Texas Home Health Agency Defrauding Medicare

The owners, the director of nursing and patient recruiters of a home-health agency based in Houston were arrested for their alleged roles in conspiracies to defraud Medicare, to pay illegal healthcare kickbacks and to commit money laundering. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services-Office of the Inspector General Dallas Regional Office and Special Agent in Charge D. Richard Goss of the Internal Revenue Service-Criminal Investigation Division Houston Field Office made the announcement.

According to the indictment, Ebong Tilong, 51, and Marie Neba, 51, both of Sugar Land, Texas, used the Texas-based, home-health agency that they owned to bill Medicare for home-health services that were not provided or not medically necessary.  They allegedly orchestrated this scheme by paying kickbacks to a series of individuals.  First, Tilong and Neba allegedly paid illegal kickbacks to physicians in exchange for authorizing medically unnecessary home-health services.  Using the money that Medicare paid for such fraudulent claims, Tilong and Neba allegedly paid illegal kickbacks to Daisy Carter, 56, of Wharton, Texas, and Connie Ray Island, 48, of Houston, in exchange for referring Medicare beneficiaries for home-health services.  Finally, all four defendants allegedly paid illegal kickbacks to Medicare beneficiaries, in exchange allowing Tilong and Neba to bill Medicare using their Medicare information for home-health services that were not medically necessary or not provided.  Neba, who also served as the company’s director of nursing, also allegedly falsified medical records to make it appear that Medicare beneficiaries qualified for and received home-health services.  From in or around February 2006 to in or around June 2015, Tilong and Neba received approximately $13 million for these allegedly fictious or unnecessary home-health services. 

GM Being Blindsided By The Number Of Lawsuits

 

 

General Motors Co. (GM), which as we all know has been under intense media, congressional and courtroom scrutiny over fatalities caused by its defective ignition switches, is now defending 104 death and injury lawsuits brought by victims whose accidents were caused by defects in the company’s cars. Another 108 suits seeking class action status over depressed car prices are pending in federal and state courts. GM released the numbers in early February in a filing with the U.S. Securities and Exchange Commission (SEC). The company is also the target of investigations by state and federal agencies. GM had this to say in the SEC filing:   Such lawsuits and investigations could in the future result in the imposition of damages, substantial fines, civil lawsuits and criminal penalties. We cannot currently estimate the potential liability, damages or range of potential loss as a result of the legal proceedings and governmental investigations.

GM spent $2.9 billion last year on recalls and loaner cars after calling in 36 million vehicles for repairs worldwide. Recalls in the United States were a record 26.9 million. GM recalled 2.59 million vehicles because the ignition switch in some cars can slip out of the “run” position, shutting off the engine and safety features including air bags while the car is moving. GM now admits to at least 57 deaths having been linked to the defective switch. Based on what we have learned in the GM litigation, we believe the number to be much higher. The program set up by GM to settle claims by victims of accidents related to faulty ignition switches in the U.S. has paid out $93 million so far. We have learned that GM estimates the settlement program will eventually cost $600 million. GM had net income of $2.8 billion in 2014.

GM received another 33 claims for compensation for ignition switch defects in its cars during the week of Feb. 11-22, bringing the total to 4,345. This comes from a report by Ken Feinberg, the administrator of the company’s compensation program. At press time, GM had received 479 claims for death, 292 for catastrophic injuries and 3,574 for less-serious injuries requiring hospitalization. This puts the total injury claims at 3,866. According to the Feinberg report, the number of claims found to be eligible for compensation so far is 151. So far, Mr. Feinberg has determined that 57 deaths, nine severe injuries and 85 other injuries are eligible for compensation.

The report also said 666 claims have been deemed ineligible, while 1,457 are still under review. Another 1,104 lacked sufficient paperwork or evidence and 967 had no documentation at all. The deadline for filing claims was Jan. 31, but any claims postmarked by that date are eligible for review.

Detroit-based GM was aware of faulty ignition switches on Chevrolet Cobalts and other small cars for more than a decade, but it didn’t recall them until 2014. Fienberg’s office has said that it likely will take until late spring to sort through all of the claims it has received. It should be noted that those who agree to payments give up their right to sue the automaker.

While GM set aside $400 million to make payments, it has now conceded that the payouts could grow to $600 million. GM placed no cap on the amount of money that the Feinberg fund can spend. At the end of last year, Feinberg had paid out $93 million in claims, according to GM’s annual report. But it should be noted that GM still faces 104 wrongful death and injury lawsuits due to the faulty ignition switches, as well as 108 class-action lawsuits alleging that the ignition switch debacle reduced the value of customers’ cars and trucks. The lawsuit filed by Ken and Beth Melton got all of this started and it’s the one case—out of hundreds—that GM has no answer for.

$4 Million Medicare Fraud Scheme Medical Supply Company in LA

A federal jury in Los Angeles convicted a Los Angeles man and owner of a medical supply company today for his role in a $4 million Medicare fraud scheme. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Eileen M. Decker of the Central District of California, Special Agent in Charge Christian J. Schrank of the U.S. Department of Health and Human Services-Office of Inspector Generals  Los Angeles Region and Assistant Director in Charge David L. Bowdich of the FBI’s Los Angeles Field Office made the announcement.

According to evidence presented at trial, Valery Bogomolny, 43, used his company, Royal Medical Supply, to bill Medicare $4 million between January 2006 and October 2009 for power wheelchairs, back braces and knee braces that were medically unnecessary, not provided to beneficiaries or both.  The evidence further showed that Bogomolny created false documentation to support his false billing claims, including creating fake reports of home assessments that never occurred.  Bogomolny personally delivered PWCs to beneficiaries who were able to walk without assistance and signed documents stating that he had delivered equipment when the equipment was not actually delivered.  Bogomolny ultimately received $2.7 million from Medicare on these false claims.

HCA Settles Shareholders Lawsuit For $215 Million

Hospital giant HCA Holdings has reached a preliminary agreement to pay $215 million to settle a class action lawsuit filed by shareholders who alleged the company used false and misleading information to sell stock during its 2011 initial public offering.

Those behind the 2011 lawsuit alleged that HCA sold more than $4.3 billion of HCA common stock at $30 a share based on a misleading registration statement it filed with the Securities and Exchange Commission.

They allege that the registration statement omitted important facts, including that at the time of the IPO, the company's Medicaid revenue was “suffering from adverse trends,” and that the Medicaid revenue was suffering from declining demand for cardiovascular and other services because of physician attrition and changes in Medicare regulations. They also alleged improper accounting led to HCA overstating its earnings by $790 million.

HCA also announced Wednesday in an SEC filing that it had reached preliminary agreements to settle several shareholder derivative cases also related to the 2011 IPO. Shareholder derivative cases are those in which a shareholder sues a third party, often a company director or officer, on behalf of the company. HCA estimated it would face legal claim costs of about $120 million for the settlements of the shareholder action and shareholder derivative cases.

Hospitals Pay United States $250 + Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac Devices

The Department of Justice has reached 70 settlements involving 457 hospitals in 43 states for more than $250 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced.

An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart.  It detects and treats chaotic, extremely fast, life-threatening heart rhythms, by delivering a shock to the heart, restoring the heart’s normal rhythm.  Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare. 

Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination.  The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates.  The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty.  The medical purpose of a waiting period -40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary.  The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions.  The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.  

  Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant.  The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant.  The whistleblowers have received more than $38 million from the settlements.  The Department of Justice is continuing to investigate additional hospitals and health systems.

 

Mesothelioma Asbestos Exposure Lawsuit By Victims Family Nets $3.5 Million

The family of a mesothelioma victim is awarded $3.5 million in a recent asbestos lung cancer lawsuit.

Plaintiff Barbara B. contracted mesothelioma from second-hand exposure to asbestos allegedly caused by washing her husband’s work clothes. Barbara claimed she would regularly wash his clothes for his next shift at Brown’s Ferry Nuclear Plant in Limestone County.

She was diagnosed with mesothelioma in 2011 and claimed that it had been directly caused by the asbestos fibers on her husband’s clothes. The plaintiff’s husband died from asbestosis in 1997, while Barbara died from mesothelioma on Sept. 7, 2013.

Before her death, Barbara filed an asbestos mesothelioma lawsuit against Tennessee Valley Authority (TVA) which was then carried out by her daughters after her demise.

According to the mesothelioma lawsuit, TVA should have provided James B., the decedent’s husband, proper safety equipment and protection masks when working with the hazardous material.

Additionally, the asbestos lung cancer lawsuit claims that TVA should have warned employees of the possible health risks associated with working with the cheap material.

The presiding judge agreed with the allegations and awarded the decedent’s family $3.5 million judgment against TVA, which owns and operates Brown’s Ferry. 

One of the most prominent problems plaguing elderly citizens in America is contending with the long-term consequences of asbestos exposure. In particular, it is estimated that 4,800 people die from asbestos lung cancer per year in the United States, which represents 4 percent of all fatalities in the country related to lung cancer.

Since the late 1800s, manufacturing companies have used asbestos for construction and insulation purposes. It was cheap and easy to use and soon become a popular construction material for its fire and chemical resistant qualities. While it is harmless in a dormant state, problems start arising when the asbestos sites are disturbed, which are then released.

After experts had officially linked asbestos exposure to lung cancer in the 1940s, the Occupational Safety and Health Administration (OSHA) proclaimed that asbestos lung cancer was a prominent risk to workers who were exposed to asbestos.  Asbestos lung cancer attacks the mucus lining of the lungs rather than the actual organs, this condition is typically diagnosed at a latent stage due to how long it takes symptoms to show. 

Asbestos lung cancer can take years for victims to experience any symptoms leaving few treatment options and short life survival expectancies for patients. Experts warn that it can take up to 50 years before any signs of asbestos cancer to show, as the fibers can sit generations in the lungs before festering.

 

Lumber Liquidators Guilty Plea Costs Them $13 Million

According to the Department of Justice-Virginia-based hardwood flooring retailer Lumber Liquidators Inc. pleaded guilty today in federal court in Norfolk, Virginia, to environmental crimes related to its illegal importation of hardwood flooring, much of which was manufactured in China from timber that had been illegally logged in far eastern Russia, in the habitat of the last remaining Siberian tigers and Amur leopards in the world, announced the Department of Justice.

Lumber Liquidators was charged earlier this month in the Eastern District of Virginia with one felony count of importing goods through false statements and four misdemeanor violations of the Lacey Act, which makes it a crime to import timber that was taken in violation of the laws of a foreign country and to transport falsely-labeled timber across international borders into the United States.  The charges describe Lumber Liquidators’ use of timber that was illegally logged in Far East Russia.  This is the first felony conviction related to the import or use of illegal timber and the largest criminal fine ever under the Lacey Act.

“Lumber Liquidators’ race to profit resulted in the plundering of forests and wildlife habitat that, if continued, could spell the end of the Siberian tiger,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division.  “Lumber Liquidators knew it had a duty to follow the law, and instead it flouted the letter and spirit of the Lacey Act, ignoring its own red flags that its products likely came from illegally harvested timber, all at the expense of law abiding competitors. Under this plea agreement, Lumber Liquidators will pay a multi-million dollar penalty, forfeit millions in assets, and must adhere to a rigorous compliance program.  We hope this sends a strong message that we will not tolerate such abuses of U.S. laws that protect and preserve the world’s endangered plant and animal species.”

According to a joint statement of facts filed with the court, from 2010 to 2013, Lumber Liquidators repeatedly failed to follow its own internal procedures and failed to take action on self-identified “red flags.”  Those red flags included imports from high risk countries, imports of high risk species, imports from suppliers who were unable to provide documentation of legal harvest and imports from suppliers who provided false information about their products.  Despite internal warnings of risk and non-compliance, very little changed at Lumber Liquidators.

On other occasions, Lumber Liquidators falsely reported the species or harvest country of timber when it was imported into the United States.  In 2013, Lumber Liquidators imported Mongolian oak from Far East Russia which it declared to be Welsh oak and imported merpauh from Myanmar which it declared to be mahogany from Indonesia. 

The illegal cutting of Mongolian oak in far eastern Russia is of particular concern because those forests are home to the last 450 wild Siberian tigers, Panthera tigris altaica.  Illegal logging is considered the primary risk to the tigers’ survival, because they are dependent on intact forests for hunting and because Mongolian oak acorns are a chief food source for the tigers’ prey species.  Mongolian oak forests are also home to the highly endangered Amur leopard Panthera pardus orientalis, of which fewer than 50 remain in the wild.  In June 2014, in response to illegal logging and the decline in tiger populations, Mongolian oak was added to the Convention on the International Trade in Endangered Species.

Under the plea agreement, Lumber Liquidators will pay $13.15 million, including $7.8 million in criminal fines, $969,175 in criminal forfeiture and more than $1.23 million in community service payments.  Lumber Liquidators has also agreed to a five year term of organizational probation and mandatory implementation of a government-approved environmental compliance plan and independent audits.  In addition, the company will pay more than $3.15 million in cash through a related civil forfeiture.  The more than $13.15 million dollar penalty is the largest financial penalty for timber trafficking under the Lacey Act and one of the largest Lacey Act penalties ever.  The company is scheduled to be sentenced on Feb. 1, 2016.

 

Sears and Whirlpool Settle Dangerous Dishwasher Claims

According to The Jere Beasley Report Sears Holdings Corp. and Whirlpool Corp. have agreed to pay for repairs and post public warnings to settle a class action accusing the companies of hiding a defective circuit board that caused name-brand dishwashers to burst into flames.

The full estimated value of the proposed settlement hasn’t been made public, but the companies agreed to pay out about $200 apiece to owners of Kenmore, KitchenAid and Whirlpool home dishwashers to cover repairs or rebates to use toward buying a new dishwasher. The parties have also proposed an arrangement in which the Defendants would also pay for repairs of dishwashers that aren’t part of the class but still had fire problems. Some customers can have the full cost of their repairs covered, according to the proposal.

The Plaintiffs filed suit in November 2011 saying that the Defendants knew, or were reckless in not knowing, that certain household dishwashers contained defective electronic control boards that spontaneously overheated, which caused them and other components in the dishwashers to melt, emit smoke and fumes, and combust.

The 10 named Plaintiffs – residents of California, Maryland, Georgia, New Jersey and Massachusetts – all purchased Kenmore, KitchenAid or Whirlpool dishwashers for their homes from 2002 to 2007 that subsequently malfunctioned due to a defective circuit board.

In the case of California residents David and Bach-Tuyet Brown, their KitchenAid dishwasher overheated while they were sleeping in April 2010, filling the house with smoke and causing them to spend $70,000 to replace the entire kitchen and to lose an additional $3,000 in rental income as a result of having to vacate the property for three weeks, according to their complaint.

The proposed settlement calls for different answers to different Plaintiffs, according to the filing. For example, people who have already had to repair or replace a dishwasher that caught on fire will get $200 minimum, but if they kept documentation of the costs of repairs they can ask for more, according to the proposed settlement.

Tuomey Healthcare Settles Violations for $237 Million

The Department of Justice announced that it has resolved a $237 million judgment against Tuomey Healthcare System for illegally billing the Medicare program for services referred by physicians with whom the hospital had improper financial relationships.  Under the terms of the settlement agreement, the United States will receive $72.4 million and Tuomey, based in Sumter, South Carolina, will be sold to Palmetto Health, a multi-hospital healthcare system based in Columbia, South Carolina.

The judgment against Tuomey related to violations of the Stark Law, a statute that prohibits hospitals from billing Medicare for certain services (including inpatient and outpatient hospital care) that have been referred by physicians with whom the hospital has an improper financial relationship.  The Stark Law includes exceptions for many common hospital-physician arrangements, but generally requires that any payments that a hospital makes to a referring physician be at fair market value for the physician’s actual services, and not take into account the volume or value of the physician’s referrals to the hospital.

The government argued in this case that Tuomey, fearing that it could lose lucrative outpatient procedure referrals to a new freestanding surgery center, entered into contracts with 19 specialist physicians that required the physicians to refer their outpatient procedures to Tuomey and, in exchange, paid them compensation that far exceeded fair market value and included part of the money Tuomey received from Medicare for the referred procedures.  The government argued that Tuomey ignored and suppressed warnings from one of its attorneys that the physician contracts were “risky” and raised “red flags.”

On May 8, 2013, after a month-long trial, a South Carolina jury determined that the contracts violated the Stark Law.  The jury also concluded that Tuomey had filed more than 21,000 false claims with Medicare.  On Oct. 2, 2013, the trial court entered a judgment under the False Claims Act in favor of the United States for more than $237 million.  The United States Court of Appeals for the Fourth Circuit affirmed the judgment on July 2, 2015. 

The case came from a lawsuit filed on Oct. 4, 2005, by Dr. Michael K. Drakeford, an orthopedic surgeon who was offered, but refused to sign, one of the illegal contracts.  The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  The act allows the government to intervene and take over the action, as it did in this case.  Dr. Drakeford will receive approximately $18.1 million under the settlement.

As part of the settlement, Tuomey will be required to retain an independent review organization to monitor any arrangements it makes with physicians or other sources of referrals for the duration of the five-year Corporate Integrity Agreement.

QLasers False Claims Verified

A permanent injunction has been granted to the Food and Drug Administration (FDA) against Robert “Larry” Lytle, doing business as QLasers PMA and 2035 PMA based on evidence of false and misleading claims regarding the health benefits of these lasers, which in some cases, reportedly cause health problems.

According to the complaint for injunction filed by the Department of Justice on behalf of the FDA, Lytle has been manufacturing and distributing QLaser devices for more than a decade and markets the devices through private membership associations. Lytle and his businesses promote the devices with false and misleading claims that they treat cancer, cardiac arrest, HIV/AIDS, diseases and disorders of the eye and ear, venereal disease, diabetes and many other health conditions.

Although the FDA cleared two of the QLaser devices for providing temporary relief of pain associated with osteoarthritis of the hand (as diagnosed by a physician or other licensed medical professional), the FDA has not cleared or approved any of the devices to treat any other medical conditions. Further, as demonstrated by the evidence presented at trial, use of the QLaser devices according to the labeling could be dangerous to the health of the consumer.

PharMerica Corp. to Pay $9.25 Million for Depakote Kickback

According to the Department of Justice the nation’s second-largest nursing home pharmacy, PharMerica Corp., has agreed to pay $9.25 million to resolve allegations that it solicited and received kickbacks from pharmaceutical manufacturer Abbott Laboratories in exchange for promoting the prescription drug Depakote for nursing home patients.  PharMerica is headquartered in Louisville, Kentucky.

“Elderly nursing home residents suffering from dementia have little control over the medications they receive and depend on the unbiased judgment of healthcare professionals for their daily care,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “Kickbacks to entities making drug recommendations compromise their independence and undermine their role in protecting nursing home residents from the use of unnecessary drugs.”

Nursing homes rely on consultant pharmacists, such as those employed by PharMerica, to review their residents’ medical charts at least monthly and make recommendations to their physicians about what drugs should be prescribed for those residents.  The settlement announced today resolves allegations that in exchange for recommending that physicians prescribe Depakote, an anti-epileptic drug manufactured by Abbott, to nursing home residents, PharMerica solicited and received kickbacks from Abbott.  The government alleges that the kickbacks were disguised as rebates, educational grants and other financial support.

In May 2012, the United States, numerous individual states and Abbott entered into a $1.5 billion global civil and criminal resolution that, among other things, resolved Abbott’s liability under the False Claims Act for alleged kickbacks to nursing home pharmacies, including PharMerica.  The settlement announced today resolves PharMerica’s role in that alleged kickback scheme.

Approximately $6.75 million of the settlement will go to the United States, while $2.5 million has been allocated to cover Medicaid program claims by states that elect to participate in the settlement.  The Medicaid program is jointly funded by the federal and state governments.

“Nursing home pharmacies accepting kickbacks from drug makers in exchange for prescribing certain prescription drugs puts vulnerable residents at risk for receiving unnecessary medications, corrupts medical decision making, and inflates health care costs,” said Special Agent in Charge Nick DiGiulio of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG).  “Our agency will continue to root out such corrosive practices from our health care system.”

The settlement partially resolves allegations in two lawsuits filed in federal court in the Western District of Virginia by Richard Spetter and Meredith McCoyd, former Abbott employees.  The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  The act also allows the government to intervene and take over the action, as it did in part in this case.  As part of today’s resolution, Ms. McCoyd will receive $1 million from the federal share of the settlement amount.

Serenity Hospice and Pallative Care Guilty of Hospice-Medicare Fraud

According to the Phoenix Sun, a Phoenix hospice provider will pay $2.2 Million to the federal government for falsely billing Medicare for hospice care. 

Under the agreed terms, the founder and former president Ruth Siegel agreed to be excluded from Medicare, Medicaid and other federal health programs for 5 years. She will also, personally pay $1 Million of the $2.2 Million settlement

This lawsuit was filed by a former employee Cheryl Sifford, under the false claims act. Serenity still denied the allegations, but said it was more cost effective to settle rather than fight it.

 

Here's how the system works, Medicare pays for medical care to manage symptoms and provide relief to those with a life expectancy of less than 6 months and who have decided not to seek any further treatment, but rather prepare for death. The rate Medicare pays for this service is over 4 times the rate that should have been paid for the actual services they received. Thus boosting profits for the facility.

 

Sifford claimed in a civil lawsuit filed, that Serenity flagged patients who were referred by CareMore to ensure they were admitted as hospice patients. In addition she was also instructed to take CareMore's staff to dinner, concerts and limousine rides.

Siegel has not admitted guilt, but has insisted that this settlement is the quickest and most cost effective settlement.

The whistleblower, Cheryl Sifford will collect $440,000 for her help in this case.

If you know of any such thing taking place where you work we encourage you to contact Jim VanderLinden immediately. http://www.vanderlindenlaw.com/

BP Will Be Paying for Many Years for Their Most Recent Accident

BP has agreed to pay a record $20 billion to resolve all federal and state claims against the company over its role in the Deepwater Horizon oil spill.

Under the terms of the finalized deal announced by the Justice Department on Monday, BP won’t have to pay all the money at once. Softening the hit to its cash flow, the company is able to spread out payments over a 15-year period. The last installments are due in 2031, more than 21 years after the Deepwater Horizon disaster, which killed 11 crew members and caused the largest oil spill in U.S. waters.

The two biggest pieces of the settlement* are the $5.5 billion in Clean Water Act penalties and the $7.1 billion that BP agreed to pay to the U.S. and Gulf Coast states to cover long-term environmental damages.

Here are the payment schedules for both categories, according to the consent decree filed in federal court in New Orleans on Monday:

Department of Justice

Department of Justice

 

Attorney General Loretta Lynch called the deal “a strong and fitting response to the worst environmental disaster in U.S. history.” BP officials, as WSJ’s Devlin Barrett notes, have said previously the agreement provides the company, and the Gulf region, “a path to closure,” resolving the largest legal exposure and providing more certainty in terms of costs and payments.

 

* Total settlement figure also includes $1 billion that BP previously committed for early restoration projects; up to $700 million for any later-discovered injuries or losses or to pay for adjustments to restoration projects; $4.9 billion to five Gulf States, plus another $1 billion to localities, to settle economic-damage claims; and $600 million to settle other claims, including reimbursement for response and removal costs.

Pfizer to pay $400 Million for Off Label Drug Marketing

According to the Jere Beasely Report a New York federal judge has granted final approval of a $400 million settlement that ends a class action accusing Pfizer Inc. of misleading investors about illegal off-label drug marketing. However, some investors may not get very much, with a recovery rate of 15 cents per share. U.S. District Judge Alvin K. Hellerstein had granted early approval of the settlement in mid-March after lawyers revised notices to class members clarifying details about the litigation.

The case, because of the settlement, has now been dismissed with prejudice. The recovery rate of 15 cents per share is far less than the $1.26 per share a damages expert for the Plaintiffs had estimated.

Pfizer put the damage per share at nothing because, the company disclosed a dividend cut to fund its purchase of Wyeth on the day of the January 2009 stock drop that was central to the lawsuit. Both sides noted in February that if fewer people claim, the recovery for claimants will grow, and institutional investors will be active, claiming most of the potential recovery.

The Plaintiffs filed their claims in 2010 after Pfizer pled guilty to illegally marketing the anti-inflammatory drug Bextra and reaching a $2.3 billion settlement with the federal government in 2009. Investors alleged that the company misled them about marketing that drug, as well as Godon, Lyrica and Zyvox, and that Pfizer concealed a kickback scheme involving payments to doctors in exchange for promotion of those drugs.

Geico Surrenders $517,000 to Settle Allegations

 

According to Top Class Actions GEICO has agreed to a $517,000 class action settlement over allegations that the insurance provider received reimbursement from a third party without first obtaining a judicial determination or an agreement with car accident victims that they were “made whole” by their settlement.

Lead plaintiff Lisa Stokes filed the GEICO class action lawsuit claiming that GEICO should have waited to obtain a “made whole” statement from insured customers before they sought reimbursement of Med Pay/PIP payments.

According to the GEICO class action, in the absence of a “made whole” agreement or judicial determination, GEICO should not have received subrogation payments.

GEICO denies any liability to Stokes and Class Members on the claims asserted in the class action lawsuit. However, the insurance company agreed to settle in order to avoid the expense and uncertainty of continued litigation.

Who’s Eligible

Class Members include individuals who received medical treatment as a result of an automobile accident and (a) who were insured under an automobile insurance policy that was issued in Arkansas by GEICO and pursuant to which GEICO made a Med Pay/PIP payment to a medical provider on behalf of the insured; and (b) who settled a bodily injury claim with a third party arising out of the automobile accident “pro se” and without the assistance of an attorney; and (c) as a result of that settlement, GEICO received a subrogation payment as reimbursement for a Med Pay/PIP payment between the dates of Nov. 1, 2008 and April 3, 2015.

Potential Award Varies.

Class Members who file a valid Claim Form will receive a payment not to exceed 100% of the amount GEICO received in Med Pay/PIP subrogation on their claim. If the number of eligible claims exceeds the amount available in the class action settlement fund, distributions will be made on a pro rata basis.

To see if you qualify go to http://topclassactions.com/lawsuit-settlements/open-lawsuit-settlements/170747-geico-auto-insurance-class-action-settlement/

Lovaza's Labeling is Incomplete--Side Effects Not Accurate

Lovaza, a prescription medicine made with omega 3 fatty acids  has recently been associated with a higher risk of  bleeding complications including subdural hematomas.

The omega-3 fatty acids found in Lovaza are the same type found in fish oil. Research for dozens of years has pointed to a link between the intake of omega-3 fatty acids and a lower risk of cardiovascular disease that can cause premature death.

Research has also shown that omega-3 fatty acids have a number of other positive effects, such as decreasing triglyceride levels, slowing the growth of atherosclerotic plague, and slightly lowering blood pressure.

However, recent studies have shown that omega-3 fatty acids also inhibit the function of platelets. Platelets are part of the process that causes proper and healthy blood clotting.

When the platelets are inhibited, bleeding time can be prolonged and therefore more dangerous. Omega-3 fatty acid supplements, including Lovaza, inhibit the function of platelets in blood clotting, which puts patients at risk of extended Lovaza bleeding complications such as subdural hematomas.

For those suffering from a subdural hematoma, excess blood collects between the layers of tissue surrounding the brain. The outermost layer of this tissue around the brain is called the dura, and the layer beneath it is called the arachnoid.

Subdural hematoma causes bleeding between the dura and the arachnoid. While subdural hematoma bleeding is not inside the brain itself, it can still negatively affect the brain.

Bleeding accumulates and pressure builds, which puts an increasing amount of pressure on the brain from outside. This pressure, if allowed to reach a very high level, can cause unconsciousness and in some cases, death.

Treatment of subdural hematomas can range from simply monitoring the condition and waiting to brain surgery. In cases where there is too much pressure on the brain, surgeons may have to perform serious operations to relieve the dangerous pressure.

Lovaza’s label, approved by the FDA, includes a warning about increased Lovaza bleeding complications with omega-3 fatty acids.

According to the American Heart Association, patients who wish to treat coronary artery disease or high triglycerides with omega-3 fatty acids may not be able to intake as much as they need in a regular diet. Therefore, the AHA recommends at least one gram of fish oil per day for coronary artery disease patients, and at least two grams per day for hypertriglyceridemia patients.

People who took Lovaza or a similar omega-3 fatty acid supplement or fish oil and have since suffered a subdural hematoma may be able to file a Lovaza lawsuit. Drug manufacturers such as GlaxoSmithKline have a legal responsibility to adequately warn consumers about the potential side effects of using their drugs.

Adventist Health Systems To Pay Out $118.7 Million

Three former employees of a North Carolina hospital were the first to expose an alleged scheme by Adventist Health System to pay doctors excessive compensation to lock in their patient referrals to Adventist-owned hospitals, clinics and other outpatient services in Florida, North Carolina, Tennessee and Texas.

The US Justice Department announced today that Adventist will pay a total of $118.7 million to the federal government and four states to settle a whistleblower (qui tam) lawsuit filed in December 2012 by those former employees. The settlement agreement also covers a separate qui tam lawsuit filed in 2013 that made the same allegations as some of those made earlier in Phillips & Cohen's qui tam lawsuit.

The Adventist settlement is the largest healthcare fraud settlement ever made involving physician referrals to hospitals. It is nearly twice the previous largest settlement involving hospital kickback allegations, which was North Broward Hospital District's recent $69.5 million settlement.

It was alleged Adventist's hospitals paid doctors outrageous sums and offered overly generous benefits and lax billing oversight as part of a corporate strategy to capture and control physician referrals for inpatient and outpatient services near its hospitals. Federal law prohibits hospitals from paying doctors directly or indirectly for referrals so that doctors make recommendations for care based on what's best for the patient – not what's best for the doctor's bank account.

A substantial portion of the settlement amount is based on allegations involving Florida Hospital Medical Group, an Adventist-owned physician practice in Florida whose doctors worked at several Adventist hospitals and dozens of Adventist-owned outpatient clinics. Those hospitals include Florida Hospital Altamonte, Florida Hospital Apopka, Florida Hospital Celebration Health, Florida Hospital Kissimmee, Florida Hospital Orlando, Florida Hospital Waterman (Tavares, Fla.), Florida Hospital for Children (Orlando, Fla.) and Winter Park Memorial Hospital.

The three whistleblowers were longtime employees at Adventist's Park Ridge Health in Hendersonville, NC, where they became aware of the alleged system-wide kickback scheme. Michael Payne was a risk manager and Melissa Church was the executive director of physician services at Park Ridge. Gloria Pryor was a compliance officer for physician offices at Park Ridge.

GM Reaches Settlement

 

General Motors announced that they have reached a criminal settlement to end the current government investigation of their faulty ignition switches. GM will pay $900 million for the Department of Justice fine incurred.

Additionally, GM has reached a resolution with over half of the death and personal injury lawsuits that are a part of the current multidistrict litigation through the U.S. District Court for the Southern District of New York. General Motors also settled in a shareholder class action lawsuit filed in the U.S. District court in Michigan for two civil lawsuits. The total for these settlements will set GM back another $575 million.

GM’s ignition switch defect caused cars to suddenly turn off when driving, most notably when the car was jostled from uneven road conditions. As well as an engine shutdown, power steering and power brakes were disabled and the airbags became deactivated. This led to numerous car accidents with severe injuries and deaths.

The MDL and shareholder class action settlements resolve about 1,380 death and personal injury lawsuits in total. GM did not release the individual settlement values paid in the various settlements.

The remaining lawsuits in the multidistrict litigation include economic loss claims, 370 injury lawsuits and 84 death lawsuits. Prior to Thursday’s announcement, GM had already agreed to offer ignition switch settlements to 124 families in death lawsuits and another 275 who were injured.

The nearly $1.5 billion GM is faced with in fines and settlements so far for the defect does not include the cost of fixing the 2.6 million vehicles that have been recalled due to the GM ignition switch defect.

Some consumers oppose how the situation was handled under the law. The Justice Department was criticized for not bringing charges against individual GM employees who were believed to have direct responsibility. In general, this criticism has extended to the DOJ in general for going after companies in general rather than prosecuting individuals for their wrongdoing.

When the GM scandal first came to light over a year ago, the company fired 15 employees for failing to resolve the ignition switch problem.

As it stands, there is no law that deals with criminal penalties for auto makers failing to disclose safety problems, so broader laws such as wire fraud and false statements are used.

According to court documents, GM knew of the ignition switch problem a decade ago in 2004 and 2005. Rather than making a simple and inexpensive change in the part at the time, which was estimated to cost approximately a dollar per vehicle, the situation was overlooked.

U.S. Attorney Preet Bharara summarized the situation, “”They let the public down. They didn’t tell the truth in the best way that they should have — to the regulators, to the public — about this serious safety issue that risked life and limb.”

KYB Agrees to Plead Guilty and Pay $62 Million Criminal Fine for Price Fixing

According to The Department of Justice, Kayaba Industry Co. Ltd., dba KYB Corporation has agreed to plead guilty and to pay a $62 million criminal fine for its role in a conspiracy to fix the price of shock absorbers installed in cars and motorcycles sold to U.S. consumers. 

According to charges filed, KYB conspired from the mid-1990s until 2012 to fix the prices of shock absorbers sold to Fuji Heavy Industries Ltd. (manufacturer of Subaru vehicles), Honda Motor Co. Ltd., Kawasaki Heavy Industries Ltd., Nissan Motor Company Ltd., Suzuki Motor Corporation and Toyota Motor Company, including their subsidiaries in the United States. 

“KYB turned the competitive process on its head by agreeing with its competitors to fix the prices of shock absorbers installed in cars and motorcycles sold in the U.S.,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division.  “Working with the FBI and our other law enforcement partners, the Antitrust Division will continue to protect American car buyers and hold automotive part suppliers accountable for their illegal conduct.”

“Fixing prices and rigging bids is against the law and ultimately harms consumers by artificially inflating prices and creating a corrupt marketplace,” said Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Division.  “The FBI and our partners will continue to investigate anticompetitive practices and promote fair competition.”

According to the information filed in the U.S. District Court of the Southern District of Ohio, KYB, based in Tokyo, and its two co-conspirators agreed to allocate the supply of shock absorbers sold and determine the price submitted to the targeted vehicle manufacturers.  To keep prices up, KYB and its co-conspirators also agreed to coordinate on price adjustments requested by the vehicle manufacturers and strived to keep their conduct secret. 

Jury Convicts Houston Psychiatrist in $158 Million Medicare Fraud Scheme

A Houston psychiatrist was convicted late yesterday by a federal jury of participating in a $158 million Medicare fraud scheme involving false claims for mental health treatment.

Sharon Iglehart, 58, of Harris County, Texas, was convicted of one count of conspiracy to commit health care fraud, one count of health care fraud and three counts of making false statements relating to health care matters, following a seven-day jury trial before U.S. District Judge Ewing Werlein Jr. of the Southern District of Texas.  Iglehart is scheduled to be sentenced on Dec. 5, 2015.
According to evidence presented at trial, from 2006 until June 2012, Iglehart and others engaged in a scheme to defraud Medicare by submitting, through Riverside General Hospital (Riverside), approximately $158 million in false and fraudulent claims for partial hospitalization program  services to Medicare.  A PHP is a form of intensive outpatient treatment for severe mental illness.
The evidence presented at trial showed that the Medicare beneficiaries for whom Riverside billed Medicare did not receive PHP services.  In fact, according to evidence presented at trial, most of the Medicare beneficiaries for whom Riverside billed Medicare rarely saw a psychiatrist and did not receive intensive psychiatric treatment.
In addition, evidence presented at trial showed that Iglehart personally billed Medicare for individual psychotherapy and other treatment to patients at Riverside locations – treatment that she never provided.  The evidence at trial also demonstrated that Iglehart falsified the medical records of patients at Riverside’s inpatient facility to make it appear as if she provided psychiatric treatment when, in fact, she did not.