X

Reset Password

Username:

Change Password

Old Password:
New Password:
We have completed your request.

False Claims Act Statistics, News & Analysis

Three's A Crowd: Potential Third Party Liability in FCA Suits

So often more is merrier, but when it comes to FCA liability, three can be a crowd. The government rarely pursues third-party liability in FCA cases despite the routine involvement of consultants, auditors, and investors with companies alleged to have defrauded the government. In what appears to be an effort to expand the scope of FCA liability to a new class of defendants, the government in February pursued FCA claims against two third parties. On February 16, the government intervened in United States ex. rel. Medrano v. Diabetic Care RX, LLC, No. 15-cv-62617 (S.D. Fla. Feb. 16, 2018) alleging that Riordan, Lewis & Harden, Inc. (“RLH”), the private equity sponsor of the pharmacy now known as Patient Care America (“PCA”), through two RLH partners who oversaw the investment, was responsible in part for an illegal kickback scheme designed to obtain increased prescriptions for compounded creams and vitamins, and thus greater reimbursement from TRICARE. A week later, on February 28, the government announced a $149.5 million settlement with Deloitte & Touche LLP (“Deloitte”) for knowingly deviating from traditional auditing standards which the government argued allowed the mortgage originator Taylor Bean & Whitaker Mortgage Corporation to defraud the government. Though these cases are not directly related, the timing suggests that third-party FCA liability may be a focus of the DOJ moving forward.

Read More

Risky Business: Reverse FCA Allegations Against Medicare Advantage Insurer Survive

In an early mixed valentine for both the government and a defendant Medicare Advantage Plan insurer, a district court in California on February 12 denied a motion to dismiss reverse FCA claims alleging the failure to correct known invalid diagnosis codes submitted for risk adjustment payments to Medicare. The court did dismiss, however, the government’s claims that the insurer’s false statements as to the validity of the diagnosis codes also violated the FCA. Poehling v. Unitedhealth Group, Inc., No. 2:16-cv-08697 (C.D. Cal. Feb. 12, 2018).

Read More

Escobar Matters for Discovery, Too: District Court Emphasizes Right to Broad Materiality Discovery

While most post-Escobar decisions have involved the merits, Escobar also has significant implications for the scope of materiality discovery under the FCA. Last week, in United States ex rel. California v. Paramedics Plus LLC, the U.S. District Court for the Eastern District of Texas became one of the first courts to directly tackle that issue in a written opinion, holding that Escobar affords FCA defendants the ability to broadly discover how the government has actually handled the disputed issue, both in that case and in other analogous situations.

Read More

Trap! Zap! Zing! — And Poof! A Florida Court Applies Escobar and Makes a $347 Million FCA Jury Verdict Disappear

On January 11, 2018, a Florida district court vacated a $350 million FCA jury verdict against defendants in U.S. ex rel. Angela Ruckh v. Salus Rehabilitation, LLC, No. 8:11-cv-1303 (M.D. Fla. Jan. 11, 2018). At trial in February 2017, relator claimed that the defendants, owners and operators of 53 specialized nursing facilities fraudulently inflated the amount of resources needed by their patients by upcoding Resource Utilization Group (“RUG”) levels to increase the amount they were able to bill Medicare and Medicaid. The jury agreed and found the defendants liable for $109.8 million in damages, which the judge then trebled to $347 million. The government had declined to intervene, but stood to reap the benefits of relator’s perseverance, but the court had other ideas.

Read More

Holding a Mere Temporal Link Between Kickbacks and Medicare Claims Is Too Weak — the Third Circuit Says Goodbye to Relator's Case

Consistent with other recent decisions we have blogged about, the Third Circuit recently held in United States ex rel. Greenfield v. Medco Health Solutions, Inc., that to survive summary judgment, a relator must link alleged kickbacks to specific claims for payment submitted to the government; it is not enough to merely allege that the “taint” of a kickback scheme renders false every claim submitted while that scheme is ongoing. Finding no such link between the defendants’ Medicare claims and an alleged kickback scheme, the Third Circuit affirmed summary judgment for the defendants.

Read More

Behind Bars: Partial Intervention and Settlement Bars Future Qui Tams Based on Government Action Bar in Two Recent Cases

The little-used government action bar has recently surfaced in two cases where relators had attempted to revive declined and unsettled allegations from earlier qui tam actions in which the government had intervened in part to settle other allegations. United States ex rel. Bennett v. Biotronik, Inc., No. 16-15919, 2017 WL 5907900 (9th Cir. Dec. 1, 2017), and United States ex rel. Estate of Gadbois v. PharMerica Corp., No. 10-cv-471, 2017 WL 5466659 (D.R.I. Nov. 13, 2017). These decisions show that a partial intervention and settlement by the government of some, but not all, claims in one relator’s complaint can protect defendants from future claims by later relators based on even unresolved allegations from the earlier complaint.

Read More

Filter By

Sign Up for Updates

Receive email news and alerts about False Claims Act/Qui Tam Litigation from V&E

Dates

Top Posts

Follow Us On Linkedin