Fraud & Abuse Compliance and Litigation

Track Record of Proven Litigation Success

The Akin fraud and abuse compliance and litigation team has a proven track record of litigation success. Indeed, almost unique among law firms, the team has prevailed against the government in FCA actions at summary judgment, for example:

• United States ex rel. Lawson v. Aegis Therapies, Inc. 2015 U.S. Dist. LEXIS 45221 (S.D. Ga. Mar. 31, 2015): Mr. Salcido was lead counsel for Aegis Therapies and a Golden Living skilled nursing facility where the federal government had alleged that defendants provided medically unnecessary rehabilitation therapy. The district court granted defendants’ summary judgment motion. Based upon defendants’ motion, the court found that the government had used the wrong standard to assess whether the services were medically necessary and failed to prove that defendants’ certification regarding medical necessity was objectively false.
• United States of America ex rel. Jamison v. McKesson Corporation, et al. 900 F. Supp. 2d 683 (N.D. Miss. 2012): Mr. Salcido was lead counsel for Golden Living in FCA action where the federal government had sued Golden Living’s predecessor company Beverly Enterprises (“Beverly”) for $895 million alleging that Beverly had engaged in an unlawful kickback scheme with McKesson Corp. in violation of the Anti-Kickback Act and the FCA. After 14 days of trial, the court ruled that Beverly and McKesson did not violate the FCA or the Anti-Kickback Act because their business negotiations were fair, reasonable and conducted in good faith.
• United States v. Prabhu: 442 F. Supp. 2d 1008 (D. Nev. 2006). Represented defendants in an FCA action in which they prevailed on summary judgment in a governmental action alleging more than $20 million in damages, contending that defendants’ claims were not medically necessary. Ultimately, because the United States’ action lacked “substantial justification,” the United States was ordered to pay defendants more than $500,000 in legal fees.
• United States of America ex rel. Jamison v. McKesson Corporation, 784 F. Supp. 2d 664 (N.D. Miss. 2011). Represented Golden Living in an action where the relator and government sued multiple defendants alleging that they created a supply company in violation of the Anti-Kickback Act and operated the company in violation of supplier standards. The district court granted defendants’ FCA summary judgment motion regarding the supplier standards allegations, finding that the government’s prior administrative proceedings demonstrated that defendant was entitled to payment.

Our team has obtained dismissal of several FCA lawsuits at early stages, including:

• United States ex rel. Graziosi v. Accretive Health, Inc.: Represented The Methodist Health Care System in action alleging that it entered into contract with a billing company and conspired with it to provide medically unnecessary services. The district court dismissed the action under Fed. R. Civ. P. 9(b) and 12(b)(6). See id., 2017 U.S. Dist. LEXIS 41076 (N.D. Ill. Mar. 22, 2017).
• United States ex rel. Moore & Co., P.A. v. Majestic Blue Fisheries, LLC: Represented defendants in an action where plaintiff contended that defendants misrepresented ownership and control of entities to obtain government licenses. The district court dismissed plaintiff’s action because the alleged violation had no impact on government funds or property. See id., 196 F. Supp. 3d 436 (D. Del. 2016).
• United States ex rel. Portilla v. Riverview Post Acute Care Ctr.: Represented a skilled nursing facility (SNF) where the relator alleged that the SNF violated the FCA because, despite doctor’s orders, the SNF failed to provide bed alarms and abdominal binders to residents. The district court dismissed the action, finding that there was no FCA violation because the failure to provide a bed alarm or abdominal binder would not change the government’s reimbursement rate and hence any regulatory violation would not be material to the government’s payment decision. See, id., 2014 U.S. Dist. LEXIS 44002 (D.N.J. Mar. 31, 2014).
• United States ex rel. Assoc. Against Outlier Fraud v. Huron Consulting Grp., Inc.: Represented Huron Consulting Group in a qui tam action alleging that Huron caused St. Vincent’s Catholic Medical Centers to inflate its charges to obtain an unlawfully excessive amount of Medicare outlier payments. At summary judgment, the court dismissed plaintiff’s claim ruling that there could be no FCA violation as a matter of law because the alleged practice—raising charges on the chargemaster, which resulted in the receipt of additional outlier payments—“was not forbidden by either regulation or standard practice.” Successfully represented Huron Consulting Group before the 2nd Circuit, which affirmed the district court ruling. Reported decision: 567 Fed. Appx. 44 (2d Cir. 2014); 929 F. Supp 2d 245 (S.D.N.Y. 2013)
• United States ex rel. Westlund v. LabCorp, 2012 U.S. Dist. LEXIS 57050 (M.D. Fla. Apr. 24, 2012). Represented LabCorp in obtaining dismissal of qui tam case under Fed. R. Civ. P. 12(b)(6) and 9(b) where relator alleged LabCorp violated the FCA and Anti-Kickback Act.
• United States ex rel. Huey v. Summit Healthcare Ass’n, Inc., 2011 U.S. Dist. LEXIS 26740 (D. Ariz. Mar. 2, 2011). Represented a hospital management company in obtaining dismissal of qui tam case under Fed. R. Civ. P. 12(b)(6) where the relator alleged that the company had discovered that a client hospital had received a substantial Medicare overpayment and then conspired with the hospital to keep the overpayment hidden from the government.
• In re Natural Gas Royalties Qui Tam Litigation: Represented ExxonMobil in a qui tam action alleging that more than 300 defendants undervalued the heating content and volume of gas. The district court dismissed the relator’s action under the FCA public disclosure jurisdictional bar. The 10th Circuit affirmed the district court’s ruling. Also successfully moved the court to award defendants’ their attorney fees based upon the relator filing a frivolous action. Reported decisions: 562 F.3d 1032 (10th Cir. 2009); 467 F. Supp. 2d 1117 (D. Wyo. 2006).
• Our team recently completed a three-week bench trial in an FCA/Anti-Kickback Act, United States of America ex rel. Jamison v. McKesson Corporation (described above). This is one of the extraordinarily rare cases in which a large health care company has tried an FCA/Anti-Kickback Act case against the government.

In cases that proceeded past summary judgment, we have successfully defended the action at trial, including United States of America ex rel. Jamison v. McKesson Corporation. In that case, we represented Golden Living in an FCA action where the government sued Golden Living’s predecessor company, Beverly Enterprises (Beverly), for $895 million alleging that Beverly had engaged in an unlawful kickback scheme with McKesson Corp. in violation of the Anti-Kickback Act and the FCA. After 14 days of trial, the court ruled that Beverly and McKesson did not violate the FCA or the Anti-Kickback Act because their business negotiations were fair, reasonable and conducted in good faith. See id., 900 F. Supp. 2d 683 (N.D. Miss. 2012). This case was featured in Law360’s article “Health Care MVP: Akin’s Robert Salcido,” where Mr. Salcido was selected as one of only four health care MVPs for 2012. Law360 also identified Akin’s health care practice as Health Practice Group of the Year in 2012, a distinction Akin as enjoyed repeatedly since then.

We have also won a number of appeals in federal circuit court, including:

• United States ex rel. Harman v. Trinity Indus. Inc.: Represented Trinity Industries in its appeal from a $663-million FCA judgment. The 5th Circuit reversed the trial court’s verdict, finding that the relator failed to satisfy the FCA’s materiality element. See id., 872 F.3d 645 (5th Cir. 2017).
• United States ex rel. Jamison v. McKesson Corp.: Represented Golden Living before the 5th Circuit, which affirmed the district court’s dismissal of the relator’s action under the FCA public disclosure bar. See id., 649 F.3d 322 (5th Cir. 2011).
• United States ex rel. Assoc. Against Outlier Fraud v. Huron Consulting Grp. Inc.: Represented Huron Consulting Group before the 2nd Circuit, which affirmed the district court’s ruling granting summary judgment for defendants. See id., 567 Fed. Appx. 44 (2d Cir. 2014).
• United States ex rel. Jehl v. GGNSC Southaven LLC: Represented Golden Living entities before the 5th Circuit, which affirmed the district court’s ruling granting summary judgments for defendants. See id., No. 22-60209, 2022 WL 17443684, at *1 (5th Cir. Dec. 6, 2022).

Informed Compliance Advice

Because of our team’s substantial litigation experience, we are positioned to provide informed compliance advice. For example, whereas in most firms those providing compliance advice are separate from those who actually litigate the cases, Akin furnishes one team that handles both. This results in more accurate and informed advice because those providing the compliance advice have frequently encountered the same issues being tested in court—such as the scope of the FCA’s overpayment mandate, the Anti-Kickback Act’s “knowing and willful” element or the Stark Law exceptions. Thus, we know what facts and evidence a court is most likely to find persuasive and compelling, and we can provide the compliance advice accordingly. We also, through court actions, know what position the government will likely adopt regarding each of these issues.

The team’s pre-lawsuit compliance advice includes:

• Responding to Department of Justice civil investigative demands and subpoena requests.
• Making voluntary disclosures.
• Conducting internal reviews regarding whether there is a known overpayment and, if so, to whom and what to disclose.

Representative Experience

Our team also provides extensive counseling concerning compliance with fraud and abuse laws. This experience includes:

• Counseling on fraud and abuse issues related to the submission of Medicare and Medicaid reimbursement claims, including compliance with the false claims laws and mandatory disclosures.
• Designing, implementing and evaluating compliance programs.
• Negotiating Corporate Integrity Agreements (CIAs) imposed by the Department of Health and Human Services (HHS) Office of Inspector General (OIG) and counseling clients in meeting CIA obligations.
• Conducting internal investigations regarding possible overpayments or other compliance failures.
• Advising pharmaceutical manufacturers on whether certain discount arrangements and bundled sales of products comport with the federal Anti-Kickback Law.
• Advising pharmaceutical manufacturers on fraud and abuse compliance policies relating to quality programs, refill reminders and other product support programs.
• Requesting advisory opinions on behalf of pharmaceutical manufacturers from the OIG, including requests regarding the Anti-Kickback Law compliance implications of proposed discount arrangements and patient assistance programs.
• Counseling a large retail pharmacy chain on vicarious liability for fraud and abuse violations committed by its employees under state patient brokering and anti-rebate statutes and the Anti-Kickback Law.
• Counseling a physician practice management company acquiring interests in numerous physician practices and clinical laboratories across the United States on how to structure these transactions to conform with federal and state anti-kickback laws.
• Evaluating independent patient assistance programs for compliance with the Anti-Kickback Law and other fraud and abuse laws and counseling manufacturers on appropriate safeguards for such programs.
• Structuring manufacturer-sponsored patient assistance programs to comply with the Anti-Kickback Law and other fraud and abuse laws.
• Structuring manufacturer marketing programs with providers and managed care organizations to ensure compliance with the Anti-Kickback Law and other fraud and abuse laws.
• Reviewing a device manufacturer’s consulting and royalty contracts with physician inventors and technical advisers for compliance with the Anti-Kickback Law and the Stark Law.
• Providing fraud and abuse counseling related to structuring business arrangements among pharmaceutical companies, managed care organizations, physicians, hospitals and other providers.
• Evaluating corporate compliance programs and practices and compliance risks as part of due diligence reviews.