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Frohsin & Barger Qui Tam Practice Adds Locations in Florida and Georgia

Since its inception, Frohsin & Barger has represented qui tam whistleblowers across the nation in False Claims Act litigation.  Over the past seven years, the firm has represented clients from more than a dozen states and appeared in federal courts in every region of the country from its home offices in Alabama, recovering nearly $200 million for its clients and the United States taxpayers.  In an effort to continue to combat nationwide fraud, Frohsin & Barger now has strategically placed attorneys in Florida and Georgia, as well.

“We will always have a strong Alabama presence due to our close ties to the University of Alabama School of Law, my ongoing work there as an adjunct professor, and our love for the State and community.” said founding partner Jim Barger.  “But as a group of lawyers who routinely represent whistleblowers in states all over the country, working in the federal court system in multiple jurisdictions against corporations operating nationwide — we came to realize the importance of having boots on the ground in other states.

Barger stressed that the expansion will not change the tight-knit litigation team nor the identity and culture of the firm.  “Our home base will always be the Southeast, and this move into Florida and Georgia is evidence of that.  The South is part of who we are as people; our identity as lawyers and our mission as a firm is informed by the struggles of the South, particularly the civil rights movement.”  One of the firm’s original founders, Henry Frohsin, was best known for his intrepid prosecutions of the Ku Klux Klan in the test years of the Civil Rights Act before moving into private practice with Frohsin & Barger.

According to current managing partner Elliott Walthall, the firm strives to honor that part of its heritage by serving individuals who stand up to corporate fraud against the United States. Barger, who is a member of the state bars in both Alabama and Georgia, will operate from the Georgia location, while Mandee Caldwell — a new addition to the firm with extensive experience on Capital Hill in Washington — will operate from the Florida location.  All of the firm’s other attorneys will continue to operate out of Alabama.

Frohsin & Barger will expand upon its pioneering use of cloud-based technology to continue to operate as a close-working team while focusing on maintaining its reputation as a small, client-focused, client-accessible firm.  “We answer our own phones,” said Barger.  “People are always surprised by that — I suppose they expect to be routed through a series of support staff, but that’s not how we operate.” Despite the firm’s geographic expansion and growth and its high-stakes nationwide practice, that aspect of the firm will never change.  “It’s what our clients have come to expect,” said Walthall. “We wouldn’t’ know how to do it any other way.”

Rite Aid Resolves FCA Allegations

Thanks to a False Claims Act (FCA) lawsuit filed pursuant to the qui tam provisions of the Act by Jack Chin, Rite Aid Corporation (Rite Aid) has agreed to pay the United States $2.99 million to resolve allegations that it violated the FCA by inappropriately using gift cards to induce Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid.  According to a Department of Justice press release, Chin will receive approximately $508,300 of the settlement for his involvement.  Patricia Stamler and Phil Benson of the law firm of Hertz Schram PC represented Mr. Chin.

“Pharmacies are not allowed to improperly influence the decision-making of Medicare and Medicaid patients about where to fill prescriptions, ” said Special Agent in Charge Glenn R. Ferry for the U.S. Department of Health and Human Services Office of Inspector General.  “Pharmacy chains that manipulate patient choices in this way will be held accountable.”

To report Medicare fraud, please contact Frohsin & Barger.

Vascular Solutions CEO Indicted For Conspiracy

According to an article in the Star Tribune, a Texas grand jury has charged Howard Root, CEO of Vascular Solutions, with conspiring to sell a varicose-vein treatment device for unapproved uses.  Prosecutors claim that Vascular Solutions marketed a device called the Vari-Lase to seal off veins deep in the leg, although the Food and Drug Administration (FDA) approved the device for the treatment of superficial blood vessels only.  The Vari-Lase was pulled from the market over the summer after Vascular Solutions settled a civil whistleblower lawsuit alleging the same off-label marketing issue as the new criminal case.

“These charges involve a deceptive sales campaign led by the CEO of a public company,” said Joyce Branda, acting assistant attorney general for the Justice Department Civil Division.  “We will take action to hold corporations and their leaders responsible when they violate laws intended to protect public health.”

To report healthcare fraud, please contact Frohsin & Barger.

Biotronik, Inc. Resolves Kickback Allegations

According to a DoJ press release, Biotronik, Inc. (Biotronik) has agreed to pay $4.9 million to resolve allegations that it paid illegal kickbacks to physicians.  Specifically, the United States alleges that Biotronik induced physicians in Nevada and Arizona to use Biotronik devices, including pacemakers, by providing the physicians with regular high-priced meals and extravagant payments for membership on a physician advisory board.  The United States alleges that these kickbacks caused hospitals and surgery centers to submit false claims for Biotronik devices to Medicare and Medicaid.

“Today’s resolution of claims underscores one of the key purposes of the Anti-Kickback law – to ensure that the judgment exercised by health care providers in treating Medicare and Medicaid patients is not influenced by illegal payments,” said U.S. Attorney Benjamin Wagner for the Eastern District of California.

The lawsuit was originally filed in 2009 by former employee, Brian Sant, and his attorney Mycal Wilson under the qui tam provisions of the False Claims Act.  Sant will receive $840,000 for his part in bringing the lawsuit.

To report healthcare fraud, please contact Frohsin & Barger.

North Florida Shipyards Settles FCA Allegations

Thanks to a False Claims Act (FCA) lawsuit, filed under the qui tam provisions of the Act by Robert Hallstein and Earle Yerger, North Florida Shipyards and its president, Matt Self, have agreed to pay the United States $1 million to resolve allegations that they violated the FCA by creating a front company, Ind-Mar Services Inc., in order to win a Coast Guard contract designated for businesses owned by disabled veterans.  According to an article on News4JAX.com, it is alleged that North Florida Shipyards created In-Mar Services Inc. as a contracting vehicle.  North Florida Shipyards performed all of the work itself and received all profits.

“Special programs to assist disabled veterans are an important part of the SBA’s business development initiative,” said A. Lee Bentley III, U.S. Attorney for the Middle District of Florida.  “False Claims such as this undermine the integrity of this vital program and, where found, will be vigorously pursued by our Office.”

To report fraud, please contact Frohsin & Barger.

Columbia University Settles FCA Allegations

According to an article on Reuters, Columbia University has agreed to pay $9 million to settle a lawsuit brought pursuant to the qui tam provisions of the False Claims Act.  Craig Love, former director of finance for Columbia’s International Center for AIDS Care and Treatment Programs (ICAP), brought the lawsuit in 2011 alleging that Columbia submitted false claims in connection with grants it obtained to fund AIDS and HIV related research.  Specifically, he alleged that Columbia used grant money for work that was not dedicated to the funded projects.

“Grantees are required to use federal money for the purpose for which the grant was given and nothing else,” said U.S. Attorney Preet Bharara. “The applicable rules are clear, and they are at the core of ensuring that tax dollars are appropriately spent. Educational institutions, like everyone else, should be held accountable when they fail to follow those rules.”

To report fraud, please contact Frohsin & Barger.

Jury Finds Trinity Industries Defrauded U.S. of Millions

On Monday, a Texas jury found that Trinity Industries Inc. (Trinity) defrauded the United States government of $175 million by hiding changes to its guardrail systems.  According to an article in the New York Times, Joshua Harman, a competitor, filed a False Claims Act lawsuit, under the qui tam provisions of the act, in 2012 alleging that Trinity changed the design of its ET-Plus rail head without disclosing the changes to the Federal Highway Administration.  Harman was represented by Nicholas Gravante Jr. of Boies, Schiller & Flexner LLP.  As a result of the change, the guardrail can seize up and impale vehicles that hit the end of the guardrail claims an article on Bloomberg.

The company could face liability close to $1 billion after the damages are tripled as required by the False Claims Act.  In addition, the Act imposes penalties for each false claim submitted.  Trinity has indicated that it will appeal the verdict.

To report fraud, please contact Frohsin & Barger.

Extendicare Settles Allegations of Substandard Care and Unnecessary Therapy

Thanks to two False Claims Act lawsuits, brought pursuant to the qui tam provisions of the act, Extendicare Health Services, Inc. (Extendicare) and its subsidiary Progressive Step Corp. (ProStep) have agreed to pay $38 million to resolve allegations that it billed Medicare and Medicaid for materially substandard nursing services and for medically unnecessary rehabilitation therapy services according to a DoJ press release.  The settlement resolves allegations that Extendicare billed the federal government for materially substandard nursing services provided in 33 facilities across 8 states.  For example, it failed to follow appropriate protocols to prevent pressure ulcers or falls.  The settlement also resolves allegations that Extendicare provided medically unreasonable and unnecessary rehabilitation therapy services to its Medicare beneficiaries in order to receive the highest per diem rate possible.

“Nursing home residents should not be subject to unreasonable or unnecessary rehabilitation therapy that is dictated by a company’s profits rather than patient needs,” said U.S. Attorney Zane David Memeger for the Eastern District of Pennsylvania.

Relator Tracy Lovvron will receive approximately $1.8 million as her share of the recovery in the RUGS upcoding case and Relator Donald Gallick will receive more than $250,000 as his share in worthless services case.

To report Medicare fraud, please contact Frohsin & Barger.

Medicare Fraud Arrests in South Florida

According to an article in the Miami Herald, federal authorities have now arrested and charged more than 30 suspects in relation to a Medicare fraud scheme in South Florida. The Department of Justice alleges that the suspects have submitted approximately $205 million in fraudulent claims to Medicare. Nearly 58 other suspects nationwide were also charged with Medicare related fraud as a part of this widespread takedown by the Justice Department.

The Miami-area is generally regarded as “the nation’s epicenter of Medicare corruption.” This reputation has been reinforced with the recent arrests, accounting for one-third of the total. On Thursday October 2nd, Karen Kallen-Zury, chief executive officer of Hollywood Pavilion Psychiatric Hospital, and two other executives, Daisy Miller and Michele Petrie, were arrested on charges of paying thousands of dollars in kickbacks to recruiters and patients. Many of the patients did not require mental health services. However, Kallen-Zury falsified documents to make it appear that the services were legitimate.

To report Medicare fraud, please contact Frohsin & Barger.

Shire Pharmaceuticals Resolves False Claims Act Allegations

As the result of the filing of two False Claims Act lawsuits, Pennsylvania-based Shire Pharmaceuticals LLC (“Shire”) has agreed to pay $56.5 million to resolve allegations regarding its marketing and promotion of Adderall XR, Vyvanse, Daytrana, Pentasa and Lialda, according to a DoJ press release.  A former Shire executive, Dr. Gerardo Torres, and three former Shire sales representatives, Anita Hsieh, Kara Harris and Ian Clark, filed the lawsuits under the qui tam provisions of the False Claims Act.  The settlement resolves allegations that between January 2004 and September 2010, Shire and its employees or representatives misrepresented and promoted various drugs including Adderrall XR, Vyvanse, Daytrana, Pentasa and Lialda despite lacking the clinical data to support its claims.

“Marketing efforts that influence a doctor’s independent judgment can undermine the doctor-patient relationship and short-change the patient.” said U.S. Attorney Zane David Memeger for the Eastern District of Pennsylvania.  “Where children’s medication is concerned, it can interfere with a parent’s right to clear information regarding the risks to the safety and health of their child.  Shire cooperated throughout this investigation and, in advance of this settlement, began to correct its marketing activities.”

To report False Claims Act violations, please contact Frohsin & Barger.

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