Participants in the contract are guaranteed to receive Office Depot’s best available prices for government purchasers, according to Sherwin’s complaint. But Office Depot allegedly gave Los Angeles, Santa Clara and the other California entities that are part of the settlement a lower discount rate than other government entities were given.
Edward O’Donnell, a former Exec. for Countrywide financial is about to collect $57.6 million from Bank of America, for his role in exposing fraudulent activity at the firm. O’Donnell filed false-claims lawsuit that accused Countrywide Financial, which is now owned by Bank of America, of defrauding government-backed mortgage finance companies Fannie Mae and Freddie Mac by selling them defective mortgages.
It was the fifth consecutive year the Justice Department recovered more than $2 billion from cases alleging fraud against Medicare,Medicaid and Tricare. 9. Whistle-blowers, are allowed to file lawsuits on behalf of the government. The government can later decide whether to intervene. In successful lawsuits, whistle-blowers are entitled to a percentage of the money recovered, leading to large rewards in some cases. In fiscal 2014, more than 700 whistle-blowers filed cases in healthcare and other areas, and reaped $435 million.
Much of the moneys recovered this year was from the pharmaceutical industry.Johnson & Johnson agreed to pay $1.1 billion in November 2013 to settle allegations that Johnson & Johnson promoted the drugs Risperdal, Invega and Natrecor for uses not approved by the FDA, causing providers to submit hundreds of millions of dollars in false claims to federal healthcare programs.
The Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorneys’ offices and the main litigating divisions of the Justice Department combined in that same period.
The amount is more than three times the $8 billion collected in FY 2013. The largest civil collections were from affirmative civil enforcement cases, many of which were brought under the whistleblower provisions of the False Claims Act, in which the United States recovered government money lost to fraud or other misconduct or collected from individuals and/or corporations for violations of federal health, safety, civil rights, tax, or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
The total includes all monies collected as a result of Justice Department-led enforcement actions and negotiated civil settlements. It includes approximately $13.7 billion in payments made directly to the Justice Department, and $11 billion in indirect payments made to other federal agencies, states and other designated recipients.
The largest single source of collections came from civil penalties paid by financial institutions to resolve financial fraud claims stemming from the 2008 financial crisis, including significant amounts paid by JPMorgan and Citigroup Inc, to resolve federal and state civil claims related to the packaging, marketing, sale and issuance of residential mortgage-backed securities (RMBS). Both resolutions include record penalties under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and in addition, also provide billions of dollars of relief to struggling homeowners.
Department collections also included hundreds of millions in fines from an ongoing investigation into institutions involved in the manipulation of the London Interbank Offered Rate (LIBOR), including UBS Securities Japan Co. Ltd., and RBS Securities Japan Ltd., a wholly owned subsidiary of The Royal Bank of Scotland plc (RBS). Hundreds of millions in additional collections resulted from the department’s ongoing investigation into international price-fixing and bid rigging in the auto parts industry. For instance, Bridgestone Corp., a company based in Tokyo, Japan, agreed to plead guilty and to pay a criminal fine for its role in a conspiracy to fix prices of automotive anti-vibration rubber parts installed in cars sold in the United States and elsewhere.
The department also collected millions in criminal penalties after resolving investigations into violations of the Foreign Corrupt Practices Act (FCPA). For instance, Diebold Inc., an Ohio-based provider of integrated self-service delivery and security systems, pleaded guilty to violating the FCPA by bribing government officials in China and Indonesia and falsifying records in Russia in order to obtain and retain contracts to provide ATMs to state-owned and private banks in those countries.
Jeffrey Newman represents whistleblowers
Davita Healthcare Partners which operates dialysis centers, has agreed to pay $400 million to settle a False Claims Act lawsuit involving kickbacks to doctors. DaVita , one of the nation’s biggest providers of dialysis services ,paid doctors hidden kickbacks as a way to get patient referrals for its dialysis clinics and to reduce or eliminate competition from other dialysis centers the suit alleged. Continue reading
A jury has ruled that Trinity Industries (TRN) deliberately withheld information from the U.S. Government about cost-savings to its highway guardrail system that made that system more dangerous which defrauded the government out of $175 million.The case was brought by Joshua Harman, a maker and installer of guardrail systems in Virginia. Trinity made secret design changes that transformed one of its products into a potentially lethal highway hazard, wrongly passing off the product as eligible for federal funding and defrauding the government of $218 million, Mr. Harman claimed. Continue reading
Shire also allegedly marketed Adderall XR based on unsupported claims that Adderall XR would prevent poor academic performance, loss of employment, criminal behavior, traffic accidents and sexually transmitted disease. In addition, Shire allegedly promoted Adderall XR for the treatment of conduct disorder without approval from the Food and Drug Administration (FDA).
Individuals who had problems with a DePuy ASR hip replacement resulting in the need for revision surgery must register by January 6 to be part of the settlement program announced in November.
There are about 12,000 hip replacement lawsuits pending in state and federal courts around the country, filed following the recall of the DePuy ASR XL Acetabular Hip System in 2010. The allegations relate to faulty design in that the metal on metal hip implant resulted in the release of metallic debris.
In November, the DePuy ASR settlement program was announced which will result in the manufacturer paying about $2.4 billion.
Pfizer Corporation has agreed to pay $491 million to resolve allegations stemming from a whistleblower suit which alleged that its subsidiary Wyeth illegally marketed the transplant drug Rapamune for uses not approved by the FDA including for patients getting liver, lung heart and other transplants–dangerous uses. Rapamune was approved in 1999 only for ise in kidney transplant patients. The company even gave its sales reps bonuses for pushing the drug for unapproved uses.
One whistleblower in the Rapamune case was Mark Campbell, a Wyeth sales rep for 20 years until he resigned in 2009. Whistleblowers are allowed up to 30% of the government’s recovery under The False Claims Act . Since resigning from Wyeth, Mr. Campbell, who has a Masters’ Degree in religious education has been serving as Executive Director of Ministries of Jesus, a nonprofit healthcare ministry in Oklahoma.
Off label marketing of drugs is not unique to Wyeth or Pfizer. The record settlement is $3 billion paid by the British drugmaker GlaxoSmithKline PLC.
Although much has been written about the IRS whistleblower program which last year saw a whistleblower collect $104 million in rewards for reporting tax evaders, not much has been mentioned about whistleblowers who report companies that purposely do not pay their sales taxes. Most states have sales taxes on goods sold or exchanged in those states. The amount varies from 5-7% but companies selling products are required to pay sales taxes in those states with such laws and where the transaction occurs in those states. Even though the laws are clear, alot of companies, especially those in offices in various states, try to evade the taxes by just not paying them. In addition, even in those states that do not have actual whistleblower laws on the books, whistleblowers with information about sales tax fraud can usually negotiate a reward of a significant percentage of the moneys recovered by the states. It usually ranges from 15-35% of the moneys collected. It helps to have an experienced lawyer. The information has to be original and generally the amounts of sales tax fraud must be substantial for the states to be interested. It also helps to have documentary support for your allegations in the form of invoices or other documents showing the sales. There have been some very large cases. In one case pending in New York State, Sprint has been charged with seeking to dodge over $300 million in sales taxes. With interest and penalties, that amount could run the company in excess of $700 million and the whistleblower could receive up to $200 million, which would be the single largest whistleblower award relating to tax fraud ever rendered. If you are aware of corporate tax fraud, contact attorney Jeffrey Newman for a free consultation. Jeffrey Newman represents whistleblowers. Jeffrey.Newman1@gmail.com