AGG’s Government Investigations Team Insights provides periodic updates covering legal and regulatory topics. Our team, which includes former federal prosecutors, SEC enforcement attorneys, and federal agency attorneys, has successfully represented companies and individuals, including executives of public companies, in numerous civil and criminal investigations, including before the U.S. Department of Justice and U.S. Attorney’s Offices, the SEC, the EPA, the FDA, the FTC, and many other federal and state agencies. We also assist our clients by conducting internal and parallel investigations, and advising them regarding the related issues that often follow government investigations, including civil litigation, media interest, and reputational concerns.
In this edition, we discuss a recent spike in insider trading cases, including the first cryptocurrency insider trading tipping indictment; the import of recent telemedicine fraud cases; and an important new Anti-Kickback Statute case.
Featured Articles
Insider Trading Cases Back on the Rise. . . With a Twist
By Aaron M. Danzig
Pillow talk from an FBI agent trainee. A former congressman turned consultant trading on merger information learned on the job. A former Goldman Sachs investment banker misappropriating information about deals the bank was considering financing. The former co-chairman of Apple’s Disclosure Committee buying and selling his company’s stock based on insider information. These recent charges indicate a renewed focus on one of the most basic of federal frauds — stealing confidential information and using it to make money on the stock market. In addition to these recent traditional cases, however, the government has also pursued insider trading cases involving digital assets and cryptocurrency, further evidence that the Department of Justice (“DOJ”) is prioritizing insider trading cases.
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The Future of Telemedicine in an Era of Enforcement
By Sara M. Lord
On the same day that the U.S. Department of Justice (“DOJ”) announced the filing of criminal charges against 36 defendants for alleged schemes involving more than $1.2 billion in fraudulent telemedicine claims, the U.S. Department of Health and Human Services Office of Inspector General (“OIG”) published a Special Fraud Alert (“Special Alert”) advising healthcare providers to “exercise caution and use heightened scrutiny” when entering into arrangements with companies purporting to provide telehealth, telemedicine, or telemarketing services. The simultaneous announcements reflect the government’s sharpening focus on the potential for fraud stemming from the rapid expansion of telehealth services during and in response to the COVID-19 pandemic.
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Eighth Circuit Says “But For” Causation Required in False Claims Act Case Based on an Alleged Anti-Kickback Violation
By Aaron M. Danzig and Kara G. Silverman
On July 26, 2022, the Eighth Circuit raised the bar for plaintiffs seeking to allege a violation of the False Claims Act (“FCA”) predicated on the Anti-Kickback Statute (“AKS”). Under this decision, the plaintiff must prove “but for” the illegal kickbacks, the defendants would not have submitted particular claims for reimbursement. United States ex rel. Cairns v. D.S. Medical, LLC, 2022 WL 2930946 (8th Cir. July 26, 2022).
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