On February 27, a Minnesota federal court jury ruled in the favor of the U.S. Department of Justice (DOJ) in a False Claims Act (FCA) case based on allegations of Anti-kickback Statute (AKS) violations. The focus of the case was on “lavish hunting, fishing and golf trips, private plane flights, frequent-flyer miles” and other remuneration allegedly provided to ophthalmologists to induce them to use the defendants’ products. The $43 million verdict handed down in U.S. ex rel. Fesenmaier v. The Cameron-Ehlen Group Inc. et al. could grow significantly due to the potential for triple damages and per claim fines of between $5,500 and $11,000 under the FCA. While it is unclear how much the total recovery will be, application of the minimum per claim fine along with treble damages points to an amount that could exceed $400 million.
The Anti-kickback Statute & False Claims Act
Like many FCA actions, the Fesenmaier case arose from allegations made by a whistleblower who filed a complaint with the DOJ. A key reason the FCA has been so successful as a vehicle for pursuing health care fraud is because of the financial incentive available to individuals who bring these cases to the attention of DOJ which allows those individuals to receive a portion (between 15% and 30%) of the recovery. Whistleblowers in FCA cases were paid over $488 million in fiscal year 2022 from these cases. The whistleblower in Fesenmaier worked for the corporate partner of one of the defendants for...
A La Habra-based provider of positron emission tomography scan services has agreed to pay more than $8.3 million to resolve allegations it violated the False Claims Act by offering improper payment...