January 16, 2014

Another Record Year for DOJ Whistleblower Recoveries

whistleblower_successesBy the C|C Whistleblower Lawyer Team

The DOJ just released its annual compilation of False Claims Act (FCA) statistics.  Once again, the numbers are sure to raise eyebrows.  Overall, the DOJ recovered $3.8 billion during FY 2013 – an amount second only to last year’s record-breaking recovery of almost $5 billion.  Neither of these figures reflects criminal fines and forfeitures or state recoveries for Medicaid fraud, which actually drive up the government’s total fraud recoveries by billions more.  This past year also marks the fourth consecutive year that the DOJ has recovered an excess of $3 billion.

Following the trend in FCA recoveries over the past few years, the majority of this past year’s recovery ($2.6 billion) was related to health care fraud.  Procurement fraud by government contractors accounted for $890 million.  One of the most significant health care recoveries was the $1.5 billion settlement with Abbott Laboratories over charges that the company was promoting its drug Depakote to combat agitation and aggression in elderly dementia patients, despite the fact that those uses had not been approved for safety or efficacy.  On the procurement front, the DOJ won a $664 million judgment against United Technologies for the company’s false statements to the Air Force made while negotiating a contract for fighter jet engines.

If that judgment survives appeal, it will be the largest procurement recovery ever. Not to be missed in all of these numbers is another key record that was shattered which speaks to the overall success of the FCA program:  the number of whistleblower qui tam cases climbed to 753, the highest mark yet.  The growing contributions by whistleblowers reflected in this figure have been an increasingly essential tool in the DOJ’s war against fraud.  As Assistant Attorney General Stuart Delery noted: “These recoveries would not have been possible without the brave contributions made by ordinary men and women who make extraordinary sacrifices to expose fraud and corruption in government programs.”  Indeed, of the $3.8 billion recovered, almost $3 billion came from lawsuits initiated by whistleblowers.  That is over three-quarters of the government’s civil recoveries in FCA cases.

Whistleblowers walked away with $345 million in awards for their work and sacrifice. These numbers do not even include the $2.2 billion settlement with Johnson & Johnson announced in November for claims that J&J illegally promoted its drugs Risperdal, Invega, and Natrecor, as well as engaged in a widespread kickback scheme with physicians.  With that kind of a start, it looks like we are in store for another record-breaking year.

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