Three Large Recoveries Under False Claims Act
Cases Brought By Individual Citizens As Whistleblowers
Three recent settlements announced by the Department of Justice (DOJ) show how effective private whistleblower suits (known as qui tam cases) under the False Claims Act (FCA), 31 U.S.C. §§ 3729 et seq., are at recovering money for the government from companies and individuals defrauding it. In fiscal year 2020, the DOJ recovered $2.2 billion in FCA settlements and judgments with $1.8 billion of those dollars involving the health care industry. Private individuals bringing FCA cases on behalf and in the name of the government (31 U.S.C. § 3730(b)(1)) are overwhelmingly the ones responsible for recovery. These private parties are referred to as “relators” under the statute but are more commonly known as whistleblowers. Whistleblowers personally recover anywhere from 15% to 30% of the damages and penalties or settlement once the government recovers. 31 U.S.C. § 3730(d). If you have credible information of fraud against the government here in San Mateo County, San Francisco, or elsewhere in California, call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).
Three Recent Recoveries
The DOJ recently announced three significant recoveries in FCA qui tam cases:
- $4,121,663.94 to settle allegations of wrongdoing by a chain of pain clinics. The complainant in that case alleged that the clinic and its owners engaged in fraudulent behavior by submitting “false claims for medically unnecessary and/or non-reimbursable testing and acupuncture.” The settlement also resolves claims that the clinics submitted bills for services never rendered or tests never performed. The whistleblowers in this case, who remain anonymous in the DOJ’s press release, are responsible for bringing the allegations that this settlement resolved. The individuals filed a qui tam lawsuit and will receive $610,684.62 for their disclosure.
- $5,641,114 to resolve allegations that a company that “manufactures and supplies tungsten products,” allegedly engaged in “falsely certifying that it sourced product materials in the United States for items it manufactured under a contract with the government of Israel that was funded by the U.S. Defense Security Cooperation Agreement Agency (DSCA).” In the case, the relator and the government alleged that defendant “knowingly submitted false certifications” to the U.S. about “the origin and manufacture of defense articles procured by the government of Israel.” The U.S. alleged that THP falsely claimed that tungsten was from China when it had actually been sourced in the U.S. The U.S. also alleged that THP falsely certified “that manufacturing occurred in the United States, when in fact THP contracted with a Mexican manufacturer.” This violated the conventions that “grant funds for foreign procurements are only available when the materials are sourced and manufactured in the United States by domestic companies,” according to the DOJ press release. The whistleblower was a former employee of defendant and will receive a reward of $958,989.
- $4.4 million to resolve allegations that a medical device manufacturer violated the False Claims Act by, according to the DOJ engaging in three kickback schemes to physicians using a medical device manufactured by defendant in spine surgeries. The U.S. alleged that defendant would resell “other manufacturers’ spinal devices” and then split the profits with those devices were used in surgeries. Defendant also allegedly “knowingly submitted false claims to federal healthcare programs for medically unnecessary procedures using the devices in which he had a financial interest.” The civil settlement resolves allegations brought in a qui tam case and the whistleblowers will receive $880,000 as a reward.
Remedies for Retaliation
The False Claims Act protects employees against retaliation from their employers for blowing the whistle on fraud against the government. But despite the legal prohibition, companies continue to retaliate against whistleblowers. But the law allows employee whistleblowers to fight back. 31 U.S.C. § 3730(h). If you are fired because you brought any fraud to light, you may be entitled to sue your employer in court and seek double back pay (with interest), reinstatement, reasonable attorneys’ fees, and reimbursement for certain costs in connection with the litigation. 31 U.S.C. § 3730(h)(2). Evans Law Firm, Inc. can represent you in any action for retaliation as well as represent you in your underlying whistleblower application.
If you have credible information of government contractor fraud against Medicare or Medi-Cal call Ingrid M. Evans at (415) 441-8669, or toll-free at 1-888-50EVANS (888-503-8267) or by email at <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>. In addition to FCA and CFCA whistleblower cases, Ingrid also handles bank fraud whistleblower cases under FIRREA/FIAFEA, commodity trading and securities fraud under the Commodities Futures Trading Commission Whistleblower Program and the Securities and Exchange Commission Whistleblower Program, and tax fraud under the Internal Revenue Service Whistleblower Program.
 Evans Law Firm, Inc. was not involved in the reported cases in any way.