Health Business Torts

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Top franchise cases of 2013

1. In Hanley v. Doctors Express Franchising, LLC, a former franchisee of the Doctors Express franchise system sued Doctors Express, the franchisor, and Rhino 7, a broker involved in the franchise sale, asserting that the...more

$1.2 Billion Medicaid Fraud Penalty Award Reversed and Claim Dismissed in Arkansas Appeal

In another decision narrowing the scope of state Medicaid fraud statutes, on March 20, 2014, the Supreme Court of Arkansas, in Ortho-McNeil-Janssen Pharmaceuticals, Inc. v. State of Arkansas, No. CV-12-1058, unanimously...more

TransCardiac's State Court Complaint Avoids Raising Federal Question

Judge Totenberg remanded the case brought by TransCardiac Therapeutics, Inc. (“TransCardiac”), against Ajit Yoganathan, Ph.D, Jorge H. Jiminez, Ph.D., Vinod H. Thourani, M.D., Emory University, Georgia Tech Research...more

ERISA Fiduciary Duties and the Tension Between the Affordable Care Act and the Religious Freedom Restoration Act

The Patient Protection and Affordable Care Act ("ACA") has significantly changed the healthcare industry in the United States. Among the many changes is the new requirement that healthcare providers must provide all "Food...more

Health Services Provider’s Settlement with DOJ Includes Detailed Factual Admissions and Agreement to Cooperate Against...

On January 8, 2014, pharmaceutical provider BioScrip, Inc. (BioScrip) reached a settlement with the Department of Justice (DOJ) to resolve claims under the False Claims Act (FCA) and the Anti-Kickback Statute (AKS), stemming...more

Pharmaceutical Company to Pay More Than $5 Million for Alleged Kickbacks

Abbott Laboratories has agreed to pay $5.475 million to settle allegations that it paid kickbacks in violation of the Anti-Kickback Act (AKA) to induce doctors to perform surgeries using the company's products. The global...more

U.S. District Court Grants in Part, Denies in Part Halifax Hospital’s Summary Judgment for Relator’s Non-Intervened FCA Claims

On January 8th, a United States District Court in the Middle District of Florida granted in part, denied in part summary judgment in favor of Halifax Hospital Medical Center and certain other defendants (collectively, Halifax...more

Why a Class Action Lawsuit Against 23andMe? Quick Hit Q&A With Audet & Partners

The bad news for 23andMe keeps coming. In late November, we learned that the U.S. Food and Drug Administration had ordered the company to stop selling its $99 DNA testing kit owing to a number of accuracy and validity...more

Private Health Insurance Fraud — Billions And Billions

When it comes to health insurance fraud, Carl Sagan’s obsession with the words – billions and billions — are particularly accurate. As the government’s role in health care increases, it is inevitable that fraud against...more

23andMe Named in Class Action Lawsuit

Things are getting worse for genetic diagnostics company 23andMe. On the heels of receiving a Warning Letter from the FDA over its Personal Genomic Services (PGS) test (see "FDA Threatens Agency Action Against 23andMe Over...more

Eighth Circuit Addresses Scope of False Claims Act Liability

Last month, the Eighth Circuit Court of Appeals addressed the scope of “fraud-in-the-inducement” liability under the False Claims Act (FCA), 31 U.S.C. §§ 3729-3733, and, in doing so, reversed the dismissal of a claim related...more

Hodgson Russ Helps Clients in Largest-Ever False Claims Act Settlement In Risperdal Lawsuits Against Johnson & Johnson

The Justice Department announced that Johnson & Johnson will pay $1.273 billion to the federal government and most states to settle a civil False Claims Act investigation into its off-label marketing of its antipsychotic drug...more

Eighth Circuit Adopts Novel False Claims Act Fraud-in-the-Inducement Theory Long Espoused by Government

On October 15, 2013, a divided three-judge panel of the United States Court of Appeals for the Eighth Circuit rendered a federal False Claims Act ("FCA") judgment against Bayer Healthcare Pharmaceuticals ("Bayer"), based on a...more

Supreme Court May Decide Issue of the Level of Specificity Required Under Rule 9(b) in FCA Whistleblower Suits

The United States Supreme Court recently indicated its potential interest in hearing arguments in a key False Claims Act (FCA) case that would address a circuit split over the important issue of the level of specificity of...more

Drug Manufacturer’s Liability Under Insurance Frauds Prevention Act May Not Be Inferred From Alleged Kickbacks to Physicians

Three former employees of Bristol Myers Squibb, Inc. (BMS) brought a qui tam action alleging that BMS violated California’s Insurance Frauds Prevention Act, California Insurance Code section 1871.7 et seq. (IFPA), by giving...more

Kurwa v. Kislinger: California Supreme Court Holds No End-Run Around the "One Final Judgment Rule" By Means of Voluntary...

Under California's "one final judgment rule," a judgment that fails to dispose of all the causes of action pending between the parties is generally not appealable. (Code Civ. Proc., § 904.1, subd. (a); Morehart v. County of...more

In Pipefitters, Sixth Circuit Holds Service Provider Is Fiduciary in Assessing Fee

Speed Read - The Sixth Circuit, in a unanimous decision, affirmed a lower court ruling in Pipefitters Local 636 Insurance Fund v. Blue Cross and Blue Shield of Michigan, holding that an entity providing services to a...more

Matria Healthcare Insider Traders Will Go to Trial

The US District Court for the Northern District of Georgia denied a motion for partial summary judgment in the Security and Exchange Commission’s insider trading case against Earl Arrowood and Parker Petit. The SEC alleges...more

OIG and MA Plan Sponsor Settle Allegations of Altering Records Submitted During Audit

Bravo Health Pennsylvania, Inc. (Bravo), a Medicare Advantage Plan Sponsor and subsidiary of Cigna Corporation, agreed to pay $225,000 to the Government for allegedly misrepresenting or falsifying information furnished to the...more

Seventh Circuit: Insurer Was Proper Defendant to an ERISA Benefits Claim, but Setting High Co-Payment Not a Fiduciary Act or De...

In Larson v. United Healthcare Ins. Co., __ F.3d __, 2013 WL 3836236 (7th Cir. 2013), the Seventh Circuit upheld the dismissal of plaintiffs’ putative class action claims that health insurers violated Wisconsin state law...more

PA Court Holds Coverage is Barred Under Professional Liability Policy for False Claim Act Lawsuit Costs

On July 16, 2013, the Pennsylvania Court of Common Pleas (Philadelphia County) granted summary judgment in favor of ACE American Insurance Company, holding that costs arising from False Claims Act Litigation were excluded...more

The Sixth Circuit Reminds Claim Administrators Of The Dangers Of A Breach of Fiduciary Duty When Handling Plan Assets

The Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et seq., was passed with the goal of protecting plan assets so that those assets would be available for plan participants and beneficiaries. See...more

Former ArthroCare CEO and CFO Charged with Securities Fraud, Wire Fraud

On July 16, 2013, the U.S. Department of Justice (DOJ) indicted Michael Baker and Michael Gluk, the former CEO and CFO, respectively, of ArthroCare Corp. – a Texas-based publicly traded surgical device company. Baker and...more

Peer Review "Interference" Alleged as Tortious Interference with Contract

Many sham peer review cases are based upon breach of contract in states in which the medical staff bylaws are treated as contracts between the hospital and/or medical staff and the individual physicians. Typically, the cause...more

7th Circuit Rules Employee May Recover Monetary Damages In ERISA Claim For Unpaid Benefits Against Insurer Who Denied Coverage...

The Seventh Circuit’s recent decision in Kenseth v. Dean Health Plan, Inc. provides a means for employees to collect monetary relief on their claim for benefits if they can show that the terms of the plan were not clear, and...more

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