Whistleblower Lawyer & Attorney : LaBovick Law Firm, Florida : Federal False Claims Act, Qui Tam

I came across an interesting post this morning, from R. Enochs, Esq, Attorney blogger and editor of the blog for news junkies.... I might fit that bill, being that I am always tuned in and online reading any and all newsworthy information that I stumble upon.  Mr. Enochs  used the clever title  Thinking of Whistleblowing and Filing a Federal False Claims Act ... Get comfortable in the DOJ waiting room. Bravo, he summed up the 900 pending DOJ cases with his catchy headline. We blogged about this DOJ yesterday on the Whistleblower Law Blog.  

This post led me to the post by David Lat, from Above the Law, blogging about the Lawsuit of the Day: A Class Action for DOJ Honors Rejects? How did I miss this riveting story? At the forefront of this case is Belgium resident, and U.S. citizen, Sean Gerlich, charging that he and other highly qualified graduates of were not hired in the Justice Department's Honors Program, because of an "ideological bias against applicants with presumed "liberal" tendencies." I liked the following sentence from David about this case  "Please compensate us for being forced to take lucrative law-firm jobs that pay several times the pittance offered by the feds." I am sure that there are many sides to this case and that more information will be uncovered as this case unfolds. 

According to the Courthouse News Service, a central character in this case is  former Deputy Associate Attorney General Esther S. McDonald. Allegedly, the former Deputy AG created and maintained a printout of applicants political or ideological views and attached them to the candidate's application.   In the wake of Social networking sites such as Myspace, Facebook, LinkedIn, and so many others, it is pretty easy to find out about a job candidate's "true: personality" instead of the one that submits the perfect resume, answers all the right questions, and  looks the part at the interview. The Internet, gives employers a way to look past the "picture perfect interviewee" and really get to know the person, by reading things about them and things by them shared in public places. Word of caution: Nothing is private on the Internet. If you say it, write it, and post it on the Internet, it can be out there in perpetuity. This another topic all together.

Pedro Ruz Gutierrez, from ALM's BLT: The Blog of Legal Times, (Note: awesome name), shared thoughts from the Plaintiff's Attorney in his post "Ex-Honors Program Applicant Sues DOJ". He quotes Daniel Metcalfe, Steve Gerlich's Attorney as saying "This is a guy who had every reason to believe that he was going to work for the government like he did the previous summer, that he would start his career there" Later on he goes on to quote Mr. Metcalfe saying that his client was n “disgracefully deprived of the opportunity to do what he had planned to do, [which was] to return to the Justice Department as an attorney and serve his country.” Are there any guarantees in life? After reading the Complaint, it made me ask this question... I do look forward to seeing how this turns out. The DOJ is an important and central figure in the prosecution of qui tam cases. I hope that this lawsuit or attention surrounding this case, does not distract their attention from such handling pressing matters such as fighting corruption, government fraud and other legal issues.

If you get chance, read the 24 page PDF of the Complaint, Gerlich v. US Department of Justice, from the Courthouse News Service. Click on the following link to David Lat's Above the Law, Blog Post. Thanks for sharing this information. It really helps put this case into perspective.

 

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Today, Washington Post writer, Carrie Johnson put qui tam front and center in the minds of everyone around the country, with her newsworthy and in-depth front page article "A Backlog Of Cases Alleging Fraud- Whistle-Blower Suits Languish at Justice" in the Washington Post today. I might add that this article was above the fold. The article  highlighted how there are over 900 cases alleging fraud by government contractors and drugmakers for defrauding  taxpayers and the government out of billions of dollars, that are in backlog because the Justice Department cannot keep up with the whistleblower cases being brought forward.  As a law firm that handles qui tam cases nationwide, we can attest that this is true. However, this is not the story for this blog post, it is how much attention this Washington Post front page story has garnered in the blog-sphere.

Let's look at the time-line today, as of right now, there are over 20 blogs that have written a post about this very newsworthy story for their readers and over 150 comments on the Washington Post.com website. Given this short amount of time, for such a niche subject matter, this is amazing.  I enjoy reading blog posts and viewpoints on qui tam issues, and writing is very subjective. However, I feel the best blog posts are when a blogger, shares personal views and makes a statement about something. This is what makes a reader come back for more to a blog.

Here are a few posts that I enjoyed reading today:  I started out on this quest, reading a post from Jesselyn Radack of the Daily KOS. Jesselyn shares that she has first hand experience with these cases. Prior to joining the Government Accountability Project, she handled Iraq reconstruction fraud cases. Jesselyn also shares that it is not uncommon for the Justice Department to seek extensions of the seal on a qui tam whistleblower suit for 6 or 12 months while it investigates the case. The most puzzling question is why are Iraq reconstruction fraud suits, taking several  years,  yet remain entirely under wraps? 

Jeffrey M. Hirsch of the The Workplace Prof Blog, did a fine detailed synopsis of the article in the blog post "Qui tam delays". I  agree with Jeffrey's assertion that "with the recent Supreme Court qui tam decision, this relatively hidden area of the law may be getting some of the attention that it deserves". I always enjoy reading this blog.

I was intrigued by the blog post from the Wordpress blog, Slabbed entitled " Good Job Brownie: The Washington Post Reports on Qui Tam Backlog in DC" They pose the question "Is it any wonder everyday people feel the concept of justice only applies to the wealthy and big business."  Great title....


Robby Moeller of the Voice in the Wilderness shared his thoughts in the post "Fraud and Uncle Sam". He adds that businesses defrauding the government is nothing new. Further, fe feels that fraud follows wherever government contracts or funds are being given out. I would love to hear a response from someone in the Federal Government to this statement.

 

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InterDent, Inc., InterDent Service Corporation and Dedicated Dental Systems Corporation have paid the United States and the State of California approximately $729,000  to settle allegations that they submitted false claims for orthodontic care to Medi-Cal’s dental program, which is called Denti-Cal.

The lawsuit was originally filed in June 2005 by relator/ whistleblower, Dr. Guy W. Mendivil, a certified orthodontist. Dr. Mendivil, a Denti-Cal provider who worked at Dedicated Dental’s orthodontic clinic in Bakersfield, alleged that the dental clinic fraudulently used his Denti-Cal number from 2002 through 2005, to bill the Denti-Cal program for orthodontic care provided by unauthorized dentists.

The Department of Justice issued a release on this case. This particular lawsuit was filed under the federal False Claims Act on behalf of the United States and the alleged Medi-Cal fraud, was filed under the California False Claims Act on behalf of the State of California.

Although the company did not admit any guilt, this case serves as an example of how quickly things can settle, when whistleblowers such as Dr. Guy W. Mendvil come forward.  I am always amazed at the qui tam cases that come to our office, brought by doctors with morals that can't stand to see their companies defrauding the government and trying to get away with millions on the backs of taxpayers. Unfortunately, when companies steal from the government, they are stealing from the everyday citizen that works hard to make an honest dollar. If you have knowledge of a company submitting false claims against the government, we encourage you to get proof and discuss your rights with legal counsel. 

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Four Miami men have been charged in $110 Million Medicare False Claims Scheme that was uncovered by the Medicare Fraud Strike Force. According to the Department of Justice’s Criminal Division and the U.S. Attorney’s Office for the Southern District of Florida, Carlos and Luis Benitez, Jose Benitez and Thomas McKenzie were all allegedly involved in the Medicare Fraud. The alleged fraud happened from January 2001 through November 2004. 

The four men are accused of conspiring to submit $110 Million in fraudulent false Medicare Claims for HIV infusion services provided at  the following 11 HIV infusion clinics: AH Medical Office Inc.; Advanced Medical Rehabilitation Center Inc.; Best Medi Corp.; Physician’s Health Med-Care; Physician’s Med-Care Inc.; Saint Jude Rehab Center Inc.; Global Med-Care Corp.; CNC Medical Corp.; G&S Medical Centers Inc.; Karla Medical Services Inc.; and Best Medicare Inc.

According to the indictment, The Medicare False Claims Scheme involved recruiting Medicare beneficiaries to go to the Clinics under the false pre-tense of needing HIV infusion services.  Physicians and medical staff were trained to fraudulently show that medical services were performed and medically necessary.

Thanks to the valiant efforts of Deputy Chief Kirk Ogrosky's Strike Force Team and U.S. Attorney R. Alexander Acosta's outstanding prosecutors, this Medicare fraud was uncovered. We applaud their efforts and hard work.

Five Ways we can combat Medicare False Claims fraud and prevent new schemes 

• First,  we can prosecute people and companies that are guilty of Medicare False Claims.
• Second, we can ask for Whistleblowers to come forward and report the fraud/ false claims.
• Third, we can support the Medicare Fraud Strike Force team by ensuring they are adequately funded and staffed to handle the investigations and prosecution.
• Fourth, we can pass stringent legislation that helps prosecute those found guilty of fraud/false claims.
• Fifth, we can make it easier to reward whistleblowers for coming forward and reporting Medicare fraud and Medicare false claims schemes and simplify the process.

  

 

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Dear Readers,

Your help is requested today in an effort to take action in protecting whistleblowers. I received an email today from the organization Project for Government Oversight, and want to share this important  information with our loyal readers of the Whistleblower Law Blog.  It is a plea for concerned citizens to send a message TODAY to Congress and show support for passing legislation that gives protections to government employees who blow the whistle on waste, fraud, and abuse. Let your Congressperson know that you believe the House's "Whistleblower Protection Enhancement Act of 2007"  (H.R. 985) offers stronger protections than the Senate's bill (S. 274).

Please click on the link below and send a message to Congress about this very important issue.  We also encourage you send to a "friend".  We can make this  a "viral" message of importance, to get more people involved in this critical issue.

http://ga6.org/campaign/wpa_2008

It takes only 3 - 4 minutes to complete the form and send to your Congress person and Senators.  

We are asking you to take action today.  June 12, 2008.

Thanks for your support of legislation that promotes whistleblowers coming forward without fear of retaliation.  Stopping Government fraud, abuse and waste should be the fundamental goal.

Brian
 

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In a recent Supreme Court decision today, in the qui tam suit, Allison Engine Co. v. US ex. Rel Saunders,  Supreme Court Justice Alito writes in his opinion that  "it is not enough under §3729(a)(3) for a plaintiff to show that the alleged conspirators agreed upon a fraud scheme that had the effect of causing a private entity to make payments using money obtained from the Government. Instead, it must be shown that they intended “to defraud the Government.” Where their alleged conduct involved the making of a false statement, it need not be shown that they intended the statement to be presented directly to the Government, but it must be established that they agreed that the statement would have a material effect on the Government’s decision to pay the false or fraudulent claim. Pp 8 -10." 471 F. 3d 610, was vacated and remanded. This was a unanimous decision for the Court.

According to Stephen M. Kohn, the President of the National Whistleblower Center,  the Court laid the responsibility for fixing the law directly on Congress: 'Had congress intended' the False Claims Act to 'apply to any one who conspired to defraud' the government 'it would have so provided."

Does this give conspirators planning to defraud the government, a  " free pass"?  Let's hope this is not the case. Maybe this uncertainty will light a fire under Congress to pass the False Claims Correction Act. 

Note to Whistleblowers: Do not let this ruling discourage you from bringing qui tam cases. This decision is only a minor set back.  The rules of the game may have changed a little, however,  the strategy to bring those guilty of defrauding the government to justice, has become more interesting.

Click here to read entire Supreme Court Opinion for Allison Engine Co. v. US ex. Rel Saunders

 

 

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The Illinois based Walgreen's Pharmacy has agreed to settle a qui tam case for $35 Million that involves drug switching of the following drugs: Ranitidine (or Zantac), which inhibits stomach acid production; Fluoxetine (or Prozac), an antidepressant; and Eldepryl, known generically as selegiline, which is used with other medications to treat the symptoms of Parkinson's disease. Reports showed that  Walgreens fraudulently increased reimbursement from Medicaid by switching the form of the drug dispensed to Medicaid patients while providing no additional medical benefit to patients.

According to the U.S. Department of Justice, the case was initially filed in 2003, by Whistleblower and licensed pharmacist Bernard Listiza. The Whistleblower should receive approximately $5 million of the total $35 Million qui tam settlement and the federal government will receive approximately $18.6 million of the settlement. The remaining $16.4 million will be shared by over 40 states and Puerto Rico, due to separate settlement agreements.

A breakdown of the shares of the Walgreen's settlement by state includes: Florida receives $9.8 million, Illinois, $1.25 million, Georgia $401,000, Indiana $289,000, Ohio $161,000, New Jersey $1.25 million and Pennsylvania $9,000.

Click here to read more on this Whistleblower Medicaid fraud case from the Chicago Tribune.

 

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The Baptist Health South Florida Inc., will pay the United States $7,775,000 to settle False Claims Act and the Stark Statute violations that allegedly occurred between 2003 and 2005. According to the Department of Justice this probe involved Baptist Health South Florida,  over compensating an oncology group for patient referrals to Baptist's hospitals. The payments were made pursuant to a contract under which the oncology group provided physics and dosimetry services to the two hospitals.

The Stark Statute prevents Medicare providers like Baptist from billing the federal health care program for referrals from doctors that have a financial relationship with the provider. There are a few exceptions for the Stark Statute.

Click here to read more from the Department of Justice and the Sun Herald on this False Claims Act settlement.

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I want to laugh when people buy into corporate propaganda. Don't you just love people who believe in a "trickle down" theory will actually trickle down to them. I also laugh when the oil companies cry that OPEC is charging too much and Exxon posts multi-Billion dollar profits. Do you believe them? How about the insurance industry that cries about how lawsuits are killing them, and turn around and post multi-billion dollar profits year after year. Corporations spin this propaganda until the average American believes it. Isn’t it Amazing?

The new spin from Beck/Herman legal bloggers for the Drug and Device Law blog claims that The False Claims Act is a "stealth tax". I was shocked by this sentiment when I came across their post “By Litigation - A Dubious Proposal To Expand False Claims Act Liability”. I am not sure what they are reading, but the last time I read the act, the purpose of the act was to catch companies and individuals that are ripping off the Federal Government. How anyone can refer to the False Claims Act as a Stealth Tax is an act of spin that is worth memorializing.

The Beck/Hermann post acts as if the poor company is being looted by pirates instead of realizing that it is the pirates who are being brought to justice. So, don't let the “spinmeisters” confuse you. What would you prefer, letting the poor companies continue to rip off your tax dollars so they can get richer and richer while you pay more and more in taxes?

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