whistleblower act

Basco to Settle False Customs Claims For $1.1M; Whistleblower Amount TBD

Submitted by kludowitz on November 25, 2013
November 25, 2013

Basco Manufacturing Co. (Basco) has agreed to pay $1.1 million to resolve allegations that it violated the False Claims Act by making false customs declarations to avoid paying duties on products imported from the PRC (People’s Republic of China), the Department of Justice announced last week.

The U.S. government alleged that Basco made false declarations to the U.S. Department of Homeland Security Customs and Border Protection to avoid paying antidumping and countervailing duties on aluminum extrusions imported from the PRC.  These companies allegedly misrepresented that the aluminum extrusions, used in the manufacturing of shower enclosures and other products, were imported from Malaysia.

Antidumping and countervailing duties exist to protect U.S. businesses and level the playing field for domestic products. Antidumping duties protect against foreign companies “dumping” products on U.S. markets at prices below cost, while countervailing duties offset foreign government subsidies. Unlike the PRC, there are no duties due for aluminum extrusions imports made in Malaysia.

Basco allegedly engaged in a scheme to avoid duties by shipping the aluminum extrusions manufactured by in the PRC through Malaysia, a practice called transshipping.   The U.S. government alleges that Basco and the defendants knew that the aluminum extrusions were merely repackaged in Malaysia and did not undergo a substantial transformation that may have justified changing the product’s country of origin from the PRC to Malaysia.

The lawsuit was originally filed by James F. Valenti Jr., a public policy lawyer, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Valenti’s portion of the settlement has yet to be decided.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Iraqi Construction Co. to Settle False Claims and Bribery Charges for $2.7M

Submitted by kludowitz on November 22, 2013
November 22, 2013

Iraqi Consultants and Construction Bureau (ICCB) has agreed to pay the U.S. $2.7 million to resolve allegations that it violated the False Claims Act by bribing a U.S. government official to obtain U.S. government contracts in Iraq, the Department of Justice announced earlier this month. 

The government alleged that ICCB, a privately owned construction company headquartered in Baghdad, Iraq, paid bribes to an Army Corps of Engineers procurement official, John Markus, to obtain information that gave it an advantage in bidding on several construction contracts with the Department of Defense in Iraq.  The contracts supported reconstruction efforts involving the Iraq war, including infrastructure and security projects and the building of medical facilities and schools.  The U.S. government also alleged that ICCB knowingly overcharged the U.S. for services provided under the contracts. As part of the investigation, Markus pleaded guilty to wire fraud, money laundering and failure to report a foreign bank account in connection with more than $50 million in contracts awarded to foreign companies in Gulf Region North, Iraq.  Markus was sentenced to 13 years in prison.

Under the False Claims Act, private parties with knowledge of fraud against the government may sue on behalf of the government and share in the recovery.  Had there been a whistleblower in this case, their portion of the settlement may have been anywhere from 15 to 30 percent.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Baptist Health to Settle False Medicare Claims For $3.7M; Whistleblower to Get $6.5K

Submitted by kludowitz on November 22, 2013
November 22, 2013
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Baptist Health Systems has agreed to pay $3.7 million to the United States Department of Justice to settle allegations that it violated the federal False Claims Act by filing false claims for reimbursement under the Medicare program, the U.S. Attorney’s Office announced earlier this week. 

Baptist Health Systems allegedly filed improper claims with the Medicare program by failing to disclose on the claim that the patient receiving treatment had another insurance policy that covered the care.  Under the law, a health care provider is required to disclose the fact that a patient has other insurance when it files its claim with Medicare.  The claim is processed under the other insurance policy and, in most cases, Medicare compensates the patient for whatever was paid for out of pocket (such as a deductible or copayment).   If the insurance company is slow to pay and the health care provider receives a double payment, then the health care provider must reimburse Medicare.

The lawsuit was originally filed by Norma Rivera, a former insurance auditor for Baptist, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Rivera will receive $600,500 for her portion of the settlement as well as a full reimbursement from Baptist Health Systems for her legal fees.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Ensign Settles Medicare Fraud Claims for $48M; Whistleblower Amount TBD

Submitted by kludowitz on November 20, 2013
November 20, 2013

The Ensign Group Inc. (Ensign) has agreed to pay $48 million to resolve allegations, under the False Claims Act, that it knowingly submitted or caused the submission of false claims to Medicare for medically unnecessary rehabilitation therapy services, the Justice Department announced today. 

Ensign, a skilled nursing provider, allegedly submitted false claims to the government for physical, occupational and speech therapy services provided to Medicare beneficiaries that were not medically necessary. The investigation alleged that Ensign provided therapy to patients whose conditions and diagnoses did not warrant it, solely to increase its reimbursement from Medicare.  The government further alleged that Ensign created a corporate culture that improperly incentivized therapists and others to increase the amount of therapy provided to patients to meet planned targets for Medicare revenue.  These targets were set without regard to patients’ individual therapy needs and could only be achieved by billing at the highest reimbursement levels.  The government also alleged that Ensign billed for inflated amounts of therapy it had not provided and that certain patients were kept in these facilities for periods of time exceeding what was medically necessary for treatment of their conditions. 

In addition to the settlement amount, Ensign also agreed that each of its skilled nursing facilities across the nation would be bound by the terms of a Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General (HHS-OIG).

The lawsuit was originally filed by Gloria Patterson and Carol Sanchez, two former Ensign therapists, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  The amount that the whistleblowers will receive has not been determined. 

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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FreshPoint Settles Contract Fraud Claims For $4.2M; Whistleblower to Get $800K

Submitted by kludowitz on November 19, 2013
November 19, 2013
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FreshPoint Inc. has agreed to pay $4.2 million to resolve allegations, under the False Claims Act, that it overcharged the Department of Defense for fresh fruit and vegetables purchased under 15 separate contracts, the Justice Department announced today.

FreshPoint, a food distribution company and wholly owned subsidiary of Sysco Corp., allegedly overcharged the government on hundreds of sales of fresh fruit and vegetables by improperly inflating its prices to the government.  The government alleged that this practice violated FreshPoint’s contracts with the government that required FreshPoint to provide the produce at cost, plus a pre-established mark-up for profit, and did not allow FreshPoint to make additional price adjustments based upon perceived changes in market prices.

The lawsuit was originally filed by Charles Hall, a former FreshPoint employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Hall will receive $798,000 as his portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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CA, Inc. to Settle Fraud Claims for $8M; Whistleblower Amount TBD

Submitted by kludowitz on November 15, 2013
November 15, 2013

CA, Inc. (CA) has agreed to pay the United States $8 million to settle allegations that it violated the False Claims Act in connection with contracts administered by the General Services Administration (GSA) and the Department of Defense (DOD), the U.S. Attorney’s Office announced earlier this week.

The U.S. government, which purchased software maintenance services from CA, alleged that CA knowingly double-billed federal agencies by charging for periods of software maintenance for which the agencies had already paid.  Specifically, when federal customers entered into software maintenance renewal agreements with CA, the company began the renewal periods on the day CA processed the order, rather than the day after the expiration of the customer’s then-existing maintenance period. 

The government also claimed that CA prevented DOD from taking advantage of pre-paid software inventory and discounts available under several contracts known as Blanket Purchase Agreements (BPAs). CA allegedly steered DOD away from BPA purchases and toward purchases under more costly contracts, with the result that the government paid more than it should have for certain software.

The lawsuit was originally filed by Ann-Marie Shaw, a former CA employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Shaw’s share of the settlement has not yet been determined.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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LG Chem Michigan to Settle False Claims for $1.2M; DOE to Receive $8.5K

Submitted by kludowitz on November 12, 2013
November 12, 2013

LG Chem Michigan, Inc. (LGCMI) will pay the United States $1.2 million to resolve allegations, under the False Claims Act, that the company improperly sought and obtained federal funds to pay employees who were engaged in recreational and volunteer activities, the U.S. Attorney’s Office announced last week. This amount is in addition to the $8,500 that LGCMI refunded to the U.S. Department of Energy (DOE) based on the same allegations.

DOE awarded LGCMI over $150 million in funds under the American Recovery and Reinvestment Act to construct and operate a lithium-ion battery manufacturing plant. The United States alleged that before LGCMI transitioned battery production from foreign sources to their plant, LGCMI submitted claims to obtain the federal share of wages and benefits paid to domestic workers who were engaged in non-work activities such as watching movies, playing games and performing volunteer work. The United States further alleged that in response to governmental inquiries about those activities LGCMI failed to fully disclose the number of employees involved in those activities, the nature and scope of those activities, and the resulting losses to the government.

Under the False Claims Act, private parties with knowledge of fraud against the government may sue on behalf of the government and share in the recovery.  Had there been a whistleblower in this case, their portion of the settlement may have been anywhere from 15 to 30 percent.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Hospice of the Comforter to Settle False Medicare Claims For $3M

Submitted by kludowitz on November 8, 2013
November 8, 2013

Hospice of the Comforter Inc. (HOTCI) has agreed to pay $3 million to resolve allegations that it violated the False Claims Act by submitting false claims to the Medicare program for hospice services provided to patients who were not eligible for the Medicare hospice benefit, the Justice Department announced earlier this week. 

The government alleged that HOTCI engaged in practices that resulted in billing Medicare for patients who were not terminally ill. HOTCI allegedly directed its staff to admit all referred patients without regard to whether they were eligible for the Medicare hospice benefit, falsified medical records to make it appear that certain patients were eligible for the benefit when they were not, employed field nurses without hospice training, established procedures to limit physicians’ roles in assessing patients’ terminal status and delayed discharging patients when they became ineligible for the benefit. 

HOTCI has agreed to enter into a Corporate Integrity Agreement that provides for procedures and reviews to be put in place to promptly detect and prevent future conduct similar to that which gave rise to the settlement.  In addition, HOTCI’s former Chief Executive Officer Robert Wilson has agreed to a three-year, voluntary exclusion from Medicare, Medicaid and other federal health care programs.

The lawsuit was originally filed by Douglas Stone, a former HOTCI employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Stone’s share of the recovery has not been determined.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Johnson & Johnson to Settle Fraud Claims For $2.2B; Whistleblowers to Get $130M

Submitted by kludowitz on November 6, 2013
November 6, 2013
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Johnson & Johnson (J&J) will pay more than $2.2 billion to resolve criminal and civil liability allegations relating to the prescription drugs Risperdal, Invega and Natrecor, including promotion for uses not approved as safe and effective by the Food and Drug Administration (FDA) and, payment of kickbacks to physicians and to pharmacy providers, the U.S. Department of Justice announced earlier this week.  The global resolution is one of the largest health care fraud settlements in U.S. history, including criminal fines and forfeiture totaling $485 million and civil settlements for False Claims Act violations totaling $1.72 billion.

The government alleged that Janssen Pharmaceuticals Inc., a J&J subsidiary, introduced the antipsychotic drug Risperdal, which was approved by the FDA only to treat schizophrenia, into interstate commerce for an unapproved uses. Janssen’s sales representatives allegedly promoted Risperdal to physicians and other prescribers who treated elderly dementia patients by urging the prescribers to use Risperdal to treat symptoms such as anxiety, agitation, depression, hostility and confusion. 

Janssen also allegedly created written sales aids for use by their ElderCare sales force that emphasized symptoms and minimized any mention of the FDA-approved use, treatment of schizophrenia.  The company also provided incentives for off-label promotion and intended use by basing sales representatives’ bonuses on total sales of Risperdal in their sales areas, not just sales for FDA-approved uses. The settlement also resolves allegations that, in furtherance of their efforts to target elderly dementia patients in nursing homes, J&J and Janssen paid kickbacks to Omnicare Inc., the nation’s largest pharmacy specializing in dispensing drugs to nursing home patients. 

The government alleged that J&J and Janssen caused false claims to be submitted to federal health care programs by promoting Risperdal for off-label uses that federal health care programs did not cover, making false and misleading statements about the safety and efficacy of Risperdal and paying kickbacks to physicians to prescribe Risperdal.

In addition to imposing substantial monetary sanctions, the resolution will subject J&J to stringent requirements under a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services Office of Inspector General (HHS-OIG).  This agreement is designed to increase accountability and transparency and prevent future fraud and abuse.

The lawsuit was originally filed by former employees across multiple states under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Whistleblowers in the Eastern District of Pennsylvania will receive $112 million while whistleblowers in the Districts of Massachusetts and the Northern District of California will receive $28 million as their portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Axway to Settle Contract Fraud Claims For $6.2M; Whistleblower to Get $1.2M

Submitted by kludowitz on November 5, 2013
November 5, 2013
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Axway, Inc. has agreed to pay the United States $6.2 million to settle allegations under the False Claims Act that it and its predecessors  provided the General Services Administration (GSA) with defective pricing information in order to obtain and maintain a contract permitting them to sell software licenses and related services to federal agencies at inflated prices, the Department of Justice announced last week.

Axway, Inc. allegedly provided GSA with commercial pricing information that was not current, accurate and complete during the initial negotiation of the contract. As a result, the United States alleges that the contract that was awarded contained pricing that was less advantageous to the government than would have been negotiated had accurate and complete disclosures been made. In addition, the United States alleges that when the contract was renewed, Axway Inc. failed to provide GSA with accurate and complete commercial pricing disclosures. Finally, Axway Inc. failed to comply with the price reduction clause of the contract resulting in allegations from the United States that the contract contained inflated prices, and that numerous government agencies relied on these inflated prices and overpaid for their purchases of software and related services.

The lawsuit was originally filed by Kenneth Marcus, a former employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Marcus will receive $1.2 million as his portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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