Riley Allen Law is pleased that taxpayers will recover millions in fraudulent charges after the Department of Justice last week announced it had settled a False Claims Act case with Orthofix and subsidiary, Blackstone Medical, Inc.
The case, which was originally filed by the firm in September 2006, alleged that Blackstone paid illegal kickbacks to doctors to encourage them to use their spinal implants and surgical products.
Blackstone reportedly provided doctors with travel and entertainment, and paid sham benefits like consulting, royalty and research deals, which were passed on to Medicaid, Medicare and the TRICARE program for military service members, retirees and their families.
The lawsuit listed 67 doctors and medical firms and said most received stipends of up to $6,000 per month.
Whistleblower, Susan Hutcheson, of Florida came forward with evidence that made the case possible, and will receive a significant portion of the approximately $32 million recovered from the company. With additional penalties and fees paid by the defendants, including attorneys' fees, the value of this whistleblower case is approximately $42 million.
Under the False Claims Act, those with evidence of fraud against government programs can file suit on behalf of the government and share in the amount recovered as a reward. More than $24 billion has been recovered since the program was overhauled in 1986, with hundreds of millions awarded to whistleblowers.
Much of the funds recovered have been in the healthcare and defense industries, however, the laws were recently amended to allow whistleblowers to come forward with tax fraud and SEC corporate fraud as well.
A representative of Orthofix stated the company was pleased with the final settlement, however, neither Blackstone nor Orthofix have admitted any wrongdoing. The company also agreed to be bound by a Corporate Integrity Agreement as part of the settlement.
For more information on how individual citizens can help fight fraud by unscrupulous corporations through the False Claims Act, contact the fraud experts at Riley Allen Law today.
