False Claims Act

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.

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On August 29, 2022, Nathan C. Zipperian of Miller Shah LLP (www.millershah.com), counsel for Plaintiff-Relator, Gregory Kuzma (“Relator”) announced Northern Arizona Healthcare (“NAHC”), Flagstaff Medical Center (“FMC”), and Health First Foundation – Northern Arizona (formerly Northern Arizona Healthcare Foundation) (“NAHF”) (collectively, “Defendants”) agreed to pay a total of $4.5 million to settle a lawsuit alleging that a 2017 Medicaid Disproportionate Share Hospital (“DSH”) payment of approximately $4.775 million to FMC violated the federal False Claims Act, 31 U.S.C. §§ 3729–3733.

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On July 20, 2022, Biogen, Inc., formerly known as Biogen Idec, Inc., agreed to pay $900 million to resolve allegations that the Company violated the federal Anti-Kickback Statute and False Claims Act by paying physicians to prescribe its Multiple Sclerosis drugs. After a decade of litigation, the parties agreed to settle just one week before trial was set to begin.

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On June 21, 2022 the Supreme Court of the United States granted certiorari in Polansky v. Executive Health Resources, a False Claims Act lawsuit appealed to the Third Circuit after the District Court dismissed at the request of the government. The Supreme Court’s decision is anticipated to resolve a split among the circuit courts of appeal regarding the legal standard applicable when the Department of Justice moves to dismiss qui tam actions brought on behalf of the government.

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The whistleblower lawsuit alleges that Northern Arizona Healthcare Corporation, Northern Arizona Orthopedic Surgery Center, LLC, and Flagstaff Medical Center, Inc., which collectively operate healthcare facilities throughout northern Arizona, violated the False Claims Act (“FCA”), 31 U.S.C. § 3729, et seq., and Anti-Kickback Statute (“AKS”), 42 U.S.C. § 1320a-7b, by purchasing a physician-owned surgery center at an inflated price in order to reward the physicians for their past business and induce them to refer future business to Defendants.

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