The FCA Insider

The FCA Insider

Insights and updates on False Claims Act Litigation

Category Archives: FCA Litigation

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FCA Litigation

Federal District Court Finds Private-Insurer Relator Can Proceed with False Claims Action

Last month, the U.S. District Court for the District of New Jersey held that a private company, Allstate Insurance Company, could proceed with its whistleblower action against a clinical laboratory, Phoenix Toxicology and Lab Services, LLC, which allegedly submitted false claims to the federal government for medically unnecessary urine drug tests (“UDT”). See generally United… Continue Reading
Anti-Kickback Statute, FCA Litigation

A Failed Constitutional Challenge to the AKS Safe Harbor Provision – More to come?

This past summer, in United States v. Booker, a North Carolina district court ruled against a challenge to the constitutionality of Congress’s delegation of authority to promulgate safe harbors to the Anti-Kickback Statute (AKS). In filing a motion for acquittal, Defendant Donald Booker argued the AKS “Safe Harbor Provision,” which grants the Secretary of Health… Continue Reading
Anti-Kickback Statute, FCA Litigation

The Growing Causal Divide: But-For Causation in AKS/FCA Actions

In United States v. Regeneron, the District of Massachusetts Court recently joined the Sixth and Eighth Circuits in requiring the government to show a direct tie between kickbacks and referrals that proximately caused claims to federal healthcare programs to prevail in Anti-Kickback Statute (AKS) and False Claims Act (FCA) actions. The District Court’s ruling contributes… Continue Reading
Anti-Kickback Statute, FCA Litigation, OIG, Regulatory

Lessons for Providers and Practice Entities: Ophthalmology Groups Pay Millions to Settle Co-Management, Optometrist Relationship Allegations

Two ophthalmology practice groups recently reached settlements with the U.S. government totaling nearly $20 million to resolve allegations that their third-party cataract arrangements violated several healthcare laws. Read on to discover how the settlements offer guidance to vision providers with respect to the government’s focus on ophthalmology-optometry relationships, and whether the settlements’ lessons have broader… Continue Reading
DOJ, FCA Litigation, Settlements

DOJ Settles Self-Reported Referral Incentives With Dermatology Practice Manager

On Sept. 13, the U.S. Attorney’s Office for the Northern District of Texas announced a settlement with Oliver Street Dermatology Management LLC to resolve self-reported allegations that its acquisition of several dermatology practices violated the Stark Law, the Anti-Kickback Statute and the False Claims Act. Read on for details about this matter, plus helpful guidance… Continue Reading
DOJ, FCA Litigation

U.S. Supreme Court Clarifies DOJ’s Authority to Dismiss Whistleblowers’ False Claims Act Suits, Questions Constitutionality of Qui Tam Provisions

In United States ex rel. Polansky v. Executive Health Resources, Inc., the U.S. Supreme Court recently resolved a circuit split[1] by holding that in a False Claims Act (“FCA”) action (1) the Government may seek dismissal of a qui tam case in which it initially declined to intervene over the relator’s objection as long as… Continue Reading
Anti-Kickback Statute, DOJ, FCA Litigation, Settlements, Stark Law

Regional Hospital System and Two Physicians Pay More Than $69 Million to Settle False Claims Act, Involving Allegations of Improper Financial Relationships With Referring Physicians

On March 29, 2023, the U.S. District Court for the Eastern District of Michigan granted the parties’ joint stipulation for dismissal in U.S. ex. rel. Godsholl v. Covenant Healthcare, following three settlements of the relator’s claims pursuant to the False Claims Act, 31 U.S.C. § 3729 (“FCA”), the Michigan Medicaid False Claim Act, MCL 400.601,… Continue Reading
FCA Litigation

Home Cooking: Washington Transfers Venue to Court in State

Earlier this year, the U.S. District Court for the Western District of Oklahoma granted Washington state’s motion to intervene to transfer venue to the Western District of Washington in James Siegel, M.D. v. Novo Nordisk, Inc. Relator Dr. Siegel originally filed suit in Oklahoma on February 2, 2015, alleging violations of the Federal False Claims… Continue Reading
FCA Litigation

Pharmaceutical Suppliers Beware: Expect Increased Scrutiny of Average Wholesale Pricing Methodology and Marketing “The Spread”

A Texas federal court recently denied a pharmaceutical supplier’s motion to dismiss claims brought by a whistleblower under the federal False Claims Act (FCA) alleging violations of the Anti-Kickback Statute (AKS) and manipulation of Average Wholesale Pricing (AWP) rules. The complaint was filed by a pharmacist (the Relator) who previously worked for the defendant, Professional… Continue Reading
Anti-Kickback Statute, FCA Litigation

Distributor of Ophthalmic Surgical Products Found Guilty of Paying Kickbacks and Violating the False Claims Act: May Be Liable For Up To $848 Million in Civil Damages and Penalties

On February 28, 2023, a federal jury in the District of Minnesota found the Cameron-Ehlen Group, d/b/a Precision Lens, and its founder and owner Paul Ehlen (the “Defendants”) guilty of paying kickbacks to ophthalmic surgeons in violation of the False Claims Act, 31 U.S.C. 3729 (“FCA”) and Federal Anti-Kickback Statute, 42 U.S.C. 1320a-7b(b) (“AKS”) between… Continue Reading
FCA Litigation

DOJ’s False Claims Act Statistics Show Declining Recoveries, Increasing Enforcement

The U.S. Department of Justice recently announced it recovered over $2.2 billion under the False Claims Act in fiscal year 2022 — the lowest annual recovery since 2008. Despite declining recoveries, the number of new matters suggests that investigation activity will remain vigorous and businesses should be prepared for more robust enforcement as promised by… Continue Reading
FCA Litigation

SCOTUS to Decide if False Claims Act Reaches Defendants Offering Reasonable Interpretation of Vague Requirement

On Jan. 13, the U.S. Supreme Court granted a writ of certiorari to petitioners in two False Claims Act cases to determine whether the law’s knowledge requirement reaches defendants who can offer an “objectively reasonable” interpretation of an ambiguous legal or contractual requirement material to government payment. Read on for details about this case, likely… Continue Reading
Defense Arguments, Retaliation

Seventh Circuit Suggests High Standard Under the FCA Whistleblower Retaliation Provision

Last month, the U.S. Court of Appeals for the Seventh Circuit affirmed summary judgement against an employee-whistleblower who had claimed that her former employer retaliated against her in violation of the False Claims Act’s (FCA) whistleblower protection provision. Lam v. Springs Window Fashions, LLC, 37 F.4th 431 (7th Cir. 2022). The court held that her… Continue Reading
Anti-Kickback Statute, Defense Arguments, FCA Litigation

Potential Anti-Kickback Prosecution Does Not Give Blanket Fifth Amendment Protection in a Medical Malpractice Suit

An Ohio Court of Appeals recently weighed in on the proper protocols one must take in order to successfully assert one’s Fifth Amendment Constitutional Right against self-incrimination in relation to a discovery request in a civil case that may have incriminating affects in an ongoing anti-kickback statute (AKS) investigation. The Fifth Amendment of the United… Continue Reading
DOJ, FCA Litigation

Supreme Court Signals Interest in Clarifying Pleading Requirements in False Claims Act Suits

The Supreme Court (Court) will soon decide whether to take up a critical (and long-running) issue concerning applicability of Federal Rule of Civil Procedure 9(b) pleading standards in False Claim Act (FCA) suits. To satisfy Rule 9(b)’s particularity requirement for fraud allegations, FCA plaintiffs generally have needed to detail specific false claims submitted by defendants.… Continue Reading
FCA Litigation

Largest-Ever Small-Business Contracting Fraud Settlement Related to Pass-Through Subcontracting

Federal contractors should take note of a $48.5 million False Claims Act settlement between the Department of Justice and TriMark USA LLC — the largest-ever FCA settlement based on allegations of small-business set-aside contracting fraud. DOJ alleged that TriMark had a plan to circumvent specific small-business contracting requirements by providing significant assistance to three small… Continue Reading
Defense Arguments, FCA Defenses, FCA Litigation

Seventh Circuit Clarifies Pleading Standard for Anesthesiologist’s False Claims Action

The Seventh Circuit recently reversed a lower court’s ruling that an amended complaint in a qui tam lawsuit filed under the False Claims Act (FCA) alleging fraudulent anesthesiology billing practices failed to meet the pleading standard under Rule 9(b) of the Federal Rules of Civil Procedure. In U.S. ex. rel. Mamalakis vs. Anesthetix Management LLC,… Continue Reading
FCA Litigation

Federal Court Permits Government Intervention in FCA Case After Seven Years After Finding “Good Cause”

The Western District of New York recently allowed the government to intervene in an FCA action brought months after the government’s initial notice of declination and more than seven years after the government initiated its investigation. U.S. ex rel. Teresa Ross v. Indep. Health Corp., et al., 12-cv-299, 2021 WL 3492917 (W.D.N.Y. Aug. 9, 2021).… Continue Reading

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