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Damages and Penalties

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DOT Imposes Record Fine Against Southwest Airlines for Christmas Meltdown

Posted  12/28/23
Last week (December 18), the Department of Transportation (DOT) announced a landmark $140 million penalty against Southwest Airlines for operational failures that stranded more than two million passengers over last year's Christmas holiday season.  DOT trumpeted it as 30 times larger than any previous DOT penalty for consumer protection violations.  And it is on top of another $600 million in refunds and rewards the...

Annual Inflation Adjustment Raises False Claims Act Penalties

Posted  12/16/21
As of December 13, 2021, each separate violation of the False Claims Act exposes defendants to a per-claim penalty between $11,803 and $23,607.  The increase is part of the Civil Monetary Penalties Adjustment for 2021, a rule issued by the Department of Justice in accordance with the Bipartisan Budget Act of 2015 as part of annual adjustment for inflation.  The increase is small – the prior range was $11,665 -...

Catch of the Week -- Prime Healthcare

Posted  08/9/18
Prime Healthcare, a nationwide healthcare provider that operates 45 hospitals and employs over 40,000 people, has settled allegations under the False Claims Act that 14 of its California hospitals improperly billed Medicare for admitting patients who only required outpatient care, and billed Medicare for treating more severe diagnoses than patients actually had. The company will pay just under $62 million to settle...

Radiation Therapy Company Agrees to Pay Up to $11.5 Million to Settle Allegations of False Claims and Kickbacks

Posted  04/2/18
By the C|C Whistleblower Lawyer Team The DOJ announced a settlement with Texas-based radiation therapy center SightLine Health LLC (“SightLine”) and Oncology Network Holdings LLC, which acquired SightLine in 2011, for $11.5 million to settle allegations in a False Claims Act complaint that Sightline submitted Medicare claims that violated the Anti-Kickback Statute.  According to DOJ, the allegations centered on...

Maybe Too Big To Jail, But Never Too Small

Posted  03/8/16
By Gordon Schnell (Published in Huffington Post) The jury is still out on whether the Department of Justice will follow through on its recent pledge to amp up its crackdown on corporate fraudsters.  Too big to jail is not in our playbook, the agency has taken pains to assure us.  Going after the top-dogs is our number one priority the agency has trumpeted in its newly minted policy of holding the high-ups...

February 11, 2016

New York, in conjunction with members of a state and federal working group announced a $3.2 billion settlement with Morgan Stanley over the bank’s deceptive practices leading up to the financial crisis. The settlement includes $550 million – $400 million worth of consumer relief and $150 million in cash – that will be allocated to New York State. The resolution requires Morgan Stanley to provide significant community-level relief to New Yorkers, including loan reductions to help residents avoid foreclosure, and funds to spur the construction of more affordable housing. Additional resources will be dedicated to helping communities transform their code enforcement systems, invest in land banks, and purchase distressed properties to keep them out of the hands of predatory investors. NY

Sixth Circuit Adds Further Uncertainty to the Question of Limits on False Claims Act Damages

Posted  02/11/16
By Hamsa Mahendranathan Violators of the False Claims Act can be subject to significant damages: the Act provides treble damages and civil penalties of between $5,500 and $11,000 for each false claim.  But in some cases, the correct measure of damages can be a murky subject. This is especially true when considering whether the damages should account for any value the government received on the contract.  Last...

State Enforcement Spotlight – HSBC

Posted  02/8/16
By the C|C Whistleblower Lawyer Team This State Enforcement Spotlight features HSBC. On Friday, Attorney General Eric Schneiderman announced a $470 million joint state-federal settlement with mortgage lender and servicer HSBC to address mortgage origination, servicing, and foreclosure abuses. The terms will prevent past foreclosure abuses, such as robo-signing, improper documentation and lost paperwork. See NY AG...

June 5, 2015

Computer Sciences Corporation agreed to pay $190 million to settle SEC charges of manipulating financial results and concealing significant problems about the company’s contract with the UK’s National Health Service, the company’s largest and most high-profile contract.  Former CEO Michael Laphen agreed to return to CSC more than $3.7 million in compensation under the clawback provision of the Sarbanes-Oxley Act and pay a $750,000 penalty.  Former CFO Michael Mancuso agreed to return $369,100 in compensation and pay a $175,000 penalty.  SEC
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