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Constantine Cannon Celebrates a Record-Shattering Year of Whistleblower Rewards

It has been a big year for our whistleblower clients

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Successes

Members of the Constantine Cannon Whistleblower Lawyer Team have been responsible for a string of major whistleblower successes over more than a decade, and had a record-shattering year in 2020.  Our successes include the following:

Cisco Systems, Inc. – Government Contract Fraud/Non-Conforming Product ($8.6 million)

Constantine Cannon represented whistleblower James Glenn against Cisco in the first cybersecurity whistleblower case ever successfully resolved under the False Claims Act. Cisco Systems, Inc. agreed to an $8.6 million settlement to resolve allegations it knowingly sold vulnerable video surveillance software to federal, state and local government agencies, exposing government systems to the risk of unauthorized access and the manipulation of vital information. The whistleblower, who worked in Europe for a Cisco partner, had reported critical security vulnerabilities in the software to Cisco, but Cisco had continued to sell the technology to government entities, including the District of Columbia and 15 states, despite the fact that the software failed to comply with FAR procurement standards that require basic cybersecurity controls, including those set forth by the National Institute of Standards and Technology.  Read more: Press Release; Whistleblower Insider

Group Health Cooperative (now a subsidiary of Kaiser Permanente) – Medicare Advantage Fraud ($6.375 million)

Constantine Cannon represents whistleblower Teresa Ross against Group Health Cooperative, an insurance company that participates in the Medicare Advantage program. GHC has agreed to pay $6.375 million to resolve allegations that the insurance plan improperly collected money from the Medicare Advantage program by overstating how sick its beneficiaries were. Ms. Ross is a former employee of GHC, where she worked for 14 years; her most recent position was the director of risk adjustment services. In her complaint, Ms. Ross alleged that GHC had improperly relied on coders’ interpretations of diagnostic tests, prescriptions, and entries in problem lists to come up with diagnoses and that it had also submitted other codes that were false because they were diagnosed by inappropriate providers, fell outside service year, or the patient had no evidence of a current condition. See Press Release and Whistleblower Insider for more.

Mid Dakota Clinic – Medicare Fraud/ASC Kickbacks ($5.45M)

The Constantine Cannon team represented Jeffery Neuberger, the former CEO of a medical group in North Dakota, in a 2017 False Claims Act case alleging a scheme in violation of the Anti-Kickback Statute (AKS) between the medical group and its wholly owned ambulatory surgery center (ASC).  The AKS is intended to prevent abuses (such as unnecessary treatments) that can occur when a doctor makes money from referring patients for goods or services.  The ASC safe-harbor to the AKS is limited; it essentially permits ASC ownership only by surgeons who perform procedures or surgeries in the ASC as a functional extension of his or her office.  The lawsuit alleges that all of the multi-practice physician owners profited from referrals, not only the surgeons, and that they refused to give up this lucrative income stream despite knowing that it violated the AKS.  In November 2019, Mid Dakota Clinic, its affiliated building partnership, and insurer agreed to pay the United States $4.15 million to resolve the case.  The clinic additionally paid $1.3 million for the whistleblower’s attorneys’ fees and costs, for a total payment of $5.45 million.  The United States awarded Mr. Neuberger a 25% relator’s share of its recovery.

Rose Cancer Center — Medicare Fraud ($5.7 million).

Two of our whistleblower attorneys co-led the representation of Kristi Beeson who reported Medicare fraud violations at her former employer Rose Cancer Center in Mississippi. Ms. Beeson, who was a laboratory technician for the clinic, brought a qui tam action under the False Claims Act against the clinic alleging, among other things, unqualified technicians performing bone marrow biopsies, diluting chemotherapy drugs, and doctoring patient records to conceal the clinic’s fraudulent Medicare billings. The physician who owned and ran the practice, Dr. Meera Sachdeva, plead guilty to various Medicare fraud violations, forfeited $5.7 million, and is now serving a 20 year prison sentence for her crimes. Ms. Beeson, along with three other whistleblowers, collectively received a whistleblower award of $525,000 for their efforts in exposing the fraud. See Clarion Ledger for more.

NEC — Government Contracting/Bribes and Kickbacks ($5 million).

One of our whistleblower attorneys was hired by the San Francisco Unified School District to pursue a False Claims Act case against NEC Business Network Solutions, a large supplier of computer systems under the government’s “E-Rate” program. E-Rate provided government subsidies for the purchase of computer equipment for school classrooms, seeking to bridge the “digital divide.” According to the complaint, NEC paid bribes and kickbacks to school officials, causing them to order excess equipment purchased with federal funds. One of the recipients of the illegal bribes was convicted and sentenced to 21 months in prison. Using a novel theory, the San Francisco school district “blew the whistle” on the company, and received an award of $5 million. See NY Times for more.

Bay Sleep Clinic – Medicare Fraud/Unapproved Facilities, Unlicensed Technicians, and Physician Kickbacks ($2.6M).

Constantine Cannon represented whistleblower Elma Dresser, a sleep technician and former Bay Sleep employee. Ms. Dresser alleged that Bay Sleep Clinic and associated businesses, a network of sleep clinics in the San Francisco Bay Area, fraudulently billed Medicare for sleep studies conducted by unlicensed technicians in unapproved locations; improperly dispensed durable medical equipment from unapproved locations using unlicensed technicians; and paid doctors for referrals in violation of the federal Anti-Kickback Statute. The government joined a portion of the case, and in 2016, defendants agreed to pay $2.6 million to settle the matter. For her significant contributions, the relator’s share award was almost 21% of the government’s recovery. See DOJ for more.

Skyline Urology — Healthcare Fraud ($2.1M)

Constantine Cannon represented a whistleblower in a qui tam lawsuit that alleged that from 2013 through 2016 a large urology practice had fraudulently and systematically misused a billing code in order to increase reimbursements from insurers, including Medicare and private insurers in California. The code, modifier 25, is properly used when a physician performs an evaluation and management service and a separate and distinct service on the same day. Billing with modifier 25 when no distinct service occurred can improperly inflate reimbursement rates and is known as “unbundling fraud.” The Federal Government recovered $1.85M and the State of California recovered $250,000 to resolve the allegations. For his efforts in uncovering the fraud, the whistleblower received a portion of both recoveries. See The National Law Review and Becker’s ASC Review for more.

Pure Collection – Customs Fraud ($908,100)

Constantine Cannon represented whistleblower Andrew Patrick, who worked for Pure Collection from 2010 to 2014, first as a sales representative in its U.K. call center and then in its U.K. packaging department. Mr. Patrick’s qui tam, or whistleblower, lawsuit alleged that since 2007 the defendants fraudulently and systematically avoided paying U.S. customs duties on its goods shipped from the United Kingdom to customers in the United States. Pure Collection and the e-retailer’s acting CEO, Samantha Harrison, have collectively agreed to a settlement of $908,100 to the U.S. Government. This lawsuit was one of the first to be brought by a U.K. whistleblower in which the U.S. Government intervened and successfully resolved the whistleblower’s False Claims Act allegations. Mr. Patrick will be awarded 18 percent of the total settlement.

Roof Systems of Maine – Government Contracting Fraud/Noncompliance with contract requirements ($439,500).

Two of our whistleblower attorneys led the representation of Brian Emery, an experienced roofer and former subcontractor to Roof Systems of Maine. Mr. Emery brought a qui tam action under the False Claims Act against Roof Systems of Maine alleging the company defrauded the government by violating contract requirements and industry standards in roofing and siding work done on behalf of the Departments of the Army and Navy, and the National Guard Bureau. According to the complaint, Roof Systems systematically used inferior products and improper installation techniques at three building sites along the Maine coast. The government joined the case, and in 2016, Roof Systems paid $439,500 to settle the case. Mr. Emery received a whistleblower award of $79,110. See Morning Sentinel for more.

Visa/MasterCard — Antitrust Violations ($3 billion).

Two of our whistleblower lawyers were on the lead counsel team representing Wal-Mart, Sears, Safeway and a class of roughly 5 million U.S. merchants in this antitrust class action alleging various forms of misconduct by Visa and MasterCard in their rules governing the use and marketing of Visa/MasterCard branded credit cards and debit cards. After winning summary judgment on a majority of the claims in this action and on the eve of trial, the parties settled the case with the plaintiff merchants recovering more than $3 billion in damages and injunctive relief valued by the court at tens of billions of dollars. This landmark victory remains one of the largest antitrust settlements in U.S. history. See NY Times for more.

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