TRENTON, N.J. — A federal judge in New Jersey sentenced a man to 50 months in prison on May 13 after he pleaded guilty to one count of conspiracy to commit health care fraud and admitted using a nonprofit organization to convince elderly patients to undergo unnecessary genetic testing and submitting the bills to Medicare (United States v. Seth Rehfuss, No. 18cr134, D. N.J.).
MIAMI — A federal judge in Florida on May 7 dismissed with prejudice a False Claims Act (FCA) lawsuit brought by two compound medication mixers against two companies, two doctors and an employee that accused the defendants of falsely billing Medicare, Tricare and other insurers for using leftover amounts of single-dose vial (SDV) medications, finding that the relator failed to allege that the defendants actually submitted claims for the leftover medications (United States, ex rel. Miguel A. Fernandez, et al. v. Miami Cancer Institute, et al., No. 17-24051-Civ-Scola, S.D. Fla., 2019 U.S. Dist. LEXIS 75529).
HOUSTON — A federal judge in Texas on May 14 denied a motion for mistrial filed by two doctors who were found guilty on 21 counts of health care fraud by a jury, holding that two references to a co-defendant’s guilty plea and testimony from a government expert about a health care fraud conviction of a technician who worked for one of the defendant doctors were not prejudicial enough to warrant vacating the verdict (United States v. Harcharan Singh Narang, et al., No. H-17-290, S.D. Texas, 2019 U.S. Dist. LEXIS 80937).
CHICAGO — A Seventh Circuit U.S. Court of Appeals panel ruled May 13 that a federal judge in Illinois erred when refusing to credit interest earned in four bank accounts containing funds that were obtained as part of a cardiologist’s insurance fraud scheme to his restitution, explaining that the U.S. marshals put the money from the accounts in an interest-bearing account that earned $225,000 and that pursuant to the doctor’s plea agreement with the government, the proceeds of all seized funds and forfeited property would be applied to the restitution amount (United States v. Sushil A. Sheth, No. 17-2741, 7th Cir., 2019 U.S. App. LEXIS 14173).
NEW ORLEANS — A Fifth Circuit U.S. Court of Appeals panel on May 7 overturned a federal judge in Texas’ ruling dismissing a False Claims Act (FCA) suit brought by four former workers for a hospice care provider, finding that their claims for fraud satisfied the heightened pleading requirement of Federal Rule of Civil Procedure 9(b) and that the allegations in the complaint sufficiently showed that the misrepresentations their former employer made to Medicare were material (United States, ex rel. Deborah Lemon, et al. v. Nurses To Go Inc., et al., No. 18-20326, 5th Cir., 2019 U.S. App. LEXIS 13634).
NEW HAVEN, Conn. — US WorldMeds LLC (USWM) agreed to pay $17.5 million to resolve allegations brought by two whistleblowers under the qui tam provisions of the False Claims Act (FCA) that accused the drug maker of engaging in a scheme to pay kickbacks to physicians and patients for prescriptions of the Parkinson’s disease drug Apokyn and cervical dystonia treatment Myobloc, according to an order entered in Connecticut federal court on April 30 (United States, ex rel. Brian Bennett v. US WorldMeds LLC, No. 13cv363, United States, ex rel. Robert Chinnapongse v. US WorldMed LLC, No. 16cv0804, D. Conn.).
NEW ORLEANS — A couple accused by their insurer of misrepresenting information on their application for a homeowners policy can amend their third-party complaint against the agency that obtained the policy, a federal judge in Louisiana ruled April 29 in denying the agency’s motion to dismiss, finding that the couple should be allowed to remedy deficiencies in their allegations for breach of contract, negligence and detrimental reliance (GeoVera Specialty Insurance Co. v. Mariette Joachin, et al., No. 18-7577, E.D. La., 2019 U.S. Dist. LEXIS 71661).
NEW ORLEANS — A Fifth Circuit U.S. Court of Appeals panel on April 26 affirmed a woman’s conviction for violating Medicare’s kickback statute based on referrals to a home health care agency she worked for but vacated an order requiring her to pay $1.9 million in restitution because the agency provided legitimate services to the patients (United States v. Kim Ricard, No. 18-30047, 5th Cir., 2019 U.S. App. LEXIS 12598).
PHILADELPHIA — A federal judge in Pennsylvania on April 22 denied an insurance purchaser’s motion to intervene in a lawsuit brought by Aetna Inc. against the manufacturer of an opioid medication accused of billing the insurer for off-label prescriptions of Subsys, ruling that while the purchaser had standing, it lacked a financial interest in the litigation (Aetna Inc., et al. v. Insys Therapeutics Inc., et al., No. 17-4812, E.D. Pa., 2019 U.S. Dist. LEXIS 67648).
MIAMI — A federal magistrate judge in Florida on April 18 held that a health care clinic patient’s statement in a police report can support an inference that a clinic employee accused of participating in a scheme to submit fraudulent no-fault personal injury protection claims to an insurance company paid patients to receive treatment at the facility and paid patients to refer someone else to the clinic (Government Employees Insurance Co., et al. v. Quality Diagnostic Health Care Inc., et al., No. 18-cv-20101, S.D. Fla., 2019 U.S. Dist. LEXIS 67262).
PITTSBURGH — A federal judge in Pennsylvania on April 12 sentenced two home health care employees to up to five years’ probation and six months of home detention and ordered them to pay restitution for their roles in an $87 million fraudulent billing scheme that involved submitting claims to Pennsylvania’s Medicare program for services that were not rendered or contained insufficient supporting documentation (United States v. Autumn Brown, No. 18cr284, United States v. Brenda Lowry Horton, No. 18cr285, W.D. Pa.).
HARRISBURG, Pa. — A Pennsylvania appeals court panel on April 10 affirmed a trial court judge’s decision to modify an insurance fraud defendant’s sentence to up to four years in prison after her probation was revoked, holding that her appeal was untimely by one day and that incarceration would prevent future crimes (Pennsylvania v. Christina Marie Famiano, No. 2626 EDA 2018, Pa. Super., 2018 Pa. Unpub. LEXIS 1326).
PASADENA, Calif. — A 2-1 panel of the Ninth Circuit U.S. Court of Appeals on April 9 vacated a man’s 97-month sentence for 15 counts of health care fraud, holding that a federal court judge in California erred when calculating the defendant’s intended loss from the $8.4 million scheme (United States v. Michael Mirando, No. 17-50386, 9th Cir., 2019 U.S. App. LEXIS 10468).
ROME, Ga. — A federal judge in Georgia on March 8 denied a doctor’s motion to dismiss a False Claims Act (FCA) lawsuit brought by the government, holding that the doctor’s argument that the use of chelation therapy was medically necessary is not enough to prove that the bills submitted for the treatment were legal (United States v. Charles C. Adams, M.D., et al., No. 18-cv-191-HLM, N.D. Ga., 2019 U.S Dist. LEXIS 61147).
WASHINGTON, D.C. — The U.S. Department of Justice announced April 9 that charges had been filed against 24 individuals in federal courts in California, Florida, New Jersey, Pennsylvania, South Carolina and Texas for their roles in health care fraud schemes that involved telemedicine companies inducing elderly patients to ask their physicians for durable medical equipment (DME) that was not medically necessary and then billing Medicare for the products, resulting in $1.2 billion in losses.
OKLAHOMA CITY — A pharmacist accused of submitting fraudulent bills to Medicare for prescriptions filled at two pharmacies he owned and operated was enjoined by a federal judge in Oklahoma March 26 from transferring or dissipating the more than $1 million he earned from the scheme (United States v. Jeffrey Scott Terry, No. 19-cv-250, W.D. Okla.).
SCRANTON, Pa. — A federal judge in Pennsylvania on March 25 denied a defendant’s motion to suppress the admission of a thumb drive that contains the identifying information of more than 400 people for the purpose of filing federal income tax returns, finding that federal law applies to the charges of insurance fraud and tax fraud against the man and that the warrant that was executed to obtain the drive was not overbroad (United States v. Frank J. Capozzi, No. 16cr347, M.D. Pa., 2019 U.S. Dist. LEXIS 55075).
GRAND RAPIDS, Mich. — A Michigan appeals court panel on April 2 vacated a trial court judge’s ruling awarding summary judgment to an insurance company that denied coverage for a woman’s claim for no-fault personal injury protection (PIP) benefits for injuries she sustained in an automobile accident, holding that the judge erred when finding that the evidence supported the insurer’s claim that the woman’s injuries did not stem from the accident (Denise Gable v. Citizens Insurance Company of the Midwest, No. 341757, Mich. App., 2019 Mich. App. LEXIS 634).
MCALLEN, Texas — A federal judge in Texas sentenced a former toxicology testing company account representative to 56 months in prison for his role in a scheme to falsify patient records and submit urine specimens for testing at a medical clinic in order to receive commissions and collection fees from the testing company, according to a docket entry dated March 20 (United States v. Omar Solis, et al., No. 17cr1046, S.D. Texas).
LITTLE ROCK, Ark.— A federal judge in Arkansas awarded summary judgment to a mental health services center and its owners after finding that plaintiffs leading a qui tam action under the False Claims Act (FCA) failed to present evidence that the owners were in violation of the state’s Medical Corporation Act (MCA), and that any bills submitted by the center and its franchises were fraudulent (United States, ex rel. Jacqueline Clemente, et al. v. Lead Teach Mentor LLC, et al., No. 16CV00875, E.D. Ark., 2019 U.S. Dist. LEXIS 45786).