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False Claims Act Statistics, News & Analysis

  • 23
  • August
  • 2016

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False Claims Act Stats: Top Five False Claims Act Payouts This Year So Far By DOJ Industry

As we approach September and DOJ Fiscal Year 2016 starts to wind down, we look at the top DOJ recoveries this year so far, broken down by DOJ’s three industry categories: health care, defense, and other industries. Without further ado:

 

Health Care  
Pfizer $413,248,820
Novartis Pharmaceuticals $390,000,000
Olympus Corp. $267,288,323
Millennium Health $237,000,000
Kindred/RehabCare $125,000,000
   
Defense  
L-3 Communications $25,600,000
Boeing $18,000,000
Netcracker Tech. Corp. $11,400,000
Menlo Worldwide Services $10,000,000
APL Limited $9,762,080
   
Other  
Freedom Mortgage $113,000,000
BPXP $82,600,000
Franklin American Mortgage Co. $70,000,000
M&T Bank Corp. $64,000,000
Education Management Corp. $52,620,000
   
DOJ FY '16, Oct. 1, 2015 - Aug. 22, 2016  
   

 

These numbers are revealing, in that they reflect a focus this year on high-dollar settlements in health care that far outstrip those in any other industry. As a point of comparison, this year’s top five health care recoveries combined are equal to more than 72% of last year’s total health care recoveries of $1,965,548,590. And total health care recoveries this year have already exceeded last year’s by close to $560 million with two months left to go in the fiscal year. Defense, on the other hand, seems to be lagging behind, with its top five recoveries miles away from breaking into nine digits, while even the highest recovery in “other” falls $12 million short of matching the lowest of the top five health care recoveries. And bear in mind that these figures account only for the federal FCA recoveries associated with the settlements and verdicts – money recovered concurrently under state FCA claims or in settlement of other statutory violations can hit the pocketbook equally hard. The Pfizer federal FCA claims settlement was accompanied by an additional amount – $371 million – attributable to state FCA claims, making this already-large recovery even more of a blockbuster.

As a final point of interest, our Top 5 Lists might differ from others you have seen, and for a good reason: While DOJ (and others) often combine settlements by multiple companies that happen at the same time in the same lawsuit into one press release and one entry in their own data, we (try to) track how much individual corporate defendants paid. We think that how much each defendant pays is more relevant than an overall “stunning” recover number (which it is in DOJ’s interest to publicize). For example, while DOJ trumpets that on or about February 17, 2016, 51 hospitals settled for a combined total $23 million, the more relevant data point (to assess FCA exposure risk) is that 11 hospital chains paid an average of $2.1 million each. Accordingly, a $21 million settlement is better understood as a series of smaller $2.1 million settlements. Would you change our approach to recording recoveries to be more like DOJ’s case-focused method? E-mail us and let us know.



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