DOJ News

Department of Justice / Genesis Healthcare Agrees to Pay $53.6 Million

A federal district court in Nevada awarded a qui tam relator $915,431.82 in attorneys’ fees and costs over opposition of defendants Creekside Hospice II, LLC, Skilled Healthcare Group, Inc., and Skilled Healthcare, LLC. See United States ex rel. Cretney-Tsosie v. Creekside Hospice II, LLC, No. 2:13-cv-00167-APG-PAL, 2018 WL 4409367 (D. Nev. Sept. 17, 2018). See here for a DOJ press release regarding a $53.6 million settlement related to the case.

Department of Justice / Qui Tam Cases Dismissed

Judge Sterling in the Eastern District of New York dismissed two qui tam cases filed by former Amgen employees against various oncology providers alleging unlawful marketing of Amgen drugs including Aranesp in violation of the FCA. The court dismissed based on the FCA’s first-to-file bar and Federal Rule of Civil Procedure 9(b). See United States ex rel. Hanks v. U.S. Oncology Specialty, LLP, No. 08-CV-3096, 2018 WL 4409832 (E.D.N.Y. Sept. 17, 2018); United States ex rel. Piacentile v. Amgen, Inc., No. 04-cv-3983, 2018 WL 4409838 (E.D.N.Y. Sept. 17, 2018). In 2012, Amgen pleaded guilty and paid $762 million as part of a global criminal and civil settlement relating to illegal off-label promotion, kickbacks, and other practices relating to Aranesp and other drugs—the largest settlement of its kind at the time. See here for a DOJ press release regarding that settlement.

Department of Justice / False Claims to Medicare and TRICARE

A federal district court in Kentucky entered a $1.3 million judgment against a toxicology laboratory for allegedly submitting false claims to Medicare and TRICARE, after providing physicians with free testing supplies to induce referrals in alleged violation of the Anti-Kickback Statute, Stark Law, and FCA. See here for DOJ’s press release relating to the settlement.

Department of Justice / Civil Asset-Forfeiture Proceeding

In FCPA news, a federal district court in New Jersey entered a default judgment in favor of DOJ in a civil asset-forfeiture proceeding, in the amount of $3,415,000. See United States v. $3,415,000.00 in United States Currency, No. 17-4429, 2018 WL 4380993 (D.N.J. Sept. 14, 2018). The judgment relates to the Linde Gas FCPA case. In June 2017, under DOJ’s FCPA Pilot Program, DOJ issued Linde a declination letter relating to the allegations, and Linde agreed to disgorge a total of roughly $11.2 million. See here for the declination letter.

Department of Justice / International Lottery Fraud Scheme

Last week, a federal jury in North Dakota convicted a defendant for her role in a Jamaican lottery-fraud scheme that allegedly targeted victims over the age of 55 and involved the purchase of victim lists and individuals posing as FBI and IRS agents, leading to more than $6.7 million in losses. The Jamaican lottery fraud scheme is listed in the United States as a Top International Criminal Organization Target (TICOT). DOJ reports that, nationwide, the number of Jamaican lottery-fraud victims is in the millions, with some estimates of annual losses in excess of $1 billion. See here for the DOJ press release.

SEC News

Securities and Exchange Commission / Investment Advisers Charged

The SEC charged an Indianapolis-based investment advisory firm and its sole owner with allegedly selling roughly $13 million of high-risk securities to more than 120 advisory clients, without disclosing that the firm and its owner stood to receive commissions of up to 18% from the sales. See here for the SEC press release.

Securities and Exchange Commission / Whistleblower Award

A whistleblower stands to receive an award of $1.5 million for providing the SEC with vital information and assistance in an enforcement action. The SEC has awarded approximately $322 million to 58 individuals since issuing its first award in 2012. See here for the SEC press release.

Securities and Exchange Commission / SeaWorld and Former CEO Settle Charges

SeaWorld Entertainment Inc. and its former CEO have agreed to pay more than $5 million to settle fraud charges for allegedly misleading investors about the impact that the documentary film Blackfish had on its reputation and business. See here for the SEC press release.

Securities and Exchange Commission / Clovis, Executives Charged

Clovis Oncology Inc., a Colorado-based biopharmaceutical company, and its CEO and former CFO will pay more than $20 million in penalties to settle charges that it allegedly misled investors about the effectiveness of the company’s flagship lung-cancer drug. See for the SEC press release.

AF Health Care

Health Care Counsel / A Pebble in the Pond?

Over at Arent Fox’s Health Care Counsel blog, our colleagues ask whether a recent decision by Judge Collyer in US District Court for the District of Columbia calls into question CMS regulations that impose liability on Medicare providers for failing to proactively identify Medicare overpayments. See here. The case is UnitedHealthcare Insurance Company v. Azar, --- F. Supp. 3d ---, 2018 WL 4275991 (D.D.C. 2018).