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DOJ Enforcement Actions

The Department of Justice is the principal federal agency authorized to enforce the laws and defend the interests of the United States. As such, it oversees the enforcement of the False Claims Act, the foundation of the American whistleblower system, as well as numerous other laws.

The agency traces its origins to the Judiciary Act of 1789 which created the Office of the Attorney General, and the 1870 Act to Establish the Department of Justice, which established the agency as “an executive department of the government of the United States” with the Attorney General as its head.

The agency is comprised of numerous divisions with the Civil Division and in some instances, the Criminal Division, overseeing investigations and prosecutions under the False Claims Act. The U.S. Attorneys Office of the federal district where the False Claims Act case is filed also plays a key role in False Claims Act enforcement.

Below are summaries of recent DOJ settlements or successful resolutions under the False Claims Act as well as other successful prosecutions for fraud and misconduct. If you believe you have information about fraud which could give  rise to a claim for a whistleblower reward, please contact us to speak with one of our experienced whistleblower attorneys.

January 30, 2023

International Vitamins Corporation (IVC), which imports and sells vitamins and supplements from China, has agreed to pay $22.8 million to settle claims of defrauding the United States.  The U.S.-based company allegedly avoided U.S. customs duties by misclassifying over 30 of its products, then failed to pay back duties owed after realizing it had underpaid millions of dollars.  The alleged fraud occurred between 2015 and 2019, and only came to scrutiny through a whistleblower’s lawsuit.  USAO SDNY

January 27, 2023

Walgreen Co. has paid $7 million to settle a False Claims Act lawsuit by the United States and State of Tennessee that alleged the company submitted claims to Tennessee’s Medicaid program for specialty medications that didn’t meet the program’s criteria for coverage.  According to the governments’ 2021 complaint, one of Walgreens’ former pharmacists falsified prior authorization requests and records for 65 Medicaid beneficiaries who didn’t meet program requirements.  The company then billed TennCare under those false prior authorization requests, and later failed to make repayments even after it discovered its employee’s misconduct.  USAO EDTN

January 24, 2023

A former energy company executive accused of defrauding investors of more than $15 million and misappropriating investor funds has been sentenced to 5 years in prison after pleading guilty to wire fraud.  While serving as the executive chairman and managing partner of Citadel Energy, which supposedly helped oil and gas companies with fluid management, Joey Stanton Dodson made false and misleading representations and omissions to investors concerning the intended use of their funds and his own compensation.  After obtaining over $15.6 million from over 50 investors, Dodson misappropriated $1.3 million into his own accounts, and used some of it to repay investors of unrelated entities.  DOJ

January 20, 2023

DePuy Synthes, Inc., a subsidiary of Johnson & Johnson that manufactures medical devices, has agreed to pay $9.75 million to resolve allegations of defrauding Medicare and Medicaid.  According to former sales representative Aleksej Gusakovs, DePuy gave a Massachusetts-based orthopedic surgeon thousands of dollars’ worth of free implants and instruments for use in overseas surgeries.  The illegal kickbacks induced the surgeon to use DePuy products in surgeries performed in the United States, and caused false claims to be submitted to Medicare and the Massachusetts Medicaid program.  As the whistleblower in a successful qui tam action, Gusakovs will receive a $1.37 million share of the settlement.  DOJ

December 21, 2022

Biotechnology companies iSense, LLC and Specific Diagnostics, Inc., together with their founder Paul Andrew Rhodes, will pay a total of $10.1 million to resolve allegations that they submitted false claims under grants from the DOD and HHS.  The government alleged that the firms improperly billed for costs incurred by another business, billed for compensation in excess of authorized federal limits, backdated services and cost-sharing agreements, and knowingly presented a backdated agreement to the government. USAO NDCal

December 20, 2022

Cochlear implant manufacturer Advanced Bionics LLC paid $11.4 million to resolve claims brought in a whistleblower action that the company falsely stated that the radio-frequency (RF) emissions generated by some of its cochlear implant processors met international standards when it submitted pre-market approval applications to the FDA.  The company allegedly knew that the devices did not meet standards, and manipulated testing conditions to obtain passing test results.  Whistleblower David Nyberg, a former engineer at Advanced Bionics, will receive a qui tam award of $1.9 million from the federal amount of the settlement.  DOJ; USAO ED PA

December 20, 2022

BioTelemetry Inc. and its subsidiary CardioNet LLC, which provide cardiac monitoring services (including Holter and mobile cardiovascular telemetry (MCT) tests), will pay $44.875 million to resolve claims that they submitted false claims to federal healthcare programs for cardiac monitoring services that were improperly performed overseas and by unqualified technicians.  CardioNet used an India-based contractor to perform diagnostic and analysis services of heart monitoring data, and while it had a formal policy of sending such data for federal healthcare beneficiaries to a U.S.-based independent diagnostic testing facility for review and analysis, in fact, substantial amounts of such data was sent to its Indian contractor.  The government further alleged that most of the offshore technicians tasked with reviewing ECG Data for federal healthcare program beneficiaries did not have the basic qualifications to perform the tests in question. The government’s investigation was initiated by a qui tam action filed by former CardioNet employees Christopher Strasinski and Philip Leone, who will share a whistleblower award of approximately $8.3 millionDOJ; USAO ED PA

December 20, 2022

Following his conviction on charges related to his direction of a Ponzi scheme and the fraudulent sale of purported N95 masks during the pandemic, Christopher Parris was sentenced to 20.3 years in prison.  In the Ponzi scheme, which collapsed in 2018, Parris and co-conspirators – including Perry Santillo, obtained at least $115.5 million from approximately 1,000 investors, with claims that they were investing in a diversified investment portfolio when, in fact, very little investor money was deployed in productive investments.  Parris also pleaded guilty to charges that he defrauded the U.S. Department of Veterans’ Affairs and others between February and April, 2020, by falsely representing that he was able to obtain brand-name N95 masks directly from authorized sources in the United States, when in fact, he had no ready access to such masks or other PPE.  Parris obtained upfront payments totaling approximately $7.4 million from at least eight clients, knowing that he had no access to or ability to obtain or deliver the PPE.  DOJ; USAO WD NY

December 19, 2022

Posted  12/19/22
Honeywell International Inc. and related entities will pay the U.S. government a total of more than $160 million before offsets – $81 million to resolve SEC claims, and $79 million as a criminal penalty – to settle charges arising out of bribery schemes that took place in Brazil and Algeria. Honeywell entered into a deferred prosecution agreement admitting that a subsidiary offered approximately $4 million as a...

December 14, 2022

In a False Claims Act case pursued on a non-intervened basis, Academy Mortgage Corporation agreed to pay $38.5 million to resolve allegations that it improperly originated and underwrote mortgages insured by the Federal Housing Administration.  The whistleblower, Gwen Thrower, who was an underwriter at Academy, alleged that the Academy had an inadequate underwriting process that led to false certifications of compliance with underwriting requirements and, ultimately, to the government having to pay insurance claims on loans improperly underwritten by Academy.  Thrower will receive a whistleblower award of $11.5 millionDOJ
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