Whistleblower Group

March 2, 2016

Mark T. Conklin, the former owner and operator of Florida-based Recovery Home Care Inc. and Recovery Home Care Services Inc. (RHC) agreed to pay $1.75 million to resolve charges of violating the False Claims Act by paying illegal kickbacks to doctors who agreed to refer Medicare patients to RHC for home health care services.  Conklin sold RHC to National Home Care Holdings in October 2012.   According to the government, Conklin ran a scheme under which RHC paid dozens of physicians thousands of dollars per month to serve as sham medical directors who performed little or no work in exchange for referring their patients to RHC.  The allegations originated in a whistleblower lawsuit filed by former RHC employee Gregory Simony under the qui tam provisions of the False Claims Act.  He will receive a whistleblower award of up to $315,000 from the proceeds of the government's recovery.  DOJ

March 1, 2016

Ubert Guillermo Rodriguez, president and owner of Florida-based durable equipment provider G.R. Services Equipment & Supplies Inc., pleaded guilty to conspiracy to commit health care fraud.  According to the government, Rodriguez’s company submitted approximately $2.6 million worth of claims to Medicare seeking reimbursement for durable medical equipment, such as wound care supplies, that was not legitimately prescribed by doctors and was not provided to beneficiaries.  DOJ

March 1, 2016

Olympus Corp. of America, the country’s largest distributor of endoscopes and related equipment, agreed to pay $623.2 million to resolve alleged violations of the False Claims Act and Anti-Kickback Statute through a scheme to pay kickbacks to doctors and hospitals.  It is the largest payout ever by a medical device company for violations of the Anti-Kickback Statute.  In addition, Olympus subsidiary Olympus Latin America Inc. also agreed to pay $22.8 million to resolve separate charges relating to violations of the Foreign Corrupt Practices Act.  The allegations originated in a whistleblower lawsuit filed by John Slowik, Olympus’ former chief compliance officer, under the qui tam provisions of the federal and various state False Claims Acts.  He will receive a whistleblower award of roughly $51 million from the proceeds of the government’s recovery.  Whistleblower Insider

March 1, 2016

Connecticut-based construction company URS Corporation agreed to pay $580,000 to resolve allegations it violated the False Claims Act by overbilling the government on a bridge reconstruction project funded by the National Railroad Passenger Corporation (Amtrak).  It allegedly did so by charging the maximum labor rates listed on the contract rather than the actual labor rates.  DOJ (CT)

February 29, 2016

Lockheed Martin Corporation (and subsidiaries Lockheed Martin Energy Systems and Lockheed Martin Utility Services) agreed to pay $5 million to resolve allegations they violated the Resource Conservation and Recovery Act (RCRA) and the False Claims Act by knowingly submitting false claims for payment under their contracts with the Department of Energy to operate the Paducah Gaseous Diffusion Plant in Kentucky.  According to the government, Lockheed Martin violated the RCRA, which establishes how hazardous wastes must be managed, by failing to identify and report hazardous waste produced and stored at the facility, and failing to properly handle and dispose of the waste.  The government alleged that this conduct resulted in false claims for payment under Lockheed Martin’s contracts with the Department of Energy.  The allegations originated in two whistleblower lawsuits filed under the qui tam provision of the False Claims Act by the Natural Resources Defense Council and several former employees of Lockheed Martin who worked at the Paducah facility.  The whistleblowers will collectively receive a whistleblower award of $920,000 from the proceeds of the government's recovery.  DOJ

March 4, 2016

Texas reached a settlement with online daily fantasy sports site FanDuel, under which the company will stop accepting paid entries for cash prizes in the state on May 2. Traditional fantasy sports leagues that are not operated by a third party for revenue are, as a general rule, legal under Texas law. In those leagues, participants generally split any pot amongst themselves, so there is no house that takes a cut. FanDuel will continue to operate its free games in Texas, but will stop accepting paid contest entries on May 2. In return, the Office of the Attorney General agrees not to take any legal action against FanDuel in connection with the operation of its contests.

March 3, 2016

New York announced an agreement with Endo Health Solutions Inc. and Endo Pharmaceuticals Inc. (“Endo”), which make and sell the long-acting opioid, Opana ER. The agreement requires Endo to cease all misrepresentations regarding the properties of Opana ER, to describe accurately the risk of addiction to Opana ER, and to summarize studies regarding Opana ER on its website. Endo must also create a program that will prevent its sales staff from promoting this powerful narcotic painkiller to health care providers who may be involved in the abuse and illegal diversion of opioids. Endo, an Irish company with U.S. headquarters in Pennsylvania, makes a variety of prescription drugs. Endo’s opioid drug Opana ER has been widely abused in New York State. NY