Category

Enforcement

22 June 2018

Acting Associate Attorney General Discusses Trump Administration FCA Enforcement Policy

On June 14, 2018, at the ABA’s National Institute on the Civil False Claims Act and Qui Tam Enforcement, Acting Associate General, Jesse Panuccio, delivered wide-ranging remarks on the False Claims Act. Of particular interest, AAG Panuccio discussed several recent high profile enforcement priorities of the Trump Administration. (more…)

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04 May 2018

DOJ Backs Down From Challenge to CIDs Issued After It Declined to Intervene in FCA Case

Faced with a challenge to its authority to do so, DOJ recently withdrew several Civil Investigative Demands (“CIDs”) which it had issued after declining to intervene in a qui tam case brought by former employees who had accused their employer, Lexington Foot & Ankle Center PSC, of fraudulent billing.  In re Civil Investigative Demands 18-13-EDKY, 18-02-EDKY, and 18-03-EDKY, No. 5:18-cv-00283 (E.D. Ky.) (filed Apr. 23, 2018).  (more…)

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09 March 2018

DOJ Confirms Involvement in Opioid Litigation, Sheds Light on Potential Claims

In a series of speeches over the last week, DOJ has expanded on its commitment to organize enforcement efforts focused on manufacturers and distributors of opioids.  On February 27, AG Sessions announced the DOJ Prescription Interdiction & Litigation (“PIL”) Task Force, positioning it as a means aggressively to deploy “all available criminal and civil law enforcement tools . . . with a particular focus on opioid manufacturers and distributors.”  See https://www.justice.gov/opa/pr/attorney-general-sessions-announces-new-prescription-interdiction-litigation-task-force.  In that regard, Sessions suggested DOJ will leverage its decades of experience pursuing “off label” cases under the Food, Drug & Cosmetic Act (“FDCA”).  Specifically, “the PIL Task Force will build on and strengthen existing Department of Justice initiatives to ensure that opioid manufacturers are marketing their products truthfully and in accordance with Food and Drug Administration rules.”  (more…)

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07 March 2018

DOJ Pursues Private Equity Firm for Portfolio Company FCA Violations

On February 16, 2018, the U.S. Department of Justice (“DOJ”) filed a complaint in intervention against a compounding pharmacy, Patient Care America (“PCA”), alleging that the pharmacy violated the False Claims Act (“FCA”) by, among other things, paying illegal kickbacks to induce prescriptions for drugs reimbursed by TRICARE, the federal healthcare program for active duty military personnel, retirees, and their families.  What is notable about this particular case, however, is that DOJ is also pursuing claims against a private equity firm that had a substantial ownership stake in the pharmacy, based on allegations that principals in the fund were actively involved in the management of the pharmacy and helped implement the purportedly illegal strategy at issue in the complaint. (more…)

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31 January 2018

DOJ Emphasizes Limitations on the Permissible Uses of Agency Guidance Documents in Civil Enforcement Cases

Associate Attorney General Rachel Brand recently issued a memo (available here) reiterating DOJ’s new position that its litigators cannot use noncompliance with agency guidance documents as evidence of a legal or regulatory violation.  As the Associate AG commented in DOJ’s official press release (available here), “this policy helps restore the appropriate role of guidance documents and avoids rulemaking by enforcement.”  In the past, DOJ and relators frequently relied upon statements in a variety of sub-regulatory guidance, including HHS-OIG Advisory Opinions and CMS National and Local Coverage Determinations, as evidence of liability under the FCA.  However, the new policy constrains the permissible uses of such guidance.  While plaintiffs/relators can still use guidance documents for narrow purposes, such as to establish that a defendant had the requisite knowledge of relevant legal obligations, they cannot wield guidance documents as presumptive evidence of noncompliance. (more…)

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26 January 2018

Internal DOJ Memo Encourages Dismissal of More Non-Intervened Qui Tams

A recently leaked internal DOJ memo reveals a dramatic shift in DOJ’s approach to dismissal of non-intervened qui tam suits.  Citing the “significant resources” that the government expends even in non-intervened cases, the memo—drafted by Commercial Litigation Branch Director Michael Granston—sets forth a series of factors for lawyers with DOJ and U.S. Attorneys’ offices to consider when evaluating whether to seek dismissal of a qui tam case. (more…)

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07 December 2017

FCA Attention Turns To Electronic Health Records

CMS has recently committed significant resources to advance the use of electronic health records (“EHR”) systems.  One of the biggest initiatives is the “meaningful use” program, through which CMS offers incentive payments to healthcare providers who demonstrate and attest to using EHR systems that have certain qualities and satisfy specific objectives.  (more…)

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04 April 2017

FDA Delays Effective Date of Its Aggressive Final Rule on Intended Use

On March 20, 2017, FDA announced a further delay of the effective date of its January 9, 2017, Final Rule entitled Clarification of When Products Made or Derived From Tobacco Are Regulated As Drugs, Devices or Combination Products; Amendments to Regulations Regarding “Intended Uses,” and requested comments on the industry petition filed in February requesting a stay and reconsideration of the Final Rule.  82 Fed. Reg. 14319; 82 Fed. Reg. 2193.  The effective date of the Final Rule had already been delayed once by the incoming Administration.  As a result of this most recent announcement, the expansive interpretation of intended use proposed by FDA will not be enforceable until at least March 19, 2018, although the controversial accompanying preamble language could be invoked now, including in False Claims Act (FCA) cases based on alleged violations of the Federal Food, Drug, and Cosmetic Act (FDCA).

(more…)

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16 December 2016

DOJ Announces Record Number of New FCA Cases, $4.7 Billion in Fraud Recoveries in FY 2016

DOJ recently announced that it recovered over $4.7 billion in settlements and judgments from civil fraud cases in the fiscal year ending September 30, 2016.  That recovery is significantly higher than the $3.5 billion that DOJ recovered in FY 2015.  The FY 2016 amount is the third highest annual fraud recovery ever.

(more…)

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