United States ex rel. Cox Et Al v. Medtronic (D. Minn.) – $23.5 Million Settlement

Case Description

Case Type: Whistleblower/Qui Tam
Company: Medtronic

(December 12, 2011, Washington, DC)  Medtronic, Inc, one of the world’s largest medical device manufacturers, has agreed to a $23.5 million settlement with the U.S. Department of Justice (DOJ), the Office of the Inspector General for the Department of Health and Human Services, and four relators in a qui tam suit related to cardiac rhythm management devices sold by Medtronic in the U.S., including pacemakers and implantable cardioverter defibrillators (ICDs).

The settlement ends a federal qui tam suit filed in Minnesota by Sanford Heisler Sharp, LLP, as well as a similar qui tam suit filed in California.  Both suits alleged Medtronic violated the U.S. False Claims Act by using post-market studies and device registries as vehicles to pay participating physicians kickbacks for implanting its pacemakers and ICDs in Medicare or Medicaid beneficiaries.

Under today’s agreement, three relators will share a settlement of some $3.8 million. The fourth relator named in the settlement will receive $160,160.

“Our society owes an enormous debt to individuals with the courage to blow the whistle when medical device makers try to influence physicians,” said David Sanford, Chairman of Sanford Heisler Sharp, LLP. “When the use of procedures or devices is driven by corporate greed rather than medical need, it creates a potentially dangerous situation for patients and contributes to escalating medical costs.”

The qui tam or whistleblower provisions of the False Claims Act permit private citizens, called “relators,” to bring lawsuits on behalf of the United States and receive a portion of proceeds of any settlement or judgment.

Sanford Heisler Sharp Of Counsel Grant Morris, one of the attorneys representing the relators, added, “We are pleased to play a role in shining a light into this dark corner of medical device marketing. Medtronic has done the right thing by settling this matter.”

Medtronic simultaneously entered into separate settlement agreements with certain states and the District of Columbia based on allegations that the company used its post-market studies and physician registries to promote the submission of similar false claims under those states’ Medicaid programs.

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