After a rare False Claims Act (FCA) trial—especially one premised on violations of the Anti-Kickback Statute (AKS)—a federal jury in Minnesota returned a $43 million verdict against Precision Lens, a distributor of medical supplies and devices used in eye surgeries, and its owner, both of which were accused of paying kickbacks to physicians. The verdict triggers potential FCA liability exposure of nearly $490 million.
On February 27, 2023, Cameron-Ehlen Group, Inc., doing business as Precision Lens, and its owner (collectively, the defendants) were found by a federal jury in Minnesota to be in violation of the AKS and, in turn, the FCA by paying unlawful kickbacks to physicians to buy and use the products supplied by the defendants in surgeries paid for by Medicare. After the verdict on March 17, the US Department of Justice (DOJ) requested that the court enter judgment, ordering the defendants to pay nearly $490 million in treble damages and related statutory penalties under the FCA. Although the judgment is still pending, counsel for the defendants said their clients plan to appeal to the US Court of Appeals for the Eighth Circuit.
FCA cases rarely go to trial, largely because of the potential for severe financial consequences given the treble damages and related per-claim penalties under the FCA and federal program exclusion.
Given the rarity of FCA trials, this case merits a closer review.
PROCEDURAL HISTORY
The case's lengthy procedural posture began nearly a...
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