False Claims Act Update & Alert

  
 

Taxpayers Against Fraud Education Fund | Washington, D.C. | WWW.TAF.ORG          
April 21, 2009

  
     
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Quest to Pay $302 Million
Quest Diagnostics has agreed to pay $302 million to settle civil and criminal charges related to a Quest subsidiary which sold a parathyroid hormone immunoassay test which reported elevated results.  The inaccurate diagnostic test kit resulted in medical providers submitting false claims for reimbursement to federal health programs. The settlement includes $262 million paid under the federal FCA, $6.2 million paid to the states, and a criminal fine of $40 million.  Thomas Cantor, founder, president and owner of Scantibodies Laboratory Inc., filed the whistleblower lawsuit, and will receive approximately $45 million for his work, and the work of his attorneys, in bringing the case. >> To read more		     

Massive Orthotics Fraud
A whistleblower lawsuit accuses Biomet Inc. and several other orthopedic companies of defrauding the U.S. Government of hundreds of millions of dollars by making false payment claims.  The FCA lawsuit was filed in March 2005 in Boston and amended in December 2007, and it alleges companies that made bone-healing stimulators made false and fraudulent claims for payment by billing the devices as purchase items even though they knew the devices should be billed as rental items.  >> To read more

HUBZone Fraud
 When the GAO investigated 36 companies in four metropolitan areas claiming they qualified for Small Business Administration HubZone contracts, they discovered 19 didn't meet program requirements and were using fake addresses.  In order to be eligible for the HUBZone program, small firms must be located in a HUBZone and employ workers who live in the area.  The HUBZone program is likely to see hundreds of millions of new dollars under the TARP program, but it appears the SBA is unprepared to deal with widespread fraud.  >> To read more
 

Supreme Court on Eisenstein
This morning, the Supreme Court will be heard oral arguments in Eisenstein v. New York City, a case dealing with filing time limits for lawsuits seeking recovery of misspent federal funds under the False Claims Act.  >> To read opinion and briefs
 
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