News & Cases


SEC Whistleblower from Brazil Gets $4.5 Million Award After Reporting Misconduct by Zimmer Biomet

SEC Whistleblower from Brazil Gets $4.5 Million Award After Reporting Misconduct by Zimmer Biomet

A whistleblower in Brazil has just received a $4.5 million award for his role in uncovering a kickback scheme allegedly run by a subsidiary of Zimmer Biomet Holdings Inc. (Zimmer Biomet), a medical device manufacturer. The tipster is a former orthopedic surgeon who became aware of the alleged misconduct while practicing medicine in his home country.

Based in Indiana, Biomet markets its orthopedic and dental implant devices on a global scale. The whistleblower, on the other hand, is a prominent surgeon in South America and former president of Brazil’s Orthopedic Sports Medicine Society. As it is customary with SEC whistleblowers, his name has not been made public.

In 2013, the whistleblower reported the alleged misconduct anonymously to Biomet executives. Within 120 days, he reported it to the SEC. According to his reports, the company was still running a kickback scheme in Brazil, in spite of having faced SEC penalties in the past for the same type of misconduct....


Game Over for Monsanto: $2 Billion Verdict to Give Way to Massive Wave of Settlements, Top Roundup Litigator Says

Game Over for Monsanto: $2 Billion Verdict to Give Way to Massive Wave of Settlements, Top Roundup Litigator Says

The recent $2 billion jury verdict against Monsanto may be a clear indication that Bayer will likely settle the remaining 13,000 cases claiming the active ingredient in Roundup, glyphosate, causes aggressive blood and bone cancer.

Attorney Brian Mahany is convinced that numerous settlements will follow and has good evidence to back up his claim. An active participant in the recent spate of Roundup cancer lawsuits, he is well placed to interpret the verdict.

Global Monsanto/Bayer Settlement in The Works

According to Mahany, the court quietly postponed the bellwether trial scheduled to begin on May 20th. Instead, the court noted an upcoming “confidential mediation.”...


Did Illegal Kickbacks Help Mallinckrodt Sell Acthar for Lofty $39,000?

Did Illegal Kickbacks Help Mallinckrodt Sell Acthar for Lofty $39,000?

In the face of skyrocketing drug prices, the federal government has opted to intervene in a whistleblower lawsuit against Mallinckrodt Pharmaceuticals - whose drug price increases are among the largest in U.S. history.

For years, healthcare providers have criticized the price of Mallinckrodt’s H.P. Acthar Gel (Acthar), a drug used to treat symptoms of multiple sclerosis, lupus, rheumatoid arthritis, and seizures in infants. In August 2007, the price of Acthar jumped from $1,600 to $23,000 per vial.

Cost per vial of the drug has increased from $40 to nearly $39,000 in just 19 years - nearly a 97,000% price increase. Currently, annual Acthar sales exceed $1 billion.

But how does a drug company compete in the pharmaceutical world with prices at $39,000 per vial? According to two Mallinckrodt whistleblowers, by breaking the law....


Health Management Associates CEO Has Agreed to Pay $3.46 Million to Settle Alleged Kickbacks and Fraudulent Billings

Health Management Associates CEO Has Agreed to Pay $3.46 Million to Settle Alleged Kickbacks and Fraudulent Billings

Gary D. Newsome, the former CEO of Florida-headquartered hospital chain Health Management Associates LLC, has agreed to pay $3.46 million to resolve allegations about his role in a large-scale fraud scheme that cost Medicare millions of dollars.    

According to the whistleblower lawsuit resolved by the settlement, Newsome conspired to increase the number of admissions of Medicare beneficiaries into Health Management-controlled hospitals. The physicians also received illegal bonuses in exchange for admissions.

The hospital admissions mentioned in the lawsuit were medically unnecessary, as the patients did not require a hospital stay to be efficiently treated. The scheme was allegedly designed to increase Medicare billings....


US WorldMeds LLC Will Pay $17.5 Million to Resolve Medicare Fraud Allegations Involving Kickbacks

US WorldMeds LLC Will Pay $17.5 Million to Resolve Medicare Fraud Allegations Involving Kickbacks

Kentucky-based US WorldMeds LLC will pay $17.5 million to resolve allegations that it offered kickbacks to both doctors and patients to secure prescriptions of its drugs Apokyn and Myobloc, used to treat Parkinson’s disease. The prescriptions generated millions of dollars for the company in the shape of Medicare billings.

The multi-million-dollar settlement resolves a whistleblower lawsuit filed by two former employees of US WorldMeds, Dr. Bennett and Dr. Chinnapongse. Under the False Claims Act, the two relators stand to receive a shared award amounting to 15-25 percent of the total recoveries.

The whistleblowers quit their jobs immediately after the resolution of the lawsuit became public. According to a spokesperson for Dr. Chinnapongse, he is not only “a brilliant scientist,” but also “a deeply ethical doctor who stood up at great risk to do the right thing,” and, “precisely the kind of whistleblower that the False Claims Act is meant to reach.”...


Astellas Will Pay $100 Million to Resolve Kickback Allegations Involving Medicare Copays

Astellas Will Pay $100 Million to Resolve Kickback Allegations Involving Medicare Copays

Astellas, a pharmaceutical company, has just agreed to pay $100 million to resolve allegations that it illegally used charitable foundations to cover Medicare copays to boost sales of its drug Xtandi.

Because patients covered by Medicare are often required to make partial payments for prescription drugs, many foundations subsidize them. When pharmaceutical companies donate to those foundations, the practice may violate the Anti-Kickback Statute, which forbids drugmakers from incentivizing the purchase of their products.

Astellas is the maker of Xtandi, a drug used to treat prostate cancer. According to the government’s findings, Astellas directly asked two foundations to start two funds to assist prostate cancer patients with their copay obligations. The funds then began exclusively subsidizing the purchase of Xtandi by Medicare-covered patients. Meanwhile, Astellas was the only donor to the funds....


Sutter Health Will Pay $30 Million Over Medicare Advantage Overpayment, Government Intervenes in Related Whistleblower Lawsuit

Sutter Health Will Pay $30 Million Over Medicare Advantage Overpayment, Government Intervenes in Related Whistleblower Lawsuit

Sutter Health LLC, a nonprofit healthcare provider based in Northern California, and its affiliates, Sutter East Bay Medical Foundation, Sutter Pacific Medical Foundation, Sutter Gould Medical Foundation, and Sutter Medical Foundation, have agreed to pay $30 million to resolve allegations that they overcharged the Medicare Advantage program.

Individuals covered by Medicare can choose to enroll in the Medicare Advantage plan. The government healthcare program then pays so-called Medicare Advantage organizations (“MAOs”) a per-person amount to provide services to those Medicare beneficiaries. As the number of seniors who are opting into the Medicare Advantage plans increases, opportunities for this type of fraud also increase. Medicare Advantage offers additional benefits like dental care, eyeglasses, and fitness expense reimbursements.   

Patients with serious diagnoses have a higher “risk score,” which determines the amount of Medicare Advantage’s per-person payments. According to the allegations resolved by the recent settlement, Sutter Health and its affiliates listed unsupported diagnoses for Medicare Advantage enrollees in order to increase billings....


SEC Pays $50 Million Award to JP Morgan Whistleblowers

SEC Pays $50 Million Award to JP Morgan Whistleblowers

Two SEC whistleblowers received a $50-million award for their role in exposing misconduct by JPMorgan Chase. The financial institution allegedly concealed information about conflicts of interest from its customers. This resulted in a $307 million settlement with the agency, which enabled the tipsters to receive $37 million and $13 million in whistleblower awards respectively.

Both whistleblowers have remained anonymous, as it is customary with individuals exposing fraud by financial institutions. It became known, however, that one of the tipsters (the one who received the $13 million reward) was once a high-ranking JP Morgan executive. It is not known whether he or she is still employed by the bank.  

Financial institutions failing to disclose conflicts of interest to their wealth management customers is nothing new. The SEC whistleblower program has repeatedly succeeded in exposing this type of misconduct through the promise of anonymity, anti-retaliation protections, and sizable rewards for insiders willing to speak out....


West Virginia’s Wheeling Hospital Accused of Paying Illegal Kickbacks to Doctors in Exchange for Lucrative Patient Referrals

West Virginia’s Wheeling Hospital Accused of Paying Illegal Kickbacks to Doctors in Exchange for Lucrative Patient Referrals

A former Wheeling Hospital VP has filed a whistleblower lawsuit alleging his employer routinely paid kickbacks to physicians in exchange for patient referrals.

Whistleblower Louis Longo claims the hospital was struggling financially until it started paying kickbacks to physicians in exchange for patient referrals. The complaint mentions two specialists who received substantial financial incentives from Wheeling in violation of both the Stark Law and the Anti-Kickback Statute.

Because the kickbacks Wheeling paid resulted in Medicare and Medicaid beneficiary referrals, the hospital submitted false claims for payment to the government programs. This allowed Longo to file a suit under the False Claims Act. If the complaint is successful, he could receive a multi-million-dollar reward....


Duke University Whistleblower Receives $33.75 Million Award for Uncovering Fraud Involving Fraudulently Obtained Federal Grants

Duke University Whistleblower Receives $33.75 Million Award for Uncovering Fraud Involving Fraudulently Obtained Federal Grants

Duke University has agreed to pay $112.5 million to resolve allegations that it submitted fake scientific data to the government to secure research grants.

The alleged misconduct was brought forward in a whistleblower lawsuit filed by former Duke laboratory analyst Joseph Thomas. Under the False Claims Act, for his part in recovering misappropriated taxpayer funds, Thomas will receive a $33.75 million reward.  

According to the suit filed by Thomas, a Duke researcher submitted bogus data as part of a series of grant applications, which resulted in lucrative financial aid from the government.

The research projects in question involved studying respiratory functions in mice. The complaint states that Duke researchers submitted false data to federal agencies, thus misrepresenting the results of their work....