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80-455: In August 2015, the company announced plans to spin off 38 hospitals and its management and consulting subsidiary, Quorum Health Resources, into a new publicly traded company called Quorum Health Corporation . The company completed the spinoff of Quorum Health Corporation on April 29, 2016. Quorum owns or leases hospitals across 16 states, primarily in cities or counties with populations of 50,000 or less. In April 2020 Quorum declared bankruptcy and

160-706: A 2000 case, Vermont Agency of Natural Resources v. United States ex rel. Stevens , 529 U.S. 765 (2000), the United States Supreme Court held that a private individual may not bring suit in federal court on behalf of the United States against a State (or state agency) under the FCA. In Stevens , the Supreme Court also endorsed the "partial assignment" approach to qui tam relator standing to sue, which had previously been articulated by

240-506: A 2023 combined case, United States ex rel. Schutte v. SuperValu Inc. and United States ex rel. Proctor v. Safeway , a unanimous U.S. Supreme Court opinion rejected an attempt to dilute the FCA's "knowledge standard." Under the knowledge standard, a defendant is liable under the FCA if a false claim is "knowingly" submitted to the government for payment. The statute defines "knowingly" as acting with actual knowledge, deliberate ignorance, or reckless disregard. The unanimous opinion found that

320-423: A FCA suit filed by two whistleblowers. The suit alleged that Ortho-McNeil-Janssen Pharmaceuticals, Inc. (OMJPI) acted improperly concerning the marketing, promotion and sale of the anti-convulsant drug Topamax . Specifically, the suit alleged that OMJPI "illegally marketed Topamax by, among other things, promoting the sale and use of Topamax for a variety of psychiatric conditions other than those for which its use

400-525: A claim. The Fraud Enforcement and Recovery Act of 2009 reversed the Court's decision and made the types of fraud to which the False Claims Act applies more explicit. In a 2009 case, United States ex rel. Eisenstein v. City of New York , the United States Supreme Court considered whether, when the government declines to intervene or otherwise actively participate in a qui tam action under

480-543: A complaint from whistleblower Jerry H. Brown II, the US Government filed suit against Maersk for overcharging for shipments to US forces fighting in Iraq and Afghanistan. In a settlement announced on 3 January 2012, the company agreed to pay $ 31.9 million in fines and interest, but made no admission of wrongdoing. Brown was entitled to $ 3.6 million of the settlement. The largest healthcare fraud settlement in history

560-424: A copy of a complaint in a secret whistleblower suit that was under seal. In 2017, bio-pharmaceutical giant Celgene Corporation paid $ 240 million to settle allegations it sold and marketed its drugs Thalomid and Revlimid off-label in U.S. ex rel. Brown v. Celgene , CV 10-03165 (RK) (C.D. Cal.). In 2021, A South Carolina pain management company was ordered to pay $ 140 million under the False Claims Act after

640-475: A defendant is liable if it submits a false claim to the government based on its own knowledge and subjective beliefs — not what an objectively reasonable person may have thought. In a 2024 case, Murray v. UBS Securities, LLC , et al. 601 U. S. ____ (2024), a unanimous U.S. Supreme Court endorsed a lower burden of proof for whistleblowers, holding that whistleblowers do not need to prove that an employer acted with "retaliatory intent" in order to be protected under

720-499: A different law, the Federal Food, Drug, and Cosmetic Act ; the intersection occurs when off-label marketing leads to prescriptions being filled and bills for those prescriptions being submitted to Medicare/Medicaid. As of 2019, over 72% of all federal FCA actions were initiated by whistleblowers. The government recovered $ 62.1 billion under the False Claims Act between 1987 and 2019 and of this amount, over $ 44.7 billion or 72%

800-472: A false claim had to be presented directly to the Federal government, or if it merely needed to be paid with government money, such as a false claim by a subcontractor to a prime contractor. The Court found that the claim need not be presented directly to the government, but that the false statement must be made with the intention that it will be relied upon by the government in paying, or approving payment of,

880-400: A nonprofit affiliated with Prime Healthcare Services ; the sale was approved by New Jersey in early February 2017. On December 6, 2016, a former CFO of a CHS hospital was awarded $ 1.9 million in a whistleblower lawsuit he filed after he was terminated for refusing to submit false financial documents. In January 2017, a settlement between investors and CHS executives for $ 60 million

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960-629: A now-discontinued matching program". The allegations were brought about by a former CHS employee in a complaint under the False Claims Act . In October 2015, Community Health Systems paid $ 13 million to the United States Department of Justice to resolve allegations related to the False Claims Act . After CHS agreed in 2015 to sell Memorial Hospital of Salem County in New Jersey to Prime Healthcare Foundation,

1040-477: A relator to recover, in addition to his award for reporting fraud, double damages plus attorney fees for any acts of retaliation for reporting fraud against the government. This provision specifically provides relators with a personal claim of double damages for harm suffered and reinstatement. Under the False Claims Act, the Department of Justice is authorized to pay rewards to those who report fraud against

1120-553: A separate penalty for each violation of the statute. Under the Civil Penalties Inflation Adjustment Act, False Claims Act penalties are periodically adjusted for inflation. In 2020, the penalties range from $ 11,665 to $ 23,331 per violation. Certain claims are not actionable, including: There are unique procedural requirements in False Claims Act cases. For example: In addition, the FCA contains an anti-retaliation provision, which allows

1200-525: Is a Chinese businessman who founded Shanda . Chen was born in Xinchang County , Zhejiang Province, China in 1973 and grew up near Shanghai with his younger brother Danian . His father was an engineer and his mother was a middle school English teacher. He earned his bachelor's degree in economics from Fudan University in 1993. Chen started at the state-owned property developer Shanghai Lujiazui Group in 1994, holding management positions in

1280-416: Is an American federal law that imposes liability on persons and companies (typically federal contractors ) who defraud governmental programs. It is the federal government's primary litigation tool in combating fraud against the government. The law includes a qui tam provision that allows people who are not affiliated with the government, called "relators" under the law, to file actions on behalf of

1360-506: Is an abbreviated form of the Latin legal phrase qui tam pro domino rege quam pro se ipso in hac parte sequitur ("he who brings a case on behalf of our lord the King, as well as for himself") In a qui tam action, the citizen filing suit is called a "relator". As an exception to the general legal rule of standing , courts have held that qui tam relators are "partially assigned" a portion of

1440-561: Is married to Qianqian "Chrissy" Luo. They moved from Shanghai to Singapore in 2009, then from Singapore to the Bay Area of California in late 2017. They are currently residents of Menlo Park, California . In 2018, Chen bought a historic mansion built for Alice Gwynne Vanderbilt in 1881 on East 69th Street in the Upper East Side of Manhattan for $ 39 million. False Claims Act The False Claims Act of 1863 ( FCA )

1520-822: Is no longer trading on the NYSE. On October 3, 2016, CHS was removed from the S&;P Midcap 400 and added to the S&P Smallcap 600 . Under CEO Wayne T. Smith, the company's stock has lost over 76% of its value since the year 2000. Chinese billionaire Tianqiao Chen had a 22.2 percent stake in Community Health Systems in 2017. E. Thomas Chaney, former executive of Hospital Affiliates, Inc. and David Steffy and Richard Ragsdale, former executives at Hospital Corporation of America spinoff Republic Health Corporation, formed Community Health Systems in 1985. The company made its initial public offering in 1991. In 1996,

1600-428: Is not a "party" for FRAP 4 purposes, and therefore, petitioner's appeal filed after 30 days was untimely. In a 2016 case, Universal Health Services, Inc. v. United States ex rel. Escobar , the United States Supreme Court sought to clarify the standard for materiality under the FCA. The court unanimously upheld the implied certification theory of FCA liability and strengthened the FCA's materiality requirement. In

1680-488: Is the safest and most expeditious way I have ever discovered of bringing rogues to justice." In the massive military spending leading up to and during World War II , the US Attorney General relied on criminal provisions of the law to deal with fraud, rather than using the FCA. As a result, attorneys would wait for the Department of Justice to file criminal cases and then immediately file civil suits under

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1760-550: The COVID-19 pandemic – CHS filed more than 19,000 lawsuits against individuals for not being able to pay off their medical debt (some from hospitals it no longer owned) even as the company collected over $ 700 million in Covid relief funds from the federal government. Many of these lawsuits are against people who cannot pay the legal fees to challenge CHS in court. (Due to the fact that these are civil suits and not criminal suits,

1840-751: The Chinese Communist Party at age 18 and was elected to the central committee of Communist Youth League of China in Shanghai. In 2008, Chen was appointed to the 11th National Committee of the Chinese People's Political Consultative Conference (CPPCC). In 2013, Chen was appointed to the 12th National Committee of the CPPCC. Chen is chairman of the Shanda Group, and is also on the boards of various portfolio companies. Chen

1920-599: The FDA . ChloraPrep is the commercial name under which CareFusion produced the drug chlorhexidine , used to clean the skin before surgery. In 2017, this case was called into question and was under review by the DOJ because the lead attorney for the DOJ serving as Assistant Attorney General in the case, Jeffery Wertkin, was arrested by the FBI on January 31, 2017, for allegedly attempting to sell

2000-636: The Medicaid program. The California False Claims Act was enacted in 1987, but lay relatively dormant until the early 1990s, when public entities, frustrated by what they viewed as a barrage of unjustified and unmeritorious claims, began to employ the False Claims Act as a defensive measure. In 1995, the State of Texas passed the Texas Medicaid Fraud Prevention Act (TMFPA), which specifically aims at combating fraud against

2080-647: The list of largest pharmaceutical settlements . Between 1987 and 2019, the government recovered more than $ 62 billion under the False Claims Act. Qui tam laws have history dating back to the Middle Ages in England . In 1318, King Edward II offered one third of the penalty to the relator when the relator successfully sued government officials who moonlighted as wine merchants. The Maintenance and Embracery Act 1540 of Henry VIII provided that common informers could sue for certain forms of interference with

2160-474: The public relations office before becoming secretary to the chairman. In 1998, he became the vice director of the office of the president at Kinghing Trust & Investment before resigning in 1999. In 1999, Chen started the online gaming company Shanda with members of his family. The company went on to become the largest Internet company by market capitalization in China in 2004. That same year, Chen

2240-557: The Court. In this time, the department decides whether it will pursue the case. If the case is pursued by DOJ, the amount of the reward is less than if the Department of Justice had decided not to pursue the case and the plaintiff/relator continues the lawsuit himself. However, the success rate is higher in cases that the Department of Justice decides to pursue. Technically, the government has several options in handing cases. These include: In practice, there are two other options for

2320-453: The Department of Justice: There is case law where claims may be prejudiced if disclosure of the alleged unlawful act has been reported in the press, if complaints were filed to an agency instead of filing a lawsuit, or if the person filing a claim under the act is not the first person to do so. Individual states in the U.S. have different laws regarding whistleblowing involving state governments. The U.S. Internal Revenue Service (IRS) takes

2400-570: The Eleventh Circuit ruling in U.S. ex rel. Hopper v. Solvay Pharms., Inc. (2009) were both appealed to the U.S. Supreme Court . The Court denied certiorari for both cases, however, declining to resolve the divergent appeals court decisions. In 2009, the American Civil Liberties Union (ACLU), Government Accountability Project (GAP) and OMB Watch filed suit against the Department of Justice challenging

2480-431: The FCA, a practice decried as "parasitic" at the time. Congress moved to abolish the FCA but at the last minute decided instead to reduce the relator's share of the recovered proceeds. The law was again amended in 1986, again due to issues with military spending. Under President Ronald Reagan 's military buildup, reports of massive fraud among military contractors had become major news, and Congress acted to strengthen

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2560-532: The FCA. The first qui tam case under the amended False Claims Act was filed in 1987 by an eye surgeon against an eye clinic and one of its doctors, alleging unnecessary surgeries and other procedures were being performed. The case settled in 1988 for a total of $ 605,000. However, the law was primarily used in the beginning against defense contractors . By the late 1990s, health care fraud began to receive more focus, accounting for approximately 40% of recoveries by 2008 Franklin v. Parke-Davis , filed in 1996,

2640-405: The False Claims Act on March 2, 1863, 12  Stat.   696 . Because it was passed under the administration of President Abraham Lincoln , the False Claims Act is sometimes referred to as the "Lincoln Law". Importantly, a reward was offered in what is called the qui tam provision, which permits citizens to sue on behalf of the government and be paid a percentage of the recovery. Qui tam

2720-510: The False Claims Act, $ 2.2 billion of which were generated by whistleblowers. Since 2010, the federal government has recovered over $ 37.6 billion in False Claims Act settlements and judgments. In 2020, the DOJ recovered $ 2.2 billion from FCA cases: $ 1.6 billion of that total was from cases filed under the FCA. Qui tam whistleblowers received a total of $ 309 million in whistleblower rewards in 2020. The Act establishes liability when any person or entity improperly receives from or avoids payment to

2800-475: The False Claims Act, including: The False Claims Act has a detailed process for making a claim. Mere complaints to the government agency are insufficient to bring claims under the Act. A complaint (lawsuit) must be filed in a U.S. District Court (Federal court) in camera (under seal). The Department of Justice (DOJ) must thence investigate within 60 days, but it often enjoys several months' worth of extensions by

2880-405: The False Claims Act, the United States is a "party" to the suit for purposes of Federal Rule of Appellate Procedure 4(a)(1)(A) (which requires that a notice of appeal in a federal civil action generally be filed within 30 days after entry of a judgment or order from which the appeal is taken). The Court held that when the United States has declined to intervene in a privately initiated FCA action, it

2960-667: The Federal government. The Act prohibits: The statute provides that anyone who violates the law "is liable to the United States Government for a civil penalty of not less than $ 5,000 and not more than $ 10,000, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990, plus 3 times the amount of damages which the Government sustains because of the act of that person." The False Claims Act requires

3040-632: The Fraud Enforcement and Recovery Act of 2009 (FERA) was signed into law. It includes the most significant amendments to the FCA since the 1986 amendments. FERA enacted the following changes: With this revision, the FCA now prohibits knowingly (changes are in bold): On March 23, 2010, the Patient Protection and Affordable Care Act (also referred to as the health reform bill or PPACA) was signed into law by President Barack Obama . The Affordable Care Act made further amendments to

3120-708: The Legg Mason board. Chen has invested in the venture funds Propel(x) and Ubiquity Ventures. Ranked on various rich lists, Chen personally had $ 4 billion in net value in 2017 and was ranked as the 93rd richest person in China, according to the Hurun Report . In 2018, Chen purchased 500,000 acres in Ontario . The same year, the Committee of 100 gave Chen an award for Lifetime Achievement as Tech Entrepreneur. According to China Youth Daily , Chen joined

3200-485: The Ninth Circuit Federal Court of Appeals and is an exception to the general legal rule for standing. In a 2007 case, Rockwell International Corp. v. United States , the United States Supreme Court considered several issues relating to the "original source" exception to the FCA's public-disclosure bar. The Court held that (1) the original source requirement of the FCA provision setting for

3280-490: The Sarbanes-Oxley Act. The Supreme Court found that a whistleblower needs only to prove that their actions in making a whistleblower complaint were a "contributing factor" in the employer's unfavorable action. The unanimous opinion found that liability hinges on a defendant's “knowledge and subjective beliefs” — not what an objective, reasonable person would have thought — at the time they submitted their claims to

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3360-546: The Texas Medicaid Program, which provides healthcare and prescription drug coverage to low-income individuals. The Texas law enacts state qui tam provisions that allow individuals to report fraud and initiate action against violations of the TMFPA, imposes consequences for noncompliance and includes whistleblower protections. In Australia, The Treasury Laws Amendment (Enhancing Whistleblower Protections) Act ,

3440-578: The UK more than £24 billion a year. In the context of anti-corruption, the paper acknowledged that there was a need to not only target serious and organised criminals but also support those who seek to help identify and disrupt serious and organised criminality. Three UK agencies, the Department for Business, Innovation and Skills , the Ministry of Justice and the Home Office , were tasked with considering

3520-496: The United States Department of Justice to resolve multiple lawsuits "alleging that the company knowingly billed government health care programs for inpatient services that should have been billed as outpatient or observation services". As part of the agreement, Community Health Systems was required to enter into a corporate integrity agreement that required the company to participate in compliance efforts. It

3600-601: The United States Department of Justice to settle a review of its billing practices. In 2007, Community Health Systems purchased Plano, Texas-based Triad Hospitals for $ 6.8 billion, adding nearly 50 hospitals, hospital management and consulting business Quorum Health Resources, and nearly doubling the size of the company. Among the facilities included in the deal was McKenzie-Willamette Hospital in Springfield, Oregon; Trinity Medical Center in Birmingham, Alabama; and

3680-1071: The affiliated hospitals, Lutheran and Dupont, and the network were fired or resigned. Key prominent local community leaders Chuck Surack and Tom Kelley resigned from the Lutheran Health Network's and hospitals' advisory boards. On March 13, 2018, it was reported that the company had hired financial advisory firm Lazard to help address long-term debt. On August 1, 2018, CHS completed the sale of 425-bed Munroe Regional Medical Center in Ocala , Fla., to Altamonte Springs, Fla.-based Adventist Health System . On May 22, 2019, AdventHealth announced they had signed definitive agreements to purchase 193-bed Heart of Florida Regional Medical Center in Davenport, Florida, and 160-bed Lake Wales Medical Center in Lake Wales, Florida, from affiliates of CHS. In December 2019, CHS announced that subsidiaries of

3760-721: The case for a US-style False Claims Act in the UK. In July 2014, the Financial Conduct Authority and the Bank of England Prudential Regulation Authority recommended Parliament enact strong measures to encourage and protect whistleblowers, but without offering whistleblower rewards, rejecting the US model. Under Rule 9(b) of the Federal Rules of Civil Procedure , allegations of fraud or mistake must be pleaded with particularity. All appeals courts to have addressed

3840-399: The company has completed the sale of 480-bed Bayfront Health St. Petersburg and its associated assets to a subsidiary of Orlando Health . In its annual Form 10-K filed in 2019, it identified Florida, Texas and Indiana as areas of geographic concentration. In 2014, CHS had around 200 hospitals, but the number had declined to around 85 in 2021. From March 2020 to May 2021 – during

3920-477: The company has signed a definitive agreement to sell its majority ownership interest in 84‑bed St. Cloud Regional Medical Center and its associated healthcare operations in St. Cloud, Florida, to a subsidiary of Orlando Health . Orlando Health currently holds minority ownership interest in St. Cloud and will purchase the remaining interest through this transaction. On September 30, 2020, CHS announced that an affiliate of

4000-764: The company have completed the sale of three Virginia hospitals – Southside Regional Medical Center in Petersburg, Southampton Memorial Hospital in Franklin, and Southern Virginia Regional Medical Center in Emporia, effective on January 1, 2020. During the COVID-19 pandemic, CHS received around a quarter-billion in federal COVID-19 relief funds. During the pandemic, CHS-owned hospitals also filed more than 19,000 lawsuits against their patients for unpaid medical bills. On April 27, 2020, CHS announced that an affiliate of

4080-403: The company was purchased by private equity firm Forstmann Little & Company . Community Health Systems went public again in 2000. In August 2003, the company acquired Southside Regional Medical Center . On October 10, 2015, the 372-bed Grandview Medical Center began operating in Birmingham, Alabama, replacing Trinity Medical Center. In 2000, Community Health Systems paid $ 31 million to

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4160-515: The constitutionality of the "seal provisions" of the FCA that require the whistleblower and the court to keep lawsuits confidential for at least 60 days. The plaintiffs argued that the requirements infringe the First Amendment rights of the public and the whistleblower, and that they violate the separation of powers , since courts are not free to release the documents until the executive branch acts. The government moved for dismissal, and

4240-594: The course of justice in legal proceedings that were concerned with the title to land. This act is still in force today in the Republic of Ireland , although in 1967 it was extinguished in England. The idea of a common informer bringing suit for damages to the Commonwealth was later brought to Massachusetts , where "penalties for fraud in the sale of bread [are] to be distributed one third to inspector who discovered

4320-440: The defendants do not receive a state-appointed lawyer.) In 2020, CHS posted its most profitable year in at least a decade. Lawsuits have been filed against CHS hospitals for alleged predatory liens practices where hospitals file for liens rather than bill individuals' health insurers, resulting in massive fees for patients. Tianqiao Chen Chen Tianqiao ( Chinese : 陈天桥 ; pinyin : Chén Tiānqiáo ); born 1973)

4400-623: The district court granted that motion in 2009. The plaintiffs appealed, and in 2011 their appeal was denied. In 2004, the billing groups associated with the University of Washington agreed to pay $ 35 million to resolve civil claims brought by whistleblower Mark Erickson, a former compliance officer, under the False Claims Act. The settlement, approved by the UW Board of Regents, resolved claims that they systematically overbilled Medicaid and Medicare and that employees destroyed documents to hide

4480-494: The federal government and are not convicted of a crime related to the fraud, in an amount of between 15 and 25 (but up to 30% in some cases) of what it recovers based upon the whistleblower's report. The relator's share is determined based on the FCA itself, legislative history, Department of Justice guidelines released in 1997, and court decisions. False Claims Act Amendments ( Pub. L.   99–562 , 100  Stat.   3153 , enacted October 27, 1986 ) On May 20, 2009,

4560-734: The fraud and the remainder for the benefit of the town where the offense occurred." Other statutes can be found on the colonial law books of Connecticut , New York , Virginia and South Carolina . The American Civil War (1861–1865) was marked by fraud on all levels, both in the Union north and the Confederate south. During the war, unscrupulous contractors sold the Union Army decrepit horses and mules in ill health, faulty rifles and ammunition, and rancid rations and provisions, among other unscrupulous actions. In response, Congress passed

4640-411: The government's legal injury, thereby allowing relators to proceed with their suits. U.S. Senator Jacob M. Howard , who sponsored the legislation, justified giving rewards to whistle blowers, many of whom had engaged in unethical activities themselves. He said, "I have based the [ qui tam provision] upon the old-fashioned idea of holding out a temptation, and ‘setting a rogue to catch a rogue,’ which

4720-482: The government. As of 2020, 29 states and the District of Columbia have false-claims laws modeled on the federal statute to protect their publicly funded programs from fraud by including qui tam provisions, which enables them to recover money at state level. Some of these state False Claims Act statutes provide similar protections to those of the federal law, while others limit recovery to claims of fraud related to

4800-532: The government. This is informally called " whistleblowing ", especially when the relator is employed by the organization accused in the suit. Persons filing actions under the Act stand to receive a portion (15–30%, depending on certain factors) of any recovered damages . As of 2019, over 71% of all FCA actions were initiated by whistleblowers. Claims under the law have typically involved government health care programs (Medicare, Medicaid and TriCare), military, or other government spending programs. FCA actions dominate

4880-512: The hospital moved from a non-profit to a for-profit enterprise under CHS. In 2011, it was accused by Tenet Healthcare of overbilling Medicare in its aggressive admissions policy compared to its peers. It was subpoenaed by Medicare on its aggressive billing to the Medicare systems. In 2013, Community Health Systems entered into an agreement with Health Management Associates to purchase HMA for about $ 3.6 billion in cash and stock. The merger

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4960-818: The issue of whether Rule 9(b) pleading standards apply to qui tam actions have held that the heightened standard applies. The Fifth Circuit , the Sixth Circuit , the Seventh Circuit , the Eighth Circuit , the Tenth Circuit , and the Eleventh Circuit have all found that plaintiffs must allege specific false claims. In 2010, the First Circuit decision in U.S. ex rel. Duxbury v. Ortho Biotech Prods., L.P. (2009) and

5040-782: The largest foreign owners of land in the United States. Tianqiao Chen and his family sold all their stakes in Shanda Games in November 2014, after which Shanda Group refocused on investing. With Chen remaining chairman and CEO, by early 2017 Shanda Group was the majority shareholder of Legg Mason , Lending Club , and Community Health Systems . It also had property operations in China and North America and stakes in companies such as Sotheby's . Shanda sold its stakes in Sotheby's in 2017 and then it sold its stake Legg Mason later that year, and then Chen resigned as vice-chairman of

5120-468: The original-source exception to the public-disclosure bar on federal-court jurisdiction is jurisdictional; (2) the statutory phrase "information on which the allegations are based" refers to the relator's allegations and not the publicly disclosed allegations; the terms "allegations" is not limited to the allegations in the original complaint, but includes, at a minimum, the allegations in the original complaint as amended; (3) relator's knowledge with respect to

5200-417: The pondcrete fell short of the direct and independent knowledge of the information on which the allegations are based required for him to qualify as an original source; and (4) the government's intervention did not provide an independent basis of jurisdiction with respect to the relator. In a 2008 case, Allison Engine Co. v. United States ex rel. Sanders , the United States Supreme Court considered whether

5280-528: The position that, for Federal income tax purposes, qui tam payments to a relator under FCA are ordinary income and not capital gains . The IRS position was challenged by a relator in the case of Alderson v. United States; and, in 2012, the U.S. Court of Appeals for the Ninth Circuit upheld the IRS' stance. As of 2013, this remained the only circuit court decision on tax treatment of these payments. In

5360-416: The practice. The fraud settlement, the largest against a teaching hospital since the University of Pennsylvania agreed to pay $ 30 million in 1995, ended a five-year investigation that resulted in guilty pleas from two prominent doctors. The whistleblower was awarded $ 7.25M. In 2010, a subsidiary of Johnson & Johnson agreed to pay over $ 81 million in civil and criminal penalties to resolve allegations in

5440-465: The projections appeared to be incompetent at best. In April–July 2017, Community Health Systems rejected overtures from key Lutheran Health Network doctors to facilitate sale of its profitable network in CHS to a third party, after assertions of continual lack of re-investment into the network's facilities and staff by CHS management. After those discussions/accusations became public, several key leaders of

5520-507: The seven hospitals of Lutheran Health Network in the Ft. Wayne, Indiana region. In 2010, McKenzie-Willamette's healthcare workers' union, SEIU, Local 49, claimed that workload increases, slashed benefits, and staff reductions had lowered the quality of both patient care and quality of life for employees. The union, in its "Profits Before Community" campaign against the hospital, continues to highlight that profits have tripled while charitable care and employee benefits have steadily decreased since

5600-614: The tobacco industry and carbon pricing schemes. In October 2013, the UK Government announced that it was considering the case for financially incentivising individuals reporting fraud in economic crime cases by private sector organisations, in an approach much like the US False Claims Act. The 'Serious and Organised Crime Strategy' paper released by the UK's Secretary of State for the Home Department sets out how that government plans to take action to prevent serious and organised crime and strengthen protections against and responses to it. The paper asserted that serious and organised crime costs

5680-438: The unlawful marketing of its drug Rapamune for uses that were not FDA-approved and potentially harmful. In 2014, CareFusion paid $ 40.1 million to settle allegations of violating the False Claims Act by promoting off label use of its products in the case United States ex rel. Kirk v. CareFusion et al., No. 10-2492. The government alleged that CareFusion promoted the sale of its drug ChloraPrep for uses that were not approved by

5760-457: Was approved by the Food and Drug Administration, (i.e., " off-label " uses)." It also states that "certain of these uses were not medically accepted indications for which State Medicaid programs provided coverage" and that as a result "OMJPI knowingly caused false or fraudulent claims for Topamax to be submitted to, or caused purchase by, certain federally funded healthcare programs. In response to

5840-548: Was completed in January 2014 and made Community Health Systems the largest for-profit hospital operator at the time, with 206 hospitals in 29 states. The acquisition of HMA brought with it liability for lawsuits and criminal charges of fraudulent claims against Medicare and other federal programs. CHS settled these claims for $ 262 million in October, 2018. On August 4, 2014, Community Health Systems paid $ 95.14 million to

5920-425: Was from qui tam cases brought by relators. In 2014, whistleblowers filed over 700 False Claims Act lawsuits. In 2014, the Department of Justice had its highest annual recovery in False Claims Act history, obtaining more than $ 6.1 billion in settlements and judgments from civil cases involving fraud and false claims against the government. In fiscal year 2019, the Department of Justice recovered over $ 3 billion under

6000-515: Was made by GlaxoSmithKline in 2012 when it paid a total of $ 3 billion to resolve four qui tam lawsuits brought under the False Claims Act and related criminal charges. The claims include allegations Glaxo engaged in off-label marketing and paid kickbacks to doctors to prescribe certain drugs, including Paxil, Wellbutrin and Advair. In 2013, Wyeth Pharmaceuticals Inc ., a pharmaceutical company acquired by Pfizer, Inc . in 2009, paid $ 490.9 million to resolve its criminal and civil liability arising from

6080-478: Was passed in December 2018 and went into effect in 2019. The law expanded protections for whistleblowers, allowing them to report misconduct anonymously, as well as applying anti-retaliation protections to additional kinds of whistleblowers. Importantly, the law does not provide for rewards for whistleblowers. There have been calls since 2011 for legislation modeled on the False Claims Act and for their application to

6160-460: Was reached. The settlement resolved allegations of "breach of fiduciary duty" by CHS executives. In March 2017, Quorum's board retained outside counsel in relation to whether Community Health Systems had committed fraud with regards to financial projections for Quorum, and whether any of its current management may have been involved in any possible fraud. In June 2017 Quorum said although the investigation did not produce "conclusive evidence" of fraud

6240-537: Was reported on August 18, 2014, that hackers broke into Community Health System's records system and stole data on 4.5 million patients. These data included names, Social Security numbers, physical addresses, birthdays and telephone numbers. CHS provided all patients whose records were impacted with free identity theft protection. On February 2, 2015, Community Health Systems was required to pay $ 75 million to settle allegations "that they made illegal donations to county governments to reap more federal dollars under

6320-674: Was second on the Hurun Report 's "rich list", was voted China Central Television 's "Rising Business Star", and was featured in MIT Technology Review ' s Innovators Under 35 list. Shanda Group went private in early 2012, with Chen, his wife, and his brother keeping a combined 57% stake. In 2015, Chen, as the beneficial owner of Shanda Asset Management, acquired over 80,127 hectares of land in Oregon from Fidelity National Financial for US$ 85 million, making him one of

6400-415: Was the first case to apply the FCA to fraud committed by a pharma company against the government, due to bills submitted for payment by Medicaid / Medicare for treatments that those programs do not pay for as they are not FDA-approved or otherwise listed on a government formulary. FCA cases against pharma companies are often related to off-label marketing of drugs by drug companies, which is illegal under

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