False Claims Act Update & Alert
Taxpayers Against Fraud Education Fund | Washington, D.C. | WWW.TAF.ORG           October 25, 2007
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			Hexcel to Pay $15 Million The Hexcel Corporation has agreed to pay $15 million to settle charges it knowingly used defective Zylon material supplied by the Toyobo Corporation in the manufacture and sale of bullet-proof vests to law enforcement agencies. The defective vests were sold by Second Chance Body Armor, Point Blank, Armor Holdings, American Body Armor, Safariland, and Gator Hawk Armor.  >> To read more
			Novation Out from Under Seal A case involving Novation, a giant "Group Purchasing Organization," that serves as a middleman for hospitals all over the nation, has come out from under seal.  The essential charge is that Novation, which buys about  $33 billion worth of healthcare supplies annually, accepts bribes and kickbacks that are not allowed under Medicare and Medicaid.  >> To read more
			200 Agents Raid WellCare The recent 200-person raid on WellCare Health Plan in Florida continues to rumble Wall Street.  The stock has plunged almost 80 percent in a week, a class-action lawsuit has been filed, and Connecticut's attorney general says he has been investigating an affiliate for months. Still no clue as to the essential nature of the problem, but WellCare was one of 10 initial companies approved to offer Medicare Part D prescription drug plans.  >> To read more
			Supremes Look at Presentment The U.S. Supreme Court has granted cert. in a case involving massive generator sets installed by Allison Engine in Arleigh-Burke Class destroyers.  The legal issue revolves around whether false claims made by a subcontractor, and paid for with U.S. Government funds, are actionable under the False Claims Act even if they are not directly presented to the U.S. Government. The Sixth Circuit has ruled that they are, citing the plain language of section 3729(a)(2) and (a)(3) of the FCA which does not require that a false claim be presented to the government.  The Sixth Circuit also notes that  section 3729(c) defines a claim as "any request … for money or property … if the United States provides any portion of the money or property which is requested or demanded [or any money which is used to reimburse a contractor]." >> To read more
			Quest Braces to Pay Quest Diagnostics is bracing to pay at least $51 million in connection with a False Claims Act case dealing with a parathyroid test kit manufactured by its wholly-owned subsidiary, Nichols Institute Diagnostics (NID).  >> To read more
			Dianon to Pay $1.5 Million Dianon Systems, a Connecticut laboratory company, has agreed to pay $1.5 million to resolve a False Claims Act case alleging the company performed medically unnecessary lab tests and billed them to Medicare and TRICARE. >> To read more
			Investigation Into Universal Health Services Expands A federal investigation into Universal Health Services seems to be expanding as HHS and DoJ look into physician contracting relationships within its South Texas Health System. Earlier this year, South Texas was served with a criminal subpoena. >> To read more