Monday, April 27, 2009

Hurricane Katrina Contractor Settles with U.S. Government for $4 Million

A Virginia based disaster relief company and its partners will pay the U.S. government $4 million to settle a False Claims complaint alleging the company accepted payment for work which was not completely performed based on a contract with the Department of Homeland Security.

The company, Lighthouse Disaster Relief and its partners Gary Heldreth and Kerry Farmer were hired to help with rescue and recovery efforts by building and staffing a base-camp to house first responders after Hurricane Katrina. The contracting company and partners were also accused of making false statements to receive payments early. The contract stipulated the base was to shelter and feed 1,000 relief workers, yet never supported more than 400.

The investigation was conducted by the U.S. Attorney’s Office for the Middle District of Louisiana, the Civil Division of the U.S. Department of Justice and was assisted by the Office of Inspector General of the Department of Homeland Security.

Click here to learn more about the $4 million settlement over Katrina relief support

Tuesday, April 21, 2009

Alta Colleges Pay U.S. $7 Million for False Claims; Initial Suit by Unnamed Whisltblowers

Alta Colleges Inc., the parent company of Westwood College in Fort Worth, Texas, will pay the U.S. government $7 million for allegedly submitting false claims for federal student aid funds.  Alta’s Texas colleges were accused of misrepresenting compliance with professional licensing and state job-placement reporting requirements.

The federal suit was initially filed by unnamed whistleblowers who will receive $1.19 million in the settlement.

Alta’s chief executive, George Burnett released a statement to faculty and staff explaining that the, “company had acted lawfully, but had settled because of the time and expense associated with litigation.” Alta Colleges is headquartered in Denver and owns 19 campuses in California, Colorado, Georgia, Illinois, Texas and Virginia.

The suit was investigated by the U.S. Department of Education, while the coordinated effort of the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Northern District of Texas reached the final settlement.

Click here for the Department of Justice official release on the $7 million settlement between the U.S. government and Alta Colleges and click here for more information on the alleged false claims by the company

Friday, April 17, 2009

Government Wins $128 Million in Qui Tam Suit Against NetApp

The whistle has been blown on a General Services Administration (GSA) contractor who will now pay the U.S. government $128 million for allegedly failing to offer, “its best commercial pricing on information technology goods and services.” A lawsuit was filed by former Network Appliance (NetApp, Inc.) employee, Igor Kapuscinski, who’s complaint led to the investigation.

In February 2003, a GSA analyst reached out to obtain information from NetApp during a “review of orders”. Kapuscinski’s concerns that NetApp had not given the same price decrease offered to commercial customers, an explicit requirement in a contract between the two, were dismissed by his supervisors. Kapuscinski filed the lawsuit against NetApp on the government’s behalf.

Click here for the full article, “Government wins $128 million settlement from GSA contractor"

Businessman Blows the Whistle on Quest Diagnostic - Ends in $302 Million Settlement

In the largest qui tam settlement paid by a medical lab company, Quest Diagnostics settled for $302 million with the U.S. government for allegedly distributing medical kits despite complaints of inaccurate test results. The faulty tests put hundreds of thousands of dialysis patient’s health at risk. In some cases the tests resulted in patients receiving unnecessary surgery or treatment. The tests were manufactured and sold between 2000 and 2006.

A California businessman and biochemist was the original whistleblower on the investigation.

Click here for the full story, “Businessman Exposed Problems With Quest Subsidiary’s Blood Test Kits; Led to $302 Million Settlement"

Thursday, April 16, 2009

West Virginia Hospital Pays to End Investigation of Previous Owner's Fraudulent Claims

A qui tam settlement for $690,000 has been reached between a Huntington, West Virginia long-term acute care hospital and the U.S. Attorney’s Office for improper billing practices. The former owners of Cornerstone Hospital were accused by two former employees for submitting fraudulent claims to Medicare to obtain, “improper and enhanced payments”. The current owners were unaware of the alleged actions of the former owners and cooperated with the investigation.

The former employees will receive 20 percent of the settlement according to the qui tam provision of the false claims act in which persons who file a lawsuit on behalf of the government, are entitled to a percentage of the government’s recovery.

Click here to read the full article, “Cornerstone Hospital Agrees to Payment to End Investigation"

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