Whistleblower Lawyer & Attorney : LaBovick Law Firm, Florida : Federal False Claims Act, Qui Tam

New York Attorney General Andrew M. Cuomo and New York City Mayor Michael Bloomberg joined forces this week in the fight against Medicaid fraud. Yesterday they filed a joint lawsuit against Merck for the drug Vioxx. Their suit claims Vioxx misrepresented the dangers the drug posed to its users. The lawsuit seeks damages and civil penalties in addition to restitution for tens of millions of taxpayer dollars wrongfully spent on Vioxx prescriptions, and marks the first time the State and City have brought a joint action to fight Medicaid fraud.

Attorney General Cuomo issued strong words in a statement on the case  "Merck's irresponsible and duplicitous conduct endangered the health of New Yorkers and wasted our tax dollars. As alleged in the complaint, even as evidence was piling up showing just how dangerous this drug was, Merck put profits above all else and put thousands at risk by continuing to push Vioxx inappropriately on doctors and patients.We will hold accountable those who put our families at risk, and we will fight back when New Yorkers are harmed and fleeced.”

According to Ed Silverman of the Pharmalot Blog, did a great job covering this story. He brings out in his recent post that this the lawsuit comes just five months after the newly appointed Jim Sheehan came aboard as New York State’s Medicaid Inspector General. Jim Sheehan is former Assistant Attorney General in Philadelphia. We owe him tremendous gratitude for his efforts in the Medco case. A company that was once owned by Merck.

This is the only the beginning. New York has jumped out first in using their new State False Claims Act to help prosecute this alleged fraud against the residents of New York.  Companies across the U.S. should be on notice that they will be prosecuted by more states for any State False Claims Act violation.  There are about 22 states with a Sate False Claims Act on their books.  Florida recently modified the the Florida False Claims Act to be in line with the Deficit Reduction Act and to receive additional funds.

Stay tuned for more news on this case with New York and the makers of Vioxx, Drug giant, Merck.  They probably will settle to get this case closed and behind them as quick as possible, before more start cropping up. This probably will not be the last Vioxx case we will hear about. 

On a side note: Merck stock closed at $50.57 an increase of $1.10 from previous trading. I guess the Shareholders are confident that Merck can handle this new law suit.

It makes me think of the two baseball teams Boston and the Yankees. Boston took the Boys of Summer for granted and did not protect their lead.  The Yankees appear to be closing in on the narrow lead Boston has over them.  One word to the wise, never take New York and New Yorkers  for granted.  

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I am sitting here in Washington DC at the initial meeting for the 7th Annual Taxpayers Against Fraud Convention listening to Jennifer Verkamp and Frederick Morgan whip through a basic overview of the Federal False Claims Act. I am carrying my Blackberry, and check it about every 5 minutes, just in case. In case what? I don't know. Regardless, I know I need to keep checking it.

So, I get an email from Juliet regarding the Georgia State False Medicaid Claims Act panel at the Southeastern Health Care Fraud Conference in Atlanta that took place yesterday. The information came from the Finch McCranie blog, where they also speak about a First Annual Whistleblower Law Symposium in Georgia at the State Bar of Georgia Association Headquarters taking place later this month.

I have noticed a trend which is coming fast to this particular legal arena and believe that State specific claims will eclipse Federal based claims. In an earlier blog post on the Whistleblower Law Blog, we wrote about Florida's recently amended False Claims Act and how it complies with the Federal Deficit Reduction Act. This opens the door to a multitude of claims brought at solely the state level.

I feel that each State with a local State False Claims Act (every State needs to step up and draft one of these) really needs to create a system of teaching their State Bar about what their Act provides. The more attorneys who recognize violations and who are aware of both the State and Federal FCAs the better for the people of the individual state. I would estimate that only 40% of the attorneys in Florida even know that these laws exist. This is not a slight. It is a fact that needs to be corrected.
So here it is:  We need a Symposium in Florida on the Florida False Claims Act." 

I will be giving a seminar on Qui Tam on Sept. 27, 2007 in Ft. Lauderdale and on Sept. 28 in Orlando for the the Florida Justice Association in the emerging areas of law seminar. If you are interested in the subject matter, please attend one of these seminars.  I will use this is a starting platform to push for a State Wide False Claims Act Symposium.

That's the goal. But goals without dates are simply dreams and I would rather set down a date. So, here it is:  Florida will hold a State wide False Claims Act Symposium on or before January 1, 2010. That gives us a bit over 2 years to put the new act to the test and get the State on board. After that we need to push for inclusion of the False Claims Act on the Bar Exam itself!

I will let you know more about the present ongoing TAF conference as it progresses. Tonight is a real treat, Stephen A. Whitlock, the Whistleblower Office Director for the IRS is speaking. We are all waiting for the new IRS guidelines on their own whistleblower provisions, so I am very excited to hear what he has to say.

Take care and thanks for reading.

Brian

PS - If you are interested in working with us on the creation of a State Whistleblowers Symposium in Florida please email us your information. I am sure this will be a successful event that will generate a lot of interest from the legal community.

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Fernando and Ileana Fonts, owners and operators of Free Line Medical Equipment in Miami, were arrested and charged with organized fraud for falsely billing the Florida Medicaid program more than $1 million. 

“Our Medicaid program exists to ensure that our citizens receive the medical care they need,” said Florida Attorney General Bill McCollum. “When individuals attempt to steal those funds, other people in genuine need are victimized.”

The Agency for Health Care Administration tipped off the Medicaid Fraud Control Unit, with information that the Fonts were failing to perform their services, by either not delivering equipment or delivering faulty equipment while billing Medicaid for fully functional equipment. This is a serious issue because not only were the Fonts stealing from the government, but they were also putting the lives of the patients with severe breathing problems in danger.

If Fernando and Ileana Fonts are prosecuted for Florida False Claims Act (qui tam) violations, they could be face substantial penalties. According to the new Florida False Claims Act violators face civil penalties for making false or fraudulent claims, written or electronically, to the government for the purpose of getting a false or fraudulent claim paid. The penalties can be up to $11,000 per claim and triple the amount of damages the government agency sustains. The new Florida False Claims Act was approved and signed into law in June 2007 by Governor Charlie Crist.

Click Here to read more from the Attorney General's Office on this case.

The Whistleblower Law Blog is presented as a service of the Private Law Firm, LaBovick & LaBovick, P.A., Civil Justice Prosecutors. LaBovick & LaBovick, P.A. is a Plaintiff's firm that represents whistleblowers in Florida and throughout the nation in qui tam (False Claims Act) litigation.

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Florida is the newest state to put more bite into their State False Claims Act. The new bill - CS/SB 2312 - Florida False Claims Act [LPCC] was signed into law on June 28, 2007 by Governor Charlie Crist.  The bill was introduced by Senator Steve Oelrich and received overwhelming support by the Judiciary Committee. The new law will also allow the Attorney General’s Medicaid Fraud Control Unit to recover triple damages in civil lawsuits against those who commit Medicaid fraud. "This new law will provide us with the tools necessary to strengthen our investigation and prosecution of individuals who are cheating the system", said Attorney General Bill McCollum. 

Highlights from the new Florida False Claims ACT - S2312:   The Florida False Claims Act  is to prevent the state from paying false & fraudulent claims; redefines term "claim" to include claims filed electronically; provides that person is liable for civil penalty if he or she files false or fraudulent claim; reduces time limits for false claim proceedings; revises period in which stay to conduct discovery may be granted, etc. Amends 68.081-.085,.089.

Click Here to Read the new Florida False Claims Act.

The Whistleblower Law Blog is presented as a service of the Private Law Firm, LaBovick & LaBovick, P.A., Civil Justice Prosecutors. LaBovick & LaBovick, P.A. is a Plaintiff's firm that represents whistleblowers in Florida and throughout the nation in qui tam (False Claims Act) litigation.

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I am amazed at how many people find ways to rip off Uncle Sam. Not only do the big players figure out ways to cheat the government, but even small fish do not play it straight.

Take the case of Vidya Bhoolai. Bhoolai figured out a great way to defraud the government.   Ms. Bhoolai (who is my same age) figured out she could bilk Medicaid while running two assisted-living facilities. What she did was actually quite simple. She would bill Medicaid for services which her facilities never actually provided. The total amount she billed for services she was not providing was about $210,000.00.

Last week Judge William Gary ordered Bhoolai to pay (3x) treble damages for her fraud. I love seeing that. Usually in the Qui Tam cases the Defendant somehow snakes a plea deal to avoid paying treble damages. In this case there was no plea deal. The Judge had the opportunity to come down hard. He ordered her to pay more than $640,000 for the numerous (300 or so) violations she committed. Florida has its own False Claims Act. 

The $640,000 was inclusive of both the past due fraud amount of $210,000.00 plus the fines.   However the wheels of Justice turned slowly. Ms. Bhoolai was arrested two years ago. The investigation immediately revealed that Ms. Bhoolai had used Medicaid's online filing system to overcharge Florida for more then 25 patients. The patients lived from Tallahassee to Miami. Some patients did not reside in either of Bhoolai’s homes.

Its no wonder Ms. Bhoolai received such a tough deal while other major Qui Tam defrauders get away with so much more. Ms. Bhoolai was charged with both Civil and Criminal charges for her fraud. Now that we know Ms. Bhoolai owes the money, lets hope she pays it back before she is finishes serving her 10 years of probation.

Brian

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