We are pleased to pass along news of a $3,500,000 settlement in the matter of USA ex rel John Prieve vs. Mallinckrodt Inc, Tyco Healthcare Group LP, out of the Northern District of California. In this whistle blower case arising in California, a former employee of a pharmaceutical manufacturer brought suit against his employer alleging that it made illegal and improper payments to doctors and thus cased the submission of false claims to the government agencies who paid them, medicare and Medicaid. kHere at Los Angeles Employment Attorney we represent whistle blowers throughout the state with similar claims.
This lawsuit was based on the qui tam provisions of the Federal False Claims Act, 31 USC 3729. This is the main federal false claim provision which allows our clients to sue on behalf of the federal government and receive a share of the proceeds. Given that the share can range from 15 to 30%, the financial incentive to report fraud is large.
The whistle blower in the above case alleged that the pharmaceutical employer paid consultants (read: doctors) for their participation in programs, trials and meetings in order to induce them to write prescriptions for their products. This is essentially also a claim of unfair business practices.
We haven’t seen the settlement agreement, but assume it carries the usual stipulations that no party admits fault. We’d estimate the whistle blower’s share of this settlement as high six figures or low sevens, to be shared with his attorney.
California whistle blowers have rights under both the federal and state whistle blower protection laws. We have handled many such cases to the great satisfaction of both the government and our clients. Let us review your case. Its critical that proper procedures be followed in order to preserve your rights as the “original source” of the claim and your priority in receiving your share of the proceeds. Last year, over 647 qui tam lawsuits were filed and the government recovered more than $3 Billion.