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.
Caremark to Pay $4.25 Million to Settle False Claims Act Allegations
Caremark LLC, a pharmacy benefit management company (PBM), has agreed to pay the government and five states a total of $4.25 million to settle allegations that it knowingly failed to reimburse Medicaid for prescription drug costs paid on behalf of Medicaid beneficiaries who also were eligible for drug benefits under Caremark-administered private health plans (commonly known as “dual eligibles”). According to the Justice Department, Caremark used a computer claims processing platform called “Quantum Leap” to cancel claims for reimbursement submitted by Medicaid for dual eligibles, thereby causing Medicaid to incur prescription drug costs for dual eligibles that should have been paid for by the Caremark-administered private health plans and not Medicaid.
The settlement resolves allegations in a lawsuit filed by Janaki Ramadoss, a former Caremark quality assurance representative, under the whistleblower provisions of the False Claims Act. Ramadoss will receive approximately $505,680 from the federal government’s share of the settlement, as well as additional amounts from the states that are party to the settlement.
Caremark is operated by CVS Caremark Corp., one of the largest PBMs and retail pharmacies in the country. PBMs administer and manage the drug benefits for clients who offer drug benefits under a health insurance plan.
Former Employee Says CH2M Hill Committed False Claims Act Violations and Wrongful Retaliation
A former employee of CH2M Hill Inc. has sued the environmental consultancy, along with its parent company CH2M Hill Companies Ltd., and her former supervisor, Dudley Wright, alleging False Claims Act violations and wrongful retaliation when she reported the violations. In her lawsuit, Grace Randazzo claims that CH2M Hill overcharged the Department of Energy for “tens of millions of dollars worth of fraudulently claimed hours” while providing professional services at the Hanford nuclear weapons site in Washington.
Like many whistleblowers, Randazzo experienced retaliation after she reported the alleged fraud to her superiors. In her lawsuit, she says: “In the wake of her whistleblowing, plaintiff became the victim of a hostile and abusive working environment intentionally inflicted upon her by Mr. Wright. [She] was stripped of her responsibilities for highly sensitive and high-risk litigation matters, and those responsibilities were delegated to a recently hired temporary contract employee -a younger male paralegal who was under-qualified to perform the work. After she attempted to take leave under the Family Medical Leave Act to care for her dying mother, and her own medical needs, she was misdirected and further retaliation ensued.”
Randazzo is seeking compensatory damages and double back pay for the wrongful discharge, illegal retaliation, intentional infliction of emotional distress, and violations of the False Claims Act and the Family Medical Leave Act.
Ohio-Based TAB Construction Company Accused of Making False Statements to the Small Business Administration
On December 5, the government announced that is has filed a complaint against TAB Construction Co. Inc. (TAB), an Ohio construction company, and its owner, William E. Richardson III, for allegedly making false statements to the Small Business Administration (SBA) in order to obtain certification as a Historically Underutilized Business Zone (HUBZone) company. The government has accused TAB of fraudulently procuring HUBZone certification to obtain four U.S. Army Corps of Engineers’ construction contracts worth millions of dollars.
In a press release, Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery said, “The HUBZone program is intended to create jobs in areas that historically have had trouble attracting business. The Justice Department will take strong enforcement action when companies obtain contracts to which they are not entitled.”
Houston Health Care Provider Pays $4.3 Million to Settle Allegations of Medicare Violations
The Lymphedema & Wound Care Institute Inc. recently paid the United States $4.3 million to settle claims it violated the Federal False Claims Act by submitting fraudulent Medicare claims. The lawsuit, filed by in 2011 by a doctor who also provides manual lymphatic drainage treatments to patients with lymphedema, accused the healthcare provider of submitting claims to Medicare for manual lymphatic drainage therapy services using massage therapists rather than physical therapists as required under Medicare rules and regulations. In addition to the monetary payment, Susan Morgan – one of the health care provider’s principals – will be barred from participating in federal health benefit programs for a period of 10 years.
Arms Company Accused of Shipping Defective Ammunition
A lawsuit filed by a former quality inspector accuses Federal Cartridge Co., a subsidiary of Alliant Techsystems Inc. of Minneapolis, of knowingly shipping defective bullets to the Department of Homeland Security in 2007. In the lawsuit, which was filed in 2010 and unsealed on December 5, 2013, Jeffrey Campbell says that he was fired in April 2007 from his position at the National Firearms Training and Tactical Training Unit for refusing to remain quiet about the defective bullets. Campbell asserts that 30-40 percent of the ammunition provided by the company failed to pass government specifications, but was still shipped to Immigration and Customs Enforcement field offices around the country. According to this article, in some cases, the shells had no gunpowder and, in at least one
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.