False Claim Act Cases Result in Lucrative Awards for Whistleblowers
False Claims Act cases filed by whistleblowers are an important way to keep companies accountable when they defraud the government and consumers, and also compensate the whistleblower for their efforts in bringing the company to justice. Below are some recent whistleblower cases of note, and the awards paid by the company to the government and the whistleblower for exposing the wrongdoing.
Whistleblower: Joseph Y. Ting
Company: 21st Century Oncology
Joseph Y. Ting, Ph.D worked as a medical physicist for 21st Century Oncology, one of the nation’s largest radiation oncology providers. The employer was requiring its physicians and physicists to use a procedure called the Gamma function to measure the radiation doses patients received. Dr. Ting believed the Gamma treatment served no medical benefit and the company was illegally charging Medicare for its use. In 2014, Dr. Ting filed a False Claims Act lawsuit challenging 21st Century Oncology’s practices.
Dr. Ting liaised with the office of the U.S. Attorney in the Middle District of Florida regarding the issue. On March 8, 2016, the U.S. Department of Justice announced that it would award Dr. Ting more than $7 million for his role in the settlement, and $34.7 million to taxpayers.
Whistleblowers: Jim Wetta, Joseph Faltaous, Steven Woodward, Jaydeen Vincente, Robert Rudolph, Hector Rosado, Robert Evan Dawitt, William Lofing, Bradly Lutz
Company: Eli Lilly
Nine sales representatives for Eli Lilly filed separate qui tam lawsuits against the company for illegally marketing the drug Zyprexa for uses not approved by the FDA.
Eli Lilly pleaded guilty to a misdemeanor violation for promoting the anti-psychotic drug Zyprexa as a treatment for dementia, pediatrics, and other uses, though the FDA had only approved it to treat patients with schizophrenia and bipolar disorder.
Eli Lilly paid $800 million to settle civil suits, including $438 million to the federal government and $362 million to the states. Additionally, it paid $615 million to resolve the criminal case, for a total of $1.42 billion. The nine whistleblowers shared nearly $80 million of the federal share of the civil settlement.
Whistleblower: John Kopchinski
Company: Pfizer
John Kopchinski, the whistleblower, is a former Pfizer sales representative and West Point graduate. He filed a qui tam lawsuit which launched a government investigation into Pfizer’s improper “off-label” marketing of Bextra, a drug approved by the FDA to treat arthritis. Pfizer promoted Bextra for uses and doses that far exceeded what the FDA approved, putting patients at risk for serious health problems such as heart attack, stroke and pulmonary embolism. Bextra was pulled from the market in 2005.
Pfizer paid a total of $1.8 billion to the government to settle the case, including a $1.3 billion criminal fine. The Bextra marketing was part of a $2.3 billion global settlement paid by Pfeizer—the largest healthcare fraud settlement in history. Qui tam lawsuits were filed by whistleblowers alleging two additional drugs were marketed for off-label use: Geodon and Zyvox. Kopchincki was awarded $51.5 million as a reward for the work he and his attorneys did on the case.
Whistleblower: Jerry H. Brown II
Companies: Maersk and APL, Limited
In response to a complaint from whistleblower Jerry H. Brown II, the United States Government filed suit against Maersk for knowingly overcharging the Department of Defense for shipment of cargo containers to US troops in Afghanistan and Iraq. In the settlement announced in 2012, Maersk agreed to pay $31.9 million in fines to the government. Brown received $3.6 million as his share of the proceeds of the settlement. Additionally, in 2009 the United States settled the same whistleblower’s allegations against shipping company APL, Limited for $26.3 million.
Whistleblower: Meredith McCoyd
Company: Abbott Laboratories
Abbott Laboratories entered into a $1.6 billion global civil and criminal settlement in May 2012 for violations of the False Claims Act for paying alleged kickbacks to Omnicare and PharMerica Corp and marketing a drug for off-label purposes. Abbott illegally marketed the anti-seizure drug Depakote to nursing homes as a method of sedating residents with Alzheimer’s and dementia.
Additionally, in 2015 PharMerica agreed to pay $9.25 million to resolve its role in receiving kickbacks from Abbott, and Omnicare settled for $28 million in 2016. $20.3 million of the settlement with Omnicare was paid in restitution to U.S. government health insurance programs, while the remaining $7.8 million was allocated to cover Medicaid program claims by states.
The settlements with Omnicare, Abbott and PharMerica resolved allegations in two lawsuits filed by former Abbott employees who blew the whistle on the kickbacks. Meredith McCoyd, a former sale representative for Abbott and the lead whistleblower, received $3 million for her role in helping uncover the scheme.
If you witness any potential false claims in California (i.e. requests for reimbursement to the government, not actually rendering work when reimbursement is received, or receiving and knowingly retaining an overpayment) by your company, or you are retaliated against for voicing your concern about potential wrongdoing, it is important you take immediate action. Contact the experienced employment law attorneys at Stephen Danz & Associates for a free consultation to discuss your circumstances and legal options.
