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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.

				

			

			
						
					
			

	
		
		

			

				
				
February 6, 2015

				 Oklahoma-based Hospice care provider Good Shepherd Hospice Inc.agreed to pay $4M to resolve allegations it submitted false claims for hospice patients who were not terminally ill. Specifically, the government contended Good Shepherd pressured staff to meet admissions and census targets and paid bonuses to staff, including hospice marketers, admissions nurses and executive directors, based on the number of patients enrolled even if they were not eligible for hospice care. The settlement resolves allegations first raised by former Good Shepherd employees Kathi Cordingley and Tracy Jones in a whistleblower lawsuit they filed under the qui tam provisions of the False Claims Act. They will receive a whistleblower award of approximately $680,000. DOJ				 					 

						
Tagged in:
													  FCA Federal, 
													  Home Health and Hospice, 
													  Lack of Medical Necessity, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 6, 2015

				 Oregon-based drug maker James G. Cole Inc., and its president James G. Cole and former general manager Julie D. Graves, have been permanently enjoined from selling their products which are distributed under the name “Maxam Nutraceutics.” According to the government, the company’s products are unapproved, misbranded and manufactured under conditions that are inadequate to ensure their quality. The court based its decision in part on the company’s claims the products could treat autism, Alzheimer’s, HIV and Fibromyalgia, among other diseases. DOJ				 			
	
		
		
	


 			




	
		
		

			

				
				
February 6, 2015

				 A federal jury in Detroit convicted unlicensed Detroit physician Wilfred Griffith for his participation in a nearly $4.7M fraud scheme. According to evidence presented at trial, Griffith worked as an unlicensed physician at Phoenix Visiting Physicians in 2010 and 2011 where he treated Medicare beneficiaries and used prescription pads pre-signed by Dr. Dwight Smith to prescribe medicine. He also referred Medicare beneficiaries to Detroit-area home health company Cherish Home Health Services Inc. in exchange for kickbacks. Griffith used the names and signatures of Dr. Smith and two other Detroit-area physicians to certify the beneficiaries were homebound and needed home health services when they did not. DOJ				 					 

						
Tagged in:
													  Healthcare Fraud, 
													  Home Health and Hospice, 
													  Improper Medical Personnel, 
													  Medical Billing Fraud, 
													  Provider Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 5, 2015

				 Minnesota-based medical device manufacturer ev3 Inc. (formerly known as Fox Hollow Technologies Inc.) agreed to pay $1.25M to resolve allegations it violated the False Claims Act by causing certain hospitals to submit false claims to Medicare for unnecessary inpatient admissions related to minimally-invasive atherectomy procedures for removing hardening of the arteries. According to the government, Fox Hollow sold the Silver Hawk Plaque Excision System for these procedures and advised hospitals to bill them as more expensive inpatient procedures, as opposed to less costly outpatient procedures, to artificially increase their Medicare reimbursement claims. The charges originated with a whistleblower lawsuit was filed under the qui tam provisions of the False Claims Act by former Fox Hollow sales representative Amanda Cashi. She will receive a whistleblower award of $250,000. DOJ				 					 

						
Tagged in:
													  FCA Federal, 
													  Hospital Fraud, 
													  Medical Billing Fraud, 
													  Medical Devices and DME, 
													  Upcoding, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 3, 2015

				 Medical device maker Atrium Medical Corporation, Maquet Holding B.V. & Co. KG, Maquet Cardiovascular LLC, and Maquet Cardiopulmonary AG were permanently enjoined from distributing adulterated and misbranded medical devices. According to the government, Atrium — which manufactures medical devices for cardiovascular-related uses, including chest drains, surgical meshes, vascular grafts and stent systems — was not complying with the FDA’s current good manufacturing practice requirements for medical devices which are designed to ensure the devices are safe and effective and otherwise in compliance with the federal Food, Drug and Cosmetic Act. DOJ				 					 

						
Tagged in:
													  CGMP Violation, 
													  Defective Products, 
													  Medical Devices and DME, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 3, 2015

				 Ratings Agency giant Standard & Poor’s Financial Services (S&P), along with its parent corporation McGraw Hill Financial Inc., agreed to pay $1.375B to settle charges it schemed to defraud investors in structured financial products known as Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs). According to the government, S&P falsely represented that its ratings of RMBS and CDOs were objective, independent and uninfluenced by S&P’s business relationships with the investment banks that issued the securities. Instead, S&P issued inflated ratings that misrepresented the securities’ true credit risks causing RMBS and CDO investors to incur substantial losses. Whistleblower Insider				 					 

						
Tagged in:
													  Financial and Investment Fraud, 
													  Housing and Mortgage Fraud, 
													  Securities Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 3, 2015

				 Ernesto Fernandez pleaded guilty and was sentenced to 10 years in prison in connection with a long-running $6.2M Medicare fraud scheme involving Miami-based home health care agency Professional Medical Home Health LLC. Fernandez was an owner and operator of Professional Home Heath and also the owner and operator of two other South Florida home health agencies where he caused patient documentation to be falsified, and planned, organized and oversaw the submission of fraudulent claims to the Medicare program. Juan Valdes also pleaded guilty to the same scheme and was sentenced to 2 years in prison. He was a patient recruiter for Professional Home Health and solicited kickbacks and bribes from the owners and operators of Professional Home Health in exchange for providing beneficiaries to allow Professional Home Health to bill Medicare for home health services that were not medically necessary or not provided. Fernandez and Valdes are the seventh and eighth defendants to be sentenced in connection with the fraudulent schemes at Professional Home Health. DOJ				 					 

						
Tagged in:
													  Home Health and Hospice, 
													  Lack of Medical Necessity, 
													  Medical Billing Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 2, 2015

				 Japanese-based small sized bearings manufacturer Minebea Co. Ltd.agreed to plead guilty and pay a $13.5M criminal fine for its role in a conspiracy to fix prices for small sized ball bearings sold to customers in the US and elsewhere. DOJ				 			
	
		
		
	


 			




	
		
		

			

				
				
February 2, 2015

				 Tennessee-based Community Health Systems Professional Services Corporation and three affiliated New Mexico hospitals agreed to pay $75M to settle allegations they violated the False Claims Act by making illegal donations to county governments which were used to fund the state share of Medicaid payments to the hospitals. The allegations were first raised in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by former Community Health revenue manager Robert Baker. He will receive a whistleblower reward of $18,671,561 as his share of the government’s recovery. DOJ				 					 

						
Tagged in:
													  FCA Federal, 
													  Hospital Fraud, 
													  Medicaid, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 30, 2015

				 The Hachiuma Steamship Co. pleaded guilty to violating the Act to Prevent Pollution from Ships arising from the illegal disposal of oil residue and bilge water overboard the cargo vessel M/V Selene Leader. The company was ordered to pay $1.8M and placed on probation for three years during which it is to develop an environmental compliance program. $250,000 of the payment was awarded to a whistleblower on board the M/V Selene Leader who alerted the Coast Guard about the illegal activities. DOJ				 					 

						
Tagged in:
													  Environmental Fraud, 
													  Ocean Dumping, 
												
						

					
	
							
	
		
		
	


 			


											

						

								

									
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