Monthly Archives

January 2019

U.S. Announces $269.2 Million Settlement With Walgreens In Two Civil Healthcare Fraud Lawsuits

By | Business Fraud, False Claims Act Litigation, Qui Tam Lawsuits, Qui Tam Litigation, whistleblower lawyers

The Department of Justice U.S. Attorney’s Office Southern District of New York (Manhattan U.S. Attorney) announced on January 22, 2019 that the United States filed and settled two healthcare fraud lawsuits against national pharmacy chain Walgreens Boots Alliance, Inc. (“Walgreens”) in which Walgreens must pay the United States and state governments a total of $269.2 million.

First Settlement – Insulin Pens

The U.S. alleged that Walgreens routinely submitted false days-of-supply data to federal healthcare programs when it sought federal reimbursement for insulin pens it dispensed to federal beneficiaries who did not need them. The U.S. alleged that Walgreens engaged in two practices that resulted in the fraudulent submissions: Walgreens configured its electronic pharmacy management system to prevent its pharmacists from dispensing less than a full box of five insulin pens, even when patients did not need that much insulin; and when a full box of insulin pens exceeded the federal healthcare program’s limit on the total days of supply (i.e., the total number of daily doses) that could be dispensed and reimbursed at that time, Walgreens allegedly evaded this restriction by falsely stating in its reimbursement claims that the total days of supply did not go over the limit. The U.S. contended that as a result, federal healthcare programs paid Walgreens millions of dollars for insulin that many beneficiaries did not actually need, and substantial quantities of valuable medication were wasted. The U.S. alleged that this conduct also opened the door to potential healthcare risks and abuse, such as the improper resale of insulin pens on the Internet.

The settlement requires Walgreens to pay approximately $168 million to the U.S., and Walgreens agreed separately to pay approximately $41.2 million to state governments. The settlement was approved on January 16, 2019 by a federal judge and was unsealed on January 22, 2019.

Second Settlement – Discount Drug Pricing

The U.S. alleged that Walgreens operated a program called the Prescription Savings Club (“PSC”) under which customers received discounts when they ordered drugs from Walgreens. Medicaid regulations required Walgreens to seek Medicaid reimbursement only at the lowest of certain drug price points, including the “usual and customary price” (“U&C price”). Medicaid rules of many states defined the U&C price as the price offered through discount programs like the PSC. Contrary to these requirements, Walgreens allegedly did not disclose to Medicaid the discount drug prices it offered customers through the PSC when it sought reimbursement from Medicaid. As a result, Medicaid programs paid Walgreens more in reimbursements than it would have paid had Walgreens disclosed the lower PSC prices.

The settlement requires Walgreens to pay a total of $60 million, of which approximately $32 million is to the United States and approximately $28 million will go to state governments. The second settlement was approved on January 15, 2019 by a federal judge and was also unsealed on January 22, 2019.

In both settlements, Walgreens admitted and accepted responsibility for conduct the U.S. alleged in its complaints under the False Claims Act. Both cases arose from lawsuits filed by whistleblowers under the False Claims Act.

Source

If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publically known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as qui tam attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.

Email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find qui tam lawyers who may handle your False Claims Act matter on a contingency basis.

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Two Ukrainian Nationals Indicted For Hacking EDGAR Reports

By | Data Breach

The U.S. Attorney’s Office for the District of New Jersey announced on January 15, 2019 that two Ukrainian men have been charged for their roles in a large-scale, international conspiracy to hack into the Securities and Exchange Commission’s (SEC) computer systems and profit by trading on critical information they stole.

The 16-count indictment alleges that from February 2016 to March 2017, the defendants and others conspired to gain unauthorized access to the computer networks of the SEC’s Electronic Data Gathering, Analysis and Retrieval (EDGAR) system, which is used by publicly traded companies to file required disclosures, such as annual and quarterly earnings reports. These filings contained detailed information about the financial condition and operations of the companies, including their earnings. Such information can, and often does, affect the stock price of the companies when it is made public, and is therefore highly confidential prior to its disclosure to the general public.

The EDGAR system allows companies to make test filings in advance of a public filing. These test filings often contain information that is the same or similar to the information in the final filing. The defendants allegedly stole thousands of test filings before they were released to the public, and sought to profit from their theft by using the information in the test filings to trade before the investing public learned the information.

The indictment alleges that in order to gain access to the SEC’s computer networks, the defendants used a series of targeted cyber-attacks, including directory traversal attacks, phishing attacks, and infecting computers with malware. Once the defendants had access to the test filings on the EDGAR system, they allegedly stole them by copying the test filings to servers they controlled. For example, between May 2016 and October 2016, the defendants extracted thousands of test filings from the EDGAR servers to a server they controlled in Lithuania.

The wire fraud conspiracy and substantive wire fraud counts with which the defendants are charged carry a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. The securities fraud conspiracy, computer fraud conspiracy, and substantive computer fraud counts with which the defendants are charged carry a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense.

Source

If your business is presently or may soon be involved in data breach litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find business litigation contingency lawyers who may handle your data breach litigation matter on a contingency basis.

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Massachusetts Strengthens Its Data Breach Law By Adding Amendments

By | Cyber Security, Data Breach

Massachusetts Governor Charlie Baker signed a new law on January 10, 2019  that significantly amends and strengthens Massachusetts’ data breach notification law when it becomes effective on April 11, 2019.

A new requirement requires an offer of complimentary credit monitoring for a period of not less than 18 months when the data security breach involves a Massachusetts resident’s Social Security number. The new law requires that a person who experienced a breach of security that involves a resident’s Social Security number to “file a report with the attorney general and the director of consumer affairs and business regulation certifying their credit monitoring services comply with” the new requirement to offer complimentary credit monitoring services for a period of not less than 18 months. If the breach happened at a credit monitoring agency, the agency would have to provide three-and-a-half years of free monitoring.

The new law (i.e., amendments to the existing law) requires a rolling notification to individuals under certain circumstances (“A notice provided pursuant to this section shall not be delayed on grounds that the total number of residents affected is not yet ascertained. In such case, and where otherwise necessary to update or correct the information required, a person or agency shall provide additional notice as soon as practicable and without unreasonable delay upon learning such additional information.” ). The amended law also requires that the notice to individuals must identify the name of the parent or affiliated corporation if the organization that experienced a breach of security is owned by another person or corporation.

The amended law includes a new requirement to inform the state regulators “whether the person or agency maintains a written information security program.” Massachusetts regulations currently require “[e]very person that owns or licenses personal information about a resident of the Commonwealth [to] develop, implement, and maintain a comprehensive information security program.” 201 CMR § 17.03(1).

Credit reporting agencies will be required to provide a “security freeze” free of charge when a consumer requests it, and third parties to gain consumers’ written consent before obtaining credit reports for non-credit purposes. If someone requests a credit freeze from one credit agency, that agency would be required to tell them how to contact the other major credit agencies.

Upon request, a credit agency would be required to disclose what is in someone’s credit history and who the agency has provided a credit report to within the past six months, and up to two years for employment purposes.

A credit agency could not charge more than $8 for a copy of a credit report and could not charge at all if someone were turned down for a job, home rental or insurance due to poor credit during the past 60 days. The law sets out rules for disputing credit reports.

In signing the amendments into law, the Massachusetts Governor stated, “The improvements made to Massachusetts laws in this legislation are necessary to protect consumers from the consequences of data breaches that could expose personal information and to give consumers more control over their data and how it is used.”

Source

If your business is presently or may soon be involved in data breach litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find business litigation contingency lawyers who may handle your data breach litigation matter on a contingency basis.

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Massachusetts Data Breach Law

By | Cyber Security, Data Breach

The Massachusetts Data Breach Notification Law requires businesses and others that own or license personal information of residents of Massachusetts to notify the Office of Consumer Affairs and Business Regulation and the Office of Attorney General when they know or have reason to know of a breach of security. They must also provide notice if they know or have reason to know that the personal information of a Massachusetts resident was acquired or used by an unauthorized person, or used for an unauthorized purpose. In addition to providing notice to government agencies, they must also notify the consumers whose information is at risk.

Definition Of Data Breach

A data breach is the unauthorized acquisition or use of sensitive personal information that creates a substantial risk of identity theft or fraud. Data breaches can be the result of criminal cyber-activity, such as hacking or ransomware, or because of employee error, such as emailing information to the wrong person.

Definition Of Personal Information

The law defines personal information as a resident’s first name and last name or first initial and last name in combination with any 1 or more of the following data elements that relate to such resident:

(a) Social Security number;

(b) driver’s license number or state-issued identification card number; or

(c) financial account number, or credit or debit card number, with or without any required security code, access code, personal identification number or password, that would permit access to a resident’s financial account.

Personal information does not include information that can be legally obtained from publicly available sources, such as addresses or birthdays.

Requirements For Reporting Data Breach

Within a reasonable amount of time after either the discovery of a breach or knowledge that personal information was obtained, the business or entity that was breached must notify both the Office of Consumer Affairs and Business Regulation and the Attorney General’s Office of the breach.

The notification must include:

  • A detailed description of the nature and circumstances of the breach of security or unauthorized acquisition or use of personal information;
  • The number of Massachusetts residents affected as of the time of notification;
  • The steps already taken relative to the incident;
  • Any steps intended to be taken relative to the incident subsequent to notification; and
  • Information regarding whether law enforcement is engaged investigating the incident.

Some data breaches are a result of a breach from a third-party vendor or other entity. For example, in addition to the regular reporting requirements, the law also requires financial institutions to report when a debit or credit card they issue is compromised. This means a breach may have occurred at a retailer but if the consumer used their bank issued card, the financial institution reports the breach as well.

Source

If your business is presently or may soon be involved in data breach litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find business litigation contingency lawyers who may handle your data breach litigation matter on a contingency basis.

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Over $2.8 Billion Recovered From False Claims Act Cases In Fiscal Year 2018

By | Business Fraud, False Claims Act Litigation, Qui Tam Lawsuits, Qui Tam Litigation, whistleblower lawyers

The U.S. Department of Justice announced on December 21, 2018 that the Department obtained more than $2.8 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending September 30, 2018.  Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $59 billion.

Of the $2.8 billion in settlements and judgments recovered by the Department of Justice this past fiscal year, $2.5 billion involved the health care industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organizations, laboratories, and physicians.  This is the ninth consecutive year that the Department’s civil health care fraud settlements and judgments have exceeded $2 billion.  The recoveries included in the $2.5 billion reflect only federal losses but, in many of these cases, the Department was instrumental in recovering additional millions of dollars for state Medicaid programs.

In addition to combating health care fraud, the False Claims Act serves as the government’s primary civil remedy to redress false claims for federal funds and property involving a multitude of government operations and contracts.  These areas range from defense and national security to import tariffs and small business programs.

In 1986, Congress strengthened the Act by increasing incentives for whistleblowers to file lawsuits alleging false claims on behalf of the government.  These whistleblower, or qui tam, actions comprise a significant percentage of the False Claims Act cases that are filed.  If the government prevails in a qui tam action, the whistleblower, also known as the relator, receives up to 30 percent of the recovery.  Whistleblowers filed 645 qui tam suits in fiscal year 2018.

Of the $2.8 billion in settlements and judgments reported by the government in fiscal year 2018, over $2.1 billion arose from lawsuits filed under the qui tam provisions of the False Claims Act.  During the same period, the government paid out $301 million to the individuals who exposed fraud and false claims by filing these actions.

Source

If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publically known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as qui tam attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.

Email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find qui tam lawyers who may handle your False Claims Act matter on a contingency basis.

BusinessLitigationContingencyLawyers.com – The Practical Solution For Business Litigation

U.S. Intervenes In West Virginia Hospital False Claims Act Lawsuit

By | Business Fraud, False Claims Act Litigation, Qui Tam Lawsuits, whistleblower lawyers

The U.S. Department of Justice announced on December 21, 2018 that the United States has partially intervened in a lawsuit under the False Claims Act against Wheeling Hospital Inc. (Wheeling), R & V Associates Ltd. (R & V), and Ronald Violi in the U.S. District Court for the Western District of Pennsylvania. The government intervened with respect to allegations that Wheeling, which is located in Wheeling, WV, violated the Stark Law and Anti-Kickback Statute, and that those violations were caused by R & V, Wheeling’s contracted management consultant, and Violi, Wheeling’s CEO.

The Stark Law prohibits a hospital from billing Medicare for services referred by physicians that have an improper financial relationship with the hospital. The Anti‑Kickback Statute, in relevant part, prohibits offering or paying anything of value to encourage the referral of items or services covered by federal healthcare programs. The United States alleges that Wheeling’s compensation to a number of employed and contracted physicians violated these statutory prohibitions because that compensation was based on the volume or value of the physicians’ referrals or was above fair market value.

The lawsuit was initially filed in December 2017 by Louis Longo, who was previously employed as Wheeling’s Executive Vice President, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States for false claims and share in any recovery. The Act permits the United States to intervene and take over the lawsuit. Those who violate the Act are subject to treble damages and applicable penalties.

The case is captioned United States of America ex rel. Louis Longo v. Wheeling Hospital, Inc. et al., No. 17-cv-1654 (W.D. Pa.).

Source

If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publically known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as <em>qui tam</em> attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.

Email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find qui tam lawyers who may handle your False Claims Act matter on a contingency basis.

BusinessLitigationContingencyLawyers.com – The Practical Solution For Business Litigation

Federal Judge Limits Evidence To Be Admitted In Bayer AG’s Roundup Cancer Trial

By | Business Litigation, product liability lawsuits

As reported by Reuters on January 4, 2019, a federal judge overseeing lawsuits alleging Bayer AG’s glyphosate-based Roundup weed killer causes cancer declined to reconsider a ruling that limits evidence the plaintiffs in the litigation consider crucial to their cases. During a hearing in federal court in San Francisco, U.S. District Judge Vince Chhabria denied a plaintiff lawyer’s request to review the decision, saying trials before him should focus on scientific evidence.

On January 3, 2019, Judge Chhabria granted Bayer unit Monsanto’s request to split an upcoming trial into two phases. The order initially bars lawyers for plaintiff Edwin Hardeman from introducing evidence that the company allegedly attempted to influence regulators and manipulate public opinion. That trial is scheduled to begin on February 25, 2019, along with two other bellwether trials intended to help determine the range of damages and define settlement options for the rest of the 620 Roundup cases pending before the Judge.

The plaintiff’s lawyer argued during a hearing on January 4, 2019 that the Judge’s ruling is “unfair” as the plaintiffs’ scientific evidence allegedly showing glyphosate causes cancer is inextricably linked to Monsanto’s alleged wrongful conduct: “The science doesn’t exist in some isolated, untouched world,” adding that evidence of Monsanto’s alleged attempts to manipulate, misrepresent and intimidate scientists has to be included.

The plaintiffs’ lawyers contend that such evidence, including internal Monsanto documents, showed the company’s misconduct and were critical to a California state court jury’s August 2018 decision to award $289 million in a similar case. That award was subsequently reduced to $78 million and was then appealed.

Judge Chhabria advised the plaintiffs’ lawyers that he did not want plaintiffs to “focus on misrepresenting statements” by Monsanto employees: “My point is you’re mischaracterizing what Monsanto people have said, you’re putting your own spin on (it).”

Bayer denies that glyphosate causes cancer, contending that decades of independent studies have shown Roundup, the world’s most widely used weed killer, to be safe for human use. However, Bayer faces more than 9,300 U.S. lawsuits over Roundup’s safety in state and federal courts across the United States.

Pursuant to Judge Chhabria’s order, evidence of Monsanto’s alleged misconduct would be allowed only if glyphosate was found to have caused Hardeman’s cancer and the trial proceeded to a second phase to determine Bayer’s liability.

Source

If your business is presently or may soon be involved in business litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find business litigation contingency fee lawyers who may handle your business litigation matter on a contingency basis.

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J. P. Morgan Chase May Face Class-Action Lawsuit Alleging Manipulation Of Precious Metals Markets

By | Business Litigation, Class Action Lawsuits

J. P. Morgan Chase, the nation’s largest  bank, may face a class-action lawsuit alleging its manipulation of the precious metals markets for years, in light of at least six lawsuits having been filed over the past month in federal court in New York after a plea agreement involving a former J. P. Morgan precious metals trader was made public by federal prosecutors in Connecticut.

On November 6, 2018, the U.S. Attorney’s Office for the District of Connecticut announced that the former precious metals trader admitted that from approximately 2009 through 2015, he conspired with other precious metals traders at J. P. Morgan Chase to manipulate the markets for gold, silver, platinum and palladium futures contracts traded on the New York Mercantile Exchange Inc. (NYMEX) and Commodity Exchange Inc. (COMEX).

The trader and his fellow precious metals traders at J. P. Morgan Chase allegedly routinely placed orders for precious metals future contracts with the intent to cancel those orders before execution (the Spoof Orders).  This trading strategy was admittedly intended to inject materially false and misleading liquidity and price information into the precious metals futures contracts markets by placing the Spoof Orders in order to deceive other market participants about the existence of supply and demand.

The Spoof Orders allegedly were designed to artificially move the price of precious metals futures contracts in a direction that was favorable to the trader and his co-conspirators at J. P. Morgan Chase, to the detriment of other market participants.  In pleading guilty, the trader admitted that he learned this deceptive trading strategy from more senior traders at J. P. Morgan Chase, and he personally deployed this strategy hundreds of times with the knowledge and consent of his immediate supervisors.

Source

A potential class action lawsuit would include all persons who purchased or sold futures contracts or an option on NYMEX platinum or palladium or COMEX silver or gold between at least January 1, 2009 and December 31, 2015, which may include thousands of traders.

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If your business is presently or may soon be involved in class action litigation in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find class action lawyers who may handle your class action litigation matter on a contingency basis.

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