Top 10 False Claims Act Recoveries for 2024
It was another big year of recoveries under the False Claims Act, the government’s primary enforcement tool to combat fraud.聽 And as usual, whistleblowers paved the way by originating the bulk of the actions that led to these recoveries.
As the Department of Justice (DOJ) just reported in its annual roundup of False Claims Act successes, the government and whistleblowers recovered roughly $2.9 billion this past fiscal year (ending September 30) from 558 settlement and judgments.聽 It is the second highest number of recoveries in the statute’s 160-year history.聽 This brings the total amount of government recoveries under the statute to $78 billion since 1986 when the statute was significantly amended to increase the incentives and protections for whistleblowers.
Of the $2.9 billion in recoveries this past year, roughly $2.4 billion (83%) came from matters originated by whistleblowers.聽 They received $400 million in whistleblower awards for their efforts, bringing the total tally of whistleblower awards to $9.5 billion since 1986.
Below is our Top-10 listing of False Claims Act recoveries in 2024 (by calendar year).聽 Unsurprisingly, whistleblowers originated all but two of them.
No. 1: Endo Health ($476M).聽 On February 29, Endo Health Solutions, which is in bankruptcy, agreed to pay roughly $476 million to settle DOJ charges of violating the False Claims Act and the Federal Food, Drug and Cosmetic Act through its sales and marketing of the opioid drug Opana.聽 Specifically, the company allegedly used a marketing scheme that targeted healthcare providers the company knew were “pill mill” prescribing Opana for non-medically accepted indications.聽 In addition to the civil settlement, the company was hit with a criminal fine of roughly $1 billion and an additional $450 million in criminal forfeiture, representing the second-largest set of criminal penalties ever levied against a pharmaceutical company.
No. 2: Teva ($450M).聽 On October 10, New Jersey-based Teva Pharmaceuticals agreed to pay $450 million to settle DOJ charges of violating the False Claims Act and Anti-Kickback Statute by (i) paying Medicare patient copays for its multiple sclerosis drug Copaxone to steer patients to the drug while raising its price, and (ii) conspiring with other generic drug makers to fix prices for certain generic drugs, including its widely-used cholesterol drug pravastatin.
No. 3: Raytheon ($428M).聽 On October 16, Raytheon Company, a subsidiary of Virginia-based defense contractor RTX agreed to pay roughly $950 million to settle DOJ and whistleblower charges of violating (i) the False Claims Act by inflating its pricing on certain defense contracts (including for the Patriot missile system), and (ii) the Foreign Corrupt 91吃瓜网 Act by bribing a high-level official at the Qatar Emiri Air Force to secure Qatari military contracts.聽 Raytheon paid $428 million to settle the False Claims Act portion of the settlement which represents the second largest government procurement fraud recovery under the statute.聽 The allegations originated in a whistleblower lawsuit filed by former Raytheon employee Karen Atesoglu who will receive a whistleblower award of $4.2 million from the proceeds of the False Claims Act settlement.
No. 4: Rite Aid ($410M).聽 On July 10, Rite Aid Corporation and 10 subsidiaries and affiliated to pay $7.5 million and up to roughly $402 million in unsecured claims in Rite Aid’s bankruptcy to settle DOJ and whistleblower charges of violating the False Claims Act and Controlled Substances Act by dispensing hundreds of thousands of prescriptions for controlled substances — including highly addictive oxycodone and fentanyl — that lacked a legitimate medical purpose and/or were not issued in the usual course of professional practice.聽 The allegations originated in a whistleblower lawsuit filed by Rite Aid pharmacy employees Andrew White, Mark Rosenberg and Ann Wegelin, who will collectively receive a whistleblower award of 17% of the government’s total False Claims Act recovery.
No. 5: Rite Aid ($121M).聽 On July 10, Rite Aid Corporation and certain subsidiaries to pay $101 million and up to $20 million in unsecured claims in Rite Aid’s bankruptcy to settle DOJ and whistleblower charges of failing to properly report to Medicare drug rebates it received from manufacturers, characterizing them instead as bona fide service fees.聽 The allegations originated in a whistleblower lawsuit filed by former Rite Aid subsidiary employee Glenn Rzeszutko who will receive an undisclosed whistleblower award from the proceeds of the government’s recovery.
No. 6: Kabbage ($120M).聽 On May 13, now-bankrupt financial technology company Kabbage Inc. (doing business as KServicing) agreed to pay up to $120 million in unsecured claims in the company’s bankruptcy to settle DOJ and whistleblower charges of violating the False Claims Act by improperly submitting thousands of claims for loan forgiveness, loan guarantees, and processing fees to the Small Business Administration under the COVID relief Payment Protection Program.聽 The allegations originated in whistleblower lawsuits filed by a former analyst in Kabbage鈥檚 collections department and an accountant who submitted PPP loan applications to Kabbage and other lenders.聽 They will receive an undisclosed whistleblower award聽from the proceeds of the government’s recovery.
No. 7: Walgreens ($107M).聽 On September 13, Illinois-based Walgreens agreed to pay roughly $107 million to settle DOJ and whistleblower charges of violating the False Claims Act by billing Medicare/Medicaid for prescriptions it processed but that patients never picked up.聽 The allegations originated in a whistleblower lawsuit filed by former Walgreens pharmacy manager Steven Turck who will receive a whistleblower award of roughly $15 million from the proceeds of the settlement.
No. 8: Independent Health ($98M).聽 On December 29, Buffalo-based Independent Health agreed to pay up to $98 million to settle DOJ and whistleblower charges of violating the False Claims Act by submitting invalid diagnosis codes to increase the payments the company received from Medicare for its Medicare Advantage Plan enrollees. 聽The allegations originated in a whistleblower lawsuit filed by Teresa Ross, a former employee of Group Health Cooperative (now Kaiser). 聽91吃瓜网represented Ms. Ross who will receive a whistleblower award of at least $8.2 million from the proceeds of the settlement.
No. 9: Sikorsky/Derco ($70M).聽 On June 21, Connecticut-based Sikorsky Support Services and its sister company Wisconsin-based Derco Aerospace agreed to pay $70 million to settle DOJ and whistleblower charges of violating the False Claims Act by overcharging the Navy for spare parts and materials needed to repair and maintain the primary aircraft used to train naval aviators.聽 Specifically, the affiliate companies allegedly entered into an undisclosed subcontract which included an improper markup which Sikorsky passed on to the government.聽 The allegations originated in a whistleblower lawsuit filed by former Derco employee Mary Patzer who will receive an undisclosed whistleblower award from the proceeds of the government’s recovery.
No. 10: Gen Digital ($55M).聽 On December 2, Gen Digital Inc. (formerly known as Symantec Corp.) agreed to pay roughly $55 million to satisfy a judgment it violated the False Claims Act by mispresenting its commercial sales practices during the negotiation and performance of a General Services Administration contract. 聽The allegations originated in a whistleblower lawsuit brought by Lori Morsell, who administered the contract at issue for Symantec, and will receive an undisclosed whistleblower award from the proceeds of the government’s recovery.
If you would like more information on any of these settlements or would like to learn more about what it means to be a whistleblower under the False Claims Act, please do not hesitate to contact us.聽 We will connect you with an experienced member of our whistleblower team for a free and confidential consult.聽 Maybe you will be the whistleblower who originates one of the next big Top-10 recoveries.
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