Young Law GrouP's Top Whistleblower Cases

No. 11-cv-0071 (S.D.N.Y.)

United States ex rel. Bilotta v. Novartis Pharmaceuticals Corp.

Novartis agreed to pay $678 million to settle allegations that the company violated the False Claims Act and Anti-Kickback Statute by paying physicians to induce them to prescribe certain of the company’s drugs. Novartis allegedly spent hundreds of millions of dollars on sham speaker programs that served as a means to bribe doctors with cash payments and other lavish rewards.  Novartis’ payments were characterized as “honoraria” given as compensation to doctors who purportedly gave lectures about certain Novartis drugs. Many of these speaking programs were allegedly nothing more than social gatherings at expensive restaurants, with limited or no discussion about the Novartis drugs. 

No. 05-cv-5025 (E.D.N.Y.)

United States ex rel. Osiecki et al. v. Amgen, Inc

Amgen agreed to pay more than $762 million, including a $612 million civil settlement, a $136 million criminal fine, and a criminal forfeiture of $14 million to settle allegations that it violated the False Claims Act by willfully defrauding government healthcare programs. Over a ten-year period, it was alleged that Amgen knowingly promoted the sale and use of  three of its drugs for dosing regiments and indications that were not for medically accepted indications nor FDA approved. The company allegedly used improper methods to obtain listings in medical compendia to establish that the promoted off-label uses were medically accepted. A drug must be listed in compendia specified in the federal regulations to be eligible for coverage by federal healthcare programs for an off-label use.

No.16-cv-7937 (C.D. Cal.)

United States ex. rel. Jane Doe v. Insys Therapeutics, Inc.

Opioid manufacturer Insys Therapeutics agreed to pay $225 million to settle allegations of False Claims Act violations as well as criminal charges for violating the federal mail fraud statute.  Both the civil and criminal charges were based on the company’s payment of kickbacks to prescribers and other unlawful marketing practices in connection with the marketing of its sublingual fentanyl spray, Subsys. Insys paid physicians and nurse practitioners for their participation in sham speaking programs to induce them to prescribe the drug. It was also alleged that Insys encouraged providers to prescribe Subsys to patients who did not have cancer and then lied to insurers about patients’ diagnoses to obtain reimbursement from federal healthcare programs.

No. 13-cv-03702 (S.D.N.Y.)

United States ex rel. Arnstein and Senousy v. Teva Pharmaceuticals USA, Inc.

Teva agreed to pay $54 million to settle allegations in a non-intervened qui tam action under the False Claims Act that it engaged in a scheme to pay physicians to speak at sham speaker programs in violation of the Anti-Kickback Statute. According to the complaint, Teva paid “speaking fees” and “honoraria” to doctors to induce them to write prescriptions for the drugs Copaxone and Azilect. Many of these prescriptions were filled and dispensed by pharmacies that submitted claims for reimbursement to government healthcare programs, including Medicare and Medicaid. Teva’s alleged illegal payments to prescribers caused false or fraudulent claims to be presented for payment in violation of the False Claims Act and the Anti-Kickback Statute.

No. 07-cv-4106 (E.D. Pa.)

United States ex. rel. Kruszewski v. Pfizer, Inc.

Pfizer agreed to pay $2.3 billion to resolve civil and criminal liability resulting from the illegal promotion of the drugs Bextra, Geodon, Zyvox, and Lyrica. $1 billion of the settlement was allocated to resolve civil allegations of False Claims Act violations. Pfizer allegedly caused false claims to be submitted to government healthcare programs for indications that were not medically accepted and therefore not covered under those programs. The company was also alleged to have paid kickbacks to healthcare providers to induce them to prescribe its drug products. The six whistleblowers who filed lawsuits under the qui tam provisions of the False Claims Act received more than $102 million from the federal portion of the civil recovery.

No. 12-cv-03870 (S.D.N.Y.)

United States ex. rel. Peiken v. Salix Pharmaceuticals, Inc.

Valeant Pharmaceuticals, the owner of Salix Pharmaceuticals, agreed to pay $54 million to settle civil charges that Salix violated the Anti-Kickback Statute and False Claims Act by paying kickbacks to doctors to induce them to write prescriptions for seven Salix drug products. It was alleged that the company conducted sham speaker programs at exclusive restaurants and paid substantial sums to physicians to educate their peers about certain Salix products. In reality, it was alleged that little or no time was spent discussing the drugs and that the speaking events were merely a conduit to pay illegal kickbacks to prescribers. When pharmacies sought reimbursement from government healthcare programs for drugs written with tainted prescriptions, Salix was liable under the False Claims Act for causing false claims to be presented to the government for payment.

No. 03-cv-6268 (E.D. Pa.)

United States ex. rel. Paccione v. Cephalon, Inc.

Cephalon agreed to pay $425 million to resolve civil and criminal liability for the off-label marketing of its drugs Actiq, Gabitril, and Provigil. The company agreed to pay $50 million to resolve the criminal charge of violating the Food, Drug and Cosmetic Act by distributing misbranded drugs with inadequate directions for use. In a separate civil settlement, the company agreed to pay $375 million to settle allegations that it violated the False Claims Act when its sales representatives promoted off-label uses of its drugs to physicians. It was further alleged that Cephalon provided millions of dollars in grants to fund continuing medical education programs that promoted off-label uses of its drugs. The whistleblowers were awarded over $46 million from the federal share of the recovery.

No. 13-cv-296 (S.D. Ohio)

United States ex rel. Helms v. Roby’s Country Gardens, Inc.

The defendants agreed to pay $3.1 million to settle allegations that they submitted false and fraudulent claims to the USDA Department of Defense Fresh Fruit and Vegetable Program for more than 7 years. The qui tam complaint alleged that the defendants contravened the terms of their contracts with the government by failing to disclose that they had received rebates, credits, and other discounts from their suppliers. The defendant’s alleged misconduct is known as a  reverse false claim which creates liability when a person “knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.” 31 U.S.C. § 3729(a)(1)(G).

No. 09-cv-01752 (D. Colo.)

United States ex. rel. Curren v. Denver Health and Hospital Authority dba Denver Health Medical Center

The defendant agreed to pay $6.3 million to settle allegations that it violated the False Claims Act by improperly classifying services rendered to patients and submitting claims to Medicare and Medicaid for reimbursement of those services. The relator was an accountant for the hospital who discovered that short hospital stays were allegedly billed as “inpatient” stays when they should have been billed as less expensive “outpatient” or “observation” stays. After reporting the issue to management, the relator was terminated by the hospital. The False Claims Act contains an anti-retaliation provision that protects employees, and others, from being “discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against . . . because of lawful acts done by the employee . . . to stop 1 or more violations of [the False Claims Act].” 31 U.S.C. § 3730(h)(1).

No. 12-cv-758 (D. Del.)

United States ex. rel. Mihalovic v. ECL Solutions, Ltd. dba Ban-Air Storage Systems

The relator filed a qui tam complaint alleging that his former employer violated the False Claims Act by concealing the fact that steel racking systems the company sold to the U.S. military were made in China. By failing to accurately mark its products “Made in China,” the defendant falsely claimed those products were compliant with the Buy American Act and Trade Agreements Act when, in fact, they were manufactured with prohibited Chinese steel. In a related criminal action brought by the Department of Justice, the defendant pleaded guilty to conspiring to smuggle goods into the United States and was ordered to pay a forfeiture monetary judgment of more than $1 million.

No. 13-3772 (C.D. Cal.)

United States ex rel. Smith and Rogers v. Tom S. Chang, M.D.

The defendants, Retina Institute of California Medical Group (RIC), along with several doctors and related entities, agreed to pay $6.65 million to resolve allegations that they violated the False Claims Act. Two former RIC administrators filed a qui tam complaint alleging that the defendants falsely billed Medicare and Medicaid for more than a decade by billing for medically unnecessary eye exams and improperly waiving Medicare co-payments without first documenting the patients’ financial needs. The routine waiver of Medicare and Medicaid co-pays or deductibles without consideration of a patient’s financial circumstances is an improper method of inducing patient referrals which can constitute a violation of the Anti‐Kickback Statute absent an applicable safe harbor.

(Anonymous Client)

In re: IRS Whistleblower Office Claim

YLG Founder Eric L. Young secured the first-ever mandatory award issued under § 7623(b) of the Internal Revenue Code. The anonymous client was an accountant for a Fortune 500 financial services firm. The client discovered that the company had an unpaid tax liability of more than $20 million. After the company declined to report the liability, the client reported the information through the IRS whistleblower program without the assistance of an attorney. For more than two years, the client waited for a response from the IRS but heard nothing despite numerous inquiries. The client then contacted Young Law Group in an effort to compel a response from the IRS.  Eric Young worked with the client to provide the IRS Whistleblower Office with original case documents and information that fully exposed the scope of the company’s tax evasion. As a result of Eric’s efforts, the client received an enhanced award of 22% of the recovered proceeds which amounted to $4.5 million. Under § 7623(b), the IRS is required to pay a reward to any whistleblower who provides original information and meets all of the applicable eligibility requirements.

No. 00-cv-238 (S.D. Tex.)

United States ex rel. Quaicoe v. Center for Pain Management

A medical practice specializing in back pain treatment for elderly patients, and its owners, settled allegations involving various billing schemes to defraud government healthcare programs.  The relators were anesthesiologists who had evidence of the alleged schemes which included unauthorized use of physicians’ provider numbers on claims; billing for patients who never visited the practice; and billing for levels of medical care not possible based on the number of patients seen on a daily basis at the defendants’ facility. As part of the settlement, the defendants agreed to repay the government for a number of disputed claims and be bound by a five-year corporate integrity agreement.

97-cv-4203 (E.D. Pa)

United States ex rel. Hendricks v. Northwestern Human Resources, Inc.

Pennsylvania’s largest provider of social services pled guilty to a federal felony and agrees to pay approximately $7.8 million to resolve criminal and civil actions brought under the False Claims Act for failure to comply with state and federal Medicare regulations relating to staffing, coding, billing, and cost report issues.

No. 96-cv-1933 (D.N.J.)

United States ex rel. Hoffman v. Kessler Hospital

Qui tam False Claims Act settlement against a hospital based on allegations of improper coding and improper provision of lymphedema pumps that resulted in a criminal prosecution and civil fines against the physician who ran the program.

No. 96-cv-7423 (E.D. Pa.)

United States ex rel. Strelow v. National Medical Care, Inc

The defendants agreed to pay $16.5 million to settle allegations that they violated the False Claims Act by paying kickbacks to physicians and dialysis facilities to induce them to purchase medically unnecessary diagnostic test kits. The kickbacks allegedly took the form of pre-interpreted test reports, sham rental payments and purchased interpretations. As part of the alleged scheme, the defendants encouraged physicians to bill the interpretations to Medicare as if they had performed the service themselves. The defendants also allegedly miscoded certain procedures to obtain reimbursement from Medicare for noncovered services and engaged in unbundling by billing separately for services that should have been included as part of another billed service.

No. 29-62591 (Anonymous Client)

In re: IRS Whistleblower Office Claim

YLG Founder Eric L. Young represented the whistleblower, a trust officer for a bank, in a matter involving an insurance trust fund. The fund operated an illegal tax shelter through a bogus 419 Plan which allowed participants to improperly take substantial tax deductions for their contributions to the plan. Mr. Young secured four partial awards for YLG’s client totaling over $650,000.

No. 2012-008461 (Anonymous Client)

In re: IRS Whistleblower Office Claim

The IRS Whistleblower Office awarded $1.1 million to a corporate executive represented by Eric Young. The anonymous whistleblower provided valuable information involving the inappropriate use of an overseas corporate structure to avoid paying millions of dollars in taxes to the United States.

Nos. 2013-001794, -001953 and -001954 (Anonymous Client)

In re: IRS Whistleblower Office Claim

Eric Young represented a corporate accountant who provided information involving a tax evasion scheme by a real estate development company. The company received ownership and title to properties as payment for services rendered. Even though it was advised that the value of the properties received was taxable income, the company failed to report that income as required by law. As a result of the information provided to the IRS Whistleblower Office, the anonymous client received an award of $800,000 from the recovered proceeds.

Nos. 2011-010962, -010963 and -010964 (Anonymous Client)

In re: IRS Whistleblower Office Claim

A corporate accountant represented by Eric Young was awarded $2.35 million by the IRS Whistleblower Office. The anonymous client provided information involving the fraudulent allocation of their company’s U.S.-based income to off-shore tax havens. The company went so far as to maintain a multi-million dollar reserve to pay a penalty in the event that the IRS discovered its tax evasion scheme.

Nos. 2016-005416 and -005417 (Anonymous Client)

In re: IRS Whistleblower Office Claim

YLG represented a corporate executive who received an award for reporting violations of their company’s continuation coverage requirements of group health plans under ERISA and COBRA.  The anonymous client also provided information involving the company’s routine and widespread practice of fraudulently misclassifying personal expenses as corporate expenses.

No. 2014-001542 (Anonymous Client)

In re: IRS Whistleblower Office Claim

Eric Young represented a corporate consultant who received an award for providing information concerning a company’s tax evasion scheme. In connection with their representation of a company being sold to an overseas corporation, the anonymous client discovered that the company had funneled hundreds of millions of dollars from its operating accounts to shell companies to fraudulently reduce its tax liability. The company also claimed the fraudulent transfers as business deductions on its corporate tax returns.

Expert Witness for former UBS banker Bradley Birkenfeld

In 2012, former UBS banker turned IRS whistleblower, Bradley Birkenfeld, received a $104 million award which stands as the largest ever issued by the IRS Whistleblower Office. Mr. Birkenfeld disclosed details of how UBS facilitated illegal overseas tax shelters that enabled U.S. citizens to evade their tax obligations. Mr. Birkenfeld retained YLG founder Eric L. Young to serve as an expert witness on the IRS Whistleblower Program in a related matter.

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