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November 8, 2019

Lenox Hill Hospital and its corporate parent, Northwell Health, Inc., have agreed to pay $12.3 million for violating the Stark Law and False Claims Act in submissions to Medicare.  From 2013 to 2018, Lenox Hill paid the chair of its urology department, Dr. David Samadi, a salary and bonus that improperly took into account the value of his referrals and grossly exceeded fair market value.  In an effort to maximize revenue-generating surgeries, Samadi was repeatedly scheduled to perform overlapping surgeries, leaving patients with unsupervised medical residents in violation of both hospital and Medicare rules.  The department also billed Medicare for minor procedures performed in operating rooms with an unnecessarily full operating room staff.  USAO SDNY

November 8, 2019

In the eleventh settlement involving the multi-state OK Compounding Pharmacy fraud scheme, podiatrist Jonathan Moore of Kentucky has agreed to pay $65,404 for the role he played in defrauding federal healthcare programs.  In exchange for illegal kickbacks disguised as “medical director fees,” Dr. Moore allegedly prescribed medically unnecessary compounded pain creams to patients, many of whom were insured by Medicare and TRICARE.  USAO NDOK

November 7, 2019

Medical device manufacturer Life Spine Inc. has agreed to pay $5.5 million to settle fraud allegations stemming from a qui tam suit, with founder and CEO Michael Butler agreeing pay another $375,000, and VP of business development Richard Greiber agreeing to pay another $115,000.  As part of the settlement, the defendants admitted to paying kickbacks to surgeons and entities between 2012 and 2018 in exchange for their use of Life Spine’s spinal implants, devices, and equipment.  USAO SDNY

November 7, 2019

Compound drug ingredient supplier Fagron Holding USA LLC has agreed to pay over $22 million to resolve two qui tam suits involving three of Fagron’s wholly-owned subsidiaries.  According to whistleblowers, Freedom Pharmaceuticals Inc. grossly inflated the price of active pharmaceutical ingredients used in compound prescriptions, causing pharmacy customers to submit false claims to TRICARE.  Other allegations involved subsidiaries Pharmacy Services Inc. and B&B Pharmaceuticals Inc., which were accused of submitting false claims to federal healthcare programs, manipulating prescription drug pricing, paying kickbacks to physicians, and illegally waiving patient copays.  DOJ

November 7, 2019

Tower Research Capital, LLC, a proprietary trading firm, has been ordered to pay a record $67.4 million for engaging in a manipulative and deceptive spoofing scheme from 2012 to 2013.  The Commission found that when Tower traders had genuine orders on one side of the market, they would also place orders on the other side that they intended to cancel before execution, intending to create a false impression of supply and demand to induce other market participants to trade against their genuine orders. The judgment for over $32.6 million in restitution, $10.5 million in disgorgement, and $24.4 million in civil monetary penalty is reportedly the largest ever ordered in a spoofing case. Tower also entered into a deferred prosecution agreement in a settlement with DOJ, crediting their monetary settlement with the CFTC and imposing compliance obligations. CFTC; DOJ

November 5, 2019

AT&T has agreed to pay $60 million to settle FTC charges of misleading customers.  From 2011 until 2014, AT&T advertised and sold “unlimited” data plans to millions of smartphone customers, but despite promises of unlimited data, it allegedly “throttled,” or reduced the data speeds, for customers on these plans after as little as 2 GBs of use.  At least 3.5 million customers were affected, all of whom will receive a credit or check for the refund amount owed as part of the settlement.  FTC

November 5, 2019

A home health agency that allegedly defrauded Medicare and Louisiana’s Medicaid program has agreed to pay $2.5 million to settle claims arising from a qui tam suit.  Defendants Health Care Options, Inc., Health Care Options of Lafayette, Inc., Home Care Options Houston, Inc., and Howard Austin, II allegedly submitted reimbursement claims involving non-face-to-face encounters, as required by program rules.  USAO MDLA

November 4, 2019

A Maryland-based plaintiffs’ law firm, Saiontz & Kirk, P.A., has paid the United States over $91 million to settle allegations that it failed to repay Medicare for conditional payments made to medical providers on behalf of firm clients.  Over the course of several years, the firm had received payments from Medicare to cover medical bills for clients involved in four injury cases.  However, after negotiating for and receiving settlement proceeds, the firm and its clients allegedly failed to return those conditional payments.  USAO MD

November 1, 2019

A New York-based painting contractor has agreed to pay $3 million to settle a suit alleging it misrepresented compliance with Disadvantaged Business Enterprise (DBE) rules in connection with two federally funded construction projects.  The False Claims Act violations involved Ahern Painting Contractors Co., which was contractually required to hire DBE subcontractors to perform renovation work on the Brooklyn Bridge and Queens Plaza.  However, Ahern hired a non-DBE, Spectrum Painting Corp., and repeatedly submitted false statements to the government that represented the work was done by a real DBE, Tower Maintenance Corp.  USAO SDNY

October 31, 2019

In the largest healthcare fraud case ever to come out of Mississippi, pharmacy owner Thomas Spell has been sentenced to 10 years in prison and ordered to pay over $243 million in restitution for knowingly defrauding TRICARE.  Between 2014 and 2016, Spell and his co-conspirators had deviously marketed compounded medications based on their rate of reimbursement from TRICARE, paid illegal kickbacks to marketers in order to obtain prescriptions from TRICARE beneficiaries, and improperly waived mandatory copayments for TRICARE beneficiaries.  USAO SDMS
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