qui tam lawsuit

The owners of Global Medical Direct, LLC and Global Medical Inc., have agreed to pay $7 million to resolve allegations against them in connection with a scheme to submit false claims to the federal Medicare and Tricare healthcare programs, the United States Attorney’s Office announced yesterday. Global Medical, Inc. and its parent company, Global Medical Direct, LLC, are mail-order diabetic supply companies. 

The United States alleged that owners Robert Shea and Mark Franz caused Global Medical and Global Medical Direct to enter into numerous marketing contracts with insurance brokerage and other companies with customer bases likely to have a high percentage of diabetes patients and paid these companies based on the number of patients referred for diabetic supplies.  The Anti-Kickback Statute makes it unlawful to pay or receive remuneration for patient referrals because of the high potential for billing abuse to federal programs, such as Medicare, resulting from these types of arrangements. 

The companies have agreed to pay to the United States $5 million in proceeds from the sale of all of the companies’ assets to settle civil allegations under the False Claims Act.  Owners Shea and Franz will also receive twenty-year exclusions from participation in any federal healthcare program as part of the settlement. 

Under the False Claims Act, private parties with knowledge of fraud against the government may sue on behalf of the government and share in the recovery.  Had there been a whistleblower in this case, their portion of the settlement may have been anywhere from 15 to 30 percent.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

The lawsuit against Citizens Medical Center (Citizens), filed by Drs. Dakshesh Parikh, Harish Chandna, and Ajay Gaala, is moving forward after a federal judge denied the defendant’s motion to dismiss the case.  The doctors allege that Citizens violated the False Claims Act by knowingly submitting or causing the submission of false claims to federal health care programs (Medicare and Medicaid).

Citizens allegedly entered into improper financial relationships with and gave kickbacks to physicians in order to induce them to refer patients to the hospital, which is a violation of the Stark Law.  The doctors also allege that Citizens knowingly provided unnecessary or worthless medical services in order to increase its revenue, and that this was all part of a conspiracy to violate the False Claims Act.

Drs. Parikh, Chandna, and Gaala were former cardiologists at Citizens, and claim that they were retaliated against for refusing to participate in the above schemes.  They filed this suit under the False Claims Act, which allows private citizens with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

Ohio-based RPM International Inc. and its subsidiary, Tremco Inc., have agreed to pay $60.9 million to resolve allegations that Tremco knowingly submitted or caused the submission of false claims in connection with contracts with the General Services Administration (GSA), the U.S. Department of Justice announced last week.  Tremco is a manufacturer of construction products and services.

The government alleged that Tremco knowingly violated its contractual obligations to provide GSA with current, accurate and complete information about its commercial sales practices, to report changes in discounts to comparable commercial customers and to pass those discounts on to government customers.  Tremco allegedly failed to provide the government with price discounts given to non-federal government customers and also allegedly marketed expensive materials to government purchasers without disclosing that the same materials were available at a lower cost that were manufactured and sold by the company.  As a result, the government allegedly paid more than it should have for Tremco’s services and products.   In addition, Tremco allegedly improperly marketed generic products as a superior line of the same product and used a defective adhesive formula in its roofing systems.

The lawsuit was originally filed by former Tremco vice president Gregory Rudolph, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private citizens with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Rudolph will receive $10.9 million as his share of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

ATI Enterprises, a Texas-based chain of career training schools operating in the southern and western United States, has agreed to pay the U.S. government $3.7 million to resolve allegations that the company knowingly submitted or caused the submission of false claims to federal student aid programs, the U.S. Department of Justice announced last month.  ATI Enterprises allegedly falsely certified compliance with federal student aid programs’ eligibility requirements and submitted claims for ineligible students.

To participate in federal student aid programs, schools must enter into a contract with the Secretary of Education called a Program Participation Agreement, in which they agree to a number of terms.   For example, if an institution advertises its job placement rates as a means of attracting students to enroll, it must make available to prospective students its most recent and accurate employment statistics to substantiate the truthfulness of its advertisements.   The government alleged that, by misrepresenting its job placement statistics in order to maintain state licensure and accreditation, ATI Enterprises fraudulently maintained its eligibility for federal financial aid.

The government further alleged that ATI employees engaged in fraudulent practices to induce students to enroll and maintain their enrollment in the schools.  This falsely increased the schools’ enrollment numbers, and consequently, the amount of federal dollars they received at the expense of taxpayers and students, who incurred long-term debt.

The lawsuits were originally filed by several former employees of ATI Enterprises under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private citizens with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Their share of the settlement has not yet been determined.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

The U.S. government has filed suit against PharMerica Corp. for violations of the False Claims Act and the Controlled Substances Act by dispensing controlled drugs without valid prescriptions and knowingly submitting or causing the submission of false claims to be submitted to the Medicare program, the U.S. Department of Justice announced earlier this month.  The lawsuit was filed in the U.S. District Court for the Eastern District of Wisconsin.

PharMerica is a long-term care pharmacy that dispenses drugs to residents of long-term care facilities, including nursing homes and skilled nursing facilities. PharMerica services approximately 300,000 residents of long-term care facilities and fills approximately 40 million prescriptions annually.   Many of the prescriptions filled by PharMerica are for controlled substances listed in Schedule II under the Controlled Substances Act.   Schedule II drugs, such as oxycodone and fentanyl, can cause significant harm if used improperly and have a high potential for abuse.

The government’s complaint alleges that PharMerica routinely dispensed Schedule II controlled drugs in non-emergency situations without first obtaining a written prescription from a treating physician.    PharMerica’s alleged actions violated both the spirit and the letter of the Controlled Substances Act by enabling nursing home staff to order narcotics, and pharmacists to dispense narcotics, before confirming that a physician had made a medical judgment about whether these narcotics were necessary and should be used by the resident.  The complaint alleges that PharMerica knowingly caused the submission of false claims to Medicare for these improperly dispensed Schedule II drugs, in violation of the False Claims Act.

The lawsuit was originally filed by Jennifer Denk, a former PharMerica employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private citizens with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  The government may intervene on its own behalf, which it has elected to do in this case.  Denk’s suit was later consolidated with a subsequent complaint filed by Eric Beeders and Lesa Martino.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.