HEAT is a coordinated effort between DOJ and HHS, and it has a Medicare Fraud Strike Force that has been going around various cities busting health care fraud perps. It's operating in various locations, including South Florida, but no, you are not likely to see Attorney General Holder wearing a Miami Vice suit and driving a go-fast boat into a medical center.

In recent testimony given before the House Ways and Means Subcommittee on Health and Oversight, Edward Siskel, the Associate Deputy Attorney General, stated that since May 2009, the Strike Force has been putting fear in the hearts of health care fraudsters. Strike Force prosecutors have filed over 120 cases charging more than 290 defendants and have obtained 16 convictions. The Strike Force also appears to have had a deterrent effect. In the twelve months since the Strike Force was announced, the Miami area has seen an almost $2 billion reduction in durable medical equipment submissions compared to the preceding 12 month period.

Deputy AG Siskel also notes in his testimony statistics all too familiar to qui tamers: the bulk of the DOJ's civil case load comprises suits against drug and medical device makers. Qui tam suits have proved to be an important weapon in the DOJ's fraud-fighting arsenal, and have helped the government to recover $24 billion since 1986. This goes to show that the civil justice system is just as important as the swaggering Task Force in the fight against health care fraud.

This article is brought to you by the QTT, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

Pequignot was claiming $500 per violation, and considering the vast number of Solo lids in existence--21,757,893,672 (you may even be slobbering all over one right now)--the fines would have produced an award for the United States of $5.4 trillion—enough to pay 42% of the national debt. Where Solo would have gotten its hands on this kind of cash is anyone's guess. What Pequignot would have done with his trillions is also unknown. He could have purchased several muncipalities, or even a few states, and started his own patent-ocracy.

The court found that Pequignot failed to prove that Solo intended to deceive the public with its expired patent mark. Intent can be very difficult to prove in lawsuits generally, and it doesn't help that a lot of products are stamped with expired patents simply because the manufacturer is too lazy or cheap to change the molds or machining.

In Solo's case, it appears that the company did not change its molds based on cost-saving. A Solo cup mold produces a lid every four to six seconds, and goes on doing this for 20 years or more. Based on advice from an attorney, Solo instituted a policy whereby replacement molds would not include the expired patent number. However, the molds were only to be replaced when the old mold became damaged or wore out. This helps to explain why there were/are so many Solo lids floating around out there with the expired patent marking.

The general consensus is that the U.S. Court of Appeals for the Federal Circuit's ruling will put a damper on future suits aimed at getting big money for false marking. But with the number of old molds constantly stamping away out there, we'll see.

This article is brought to you by the QTT, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

Campbell filed a complaint with the Labor Department alleging that he was fired for his role in the federal investigation as well as for safety complaints he made to mine management.  Federal administrative law Judge L. Zane Gill agreed with Campbell, stating that there was "substantial evidence to support a reasonable cause to believe" that Campbell's complaints led to his firing.  The administrative law judge ordered Massey to temporarily reinstate Campbell, and the ball is now in the Labor Department's court to file a complaint seeking permanent reinstatement.

The harsh world of mining seems to lend itself to a wide array of egregious violations. If you're still fired up about mines, here's a shameless plug for the film North Country, which is the semi-fictionalized story of a group of women who had the guts to stand up to a mining corporation and bring a sex discrimination lawsuit despite outrageous threats and harassment. The lawsuit at the center of the film is based on Jenson v. Eveleth Taconite Co. The case was filed in 1988 on behalf of Lois Jensen and other female workers at EVTAC mine in Eveleth, Minnesota. Jensen began working at the mine in 1975 and endured outrageous sexual harassment. She quit working at the mine in 1992, and was diagnosed with post-traumatic stress disorder shortly thereafter. It wasn't until 1998, when another trial was set to begin following years of protracted litigation, that the company settled with 15 female plaintiffs for $3.5 million.

Both the Massey mine situation as well as the Eveleth sexual harassment suit illustrate that even in harsh, remote environments such as mines, concerned individuals can make a difference by letting their voices be heard. No matter how far underground you may be, there is always a path to the courtroom.

This article is brought to you by the QTT, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

In looking at the top 27 FCA cases, 93% of them have to do with some type of healthcare fraud. In fact, among the top 5 FCA cases, each one is related in some way to the healthcare industry.

At the top of the list is drug-making mastodon Pfizer. In the fall of 2009, Pfizer agreed to pay $2.3 billion to settle claims, including claims brought under the FCA. $1.3 billion of the settlement constituted criminal penalties. This penalty sounds like it would be the final straw for Pfizer, but when you consider Pfizer's 3rd quarter 2009 profit alone was $2.88 billion, you have to wonder whether even an enormous fine like this is enough to deter a drug company from potentially engaging in fraud.  Pfizer was sued for allegedly marketing certain popular drugs like Bextra and Lipitor for unapproved uses. The company made huge profits off of these drugs, and legal experts are not convinced that fines will prevent drug makers from going down the same road in the future.

The FCA keeps drug companies on their toes, but it remains to be seen whether fraud will be completely eliminated.  Our society does love its drugs--prescription drugs are so ubiquitous that they are even showing up in trace amounts in public drinking water supplies--and as long as profits outweigh fines, the temptation to engage in fraud to increase those profits will probably endure.

This article is brought to you by The Qui Tam Team, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

Even though the DOJ has just joined a whistleblower lawsuit against KBR, the Army has announced a $568 million no-bid contract with the company through 2011 for military support services in Iraq.

KBR allegedly accepted meals, sports tickets, and golf outings from two freight forwarding companies.

KBR denies the allegations, of course, and in a statement said that "Gifts of dinners, baseball tickets and other similar items would violate KBR policies." This is sort of like saying, "It would just be so awful if some (hypothetical, of course) company bribed officials. Nothing specific, other than dinners and baseball tickets...er..." KBR went on to say that maybe, possibly, if this hypothetical naughty company did give any gifts, they would have been less than $20,000. No big deal, right?

The problem is that this kind of behavior ends up costing taxpayers money in the end. Although the government hasn't definitively stated whether the kickbacks cost taxpayers money yet, there is a strong possibility that KBR passed up companies offering lower costs for those that bought the best dinners and seats for games. Choosing a supplier on the basis of the gifts they provide shifts a government contractor's priorities away from where they belong (providing the best value to the taxpayer) and warps the "bidding" process into one in which the contractor puts its own interests first.  Fortunately, there are whistleblowers out there to help keep contractors like KBR in check.

This article was sponsored by The Qui Tam Team, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

The relevant section of the law pertaining to patents (35 U.S.C 292) states:

(a) Whoever, without the consent of the patentee, marks upon, or affixes to, or uses in advertising in connection with anything made, used, offered for sale, or sold by such person within the United States, or imported by the person into the United States, the name or any imitation of the name of the patentee, the patent number, or the words "patent," "patentee," or the like, with the intent of counterfeiting or imitating the mark of the patentee, or of deceiving the public and inducing them to believe that the thing was made, offered for sale, sold, or imported into the United States by or with the consent of the patentee; or Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article the word "patent" or any word or number importing the same is patented, for the purpose of deceiving the public; or Whoever marks upon, or affixes to, or uses in advertising in connection with any article the words "patent applied for," "patent pending," or any word importing that an application for patent has been made, when no application for patent has been made, or if made, is not pending, for the purpose of deceiving the public - Shall be fined not more than $500 for every such offense.

(b) Any person may sue for the penalty, in which event one-half shall go to the person suing and the other to the use of the United States.

Note that the law provides for qui tam suits in subsection (b), with a hefty 50% of the recovery going to the relator.

False marking "includes marking unpatented product as “patented” or marking a product as 'patent pending' when no patent is pending." The tricky issues arise when manufacturers lose track of patents or continue to manufacture products bearing a patent number that has long expired.

In the now-famous/infamous case Pequignot v. Solo Cup Co., the plaintiff, Matthew Pequignot, alleged that Solo Cup falsely marked certain products with expired patent numbers and improperly marked others with conditional patent markings. Notably, Pequignot is a patent attorney, so presumably knows more about this area of the law than the average bear. Also, the case involves about 21 billion lids, each of which could potentially constitute an "offense" under the aforementioned law and carrying a $500 fine.

Solo tried to get the case dismissed on several grounds, including an argument that Pequignot lacked standing as a qui tam relator. The federal district court, however, wasn't buying, and denied Solo's Motion to Dismiss. In regard to Solo's arguments that suits like Pequignot's were not what Congress had in mind when it made qui tam suits available in false marking suits, the court noted that Congress had the opportunity to change the law, but may have decided that the benefits of allowing citizens to blow the whistle on falsely marked products outweighed the burdens.

It will be very interesting to see how the Pequignot case turns out. Given that we as a society consume so many patented products, the stakes are extremely high.

This article was sponsored by The Qui Tam Team, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.

What seems particularly preposterous is the fact that of the few UBS clients convicted of tax evasion, few have received time behind bars, whereas Birkenfeld is serving more than three years. There may be a significant amount of reward money waiting for him when he gets out--possibly millions--but even that is uncertain. Hopefully the government will realize just how valuable the information Birkenfeld has provided really is. To put things in perspective, approximately 15,000 people presented themselves to the IRS last year, many paying back taxes and fines. The number of people who seek a soul-cleansing from the IRS' revenual font in a normal year? About 100.

The most recent development in the Birkenfeld saga is his revelation that some politicians kept off-shore accounts with UBS. According to Birkenfeld, UBS had an office in Washington D.C. referred to internally as the PEP office for "Politically Exposed People." One wonders: where is the outrage over this? Birkenfeld's revelations have been largely overshadowed by the Goldman Sachs debacle, but we definitely haven't heard the last from this high-octane UBS whistleblower.

Now, the government has extended the indictment to two of Agility's subsidiaries: DGS Holdings and KSCc. The company has been doing extremely well financially up until now, so it remains to be seen how the extra indictments will affect things. On April 11th, Agility posted a 22 percent rise in fourth-quarter profit--evidence that its enormous military contracts are an extremely lucrative business, even if it involves vast overchargings for a couple of bananas or some Romaine.

Today's overpriced banana is the modern version of the $600 toilet seat--the modern military outsources even the most mundane details, not just procurement of equipment. Although the extensive use of contractors puts the military at a much higher risk of being subjected to fraud, this does not excuse any contractor who overcharges for goods and services. It's taxpayers who ultimately end up footing the bill.

UPDATE: As we were writing this post,  it was announced that Agility has lost its contract to supply food to troops in Iraq! Agility stated on the Kuwaiti Stock Exchange website that another company had been appointed to take over its duties, but that Agility would continue on for six more months.

This dramatic turn of events was brought about by a whistleblower without whom Agility's fraud may never have come to light. The company could have gone on overcharging the military and taxpayers for many more years, but fortunately  in sixth months we won't be buying any more overpriced Iceburg lettuce from this outfit.

Although it doesn't necessarily tug at the heartstrings the way stories of trapped miners do,  fraud by by companies extracting coal and other natural resources from federal and Indian lands costs taxpayers millions of dollars in lost royalties. The typical situation is one in which a resource extractor removes more of a resource than it discloses to the government by falsifying records.

According to testimony given by Acting Inspector General for the Department of the Interior Mary L. Kendall before Congress regarding bill H.R. 3534, nearly $700 million has been recovered from 25 companies, much of it through qui tam cases. H.R. 3534, the Consolidated Land, Energy, and Aquatic Resources Act, is a bill that would "provide greater efficiencies, transparency, returns, and accountability in the administration of Federal mineral and energy resources by consolidating administration of various Federal energy minerals management and leasing programs into one entity to be known as the Office of Federal Energy and Minerals Leasing of the Department of the Interior."

A perfect example of a False Claims Act violation by a resource extractor met its apex in December 2009, when Chevron agreed to pay $45 million to the United States to resolve claims that it knowingly underpaid royalties for natural gas extracted from federal and Indian land. As one of the assistant attorneys general involved in the case observed, royalties are an important source of income for Native Americans, the federal government, and various states. When companies underpay royalties, they usually end up cheating everyone to some degree. It's important for whistleblowers to help ensure that resource extractors don't take advantage of the complex nature of their business. As the demand increases for certain natural resources, such as natural gas, there are sure to be more opportunities for fraud.

• Exposing troops to unsafe food, water, and toxic fumes. KBR allegedly loaded ice for the troops onto trucks that were still contaminated with bodily fluids and other biohazards from bodies, and allegedly mismanaged the burn pits it used to dispose of medical waste and bodies so poorly that a stray dog was seen running around a base with a human arm in its mouth.
• Health problems related to its massive burn pits. Plaintiffs alleged that their family members died as a result of exposure from toxic fumes emitted from KBR's flaming garbage pits in Iraq and Afghanistan. Pretty much anything not tied down was allegedly tossed into these pits, including the aforementioned arm.
• Forcing Nepalese workers to work in Iraq, where they were kidnapped and killed. The workers were allegedly recruited in Nepal by KBR and its Jordanian contractor and told that they would be working in a luxury hotel in Jordan. However, they were taken instead to Iraq where, on the way, their unprotected convoy was attacked and all but one were kidnapped and murdered.
• KBR is also facing a criminal investigation as a result of electrocution deaths of soldiers. 18 soldiers have been electrocuted, most while showering, as a result of improperly installed or maintained electrical equipment.

Now, in the latest legal snafu, the U.S. Department of Justice has sued KBR for allegedly knowingly including impermissible costs for private security  in bills submitted to the Army between 2003 and 2006.  According to the lawsuit, KBR violated a service contract by failing to obtain authorization from the government for private security subcontractors. KBR, on the other hand, claims that the government was the one in breach of contract because it failed to provide adequate protection for KBR employees, requiring KBR to hire its own guns.

With all this litigation as a result of what appears to be serious mismanagement and lack of oversight, we need to question whether military contractors are providing taxpayers the best value for their money. It's important for more whistleblowers to bring fraud by military contractors to light so we can start getting our  ill-gotten tax dollars back!