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Constantine Cannon Celebrates a Record-Shattering Year of Whistleblower Rewards

Posted  October 8, 2020

This has been a big year for the whistleblower clients of Constantine Cannon. Our whistleblower team represented the whistleblowers in four blockbuster settlements in just the past twelve months.  In two of those cases, the government declined to pursue the matter so we had to litigate on our own.

More importantly for our clients, in all four cases Constantine Cannon secured some of the highest whistleblower rewards, “relator’s shares,” in the history of the False Claims Act.

As we wrote in February when the Whistleblower Practice Group was recognized by Law360 as a Government Contracts Practice Group of the Year, the first time such an award was given to a whistleblower practice, strong whistleblower cases can take years to come to fruition.

These results recognize the courage of our clients, and years of hard work by our incredibly talented legal team.

 

The Wireless Cases: A $139 Million Settlement and a $52 Million Whistleblower Reward (September 2020)

Constantine Cannon represented the whistleblower in a massive action against the four largest wireless carriers for allegedly defrauding dozens of California and Nevada government agencies and violating those states’ False Claims Acts.  While the carriers – Verizon, AT&T, Sprint and T-Mobile – promised to “optimize” wireless plans for these public entities by selecting those that would yield the “lowest costs available,” in fact, according to the lawsuit, they did no such thing.  Constantine Cannon partner Anne Hartman summarized the alleged violations: “To seal a multibillion-dollar deal, the carriers promised to help public agencies find the most efficient rate plans and save taxpayer dollars.  But when the time came to deliver on those promises, the carriers instead chose to pad their bottom lines.”

Unlike most other whistleblower firms, Constantine Cannon represented not only the whistleblower but also many of the victimized government agencies, who often hire the firm’s attorneys due to their deep expertise in False Claims Act cases.  That trust paid off here; the firm negotiated settlements totaling $138.7 million, in addition to the defendants’ payment of $36 million in attorneys’ fees.

Even more impressive, the firm did right by our whistleblower client, who was compensated with a whopping 43% share of the Verizon and AT&T settlements payable to the government entities that did not join the case (under California law whistleblowers may receive up to 50% of the government’s recovery).  Our client received a total reward of $52 million in the case.  We are unaware of any case in which a court awarded such a high whistleblower share in a case this large.

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International Bid-Rigging: A $363 Million Settlement and a $37 Million Whistleblower Reward (September 2020)

Constantine Cannon has long emphasized its international practice and is the only major whistleblower firm with a fully staffed offshore office (London).  It is therefore unsurprising that in September the firm announced another record-shattering settlement, representing a whistleblower who exposed a decade-long bid-rigging conspiracy by the five largest oil companies in South Korea.  The Korean whistleblower came to the firm because of our unparalleled expertise in both whistleblower and antitrust cases, as well as our proven track record securing maximum compensation for our clients.

The oil companies paid $163 million under the False Claims Act plus another $200 million in fines and penalties to settle the case.  The U.S. Department of Justice announced that “these are the largest [Clayton Act] Section 4A settlements in American history.”  The government also cited this case as the impetus for a new enforcement initiative, the Procurement Collusion Strike Force, an interagency partnership of federal prosecutors, the FBI, and Defense Department and Postal Service Inspectors General.

But Constantine Cannon’s special expertise truly emerged when it came to securing compensation for its international whistleblower client.  Under the Federal False Claims Act, the maximum award for the case was 25%, yet the government offered 12.5%.  So the firm took the unusual step of going to court to fight for a higher share.  There are only about a dozen reported instances in the history of the False Claims Act of whistleblowers suing for their reward.

First, the firm sought an emergency payment of funds to its client, who, like many whistleblowers, was experiencing severe financial hardship.  The court ordered the government to deposit approximately $15 million to an escrow account and pay the client $1 million immediately.

After considering the parties’ voluminous submissions, the Court awarded near the maximum share, 23% of the $163 million False Claims Act settlement, $37 million.  Just as the firm had secured a record-breaking share in the Wireless Cases under state law, this appears to be the highest federal whistleblower reward percentage of a $100 million+ settlement.

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Visiting Nurse Service of New York: A $57 Million Settlement and a $16 Million Whistleblower Reward (June 2020)

In another recent ground-breaking settlement, Constantine Cannon represented a whistleblower who sued the Visiting Nurse Service of New York, one of the largest home health agencies in the country.  According to the complaint filed by the firm, VNSNY routinely failed to provide its patients all the critical nursing and therapy visits and services their doctors prescribed under the patient Plans of Care.  The whistleblower contended that by failing to provide this care, VNSNY endangered the welfare of tens of thousands of its patients while maximizing the company’s Medicare and Medicaid reimbursement.

Despite the strong allegations of fraud and a substantial financial impact on Medicare and Medicaid, the federal government decided not to intervene in the case.  So Constantine Cannon decided to pursue the case on behalf of its whistleblower client without the government’s assistance.

The firm drew on its long and deep experience with scorched earth litigation to battle VNSNY for years, deposing key VNSNY witnesses and reviewing tens of thousands of VNSNY internal documents to support its case.  In the end, VNSNY settled for $57 million, the second-largest home health fraud settlement ever and the first case to directly address the issue of not following patient Plans of Care.

Firm partner Marlene Koury explained “the lawsuit’s claims concerning alleged Plan of Care failures impact the entire home health care industry,” pointing to a statement by the National Association for Home Care & Hospice that this case “has the potential to impact … home health services provided to over 3.4 million Medicare beneficiaries annually by nearly 12,000 Medicare and Medicaid participating home health agencies.”

The firm also secured impressive compensation for its client.  Because the government had declined to pursue the case, the applicable reward maximum was 30% and the firm obtained a 29% share.

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Iran Sanctions Violation: A $45 Million Settlement and a 28.5% Whistleblower Reward (December 2019)

Constantine Cannon represented whistleblowers who disclosed violations of Iranian Sanctions by contractors Unitrans International and Anham FZCO, an associated Dubai Free Zone company.  According to the False Claims Act lawsuit, the defendants’ false certification of compliance with the U.S. sanctions regime induced the government to award Anham wartime contracts to provide food and transportation to U.S. troops.

As in the VNSNY case, the government declined to join the case and Constantine Cannon’s experienced litigators and whistleblower attorneys moved forward on behalf of their whistleblower clients.

The government ultimately agreed, however, that it was the victim of fraud and brought criminal charges.  In December 2019, Unitrans agreed to pay $45 million to resolve both the criminal and civil allegations related to the alleged misconduct, which included $27 million to resolve our whistleblower clients’ False Claims Act allegations.

Constantine Cannon not only settled the civil case, but also secured a 28.5% reward for its whistleblower clients, once again close to the 30% maximum.

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Takeaways from the Past Year’s Results

In a relatively brief period of time, Constantine Cannon has emerged as the most successful and perhaps the largest whistleblower firm in the country, with over 20 full-time whistleblower lawyers in offices in New York, Washington, San Francisco, and London.

For prospective clients choosing among the hundreds of whistleblower firms, it is noteworthy that the firm not only has recovered hundreds of millions of dollars for taxpayers while ending some truly egregious practices by powerful corporations.  It also has secured rewards for its whistleblower clients of over $100 million in the past year alone.

This is deeply satisfying for the members of our firm.  Whether representing whistleblowers, antitrust clients, or clients in our unique art law practice, the firm is committed to working in the public interest.

We look forward to continuing our whistleblower work for the next five years and beyond.  With many dozens of promising cases on our docket, the firm’s steep trajectory of success is likely to continue.

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Tagged in: CC Lawyers, FCA Federal, FCA State, Government Procurement Fraud, Healthcare Fraud, Importance of Whistleblowers, Whistleblower Rewards,


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