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Consumer Fraud 420 articles

Investment and securities fraud is one area of consumer fraud litigation pursued by the attorneys at Beasley Allen. Litigation includes individual cases as well as class actions that have been filed throughout the country. Cases in this area also involve matters including wrongful conduct of insurance and finance companies including fraud and bad faith, mortgage loan fraud, general consumer fraud and employment issues. Pending cases include securities and investment fraud litigation against companies including Stanford Securities and Regions Morgan Keegan, among others.

Our firm also is representing people who have been taken advantage of in the workplace, through violations of the Fair Labor Standards Act (FLSA). In these cases, employers intentionally misclassify employees as independent contractors or managers in order to reduce costs such as overtime compensation, employee benefits, payroll taxes, unemployment compensation and workers compensation.

Texas guardrail maker loses whistleblower case, jury orders company to pay $175 million

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A Texas guardrail manufacturer accused by a whistleblower of defrauding the federal government has been ordered to pay $175 million by a federal jury. Dallas-based Trinity industries for years has manufactured guardrail systems for the Federal Highway Administration (FHA), which uses them on highways in most every state. In 2012, whistleblower Josh Harman, a Virginia guardrail installer and safety advocate, sued Trinity under the qui tam provisions of the False Claims Act, accusing the company of secretly changing the design of its government-approved ET-Plus guardrail system. According to Mr. Harman, the redesigned ET-Plus guardrails cost less for Trinity to produce ... Read More

Merck company Organon to pay several states $31 million to settle Medicaid fraud allegations

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Following an investigation into possible Medicaid fraud, Drug maker Organon USA Inc., a subsidiary of pharmaceutical giant Merck, has agreed to pay $31 million to settle allegations by several U.S. states that it overcharged their Medicaid programs for the anti-depressant Remeron and Remeron SolTab. The states claimed that Organon encouraged pharmacies to offer Remeron to their nursing home clients by providing the drug at a discount, which gave Organon a competitive edge against other drug manufacturers. Organon then reported the drug’s full cost when it sought reimbursements from the Medicaid programs in multiple states, the plaintiffs alleged. Washington D.C. and ... Read More

Generic drug maker Ranbaxy settles Texas Medicaid fraud lawsuit for $40 million

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Indian generic drug manufacturer Ranbaxy Laboratories has agreed to pay the State of Texas nearly $40 million to resolve a Texas Medicaid fraud lawsuit alleging the company defrauded the Texas Medicaid program by reporting inflated market prices for its drugs, resulting in larger reimbursements. The agreement calls for Ranbaxy to pay the Texas general revenue fund and the federal government each $17.875 million and another $4 million in attorney fees to the state’s attorney general office. The federal government receives a percentage of the settlement funds because it subsidizes state Medicaid programs. The payments, totaling $39.75 million, will be made in ... Read More

Anti-insurance-fraud coalition objects to Illinois court’s ruling against whistleblower

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The Coalition Against Insurance Fraud has filed an amicus brief in Illinois state appellate court following a lower court’s ruling that struck down a physical therapist’s whistleblower complaint. According to the Property Casualty 360, the Coalition believes the Illinois court’s decision will weaken the state’s whistleblowing laws and diminish fraud-fighting efforts there. The objectionable ruling centers on complaint brought by Jocelyn Zolna-Pitts against her former employer accusing the clinic of routinely overbilling insurers for patient services. Ms. Zolna-Pitts filed her whistleblower lawsuit in an Illinois Circuit Court under the state’s Insurance Claims Fraud Prevention Act. The court dismissed the lawsuit, ... Read More

Nursing home giant settles fraud allegations for $38 million

One of the largest nursing home chains in the United States has agreed to pay the federal government $38 million to settle False Claims Act allegations that it routinely billed Medicare for “substandard” and “worthless” patient care services and therapy services that were medically unnecessary or unreasonable, the Justice Department announced Friday. The settlement between the federal government and Extendicare Health Services, which operates 146 facilities in 11 states, is the largest False Claims Act settlement involving “failure of care” allegations the Justice Department has ever reached with a nursing home company. “Protecting this nation’s vulnerable populations – including our ... Read More

Kmart exposed customer credit and debit card information throughout month-long data breach

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According to a recently submitted SEC filing, Kmart, a subsidiary of Sears Holding Corporation, has had an unconfirmed amount of credit card numbers stolen during a month-long data breach. Kmart, which has roughly 1,200 stores across the United States, is just the latest retailer affected in what appears to be the greatest amount of data breaches to occur in a year’s time. Kmart’s IT team was responsible for discovering the breach on October 9, despite the malware being “undetectable by current anti-virus systems.” Although Kmart confirms that the malware has been removed from its system, the investigation concluded that debit and credit ... Read More

Whistleblower says Northrop Grumman faked key tests on military GPS systems

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A longtime employee of defense contractor Northrop Grumman Inc. alleges in a whistleblower lawsuit that the company failed to take vital safety precautions and faked critical tests on GPS navigational systems it manufactured for use in military aircraft and submarines. The lawsuit, filed in 2012 by Todd Donaldson in a Salt Lake City federal court, was unsealed last week after the U.S. Justice Department declined to intervene. Mr. Donaldson asserts that Northrop Grumman’s shortcuts could have catastrophic consequences. By skipping critical tests that assure the LN-100 GPS system communicates properly with satellites, Northrop Grumman put military jets, drones, and submarines ... Read More

Dairy Queen suffers data breach stemming from infamous Backoff malware

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The recent slew of data breaches has claimed its latest victim. Dairy Queen (DQ) announced a data breach this week. According to the ice cream/fast food chain, 395 of its locations throughout the country, as well as one Orange Julius location, were compromised by Backoff malware between August and September of this year. The information stolen from the company included personal information such as customer names, credit/debit card numbers and expiration dates. “We are committed to working with and supporting our affected DQ and Orange Julius franchise owners to address this incident,” said John Gainor, president and CEO of International Dairy ... Read More

Appeals court tells lower court to reconsider JP Morgan whistleblower lawsuit

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A whistleblower who accused JPMorgan Chase & Co. of turning a blind eye to an Israeli client’s massive fraud scheme but had her lawsuit tossed by a federal judge will have another chance to have her case heard, the 2nd U.S. Circuit Court of Appeals decided Thursday. Jennifer Sharkey, a former JPMorgan employee, started voicing her concerns about the client to JPMorgan executives in January 2009, just weeks after Bernie Madoff’s colossal Ponzi scheme was exposed. She claims that executives ignored her concerns that the client, which remains anonymous in public court documents, engaged in fraud and money laundering. Madoff ... Read More

Red Bull settlement among lawsuits against makers of energy drinks

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Red Bull, which manufactures popular energy drinks, has agreed to pay $13 million to settle a false advertising lawsuit alleging that its product misled consumers into thinking consuming the product would increase performance and reaction speed. Under the agreement, anyone who bought a Red Bull energy drink between Jan. 1, 2002, and Oct. 3, 2014, will receive either $10 cash or $15 worth of Red Bull products. The lawsuit alleges that the company misled consumers with its slogan “Red Bull gives you wings,” but did not back up its energy-boosting claims with scientific evidence. Red Bull has denied wrongdoing. Consumers have until ... Read More