Jan 14, 2020

False Claims Act Recoveries Increase in 2019

The Department of Justice (“DOJ”) announced that in 2019 it obtained more than $3 billion in settlements and judgments from cases involving fraud and false claims against the government. False Claims Act recoveries increased over 2018, when DOJ announced total recoveries of approximately $2.8 million, and exceeded $2 billion for the tenth consecutive year. More than 85% of the funds recovered in 2019, totaling more than $2.6 billion, were from health care-related matters. Reflecting DOJ’s focus on “holding drug companies accountable for their role in the opioid crisis,” DOJ’s announcement highlighted the fact that “two of the largest recoveries involving the health care industry this past year came from opioid manufacturers,” including a global resolution with Insys Therapeutics, which paid $195 million to settle allegations it paid kickbacks to providers to induce them to prescribe Subsys for their patients. DOJ’s announcement also highlighted a variety of non-healthcare recoveries, including Northrop Grumman Systems Corporation’s payment of $27 million to resolve claims related to two battlefield communications contracts with the United States Air Force, and Duke University’s payment of$112.5 million to resolve allegations that it submitted applications and progress reports that contained falsified research on federal grants. As in past years, False Claims Act recoveries were driven in substantial part by cases initiated by whistleblowers. Of the $3 billion in settlements and judgments reported, over $2.1 billion arose from lawsuits filed under the qui tam provisions of the False Claims Act. F|G has experience handling alleged fraud and false claims act violations across a broad range of industries.