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Multiple Whistleblowers and First-to-File

This archive displays posts tagged as relevant to multiple whistleblowers and first-to-file issues in whistleblower litigation. You may also be interested in our pages:

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November 22, 2021

Two whistleblowers who provided the SEC with new and significant information during an existing investigation, including information about misconduct occurring in different geographic areas, received awards of approximately $6.2 million and $1.3 million.  The award to the first claimant was also based in part on a recovery in a related action, based on findings that the whistleblower provided information to the relevant other agency.  In support of the first claimant’s larger award, the SEC also cited that their information was more significant, that the majority of the relief ordered was based on information provided by them, that they reported their concerns internally prior than reporting to the SEC, and they reported more expeditiously.  SEC

October 8, 2021

U.S. Medical Management, LLC (USMM) and VPA, P.C. (VPA) have agreed to pay $8.5 million to resolve claims raised in five separate qui tam lawsuits that USMM and VPA billed Medicare for medically unnecessary laboratory and diagnostic testing services between 2010 and 2015.  Although the government did not join any of the lawsuits, the whistleblower who filed first will receive $1.53 million under the alternate remedy provision of the False Claims Act.  USAO EDMI

September 3, 2021

A number of South Carolina pain management clinics, drug testing laboratories and other entities associated with chiropractor Daniel McCollum have had default judgments entered against them ordering the payment of $140 million.  The defendant entities, Oaktree Medical Centre P.C., FirstChoice Healthcare P.C., Labsource LLC, Pain Management Associates entities, ProLab LLC, and ProCare Counseling Center LLC, were alleged to have provided illegal financial incentives to providers to induce their referrals of urine drug tests in violation of the Stark Law and the Anti-Kickback Statute, and to have submitted false claims to federal healthcare programs for medically unnecessary urine drug testing, steroid injections, opioid prescriptions, and lidocaine ointment prescriptions.  The settlement resolves claims against the entities brought in three separate qui tam actions Donna Rauch, Muriel Calhoun, Brandy Knight, Karen Mathewson and Tracy Hawkins, former employees of pain management clinics owned or operated by McCollum. The government continues to pursue claims against McCollum.  DOJ; USAO SC; November, 2021 judgment against McCollum

May 17, 2021

The SEC made an award of $750,000 to one whistleblower and $3.75 million to a second whistleblower based on findings that they provided information that assisted SEC staff in related civil and criminal proceedings against a company and individual.  The first individual provided information relevant to the action against the individual only, but did so more than five years after learning of the violation.  The second individual, who received a larger award, was originally denied any award by the SEC, but, upon reconsideration, the SEC concluded that they had voluntarily provided information to the Commission prior to being contacted by the Commission.  Three other claimants were denied awards.  SEC

May 17, 2021

Two whistleblowers were awarded a total of $27 million, with the SEC finding that the information they jointly and voluntarily provided aided an enforcement action which resulted in the return of millions of dollars to harmed investors, even through most of the information the individuals provided was already known the SEC from other sources. The two individuals had also reported their concerns internally and met in-person with SEC staff over the course of two days. SEC

Partner Mary Inman discusses SEC whistleblower reward program and Reenvisioning Whistleblowers as Forward Indicator of Risk at Stanford Rock Center “Whistleblowers, Ethics and Compliance” Event

Posted  03/19/21
On January 19, 2021, Constantine Cannon partner Mary Inman joined several esteemed co-panelists to discuss the recent amendments to the SEC Whistleblower program’s rules, SEC whistleblowers’  impact on securities law enforcement, and the nature and frequency of corporate whistleblowing in the “Whistleblowers, Ethics and Compliance” event organized by Stanford’s Rock Center for Corporate Governance. The...

July 24, 2020

Several divisions of pharmaceutical company Indivior, which marketed of the opioid-addiction drug Suboxone, pleaded guilty to felony healthcare fraud, entered into a five-year Corporate Integrity Agreement, and will pay a total of $600 million in criminal fines, restitution, civil damages, and penalties.  In six separate cases brought by whistleblowers, Indivior was also alleged to have caused false claims to be submitted to government healthcare programs including by promoting the sale of Suboxone to physicians who were prescribing it outside of medically accepted indication, misrepresenting the likelihood of Suboxone being diverted, and taking steps to delay generic competition for Suboxone. Indivior admitted making false statements about the safety of the film version of Suboxone in order to promote its sale.  In addition, the FTC claimed that violated antitrust laws through a deceptive scheme to thwart lower priced generic competition with Suboxone.  The total settlement consists of criminal restitution of $289 million; a civil settlement of $300 million, with $209.3 million paid to resolve claims by the federal government and $90.7 million to participating states; and, $10 million in penalties to the Federal Trade Commission.  The settlement also requires Indivior to take steps including the dissolution of its Suboxone sales force. Indivior was until 2014 a subsidiary of Reckitt Benckiser Group PLC, which previously paid $1.4 billion to resolve claims related to Suboxone marketing.  DOJ; USAO NJ; FTC

Centric Parts – Customs Fraud ($8 million)

In a customs fraud victory, the Constantine Cannon team represented whistleblower Steve Hughes in his successful False Claims Act action against his former employer, auto parts distributor CWD, LLC.  Hughes alleged that CWD, which does business as Centric Parts, misclassified brake pads imported from Asia as “unmounted” brake pads when they were, in fact, brake pads mounted to a metal backing plate, and therefor subject to a 2.5% tariff.  When Hughes learned of the misclassification, he immediately advised the CEO and CFO to disclose the issue to U.S. Customs and Border Protection.  Instead, the company concealed the misclassification and retaliated against Hughes.  As a result of Centric’s alleged omissions and false statements regarding its imported products, the company knowingly evaded millions of dollars of customs duties it owed to the United States.  The $8 million settlement resolved the Hughes lawsuit and one other qui tam action filed by a different whistleblower.  The whistleblowers shared a $1.48 million whistleblower award, representing 18.5% of the government’s recovery.  Whistleblower Insider; Press release
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