Articles Posted in False Claims act

International Tutoring Services, LLC, f/k/a International Tutoring Services, Inc., and d/b/a Hospice Plus; Goodwin Hospice, LLC; Phoenix Hospice, LP; Hospice Plus, L.P.; and Curo Health Services, LLC f/k/a Curo Health Services, Inc.will  pay $12.21 million to resolve allegations that they violated the False Claims Act by paying kickbacks in exchange for patient referrals. Curo Health Services is headquartered in Mooresville, North Carolina and operates eight hospice affiliates across 18 states. In September 2010, Curo Health Services purchased Hospice Plus, Goodwin Hospice, and Phoenix Hospice, and consolidated the hospice companies under the Hospice Plus brand, which operates primarily in and around Dallas, Texas.

The settlement resolves allegations brought by several whistleblowers that Hospice Plus, Phoenix Hospice, and Goodwin Hospice submitted claims to Medicare and Texas Medicaid that were rendered false as a result of the payment of kickbacks by the hospices, its owners and employees, and others. There were two alleged  schemes. First, from 2007 through 2012, kickbacks were allegedly paid to American Physician Housecalls, a physician housecall company, in exchange for patient referrals to these hospice companies. They took the form of sham loans, a free equity interest in another entity, stock dividends, and free rental space. Second, from 2007 through 2014, kickbacks were allegedly paid to medical providers, including doctors and nurses as well as hospitals and long-term care facilities, in exchange for patient referrals to these hospice companies. The alleged kickbacks took the form of cash, gift cards, and other valuable items.

In addition to reaching a settlement with these defendants, the United States also requested that the Court permit the United States to intervene in and prosecute the fraud claims against two former executives, Dr. Bryan White and Suresh Kumar.

The Sunday Times has reported that Lance Armstrong and his management company Tailwind Sports Corporation have settled their legal battle with the SCA Promotions company, apparently paying more than $10 million to the company that agreed an insurance policy covering the cost of bonus payments for Armstrong’s Tour de France victories.

Still pending is the False Claims Act being pursued by the Justice Department seeking to recover the $30 million the US Postal Service paid to sponsor the team. The whistleblower Floyd  Landis could receive as much as 30% of any award as part of a qui tam Whistleblower legal suit. The legal battle result in Armstrong being forced to pay three times the sponsorship figure if he loses the case,  up to $90 million.

Jeffrey Newman represents whistleblowers. He is not involved in this case.

 

A new scheme has entered the pharmaceutical industry involving what the courts have now deemed as illegal payoffs in which drug-makers holding patents, sue generic manufacturers then settle the case paying millions to keep them from making the less expensive version.

Pharmaceutical manufacturer Cephalon was sanctioned by the Federal Trade Commission for the so called “reverse payment” settlements the company struck with competing drug makers to stop them from making generic versions of the narcolepsy drug Provigil.

The problem  with companies doing this, says the FTC is that it harms consumers through delayed entry of generic drugs into the market, which are far less expensive. In some cases where the drugs were ultimately billed to Medicare, Pharma companies, including Cephalon have been charged with fraud under The False Claims Act. This is because when the generic drug is kept from the market, Medicare, which is your tax dollar, pays a much higher price for the medications.  There is a False Claims Act case against Cephalon that is pending at this time.

Commerzbank AG has agreed to pay $1.45 billion to settle sanctions actions for doing business with Iran, Sudan  and its failure to have adequate money laundering controls, the DOJ and New York financial regulator said Thursday.

The bank “concealed hundreds of millions of dollars in transactions prohibited by U.S. sanctions laws on behalf of Iranian and Sudanese businesses, the prosecution agreement states. At one point, the bank was concerned that transactions with Iran would be revealed, so in 2003, it created a policy entitled “Routing Instructions Iranian banks for USD payments”. The policy instructed employees to “under no circumstances mention the Iranian background in the cover order.”  By concealing these payment details prevented the U.S. from identifying or stopping the transactions that involved sanctioned entities.

In 1995, President Clinton issued an Executive Order finding that the actions and policies of the Government of Iran constituted an unusual and extraordinary threat to the national security of the U.S. and imposed comprehensive trade and financial sanctions on the country. In 1997 President Clinton imposed a trade embargo on Sudan which prohibited virtually all trade and investment activities between the U.S. and Sudan.

A federal False Claims Act lawsuit filed by a whistleblower who was an employee at a plant owned by DuPont, says he saw that the company was leaking “potentially tons” of carcinogenic gas. The plant is located next to a residential neighborhood and primary school. Continue reading

Symantec Corporation the largest maker of computer security software may be required to pay as much as $145 million in damages relating to A Department of Justice investigation  into whether the company failed to comply with government contracting rules concerning pricing. Continue reading