Archives: Government investigation

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The FCA and Medical Necessity: An Increasingly Tenuous Relationship

On January 19, 2017, another district court ruled that a mere difference of opinion between physicians is not enough to establish falsity under the False Claims Act.  In US ex rel. Polukoff v. St. Mark’s et al., No. 16-cv-00304 (Jan. 17, 2017 D. Utah), the district court dismissed relator’s non-intervened qui tam complaint with prejudice … Continue Reading

Cooperation in the Eye of the Beholder: DOJ Official Bill Baer Elaborates on Cooperation in False Claims Act and Other Civil Enforcement Matters

The law is uncertain. One example of this uncertainty is how the “Yates memo” is to be applied in civil cases — in particular, what constitutes “cooperation” and how cooperation may benefit a company under investigation for False Claims Act violations. On September 29, 2016, DOJ attempted (for a second time) to address the lack … Continue Reading

Third Circuit Revives Reverse False Claims Act Case but Acknowledges Burden on Defendants

On October 5, 2016, the Court of Appeals for the Third Circuit remanded a “reverse” False Claims Act (FCA) case to the District Court for the Eastern District of Pennsylvania for further proceedings. The court’s decision in United States ex rel. Custom Fraud Investigations, LLC v. Victaulic Company, Case No. 15-2169 (3d Cir., Oct. 5, … Continue Reading

The Perils of Parallel Proceedings: To Stay or Not to Stay

One of the more concerning trends for the defense bar in False Claims Act cases is an uptick in parallel criminal and civil proceedings. While the pursuit of parallel proceedings is long-standing DOJ policy, the last few years have seen a “doubling down” by the government on the use of these proceedings — for instance, … Continue Reading

Congress Examining Stark Law Reform This Year

On July 12, 2016, the US Senate Finance Committee held a hearing to “examine ways to improve and reform the Stark Law” as a follow up to releasing a white paper on June 30 titled Why Stark, Why Now? Suggestions to Improve the Stark Law to Encourage Innovative Payment Models. The white paper summarizes comments … Continue Reading

Supreme Court Vacates First Circuit’s Expansive View of Implied Certification Liability

On June 16, 2016, the Supreme Court of the United States issued an important decision regarding the implied certification theory of liability under the False Claims Act (FCA) in which it vacated a decision of the US Court of Appeals for the First Circuit and remanded the case for further proceedings in accordance with the … Continue Reading

Acting Associate Attorney General Remarks on Yates Memorandum and False Claims Act

On June 9, 2016, Acting Associate Attorney General Bill Baer delivered a speech regarding the impact of the Yates Memorandum’s focus on individual accountability and corporate cooperation at the American Bar Association’s 11th National Institute on Civil False Claims Act and Qui Tam Enforcement.  The focus of the speech was on the interplay between the … Continue Reading

Circumstantial Evidence Stretched Beyond Its Limits in Proving Kickback and Fraud-on-DrugDex Theories

Two decisions from the US District Court for the Southern District of Texas limit the extent to which relators can stretch the use of circumstantial evidence to support a False Claims Act case based on an anti-kickback or off-label marketing theory. In two separate decisions on December 10 and December 14 in US ex rel. … Continue Reading

DOJ Boasts About $3.5 Billion in Recoveries from False Claims Act Cases in FY 2015

The U.S. Department of Justice (DOJ) continues to tout its total annual recoveries in False Claims Act cases, as it does each year after the federal government’s fiscal year closes in September.  In its December 3, 2015, press release, DOJ disclosed that it obtained more than $3.5 billion in settlements and judgments from civil cases … Continue Reading

“Operation Spinal Cap” Sees Former Hospital Executive, Physicians Charged for Their Roles in Kickback Scheme

Last week, the Department of Justice (DOJ) announced charges against a former hospital CFO, two orthopedic surgeons, a chiropractor, and a health care marketer for their alleged roles in a series of fraudulent referral and billing schemes.  According to the DOJ, these referral schemes paid illegal kickbacks to physicians for spinal surgery referrals and caused … Continue Reading

U.S. Attorney Manual Revised To Reflect Yates Memorandum’s Focus on Individuals

On September 9, 2015, Deputy Attorney General Sally Quillian Yates issued a memorandum outlining the Department of Justice’s increased focused on individual responsibility in investigations of corporate wrongdoing, now colloquially referred to as the “Yates Memorandum.”  (We previously reported on the Memorandum here). Pursuant to the Yates Memorandum’s directive that the U.S. Attorneys’ Manual (USAM) … Continue Reading

DOJ Pursues Both Sides of an Alleged Kickback Arrangement Under the FCA

As many health lawyers know, the government usually only pursues the person or entity that offers or pays allegedly improper remuneration, even though the federal Anti-Kickback Statute (AKS) also applies to those to solicit or receive it.  This uneven enforcement pattern occurs for a variety of reasons — the alleged payor is the focus of … Continue Reading

Supreme Court Denies Cert on Whether Government Investigations Are a Public Disclosure

On October 2, 2015, the Supreme Court of the United States denied a petition for writ of certiorari in a case that sought to resolve an apparent circuit split concerning one of the most frequently litigated issues under the False Claims Act (FCA)—the circumstances in which the disclosure of allegations in a government audit or … Continue Reading

D.C. Circuit Declines to Eviscerate Attorney-Client Privilege in Internal Investigations

On Tuesday, August 11, 2015, in United States ex rel. Barko v. Haliburton et al., the U.S. Court of Appeals for the D.C. Circuit issued an opinion vacating another series of rulings by the United States District Court for the District of Columbia that had required defendant Kellogg Brown & Root, Inc. (KBR) to produce … Continue Reading

OIG Announces New Penalty and Exclusion Litigation Team to ‘Level the Playing Field’

The federal government’s health care fraud enforcement efforts expanded this week with an announcement by the Office of the Inspector General (OIG), of the U.S. Department of Health and Human Services, that it has created a new litigation team dedicated to pursuing civil penalty and exclusion cases. Read the full On the Subject discussing the … Continue Reading

New Fraud Alert Shows OIG Focus on Physicians

On June 9, 2015, the Office of Inspector General of the Department of Health and Human Services (OIG) issued a new fraud alert concerning physician compensation arrangements and compliance with the federal Anti-Kickback Statute (AKS). While the fraud alert itself does not break new ground interpreting the AKS, it signals OIG’s steadily increasing scrutiny and enforcement … Continue Reading

Supreme Court Rules on Wartime Tolling of FCA Statute of Limitations and FCA’s First-to-File Bar in Kellogg Brown & Root v. United States ex rel. Carter

On May 26, 2015, the Supreme Court issued a unanimous opinion in Kellogg Brown & Root v. United States ex rel. Carter (S. Ct. No. 12-1497), a case addressing several important issues under the False Claims Act (FCA).  In a previous post, we laid out the two issues in this case.  First, when the United … Continue Reading

Use of Statistical Sampling to Establish Damages in FCA Cases Still Controversial

As we previously posted, on April 28, 2015, the United States District Court for the Middle District of Florida in U.S. ex rel. Ruckh v. Genoa Healthcare LLC et al, held that expert testimony based on statistical sampling was appropriate in False Claims Act (FCA) cases and could not be excluded solely due to the … Continue Reading

Whistleblower Wins Reinstatement Fight, Demonstrating the Need for Detailed Personnel Files

In 2012, a jury concluded that Bayer Corporation (Bayer) unlawfully terminated a sales representative, Mike Townsend, because he reported to the Arkansas Attorney General that with the alleged knowledge of Bayer’s sales force, physicians were overbilling Medicaid for Bayer’s drugs. See Townsend v. Bayer Corp., 774 F.3d 446, 452 (8th Cir. 2014). Shortly before Townsend … Continue Reading

DOJ Continues to Beat the Executive Drum in Recent Speeches

In the annual speeches at New York University Law School, Assistant Attorney General Leslie R. Caldwell specifically addressed the Department of Justice’s (DOJ) continued interest in examining corporate executives allegedly responsible for corporate misconduct.  Ms. Caldwell discussed this issue in the context of shaping corporate culture through deterrence and explained DOJ’s expectations of companies that … Continue Reading

Increased Federal Scrutiny of Laboratory-Physician Arrangements for Potential AKS and FCA Violations Leads to $48.5 Million Settlement

A recent $48.5 million False Claims Act (FCA) settlement between two laboratory companies and the federal government highlights the increased scrutiny of laboratory-physician compensation arrangements for potential Anti-Kickback Statute (AKS) violations.  Both companies deny any wrongdoing and maintain that they cooperated fully with the government investigation.  The investigations and settlements follow guidance published last year … Continue Reading

OIG Audits Begin for Meaningful Use Compliance

The Office of Audit Services of the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services has begun a nationwide audit of a random sample of providers that have received incentive payments for achieving “meaningful use” under the Medicare Electronic Health Record (EHR) Incentive Program from January 1, 2011 to … Continue Reading

U.S. Departments of Justice and Health and Human Services Issue FY 2014 Health Care Fraud and Abuse Control Program Report

Last week, the U.S. Departments of Justice (DOJ) and Health and Human Services (HHS) announced that the Health Care Fraud and Abuse Control (HCFAC) Program has recovered over $27.8 billion since its inception in 1996.  In FY 2014 alone, with a collective budget of $571.7 million, HCFAC efforts recovered $3.3 billion from individuals and companies … Continue Reading
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