Whistleblower and Qui Tam Cases

Organizations: Aurora Behavioral Healthcare – Santa Rosa, LLC and Signature Healthcare Services, LLC

After more than three years of litigation, attorneys at Sanford Heisler Sharp McKnight and Valerian Law announced they reached a landmark Private Attorney General Act (PAGA) settlement on behalf of a former nursing leader at a North Bay acute psychiatric hospital.

Sanford Heisler Sharp McKnight and the U.S. Government settled a whistleblower action under the False Claims Act (“FCA”) with International Vitamin Corporation (“IVC”), a leading importer of dietary supplements, in January 2023. As part of the settlement, IVC agreed to pay the government $22.865 million. The relator, who is represented by Sanford Heisler Sharp McKnight, will receive 20% of the settlement—over $4.5 million. The case alleged that IVC systematically skirted customs duties on thousands of imports of nutritional supplements from China between January 1, 2015 and September 13, 2019 by fraudulently reporting incorrect tariff classifications and duty rates on the imports. The Complaint also alleged that IVC knew that it had evaded more than $10 million in duties but failed to inform the Government and pay the duties as required under applicable law.

In 2013, Duquoin Burgess, a former contract director at Navistar, filed the Complaint against Navistar Defense and Navistar International for violations of the False Claims Act. Seven years later, Navistar agreed to pay $50 million to resolve the FCA allegations.

Sanford Heisler Sharp McKnight today announced that luxury jeweler Temple St. Clair has agreed to pay the United States Government $796,000 to settle claims brought by a whistleblower under the False Claims Act. The suit was filed in the United States District Court for the Southern District of New York in 2015. The case is thought to be the first in New York to recover money for the United States government based on the defendant’s failure to properly mark its products with their country of origin.

In 2014, Sanford Heisler Sharp McKnight filed a whistleblower action on behalf of the Relator, a former employee of Roche Diagnostics, alleging that the company violated the Anti-Kickback Statute and False Claims Act by submitting false claims to the Medicare Advantage program, and that when the whistleblower reported this fraudulent activity to corporate management she was terminated in retaliation.

In April 2019, Sanford Heisler Sharp McKnight and the U.S. Government settled a whistleblower case brought under the False Claims Act (“FCA”) with Fortinet, a publicly held network security company headquartered in Sunnyvale, Ca. As part of the settlement, Fortinet agreed to pay the Government $545,000. The Relator, represented by Sanford Heisler Sharp McKnight, received $103,550, or 19% of the total settlement.

United States of America et al. v. Bon Secours New York Health System, Inc., et al.

The original complaint in this matter (SDNY Case 1:10-cv-09650) was filed in U.S. District Court for the Southern District of New York on December 29, 2010, and unsealed by an Order of the Court on April 21, 2015. Relator asserts that between December 2004 until 2015, Bon Secours Health System, Inc., Bon Secours New York Health System and Schervier Long Term Home Health Care Program defrauded Medicaid and Medicare by filing millions of dollars in false claims for home health services provided to elderly and homebound patients. Poughkeepsie resident June Raffington, a licensed nurse in New York since 1986, is the relator in this qui tam matter.

Sanford Heisler Sharp McKnight brought a whistleblower/qui tam matter against AtriCure Inc., (“AtriCure”), a medical device manufacturer. Subsequently, AtriCure agreed to pay $4.15 million to resolve all claims against it. The Complaint charged that AtriCure violated the Federal False Claims Act by using illegal kickbacks and an off-label marketing campaign to induce doctors and hospitals to perform AtriCure’s costly inpatient cardiac surgical ablation procedures rather than standard, and more effective outpatient catheter ablation procedures. As a result, the Medicare program faced substantially increased costs from AtriCure’s unnecessary and expensive procedures.

In July 2009, Sanford Heisler Sharp McKnight and the U.S. Government settled a whistleblower action under the False Claims Act (“FCA”) with Endoscopic Technologies, Inc. (“Estech”), a medical device manufacturer.

On March 24, 2016, Sanford Heisler Sharp McKnight filed a whistleblower action under the False Claims Act on behalf of the U.S. Government and the Relator, a former Director of Business Operations at San Diego’s Scripps Health System.

In December 2015, Sanford Heisler Sharp McKnight and the U.S. Government settled a whistleblower action under the False Claims Act (“FCA”) and the Anti-Kickback Statute with San Diego-based genetic testing giant Pathway Genomics Corporation (“Pathway”).

In October 2013, Sanford Heisler Sharp McKnight, Relator’s co-counsel, and the United States Government settled a whistleblower action under the False Claims Act (“FCA”) with Omnicare, Inc., the nation’s largest provider of pharmacy services to nursing home patients. As part of the settlement, Omnicare agreed to pay the Government $124.24 million. The Relator, represented by Sanford Heisler Sharp McKnight and its co-counsel, received approximately 17% of the settlement, or $17.24 million.

In January 2014, Sanford Heisler Sharp McKnight and the U.S. Government settled a False Claims Act (“FCA”) whistleblower action with the City of New York’s Department of Education (“DOE”). As part of the settlement, the City agreed to pay the Government $1.375 million. The Relator, Dana Ohlmeyer, who was represented by Sanford Heisler Sharp McKnight, received 15% of the settlement, or $206,250.

In September 2014, Sanford Heisler Sharp McKnight and the U.S. Government settled a whistleblower action under the Trade Agreements Act (“TAA”) and the False Claims Act (“FCA”) with Smith and Nephew, Inc., one of the world’s largest medical device manufacturers.

The whistleblower, represented by Altomease Kennedy and California co-counsels, alleged that Office Depot violated the California False Claims Act by overcharging numerous governmental entities, including the city and county of Los Angeles, for office and classroom supplies, and failing to offer them the company’s “best price.” The city of Los Angeles received the largest settlement allocation of more than $11 million.