Health Law Alert: OIG Ceases Exclusion Efforts Against Forrest Labs CEO - Not All Corporate Officers


The Office of Inspector General (OIG) for the U.S. Department of Health and Human Services has ended its effort to exclude former Forrest Laboratories’ CEO Howard Solomon. The OIG informed Mr. Solomon by letter on Friday, August 5, 2011 that “Based on a review of information in our file, and consideration of the information your attorneys provided to us both in writing and in an in-person meeting, we have decided to close this case.” Mr. Solomon’s case had been the subject of considerable attention in the health care community as the OIG attempted to exercise its permissive exclusion authority under section 1128(b)(15) of the Social Security Act.

The OIG’s (b)(15) exclusion authority allows it to exclude, at its discretion, an individual “who has a direct or indirect ownership or control interest in a sanctioned entity and who knows or should know . . . of the action constituting the basis for the conviction or exclusion. . . , or who is an officer or managing employee . . . of such entity.” This “should know” language has been interpreted by the OIG to create what it calls its “Responsible Corporate Officer Doctrine.”

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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