False Claims-Qui Tam News

Two major whistleblower awards were revealed late last week.

Reuters is reporting a $1.7 million award to three Takata employees who exposed problems in airbag inflators.

In a separate case, CareWell Urgent Care Centers will pay $2 million to two states and the U.S. Department of Health and Human Services (HHS) to settle a case involving both overbilling and unnecessary care. The walk-in clinics allegedly overbilled Medicaid and the insurance plan for state employees, according to a release issued Friday from Massachusetts Attorney General Maura Healey. 

The case was triggered after a former CareWell nurse practitioner came forward, according to a story in The Boston Globe.

Aileen Cartier, who worked at several of the company’s locations for almost two years, said managers told staff to take medical histories and perform exams on patients that far exceeded what was needed for their simple ailments.
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Duke University reported in January that its scientists won $384.6 million last year from the National Institutes of Health, “ranking 9th in the country among universities, research institutions and teaching hospitals that are awarded the taxpayer-based research dollars.”

This week, they had to give some of it back.

Duke has agreed to pay $112.5 million to the U.S. Government to settle a suit brought by a whistleblowing lab tech. The case involves another research technician who fabricated data from 2006 to 2013. The findings were used in applications for some of those NIH-funded studies.

The government investigation began after Joseph M. Thomas brought a qui tam case under the False Claims Act. Thomas’s share of the settlement will be $33,750,000.

The Justice Department announcement quoted U.S. Attorney Matthew G.T. Martin saying that taxpayers expect federal grant dollars will be used honestly.

“Individuals and institutions that receive research funding from the federal government must be scrupulous in conducting research for the common good and rigorous in rooting out fraud,” the statement notes.  “May this serve as a lesson that the use of false or fabricated data in grant applications or reports is completely unacceptable.”
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Title page Supreme Court case 18-31`5Members of the Supreme Court are skeptical of interpreting the statute of limitations in False Claims Acts cases in a way that would “help fraudsters,” according to attorney Stephen M. Kohn, who attended arguments today in a key False Claims Act case.

Kohn is author of an amicus brief in the case submitted on behalf of the National Whistleblower Center. A decision in Cochise Consultancy, Inc. v. United States, will determine the statute of limitations window for False Claims Act (FCA) cases when the government declines to intervene.

“The Justices appeared to understand the purpose of the False Claims Act is to help the government uncover fraud and were skeptical of interpreting the statute of limitations in a manner that would help fraudsters,” Kohn noted

More from Kohn’s report:

Demonstrating the Courts understanding as to why Congress would have wanted a longer statute of limitations when the relator moves a False Claims Act case forward, even without the government, Justice Sotomayor noted that, “in qui tam the recovery in bulk goes to the government.”
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The Supreme Court is scheduled to hear arguments on Tuesday in Cochise Consultancy, Inc. v. United States, a case that will determine the statute of limitations window for False Claims Act (FCA) cases when the government declines to intervene.

At issue: How should the statute of limitations apply in a qui tam suit in which the United States declines to intervene? Does the three-year limitations period begin to run from the date of the whistleblower’s knowledge of the alleged false claim? Or does it begin on the date of the government official’s knowledge of the alleged false claim?

The case revolves around whistleblower Billy Joe Hunt. In 2013, he filed a qui tam case alleging fraud by his former employer, a war contractor performing munitions clean-up work in Iraq in 2006. The government declined to intervene in Hunt’s case and it was dismissed by a district court. The Eleventh Circuit then allowed the case to go forward ruling that the FCA’s three-year limitations period was triggered by the government’s knowledge of the alleged fraud—not the whistleblower’s knowledge.

Those arguing in support of the Eleventh Circuit ruling include the federal government and a 20-state coalition. An amicus brief filed on the coalition’s behalf by the Indiana attorney general argues that the states have a “strong fiscal interest in ensuring the False Claims Act (FCA) provides adequate time to investigate, prepare, and file FCA claims.”


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The Department of Defense Inspector General (DOD IG) should coordinate with the military services to do a better job of protecting whistleblower confidentiality and addressing delays in handling cases, according to a new report.

The Government Accountability Office report found the IG offices have made progress since past reviews, but needs to do more to protect confidentiality. The review found that employees without “the need to know” have had access to sensitive whistleblower information.

While the timeliness of handling cases has improved in some areas, delays persist in others, according to the report. For example, the average number of days to complete military and contractor reprisal investigations increased between 2017 and 2018 from 394 days to 541 days.

The DOD IG completed closed 73 investigations in 2018, including 13 senior official misconduct cases and 60 military, contractor, and civilian reprisal cases. However, about 85 percent of all investigations “did not meet the timeliness goals.”


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The False Claims Act (FCA) has long served as a powerful weapon against fraud and waste in government programs, from rancid Civil War rations to Medicare scams. The Department of Justice (DOJ) recovered $2.88 billion under the law last year, with whistleblowers involved in the majority of cases.

March 2 marks the anniversary of the law, which was signed in 1863 by President Abraham Lincoln. After the Civil War, the FCA continued to identify military contractors guilty of mismanagement and fraud. With rising health costs, much of it covered by Medicare, most cases now involve medical providers and suppliers. The DOJ’s December report noted that $2.5 of the $2.8 billion in recovery involved the health care industry. The first line of a story in the trade publication Modern Healthcare reports “Healthcare industry groups have always hated False Claims Act whistleblower lawsuits.”


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When does the statute of limitations clock start running in a False Claims Act (FCA) case when the government declines to intervene in a whistleblower case?  That is the question the Supreme Court will consider when it takes up Cochise Consultancy, Inc. v. United States.

The National Whistleblower Center filed an amicus curiae brief in the case this week.

At issue: Must an FCA plaintiff rely on the statute of limitations in a suit in which the United States declines to intervene? If so, does the three-year limitations period begins to run from the date of the whistleblower’s knowledge of the alleged false claim, or from the date of the government official’s knowledge of the alleged false claim?

The brief, written by NWC board chair Stephen M. Kohn, notes that his organization takes the position that the “merits of a claim often bear no relation to the duration of a case.”
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Some might see whistleblowers as lucky lottery winners when their multimillion-dollar rewards come through. But, the title of the piece in the February 4 issue of The New Yorker reflects the other side of the story: “The Personal Toll of Whistleblowing”

“Whistleblowers are usually, but not always, employees or members of the group on which they’re blowing the whistle; after they do so, their lives are never the same,” writes Sheelah Kolhatkar. She joined The New Yorker in 2016 after a writing about Wall Street and financial crime for Bloomberg Businessweek.

“Institutional denial, obfuscation, and retaliation are hallmarks of many whistle-blowing cases,” she writes.

new york whistleblower artKolhatkar runs through a list of notable whistleblowers, including New York City police officer Frank Serpico, tobacco company whistleblower Jeffrey Wigand; Sherron Watkins of Enron; and National Security Agency contractor Edward Snowden. That they were all portrayed in Hollywood films is no surprise. Whistleblower tales are often David versus Goliath dramas.


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William Barr Attorney General nominee William Barr this morning committed to “diligently uphold” the False Claims Act during a Senate Judiciary Committee hearing on his nomination.

Under questioning from Sen. Chuck Grassley, Barr said the constitutionality of the law has been upheld by the Supreme Court.

Grassley asked: “If confirmed do you commit to not take action to undermine the False Claims Act? Further if confirmed will you continue Justice department staff and funding levels to to properly pursue and and prosecute cases under the FCA?”

Barr: “Yes, I will diligently enforce the False Claims Act.”


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While serving as Assistant Attorney General under the first President Bush, William Barr took aim at the whistleblower provisions of the False Claims Act.

Whistleblower Lawyer Stephen M. Kohn
Stephen Kohn

Now President Donald Trump’s Attorney General nominee, Barr stood alone among top Justice Department officials in vehemently opposing” the provisions,  Stephen M. Kohn, a partner in the firm Kohn, Kohn and Colapinto writes in the January 13 issue of The Hill.

“Although his arguments against the False Claims Act have long been discredited, his underlying reasoning reveal a deep-seated animus against whistleblowers,” Kohn writes.

The National Whistleblower Center has issued an “Action Alert,” calling on supporters to contact members of the Senate and urge them to Question Barr on his prior anti-whistleblower positions :


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