A False Claims Act Proponent Looks to Great J&J Settlement of $2.2 Billion for Support

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Close up of books - False Claims Act and whistleblower immunity

The Commonwealth of Pennsylvania is one of just twenty-one states that have yet to enact a version of the False Claims Act (“FCA”), arguably the federal government’s most effective fraud fighting tool.  Currently, twenty-nine states, the District of Columbia, and a number of the nation’s largest cities have enacted some adaptation of the landmark legislation.  Thankfully, as discussed is a prior post on the YLG blog, over the summer, Pennsylvania State Reps., Brandon P. Neuman and Anthony DeLuca introduced H.B. 1439, which would at long last create an FCA for the Commonwealth.

Reps. Neumann and Deluca are using the recent news of Johnson & Johnson’s (“J&J”) historic fraud settlement, as a catalyst, to grow support for their proposed legislation.  As has been widely reported, on Monday October 4, 2013, the U.S. Department of Justice (“DOJ”) announced that J&J will pay more than $2.2 billion to settle allegations related to misbranding, off-label marketing, and the payment of kickbacks in the promotion of a number of drugs, most notably the antipsychotic drug Risperdal.

The DOJ settlement arises from proceedings which consolidated a number of whistleblower’s cases.  As is often the case in large fraud cases, a number of states will benefit from the settlement agreement, due to the existence of their own versions of the FCA.  A PA False Claims Act would allow the Commonwealth to reap the rewards of victories, such as the J&J settlement.

For Reps. Neumann and Deluca, Pennsylvania is currently missing the opportunity to return fraudulently removed monies to its coffers, to the substantial detriment of taxpayers.  As Rep. Neumann stated in June, “Pennsylvanians lose as much as $200 million a year through Medicare and Medicaid fraud and abuse … our Pennsylvania False Claims Act legislation … would go a long way toward deterring this dishonesty.”  Following the Monday DOJ announcement, Rep. Neumann wisely noted that, “[m]ore than half of the states and the District of Columbia have false claims acts … and implementing one in Pennsylvania would provide a new source of revenue while punishing those who steal taxpayer dollars.”

The proposed legislation would allow the filing of a civil suit against individuals or companies defrauding the Pennsylvania government, by either the Attorney General or private qui tam litigants.  Just like the FCA, the law would penalize those submitting false claims to the Commonwealth with treble damages, a powerful fraud deterrent.  Additionally, H.B. 1439 provides for anti-retaliation protections for would-be whistleblowers.

Upholding the False Claims Act

The team at YLG proudly continues to offer our full support to Reps. Neumann and Deluca as they seek redress for the taxpayers of the Commonwealth and to punish fraudsters.

Young Law Group is a nationwide leader in whistleblower representation and has successfully represented numerous clients in some of the nation’s largest qui tam cases for over a decade.  For a free confidential consultation, please call Eric L. Young, Esquire at (800) 590-4116 or complete the online form here.