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The Whistleblower Blog

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Presented by Hodgson Russ, the Whistleblower Blog is written by a team of lawyers experienced in successfully guiding both whistleblowers and companies accused by whistleblowers of wrongdoing through the False Claims Act process.

Showing 2 posts from May 2014.

Medical Devices Offer Fertile Ground for Future Whistleblower Activity

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Recent gatherings of False Claims Act attorneys —who represent whistleblowers, the government, and the defense — revealed a consensus that medical devices offer fertile ground for future whistleblower activity. Medical device fraud can take at least three forms and may arise for durable medical equipment as well.

  • First, defective medical devices, sold in connection with Medicare or Medicaid reimbursement, may lead to FCA liability. On this point, manufacturer quality management systems, supplier controls and monitoring, attention to customer complaints, and corrective measures are all key issues that may impact FCA liability. Medical devices that are not safe, effective, and reliable create FCA risk for their manufacturers.
  • Second, off-label promotion of medical devices brings up issues similar to off-label pharmaceutical promotions. FCA approval of devices should guide marketing. If marketing goes off-label, there may be FCA liability.
  • Third, kickbacks paid to medical professionals in connection with medical device sales would trigger FCA liability.

Federal government spending on health care is ever-growing. The government frauds in this area, along with qui tam activity, are expected to increase as well.

John Sinatra is a partner in the Business Litigation Practice at Hodgson Russ LLP. You can reach him at jsinatra@hodgsonruss.com

Relators Win Right to Share of Proceeds Under False Claims Act

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In a recent False Claims Act case from the Eighth Circuit, Rille v. PricewaterhouseCoopers LLP, 2014 U.S. App. LEXIS 6597 (8th Cir. April 10, 2014), the relators won an important victory against the government relating to their right to obtain a portion of the settlement proceeds of a claim under the act. Specifically, according to the act, if the government “intervenes” in a case brought by relators, relators are entitled to a portion “of the proceeds of the action or settlement of the claim.” 31 U.S.C. 3730(d)(1). But in Rille, the relators had to fight not only defendants, but also the government to get the recovery they were entitled to under the act. The Eighth Circuit – in no uncertain terms – sided with the relators.

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Hodgson Russ is one of only a few major law firms that represents both whistleblowers and companies accused by whistleblowers of wrongdoing. This unusual perspective means we are exceptionally well positioned to advise whistleblowers about potential claims.

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