April 3, 2015

DOJ Catch Of The Week — Medtronic

By the C|C Whistleblower Lawyer Team

This week’s Department of Justice “catch of the week” goes to medical device maker Medtronic plc and affiliated Medtronic companies, Medtronic Inc., Medtronic USA Inc., and Medtronic Sofamor Danek USA Inc.  Yesterday, the companies agreed to pay $4.4 million to resolve allegations they violated the False Claims Act by making false statements to the Department of Veterans Affairs and the Department of Defense regarding the country of origin of certain Medtronic products sold to the US.  See DOJ Press Release.

According to the government, Medtronic sold to the VA and DoD products it certified would be made in the US or other designated countries as required under the Trade Agreements Act of 1979 (TAA).  But instead, Medtronic sold the US products manufactured in China and Malaysia, which are prohibited countries under the TAA.  The specific medical products at issue included anchoring sleeves sold with cardiac leads and used to secure the leads to patients, certain instruments and devices used in spine surgeries, and a handheld patient assistant used with a wireless cardiac device.

In announcing the settlement, Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division stressed the importance of the country’s “commitment to ensure that our service members and our veterans receive medical products that are manufactured in the United States and other countries that trade fairly with us.”  The settlement resolves allegations originally brought in a whistleblower lawsuit filed by three unidentified individuals under the qui tam provisions of the False Claims Act.  They will receive a whistleblower reward of $749,700.

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