whistleblowers were consolidated and unsealed early this month as the United States intervened in the False Claims Act (FCA) cases against Insys Therapeutics, Inc.

The cases allege illegal marketing tactics related to Subsys, a sublingual spray form of fentanyl, a highly addictive opioid painkiller. Subsys was approved by the Food and Drug Administration in 2012 for persistent breakthrough pain among adult cancer patients who are already receiving but are tolerant to around-the-clock opioid therapy.

According to the five “whistleblower” lawsuits, the Arizona-based Insys Therapeutics, Inc. paid illegal kickbacks and defrauded federal health programs in selling Subsys.

Opioid lawsuits are highly prioritized by this administration as the epidemic has reached epic proportions and the government seeks ways to combat addiction.  Opioid Medicare Fraud or Opioid Medicaid Fraud allegations will trigger a swift reaction from the government particularly if programs meant to benefit injured people are exploited solely for economic gain and create a cycle of dependence.

Insys allegedly paid kickbacks to induce physicians and nurse practitioners to prescribe Subsys for their patients. The United States said in the complaint that these kickbacks took the form of sham speaker fees to physicians, jobs for the prescribers’ relatives and friends, and lavish meals and entertainment.

The United States also alleges that Insys improperly pushed physicians to prescribe Subsys for patients who did not have cancer. The government alleged that even the Insys employees lied to insurers about patients’ diagnoses to avail of reimbursements on prescriptions meant for Medicare and TRICARE beneficiaries.

In a statement, United States Attorney Nicola T. Hanna explained that the government’s intervention in the whistleblower lawsuits is just one among their efforts to fight the opioid crisis. The government believes that the illegal marketing activities such as the modes exposed in these whistleblowers’ lawsuits help fuel the opioid crisis.

Whistleblowers can file lawsuits such as these on behalf of the United States if they see that a party has submitted false claims for government funds. This is stated in the qui tam provisions of the False Claims Act, which also gives the whistleblowers a share in any recovered funds.

The United States has the right to intervene and take over responsibility for litigating such cases. In this complaint against Insys, for example, the United States intervened since last month.

“Insys allegedly bribed doctors who are more concerned with profits than patients,” said Christian J. Schrank, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Encouraging the inappropriate use of this too-often deadly opioid is intolerable enough, but the abuse is compounded when taxpayers are forced to pick up the bill,” he added.

As of this writing, the above are still allegations. Insys’ liability has not yet been determined. Meanwhile, the United States is also separately pursuing a number of criminal cases against Insys employees and Subsys prescribers.

The following are the whistleblowers’ lawsuits consolidated last week in Los Angeles and entered into by the United States government: United States, et al., ex rel. Guzman v. Insys Therapeutics, Inc., et al., 13-cv-5861; United States ex rel. Andersson v. Insys Therapeutics, Inc., 14-cv-9179; United States ex rel. John Doe and ABC, LLC v. Insys Therapeutics, Inc., et al., 14-cv-3488; United States ex rel. Erickson and Lueken v. Insys Therapeutics, Inc., 16-cv-2956; and United States ex rel. Jane Doe, et al. v. Insys Therapeutics, et al., 16-cv-7937. #


If you know of similar unhealthy arrangements that lead also to defrauding Medicare, Tricare or any other government fraud, call our whistleblower law firm toll free (877) 561-0000. 

Mental Health Clinic and Psychiatrist Owner Pay $805,000 to Settle False Claims Act (FCA) Allegations

Thanks to a whistleblower from Connecticut, the patients in the area utilizing psychiatric services will hopefully no longer become unknowing parties to misspending the government’s health budget or of any additional Medicare Fraud or Medicaid Fraud.

United States Attorney John H. Durham and Connecticut Attorney General George Jepsen announced May 14 that Dr. Erum Shahab and Waire, LLC, doing business as Ellington Behavioral Health (EBH), have entered into a settlement deal with the government. They agreed to pay $805,071 to resolve allegations that they violated the False Claims Acts.

Shahab is a psychiatrist who also owns the EBH, a psychiatric clinic in Ellington, Connecticut. The clinic treats people with depression and substance abuse. It promises the latest in psychiatric treatment.

In treating patients with substance use disorders, Shahab and the clinic regularly conduct urine drug screening tests on urine samples from their patients. They use a single urine sample to screen for use of multiple classes of drugs. For Medicare, this is considered a single test and billed only once for every patient.

But Shahab and EBH submitted claims to Medicare for multiple units of urine drug screening tests when they knew or should have known that only one unit of service could be billed per patient encounter, the government alleged along with the original whistleblower. Due to EBH’s improper coding of claims, Shahab and EBH received hundreds of thousands of dollars from the Medicare program that they were not entitled to receive, the government said in its complaint.

On top of this, Shahab and EBH also allegedly billed Medicaid for urine drug screening tests even when it did not actually test the urine samples or they tested it weeks or months after collecting the urine samples from the Medicaid beneficiaries.

The $805,071 settlement deal between the government and Shahab and EBH covers claims they submitted to the Medicare program from January 1, 2011 to September 30, 2013, and claims submitted to the Medicaid program from January 1, 2014 to June 30, 2014.

As the relator, Dr. David Simon, a former employee at EBH, will receive a share of the proceeds in the form of a whistleblower award amounting to $99,113. He filed his complaint in the U.S. District Court in Connecticut under the qui tam, or whistleblower, provisions of the both the federal and state False Claims Acts.

The whistleblower provisions of both the federal and state False Claims Acts provide that the whistleblower or relator is entitled to receive a portion of the proceeds of any judgment or settlement recovered by the government.

“Physicians and their medical practices must carefully code their claims, honestly bill for services, and ensure that taxpayers’ health care dollars are properly spent,” said U.S. Attorney Durham.

In 2012 and 2014, Dr. Shahab has also been reprimanded and fined by the government, in these cases allegedly due to improper handling of addictive drugs.


If, like whistleblower Dr. Simon, you suspect that a health care fraud is happening, call to speak with our whistleblower law firm toll free (877) 561-0000.

$280 Million Foreign Corrupt Practices Act (FCPA) & SEC Settlement

Panasonic Avionics Corporation (PAC), part of  global electronics company Panasonic Corporation (Panasonic), has agreed to pay $137 million dollars for alleged violations of the Foreign Corrupt Practices Act (FCPA).  The charges arise out of a scheme to retain “dummy” consultants used to conceal third-party payments for accounting fraud.

Acting Assistant Attorney General Cronan said,  “The Criminal Division will take all appropriate action to ensure that the investing public is able to trust the accuracy of the financial statements of companies that avail themselves of American securities exchanges.”

These types of actions are comparable to SEC Whistleblower actions. Under the SEC Whistleblower program individuals who blow the whistle on companies engaging in fraudulent behavior stand to recover an SEC whistleblower award that could range up to 30% of the recover.  Therefore, the SEC whistleblower in this case could have received an SEC whistleblower award of a staggering $41 million dollars.

“Enforcement of the Foreign Corrupt Practices Act is critical in maintaining a fair and competitive international market to which all businesses are entitled,” said Acting Assistant Director Hacker.  “Along with our federal partners and the Department of Justice, the FBI will continue to aggressively investigate violations of the Foreign Corrupt Practices Act.”

According to admissions and court documents, PAC knowingly and willfully caused Panasonic to falsify its books and records through “dummy” consultants  who did little or no actual consulting.  In outstanding work done by the United States Government, The United States Attorney’s Office and the Federal agents (FBI) investigating the matter,  PAC admitted that it mischaracterized these payments as “consultant payments” on its general ledger, which it knew caused Panasonic to incorrectly designate those payments as “selling and general administrative expenses” on Panasonic’s books, records, and accounts.

SEC whistleblowers who know of companies falsifying their books, or who don’t have the best interest of the shareholders in mind are integral in making SEC qui tam cases.

By distorting the payments and providing false representations and Sarbanes-Oxley (SOX) subcertifications to Panasonic about PAC’s financials and financial controls, PAC caused Panasonic to falsify its books, records, and accounts in violation of the FCPA.

In a related proceeding, the U.S. Securities and Exchange Commission (SEC) filed a cease and desist order against Panasonic, who agreed to pay $143 million to the SEC. That makes the the combined total amount by the defendant $280 million, which could have triggered an $84 million dollar whistleblower award if someone blew the SEC whistle on this fraud.

If you know of any Foreign Corrupt Practices Act or need an SEC whistleblower lawyer, call (877) 561-0000 to consult with our firm.  The SEC whistleblower provisions have a mechanism where the whistleblower can potentially stay anonymous from start to finish. The SEC violations could stem from accounting falsifications, cooked books, no show jobs, or any of a variety of violations where the company is falsifying its records to the detriment of the shareholders.  Even if you’re not in the United States and know about these violations you could potentially receive an SEC whistleblowing award for your information.

Three Physicians pay $700,000 to settle FCA violations with drug testing laboratory

Three physicians separately entered deals with the US government to settle allegations that they received improper payments and caused false claims to be submitted to Medicare, United States Attorney Scott W. Brady announced May 8. The allegations remain as such, but the three physicians involved will pay a combined total of $700,000.

Dr. Robert Fetchero, D.O., of Jeannette, Pennsylvania, Dr. Sridhar Pinnamaneni, M.D., of Windermere, Florida, and Dr. Thelma Green-Mack, M.D., of Zionsville, Indiana, referred Medicare patients to Universal Oral Fluid Laboratories (“UOFL”) for drug testing services while allegedly engaged in a financial relationship with the lab. Another doctor who pled guilty on related charges had already begun his 80-month jail sentence in July last year.

Because of the so-called financial relationship between these physicians and UOFL, the latter was able to send claims to Medicare for drug testing services from 2011 to 2014. UOFL paid the involved physicians to refer their patients to the lab for drug tests. The United States alleged that the financial arrangement between the settling physicians and UOFL violated the physician self-referral law, commonly known as the “Stark Law,” and the Anti-Kickback Statute. This, in turn, gave rise to liability under the False Claims Act.

The Stark Law forbids physicians from referring certain health services payable by Medicare to providers that he or she (or an immediate family member) has a financial relationship with, unless an exception applies. The Anti-Kickback Statute bars them from offering, paying, soliciting, or receiving payment to induce referrals of services covered by federal health care programs, such as Medicare. Violating the Stark Law or Anti-Kickback Statute can result in damages and penalties under the False Claims Act that are up to three times the payment earned from the scheme.

“A physician’s medical judgment should never be compromised by improper financial incentives,” said United States Attorney Scott W. Brady in a statement.

The False Claims Act is a powerful statute that enables courageous individuals with inside information to essentially blow the whistle and potentially receive a whistleblower award up to 30% of what the government recovers.  Under the Federal False Claims Act the cases must have some sort of nexus to the Federal government – either overbilling or falsely billing Medicare or Medicaid for example. Certain states like California and Illinois permit the recovery for frauds against private insurance companies as well.


If you know of similar arrangements leading to false claims to Medicare, take the first step to correct it. Call Toll Free (877) 561-0000.

Physicians, providers indicted for health care fraud

Over the past week, the United States indicted a number of physicians for allegedly causing fraudulent claims to be submitted to Medicare or Medicaid and to other health insurance entities.

In Pennsylvania, five physicians of Redirections Treatment Advocates, LLC, an opioid addiction treatment practice with offices in Pennsylvania and West Virginia, were charged last week for alleged unlawful dispensing of controlled substances and for having committed health care fraud, Attorney General Jeff Sessions, United States Attorney Scott W. Brady of  the Western District of Pennsylvania and United States Attorney William J. Powell of the Northern District of West Virginia announced on May 1, 2018.

The United States alleged that these physicians, working as contractors at various locations, created and distributed unlawful prescriptions for buprenorphine, known as Subutex and Suboxone, a drug that should be used to treat individuals with addiction.  The government alleged that the physicians caused fraudulent claims to be submitted to Medicare or Medicaid for payments to cover the costs of the unlawfully prescribed buprenorphine.

In Portland around the same time, a federal Grand Jury handed down an indictment charging Abdirashid Ahmed, 38, of Lewiston and Garat Osman, 32, of Auburn, with health care fraud involving the MaineCare program and soliciting and receiving health care kickbacks from May 2015 through December 2017.

According to the indictment, Ahmed sought payments from a MaineCare provider and in return referred some beneficiaries to the provider.

Ahmed and Osman allegedly took beneficiaries to the provider and served as Somali interpreters during the visits.  As a result, fraudulent bills were allegedly submitted to MaineCare, with overstated health and interpreter services. MaineCare reimbursed the provider based on the fraudulent billing.

An indictment is merely an accusation, and a defendant is presumed innocent unless proven guilty in a court of law.

Medicare fraud is still robustly going on, with only a fraction of it being detected and caught. Oftentimes unless a whistleblower comes forward there is no way to find out about illegal kickbacks, overbilling or a variety of other overbilling that may happen.

Under the False Claims Act (FCA), a whistleblower can come forward initially anonymously and collect a whistleblower award up to 30% of what the government recovers under Federal Law and some state statutes provide higher awards.  In order to commence a False Claims Act you must have a whistleblower lawyer.


If you know of similar cases of medicare fraud or wrongdoing that could be risking your health on top of unfairly charging our health care, call Toll Free (877) 561-0000.

Tennessee Health Care Executives Charged in $4.6-M kickback scheme

A kickback scheme that allegedly defrauded Medicare and lined the pockets of two health care executives was halted this week by the government. John Davis and Brenda Montgomery, two top executives and owners of health care companies involved in the scheme, were charged not only for the kickback scheme but also for having defrauded Medicare. They were arrested morning of April 9.

The government said that from around June 2011 to June 2017, Montgomery agreed to pay Davis illegal kickbacks in exchange for Medicare referrals for durable medical equipment. Montgomery owns the medical equipment company CCC Medical Inc. Davis, meanwhile, is former CEO of pain management company Comprehensive Pain Specialists (CPS). As head and owner of CPS, Davis allegedly used the CPS to generate need, and sales, for CCC Medical’s durable equipment, in exchange for 60 percent of Medicare proceeds collected on claims for these.

“The charges against John Davis and Brenda Montgomery, alleging almost three quarters of a million dollars in illegal health care kickbacks and the submission of over $4.6 million in fraudulent claims to Medicare, demonstrate the Department of Justice’s commitment to protect taxpayer dollars and to hold corporate executives accountable for fraudulent and abusive conduct,” said Acting Assistant Attorney General Cronan.

The government also charged the two for their efforts to cover up their scheme. These involve making kickback payments through a nominee, creating and filing false tax documents, creating and filing false tax documents, and, for Davis, intervening as CEO to prevent the owners of CPS from obtaining their own Medicare DME supplier numbers that would have allowed CPS to bill for its own Medicare DME orders.

The government said that since around May 2015, Davis and Montgomery renegotiated their illegal agreement to further obscure their personal contract from Medicare and from CPS owners and employees.  This, the government said, resulted in a sham purchase of a shell entity known as ProMed Solutions, LLC. Montgomery allegedly paid $150,000 for this, to induce Davis to continue driving CPS referrals to CCC Medical, the government lawyers said.

All these, so far, are still allegations. Davis and Montgomery are presumed innocent until proven guilty beyond a reasonable doubt in a court of law, the Department of Justice said on April 11.

U.S. Attorney Cochran promised “unrelenting efforts” to bring to justice individuals and corporations who he said choose profit at the expense of the health of those in greatest need.

“Stealing funds from our health care system places the vulnerable at greater risk and diverts public funds into the pockets of the greedy individuals who exploit those with the greatest need,” he said.

Trial Attorney Anthony Burba of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Ryan Raybould of the Middle District of Tennessee are prosecuting the case.

More than 3,500 defendants have previously been charged by the government’s Medicare Fraud Strike Force. These defendants have collectively billed the Medicare program for over $12.5 billion. Private whistleblowers have helped the government achieve this.


If you know of similar kickback schemes or moves defrauding Medicare, help put a stop this. Call our Whistleblower Law Firm Toll Free (877) 561-0000

Allergan to pay $3.5-M to settle False Claims Act violations on weight-control device

Allergan Inc., a New Jersey-based seller of a weight-control medical device called LAP-BAND Gastric Banding System, has agreed to pay the US government $3.5 million to resolve False Claims Act (FCA) violations alleged against one of its devices. The LAP-BAND device was approved by the Food and Drug Administration for weight reduction of adult patients who failed to meet their weight target through more conservative weight-reduction measures. But the devices it sold had numerous malfunctions which the company allegedly tried to conceal while continuing to sell it, billing the country’s federal government and Medicare in the process.

LAP-BAND is an inflatable silicone band installed in a patient’s stomach by surgery. This constricts or expands the stomach as needed by adding or removing saline fluid through a subcutaneous access port.

For nearly three years, from January 2008 to November 2010, Allergan knowingly sold LAP-BANDs with flawed access ports, the lawsuit alleged.

“Patients have every right to expect that medical devices used during surgery are free of defects,” said Robert K. Hur, United States Attorney for the District of Maryland. He said patients have the right to expect that medical devices have been subject to the rigorous review and approval process of the Food and Drug Administration.

“When marketing and selling medical devices that may have defects or may be used in unapproved procedures, patients can be put at risk,” Hur emphasized when he announced the settlement with Allergan Monday, April 16.

The United States said in its lawsuit that Allergan misrepresented the cause of access port leaks so health care professionals will continue using the LAP-BAND. On top of this, Allergan failed to gather data and complaint files.  Also, between 2008 and 2012, Allergan allegedly promoted the LAP-BAND for use in two ways that were not approved by the Food and Drug Administration. Some of these were not needed for diagnosing or treating an illness or injury. But to promote LAP-BAND’s use, Allergan allegedly tipped health care professionals with proctoring, workshops, advisory boards, and training events where they discussed or showed the use of LAP-BANDs.

The $3.5 million qui tam settlement resolves the original lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and attain a part of the government’s recovery.  The whistleblowers filed charges in the District of Maryland, where it was captioned as the United States ex rel. Schwartz and Tinsley v. Allergan, CCB-10-2796.  Dr. Schwartz and Mr. Tinsley are set to receive around $594,064 from the settlement; the federal government $3,300,360 and the state Medicaid $199,640.  Relator or whistleblower awards have proliferated in the last decade with billions of dollars of recoveries for the government which generally result in whistleblower awards of around 20% of the amount the government recovered.

The claims resolved in the settlement remain as allegations as there has been no determination of liability.

Allergan Inc. used to be an American company since the 50s. In 2015 a global pharma company Actavis Plc acquired it and continued expanding the company as well as defending it from hostile takeovers. Its earnings as of last quarter of 2017 have increased compared to same period in the previous year. The company’s bottom line totaled $2.17 billion, or $4.86 per share.


If you know of similar cases of fraud or wrongdoing risking your health, call our whistleblower lawyers Toll Free (877) 561-0000.

$60 Billion Dollars!!!

If this was a game of jeopardy and that was the answer, the question would be, “How much Medicare Fraud is there per year?”  Even with all the efforts to police Medicare and Medicaid, the government still is stung for an average of $60 billion dollars a year according to an interview Attorney General Jeff Sessions did with the AARP

How much of a whistleblower award could that be?   Technically, under the False Claims Act (FCA) a relator could receive up to 30% of the amount the government receives.  So doing the math, if all that was the result of relators and whistleblowers, there could be $18 Billion dollars a year in whistleblower awards.  More than likely though, the relator share would be around 20% if the government intervenes, so that still would be a lofty $12 Billion dollars available to whistleblowers each year for doing the right thing and blowing the whistle on Medicare Fraud.

Opioids have become a priority for this administration.  Sessions indicated, “Some of the more blatant problems were highlighted in our Medicare fraud takedown recently where we had a sizable number of physicians that were overprescribing opioid pain pills which were not helping people get well, but instead were furthering an addiction being paid for by the federal taxpayers.”

If the case has an opioid nexus and there is false billing, over prescription of opioids leading to addiction and other issues, there’s a strong chance that the government will streamline the case and intervene.

Not every case will win. But you can’t win unless you try.  If you’re wondering, “how do I blow the whistle on Medicare Fraud,” and what are some sample whistleblower awards, you should speak with a whistleblower lawyer to go over your options and find out if you might have a viable case that can serve up a piece of that large pie for doing the right thing.

Florida Pharmacy Charged With Up to $200M False Claims Act Allegations

The Justice Department has joined the lawsuit filed by two former employees turned whistleblowers in Pompano Beach, Florida. Federal prosecutors last week filed a case in Miami, Florida under the False Claims Act against the pharmacy called Patient Care America (PCA) and its Diabetic Care Rx LLC. The federal prosecutors charged the pharmacy of having taken improper reimbursements from TRICARE for the illegal push of its creams and vitamins. TRICARE is a federally-funded health care program for military personnel and their families.

The government is also suing Patrick Smith and Matthew Smith, two pharmacy executives, and the firm that owns and manages the pharmacy, the Riordan, Lewis & Haden Inc. (RLH), a private equity firm based in Los Angeles, California. The firm was founded by former Los Angeles Mayor Richard R. Riordan, but a report said he has long been retired and no longer has a financial interest in the firm based on its public filings.

In its lawsuit, the Justice Department alleged that the pharmacy, its two executives and the firm that owns and manages it paid illegal kickbacks to make TRICARE beneficiaries receive prescriptions for compounded pain creams, scar creams, and vitamins, whether or not the patients needed it for medical reasons.

The government claimed that the pharmacy and its marketers manipulated the compound formulas to obtain the maximum possible reimbursement from TRICARE. As a result, the Patient Care America raked in millions from doubtful reimbursements with TRICARE in just eight months from 2014 to 2015. The complaint alleged that the defendants and the marketers shared in the profits from the scheme.

Two former employees of Patient Care America first complained about the pharmacy’s kickback scheme in a False Claims Act filed in 2015. The lawsuit, United States ex rel. Medrano and Lopez v. Diabetic Care Rx, LLC dba Patient Care America, et al., No. 15-CV-62617 (S.D. Fla.), was first filed in the U.S. District Court for the Southern District of Florida by Marisela Medrano and Ada Lopez. The two former employees filed it under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to sue for false claims against of the United States and to receive a share of any recovery.  The Act permits the United States to intervene in such lawsuits, as the United States has done in this case.

The False Claims Act allows the government to seek payment of three times the proven actual damages. Patient Care America and the involved owner and executives might have to pay the US government more than $200 million in tainted reimbursements with TRICARE if federal prosecutors prevail.   The whistleblowers also known as relators are entitled to a portion of the recovery under the False Claims Act and whistleblower settlements under the federal statute can total  up to 25% of the amount the government actually recovers, so theoretically, the whistleblower award here can be as high as $50 million dollars.

This case was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Southern District of Florida, the Defense Criminal Investigative Service, the U.S. Food and Drug Administration’s Office of Criminal Investigations, and the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit.

“Providers and marketers that engage in kickback schemes drive up the cost of health care because they focus on their own bottom line instead of what is in the best interest of patients,” said Executive Assistant Randy Hummel of the United States Attorney’s Office for the Southern District of Florida.  “We will hold pharmacies, and those companies that manage them, responsible for using kickbacks to line their pockets at the expense of taxpayers and federal health care beneficiaries.”

Memphis Operator of Spring Gate nursing home settles FCA allegations with half a million dollars, integrity deal

A concerned nephew turned whistleblower succeeded at helping the residents of a large nursing home in Tennessee address complaints of substandard, unhealthy services. His whistleblower lawsuit also helped the United States and the State of Tennessee investigate and address allegations that the large nursing home allegedly fraudulently billed Medicare.

In 2015, Chris Godwin filed a lawsuit against Spring Gate under the qui tam provisions of the False Claims Act (FCA). It permits persons like him to sue on behalf of the government as a relator to recover the submission of false claims and share in the recovery. The False Claims Act gives the US government a cause of action against any person or entity that knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval. The provisions of the False Claims Act permit a whistleblower to receive an award up to 30% of the amount recovered. The last decade showered record amounts of qui tam awards which aggregated in the billion dollar range.

Based on his filed case, Godwin acted out of concern for his aunt (now deceased). He observed a deterioration in his aunt’s health in 2013 after the nursing home allegedly made her take psychoactive drugs. He subsequently learned more about the substandard nursing services from the experience of his aunt as a resident there, from his talks with the nursing home staff and from his investigation into the situation of other residents.

Combined with the findings of the government, they alleged that from 2012 to 2015, Spring Gate provided substandard and worthless nursing home services to residents. Spring Gate is a large facility with more than 200 beds. It has a for-profit, corporate ownership.

“By relying on psychoactive drugs as a substitute for actual, skilled nursing care, and then billing Medicare for that care, Spring Gate has fraudulently billed the United States for worthless services,” Godwin’s case said.







Under federal and state law, Medicare and Tenncare will not pay for services deemed so deficient that they are essentially worthless.

The whistleblower’s case was captioned United States of America and the State of Tennessee ex rel. Chris Godwin v. Memphis Operator, LLC (d/b/a Spring Gate Rehabilitation and Healthcare Center). Vericare Management, Inc. and PharMerica Corporation, No. 2:15-cv-2090 (W.D.Tenn.). The Justice Department said Spring Gate cooperated to resolve the matter.

As a result, the Justice Department announced early this month (February 2) that Memphis Operator, LLC, owner of Spring Gate Rehabilitation and Healthcare Center, will pay $500,000 to the United States and the State of Tennessee. The deal resolves the allegations of false claims to Medicare and Tenncare. Although the company will pay, the settlement says it has not been deemed liable for the allegations that provided substandard and worthless services to residents of Spring Gate and violated some requirements expected to be met by skilled nursing facilities.

Whistleblower Attorney Jason T. Brown commented, “This is another positive outcome obtained by the government with the assistance of a whistleblower and private qui tam counsel. These cases are made possible through the integrity of good people who come forward with their qui tam complaints and work with the government to hold entities accountable.”

Aside from the $500,000 settlement, Spring Gate signed a Corporate Integrity Agreement with the Department of Health and Human Services’ Office of Inspector General to prevent future unlawful conduct. Qui tam cases have become increasingly challenging in recent years with some courts ruling that a whistleblower needs to be on the inside, not merely a patient of a medical facility. Still, with specific enough facts a patient or client can proceed with their claim, but under the Qui Tam provisions must use a whistleblower law firm to commence an action.

“Residents of nursing homes are some of our most vulnerable citizens. When nursing homes break the law by defrauding the government for substandard or worthless services we will use our resources to combat this fraud and hold them accountable,” said D. Michael Dunavant, United States Attorney for the Western District of Tennessee.

The United States Department of Health and Human Services Office of the Inspector General, the Tennessee Bureau of Investigation and the Tennessee State Attorney General’s Office conducted the investigation. On behalf of the government, Assistant United States Attorneys Stuart J. Canale and Matt Waldrop and Steve Jobe, Senior Counsel for the Tennessee Attorney General, prosecuted the case.

If you have knowledge of nursing homefraud endangering our vulnerable citizens or other types of Medicare Fraud or Medicaid Fraud, click here for info on what you can do.

US Obtains a $16.2 Million Judgment for MRI provider’s False Claims Act Violations

Richard Pfarr and the Orthopedic and Neuro Imaging LLC (ONI) he owns were held liable in the U.S. District Court in Delaware for having submitted fraudulent claims to Medicare. The Court granted the United States’ request for a default judgment against ONI and Pfarr. In its complaint, it said ONI knowingly submitted false claims to Medicare by administering contrast dye during magnetic resonance imaging (MRI) scans on patients without proper supervision by a physician. Contrast dye is a chemical injected into the body to make certain tissues more clearly visible on an MRI.

“This case exemplifies the utility of the False Claims Act to deter fraudulent conduct, protect patient safety, and save taxpayer dollars,” said Acting U.S. Attorney David C. Weiss. ONI operates independent diagnostic testing facilities (IDTFs) in Delaware and Maryland. The lawsuit contended that ONI injected dyes into 1,700 Medicare patients from 2003 to 2014 without direct supervision by a physician. The suits said ONI received more than $1 million from Medicare for scans, images and tests.












The government’s case took off from a whistleblower’s lawsuit filed by Robin White in 2013. A former employee of ONI. White filed the suit under the qui tam provisions of the False Claims Act (FCA). It permits private parties to sue on behalf of the United States for false claims on government funds, and to receive a share of any recovery. The private plaintiff relates the case to the governments interest and is referred to as a relator. The False Claims Act permits the government to intervene in such a lawsuit, as the government did in ONI’s case. Ms. White will receive a whistleblower award of 18 percent of the recovered funds, if any. Whistleblower awards could be in the tens of millions and are judged on a multitude of factors including cooperation of the whistleblower, and their utility in the investigation. Commencing a qui tam action requires the use of a whistleblower lawyer.

The US government intervened in the False Claims Act lawsuit September last year. The matter was investigated by the U.S. Attorney’s Office for the District of Delaware, the U.S. Department of Health and Human Services Office of Inspector General, and the FBI. Assistant U.S. Attorneys Jennifer L. Hall and Laura Hatcher handled the case on behalf of the United States.

The case is captioned United States ex rel. White v. Orthopaedic and Neuro Imaging LLC, No. 13-1109-RGA.

Tampa’s biggest ambulance provider to pay $5.5 million to settle False Claims Act claims

The biggest provider of ambulance services in Tampa, Florida entered an agreement with the US government this week to settle allegations that it violated the False Claims Act (FCA). In a statement on January 30, the Department of Justice said the AmeriCare Ambulance Service, Inc. and its sister company, AmeriCare ALS, Inc. (collectively, AmeriCare), have agreed to pay around $5.5 million to resolve claims that it defrauded Medicare by billing for medically unnecessary ambulance transportation services.

The settlement concludes a lawsuit first filed by Ernest Sharpe, a former paramedic in AmeriCare. He filed the lawsuit in 2013 under the qui tam, or whistleblower, provisions of the False Claims Act that permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case in 2017. Mr Sharpe as whistleblower will receive roughly $1.15 million of the $5.5 million recoveries from AmeriCare. Whistleblower awards have skyrocketed over the last decade as the government is clamping down on health care fraud and handsomely giving qui tam awards to people who blow the whistle in the correct manner.  To blow the whistle under the False Claims Act, one needs a whistleblower lawyer, preferably one experienced in combatting Medicare Fraud.

Based on Sharpe’s lawsuit and the complaint subsequently filed by the US government against AmeriCare, the latter had allegedly engaged in a systemic practice – over many years – of submitting fraudulent claims to the government. With the whistleblower, the government investigators amassed damaging testimonies from members of AmeriCare’s management team. These, along with other evidence obtained by the government, reportedly showed that from January 2008 through December 2016, AmeriCare fraudulently billed Medicare and TRICARE. They also found out that AmeriCare had produced thousands of false reports and other documentation during this period, to prop up the claims to Medicare.

Although the settlement states that the allegations against AmeriCare remain as such, it agreed to pay around $5.5 million and allowed itself to enter into an integrity agreement with the Inspector General of the U.S. Department of Health and Human Services.   Whistleblower Attorney Jason T. Brown commented, “This is another excellent result obtained by the government with the assistance of a whistleblower and private qui tam counsel.  The companies rarely admit guilt, but the money speaks volumes.”

US Attorney Chapa Lopez said the lawsuit and the week’s settlement speak for the office’s ongoing efforts to safeguard federal health care program beneficiaries from the effects of this type of unlawful conduct. The DOJ highlighted the government’s efforts against health care fraud, where it considers the help of whistleblowers under the False Claims Act as one of their most powerful tools.

Although the settlement resolves the case, it did not say that AmeriCare has been determined as liable. The claims against in remain as allegations. The case is captioned United States, et al. ex rel. Sharpe v. AmeriCare Ambulance, Case No. 8:13-cv-1171-T-33AEP.

The settlement resulted from the coordinated effort of the U.S. Attorney’s Office for the Middle District of Florida and the HHS-OIG and the Defense Criminal Investigative Service. Assistant United States Attorney Christopher P. Tuite handled the case.

Pain clinic operator pays more than $1.45-million to settle False Claims Act violations

A whistleblower helped the government save lives and protect taxpayers’ money in Tennessee last week. U.S. Attorney General Jeff Sessions and U.S. Attorney Don Cochran of the Middle District of Tennessee announced that a chiropractor operating pain clinics from Lenior City, Tennessee has paid $1.45 million, plus interest, to resolve False Claims Act violations. Under the same settlement, a pain clinic nurse in Cookeville, Tennessee is to pay $32,000 and surrender her DEA registration to settle allegations that she violated the Controlled Substances Act.

“More Americans are dying because of drugs today than ever before—a trend that is being driven by opioids,” said Attorney General Jeff Sessions. “If we’re going to end this unprecedented drug crisis, which is claiming the lives of 64,000 Americans each year, doctors must stop over-prescribing opioids and law enforcement must aggressively pursue those medical professionals who act in their own financial interests, at the expense of their patients’ best interests. “

Vowing to fight opioid abuse “on all fronts,” U.S. Attorney Cochran recognized the help in this case of a whistleblower.  The United States and Tennessee began to investigate in March 2016 after a former office manager for the Cookeville Center for Pain Management filed a qui tam lawsuit against Matthew Anderson and his management company, PMC LLC.

The qui tam, or whistleblower, provisions of the False Claims Act allow private citizens with knowledge of false claims to bring civil suits on behalf of the government and to share in any recovery.  In this more than $1.45 million settlement, the whistleblower will get $246,500 and other amounts under the settlements with Scott and the three pain clinics.  Whistleblowers stand to receive significant awards under the False Claims Act which could be up to 30% of the amount recovered for the taxpayers.

Anderson and PMC LLC operated four pain clinics in Tennessee, most recently known as Cookeville Center for Pain Management; Spinal Pain Solutions in Harriman; Preferred Pain Center of Grundy County in Gruetli Laager; and McMinnville Pain Relief Center.   All these clinics have now closed. Anderson allegedly reaped over $5 million from the four pain clinics, and took over 90 percent of the pain clinics’ profits.

Anderson and PMC resolved in the settlement the governments’ claims that from 2011 through 2014, they caused pharmacies to request for Medicare and TennCare payments for painkillers, including opioids, without valid medical purpose.

It also resolved allegations about Anderson’s too high reimbursements for office visits, and the PMC’s claims on Medicare for nurse services in 2011 and 2012 that failed to abide by the Tennessee law.

The case was handled by the United States Attorney’s Office for the Middle District of Tennessee and the Tennessee Attorney General’s Office and investigated by the Department of Health and Human Services – Office of Inspector General and the Tennessee Bureau of Investigation Medicaid Fraud Control Unit.  Assistant U.S. Attorney Ellen Bowden McIntyre represented the United States, and Assistant Attorney General Philip Bangle represented the State of Tennessee.

There is a prioritization of opioid litigation as the crisis has reached epidemic proportions.  Opioid Qui Tam litigation has become increasingly prevalent to combat the crisis.  Oftentimes, these doctors or clinics are called “pill pushers” or “Dr. Feelgoods” and although one could conceivably blow the whistle as an opioid user, the False Claims Act (FCA) contemplates recovery for mainly insiders with specific information of fraud against the government.   Victims of opioid addiction who have had their lives ruined by the drugs may have other avenues to bring litigation against the drug manufacturers and the opioid prescribers.

The case is docketed as United States ex rel. Norris v. Anderson, No. 3:12-cv-00035 (M.D. Tenn.).  The settlement resolved the case but Anderson or PMC had not admitted any liability.

Medical Device Company to Pay $7.62 Million Over False Claims on TRICARE

The Department of Justice hailed the False Claims Act (FCA) for proving yet again as a powerful tool in combating health fraud.  Through tips and complaints from all sources, the DOJ is successfully going after potential fraud, waste, abuse, and mismanagement. Last January 23, it concluded a settlement for one of such cases.

The Department of Justice said that DJO Global Inc. (DJO), a medical device company headquartered in Vista, California, has agreed to pay $7.62 million to resolve allegations that its subsidiary, Empi Inc., a now-defunct medical device company based in Shoreview, Minnesota, submitted false claims to TRICARE for excessive, unnecessary transcutaneous electrical nerve stimulation (TENS) electrodes that TRICARE beneficiaries did not need or use.  TENS is a therapy that uses low-voltage electrical current for pain relief.

DJO shut down Empi in November 2015. But before that, from 2010 to 2015, Empi allegedly used “assumptive selling” to persuade the TRICARE beneficiaries to seek and accept unjustifiably large quantities of TENS electrodes. Its use rose steeply with more beneficiaries receiving unnecessary quantities in 2014 to 2015.

With this selling technique, the Empi sales representatives contacting TRICARE beneficiaries and prompted them to order excessive TENS electrodes by acting as though the beneficiaries had shown a need for them, when that may not have been the case.

Oftentimes these cases are filed through a whistleblower who stands to receive a whistleblower award for their information.  The whistleblower also known as a relator, files the False Claims Act action which is often referred to as whistleblower or qui tam lawsuits.  Qui Tam law is an interesting area of practice and one in which a plaintiff may not file pro se, that is they need a whistleblower lawyer or qui tam law firm to assist and as a prerequisite to file.  In a case like DJO a whistleblower could received up to 30% and thus a sample qui tam award would be $2.28 million dollars for providing information.

TRICARE is a federal health care program providing medical care and services to those in the military and their families. United States Attorney Gregory G. Brooker said the $7.6 million settlement underscores their commitment to protecting the integrity of federal health care programs and that it sends a strong message of accountability to those who would seek to take advantage of those programs.

The case was handled by the Civil Frauds Unit of the U.S. Attorney’s Office for the District of Minnesota, the Justice Department’s Commercial Litigation Branch, and the Department of Defense Office of the Inspector General. The settlement concluded the case but DJO did not admit liability.