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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

Jury awards $73 million to plaintiff in transvaginal mesh lawsuit

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A woman injured by transvaginal mesh intended to treat urinary incontinence has received the largest jury award of any plaintiff to date in a transvaginal mesh lawsuit. Boston Scientific was ordered by a West Virginia jury to pay plaintiff Martha Salazar $73 million for injuries she received from the company’s bladder sling device. Salazar, 42, claims she was a healthy woman with a full-time job when she underwent surgery to repair a condition causing urinary incontinence. But she says the transvaginal mesh that was implanted in her – the Obtryx mesh – was defective, causing severe chronic pain. The $73 million ... 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

Whistleblower case against guardrail manufacturer to be re-tried this week

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A whistleblower who claims a leading guardrail manufacturer secretly changed the design of its guardrail systems, making them extremely dangerous and in some cases deadly, will have his case heard again this week after the first trial ended in a mistrial. Joshua Harmon, a safety advocate from Virginia, is suing Trinity Industries Inc. under the qui tam provisions of the federal False Claims Act, which allow private individuals to sue on behalf of the U.S. government. Mr. Harmon alleges that Trinity secretly changed the design of its widely used ET guardrail system to save money, shortening the end terminals. But ... 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

Commercial truck safety improvements slow to become law despite rise in crashes

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Two high-profile commercial truck crashes this year have re-ignited calls for new rules that would enhance highway safety for tractor trailers, but federal regulators have been slow to act, Bloomberg reports. On June 17, 30 Rock star and Saturday Night Live veteran Tracy Morgan was critically injured when an allegedly fatigued Walmart driver plowed his tractor trailer into Mr. Morgan’s limo van. In addition to injuring Mr. Morgan, the collision killed comedian James McNair and critically injured three others. Then on Sept. 26, a tractor trailer driving north on Interstate 35 in Oklahoma ran across the median into the southbound ... 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