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The whistleblower attorneys at Goldberg Kohn are committed to fighting fraud against the government and protecting the rights of whistleblowers. Below are summaries of recent developments pertaining to whistleblower, qui tam, and False Claims Act actions throughout the United States.

Judge Rules that Halifax Hospital Violated Stark Law

The federal judge recently held that Halifax Hospital did, in fact, pay illegal bonuses to doctors for referring patients to Halifax, thereby confirming whistleblower claims that the hospital had violated federal law and prioritized profits over patients’ health.

Specifically, the judge’s decision stated: “claims forms relied on by the Government are evidence of referrals for DHS made by the Medical Oncologists during the time period the Incentive Bonus was in effect, thereby violating the Stark Law [and] the claims forms are evidence that Halifax Hospital submitted claims to Medicare for the DHS furnished pursuant to such referrals… Because [t]he Defendants have not presented any evidence to the contrary [and] the Government’s evidence on this point is undisputed, the Government has established that Halifax Hospital violated the Stark Law.”

As a result of the judge’s ruling, Halifax could face up to $350 million in damages. The lawsuit was initiated by Elin Kunz, who worked in compliance at Halifax. As we recently reported, Halifax is also implicated in an investigation into a high number of spinal fusion surgeries, many of which were medically unnecessary.

CA Technologies Agrees to Pay $11 Million to Settle Claims Related to its Billing Practices

CA Technologies has agreed to pay $11 million to settle whistleblower allegations that the software company violated the federal False Claims Act and similar state and local laws by fraudulently billing hundreds of public agencies in connection with software maintenance renewal contracts from 2001 through 2009. Specifically, CA Technologies was accused of billing customers for renewed software maintenance plans on the date of renewal, rather than the expiration date of the previous contract, which essentially resulted in a period of double-billing customers for the overlapping period.

Additionally, CA Technologies allegedly deterred Defense Department customers from ordering software from existing inventory that it had paid for and, instead, convinced them to pay for the same products through third-party vendors.

The whistleblower in the case – former CA Technologies employee Ann Marie Shaw – will receive approximately $2 million from the settlement.

Iraqi Construction Company Pays $2.7 Million in Connection with Bribery Allegations

Iraqi Consultants and Construction Bureau (ICCB) – a privately-owned construction company located in Baghdad, Iraq – paid $2.7 million to resolve allegations that it violated the False Claims Act by bribing a U.S. government official to obtain U.S. government contracts in Iraq.

According to a Department of Justice press release, the government alleges that, from 2007 to 2008, ICCB paid bribes to Army Corps of Engineers procurement official John Salama Markus in order to obtain information giving the company an advantage in bidding on several construction contracts with the Department of Defense in Iraq.

The settlement was reached as part of a larger investigation, in which Markus pleaded guilty to wire fraud, money laundering, and failure to report a foreign bank account.  Markus was sentenced to 13 years in prison earlier this year.

Jury Finds JM Eagle Guilty of Fraud

A federal jury unanimously found that JM Eagle – one of the largest pipe manufacturers in the world – knowingly manufactured and sold substandard plastic pipe used in water and sewer systems to various government entities. As a result of the jury’s verdict, JM Eagle will be required to pay an undetermined amount of damages to the states of Nevada, New Mexico and Virginia, in addition to 42 cities and water districts. A separate trial will be held to determine the amount of damages, with a date not yet set.

In addition, Formosa Plastics, which was formerly the owner of JM Eagle, has agreed to pay $22.5 million to the same government entities to settle allegations regarding its role in the fraudulent scheme.

Please contact us at (312) 863-7222 if you would like to learn more about any of the aforementioned whistleblower news updates or would like to schedule a free, confidential appointment with one of our nationally recognized whistleblower attorneys.