×
Search

866-540-5505

Se Habla Espanol
Menu
Search

Our Blog

Home/Blog/Federal Physician Kickbacks Claims Survive Abbott Labs Motion to Dismiss

Federal Physician Kickbacks Claims Survive Abbott Labs Motion to Dismiss

On August 18, 2022, a District Judge in the United States District Court for the Southern District of California granted in part and denied in part the motion to dismiss the False Claims Act lawsuit against Abbott Laboratories, Inc. a/k/a Abbott Laboratories, Abbott Cardiovascular Systems Inc., and Abbott Vascular Inc., (collectively, “Abbott” or the “Company”), sustaining the federal claims but dismissing the state claims in the action.

The False Claims Act, 31 U.S.C. §§ 3729–3733 (“FCA”), allows private citizens (known as whistleblowers or relators) to bring lawsuits on behalf of the government against entities suspected of misusing government funds. In the healthcare context, FCA cases frequently include claims under the federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7b (“AKS”), which prohibits the willful provision of anything of value in exchange for patient referrals. In 2010, Congress clarified that violations of the AKS are also FCA violations.

Because FCA actions are filed on behalf of the government, whistleblowers must first allow the Department of Justice (“DOJ”) to investigate their claims. The DOJ may then elect to take over prosecution of the case, do nothing and allow the relator to prosecute the case, or move to dismiss the lawsuit. If an FCA suit is successful, the relator is entitled to a share of the recovered funds.

Relator’s allegations accuse Abbott of paying kickbacks to physicians in exchange for implanting and/or referring patients to the Company’s MitraClip device, which is used to treat mitral regurgitation. Relator claims that these arrangements are kickbacks in violation of the AKS, and any procedure resulting therefrom and paid for through a government healthcare program constitutes a false claim made to the government.

Relator specifically alleges that kickbacks were paid to two groups of physicians: referring physicians and implanting physicians. Abbott targets non-implanting physicians by using free lunches and dinners, and other lavish events to bribe them to refer their cardiac patients to specific implanting physicians. Abbott then provides kickbacks to implanting physicians in the form of patient referrals, free marketing, and practice building, sham speaker program honoraria, and promises to participate in future clinical trials.

Following investigation, the DOJ declined to intervene in the matter, permitting Relator to continue prosecuting the action independently through its counsel, Miller Shah LLP.

In September 2021, Abbott moved to dismiss the lawsuit, arguing that Relator failed to allege that the kickbacks were the but-for cause of the MitraClip procedure and thus failed to plead the necessary causation element under the FCA. Abbott also argued that Relator did not adequately allege facts supporting the scienter (knowledge) element under both the AKS and the FCA.

In August 2022, the Court denied the motion as to Relator’s federal claims.

Opening on the FCA’s causation element, the Court held that “a claim is false if it seeks reimbursement for a prescription that was not provided in compliance with the Anti-Kickback Statute, regardless of whether the claim was the result of a quid-pro-quo exchange or would have been submitted even absent the kickback.” This finding is significant in light of the recent Eighth Circuit decision in U.S. ex rel. Cairns v. D.S. Medical LLC, et al., which held that the language of the AKS imposes a ‘but-for’ causation requirement and which created a circuit split with the Third Circuit’s holding in United States ex rel. Greenfield v. Medco Health Solutions, Inc.

Ultimately, the Court determined that Relator satisfied the pleading standard and sufficiently established a link between the kickbacks and the resulting claims for reimbursement. The Court also found for Relator on the scienter element, citing Relator’s allegations that Abbott management directed the kickbacks.

The caption for the lawsuit is United States ex rel. Everest Principals, LLC v. Abbott Labs et al., Civil Action No. 3:20-cv-00286-W-AGS, filed in the United States District Court for the Southern District of California.

The legal team at Miller Shah LLP has significant experience representing whistleblower matters. If you have any questions regarding this subject or this post, please contact Stephen Rutkowski (strutkowski@millershah.com) or Anna D’Agostino (akdagostino@millershah.com). The firm can also be reached toll-free at (866) 540-5505.

Share Post:
facebooktwitterLinkedin

Categories

Archives

Contact
Miller Shah LLP

While this website provides general information, it does not constitute legal advice. The best way to get guidance on your specific legal issue is to contact a lawyer. To schedule a meeting with an attorney, please call 866-540-5505 or complete the intake form to email us.
Alec J. Berin - Associate

PA Philadelphia | 866-540-5505

Alfonso Vilaboa - Of Counsel

NJ Hoboken |

Anika S. Keuning - Project Analyst

CA San Diego | 866-540-5505

Anna D’Agostino - Associate

NY New York City | 866-540-5505

Betsy Ferling-Hitriz - Legal Assistant

CT Chester | 866-540-5505

Bruce D. Parke - Partners

PA Philadelphia | 866-540-5505

Caroline Soper - Project Analyst

NY New York City | 866-540-5505

Christopher A. Miller - Associate

PA Philadelphia | 866-540-5505

Deborah C. England - Of Counsel

CA San Francisco | 866-540-5505

Edward H. Glenn - Of Counsel

NY New York City | 866-540-5505

Edward M. Fitzgerald - Staff Attorney

CA Los Angeles | 866-540-5505

Elena M. DiBattista - Legal Assistant

FL Fort Lauderdale | 866-540-5505

Elise M. Wilson - Project Analyst

NY New York City | 866-540-5505

Eric L. Young - Of Counsel

PA Philadelphia | 866-540-5505

Finn M. Mutrux - Office Staff

CA Los Angeles | 866-540-5505

Gina S. Demetriades - Office Staff

CT Chester | 866-540-5505

Heidi A. Wendel - Of Counsel

NY New York City | 866-540-5505

James C. Shah - Partners

CA Los Angeles | 866-540-5505

James E. Miller - Partners

CT Chester | 866-540-5505

Jayne A. Goldstein - Partners

FL Fort Lauderdale | 866-540-5505

Jillian M. Boyce - Office Staff

CT Chester | 866-540-5505

Jocelyn McNamara - Project Analyst

NY New York City | 866-540-5505

Johanna C. Richter - Law Clerk

PA Philadelphia | 866-540-5505

John C. Roberts - Associate

PA Philadelphia | 866-540-5505

Jonathan Dilger - Office Staff

NY New York City | 866-540-5505

Julie M. Capito - Legal Assistant

CA San Francisco | 866-540-5505

Katie Edwards - Legal Assistant

PA Philadelphia | 866-540-5505

Kolin C. Tang - Partners

CA San Diego | 866-540-5505

Laurie Rubinow - Partners

CT Chester | 866-540-5505

Madison Gregg - Associate

NY New York City | 866-540-5505

Marialisa Samo - Legal Assistant

CA San Diego | 866-540-5505

Mark Xiao - Associate

NY New York City | 866-540-5505

Natalie Finkelman Bennett - Partners

PA Philadelphia | 866-540-5505

Nathan C. Zipperian - Partners

FL Fort Lauderdale | 866-540-5505

Nicholas Day - Of Counsel

NJ Hoboken | 866-540-5505

Nicholas K. Ono - Project Analyst

NY New York City | 866-540-5505

Raffaele Scalcione - Of Counsel

IT Milan | 866-540-5505

Reilly K. Powers - Project Analyst

PA Philadelphia | 866-540-5505

Robert W. Biela - Staff Attorney

PA Philadelphia | 866-540-5505

Ronald S. Kravitz - Of Counsel

CA San Francisco | 866-540-5505

Rrita Osmani - Project Analyst

CT Chester | 866-540-5505

Shuping Li - Project Analyst

NY New York City | 866-540-5505

Stephen T. Rutkowski - Law Clerk

CT Chester | 866-540-5505

Sue Moss - Legal Assistant

PA Philadelphia | 866-540-5505

Sydney D. Finlay - Associate

CA San Diego | 866-540-5505

Tina Moukoulis - Staff Attorney

PA Philadelphia | 866-540-5505