Whistleblower Lawsuits On The Rise

Whistleblower claims, or “qui tam” lawsuits, brought under the federal False Claims Act, increased to 753 in 2013, an increase of almost 20% over the previous year.* These claims resulted in aggregate net recoveries to the federal government of $3.8 billion last year. For the past four years, whistleblower lawsuits have produced recoveries to the federal government exceeding an aggregate amount of $3 billion.

What is driving the rise in whistleblower lawsuits under the False Claims Act? False claims involving healthcare and pharmaceuticals produced the largest share of recoveries in 2013, totaling $2.6 billion. Procurement fraud, involving fraud in the bidding and award of government contracts, net recoveries to the federal government totaling almost $900 million.

Escalating whistleblower lawsuits involving the federal False Claims Act are prompting the federal government to devote increased resources towards the improvement of compliance with existing federal law. The government has determined that reducing the number of False Claims Act lawsuits through improved compliance is a potentially more cost-effective approach than pursuing recoveries through protracted litigation.

Within the healthcare and pharmaceutical industries, drug “misbranding” cases are being most often pursued by the federal government. These cases often involve “off-label” promotion of drugs by manufacturers and/or distributors who market the drug for uses other than those specifically approved by the FDA.

Specific whistleblower and qui tam lawsuits within the pharmaceutical and healthcare sectors in 2013 included Johnson & Johnson’s marketing of the antipsychotic drug Risperdal. In November 2013, Johnson & Johnson paid $2.2 billion to resolve civil and criminal actions alleging kickbacks and off-label marketing of a litany of drugs including Risperdal, Invega, and Natrecor.

Audet & Partners, LLP is a leading plaintiff’s law firm in the pursuit of claims for dangerous pharmaceuticals, as well as whistleblower lawsuits and qui tam actions for violations based on the federal False Claims Act. If you have information suggesting that a company has presented false claims that may have defrauded the federal government, you are urged to contact a whistleblower lawyer at Audet & Partners, LLP for a free, completely confidential consultation by calling (800) 965-1461, or by completing and submitting our inquiry form on the right side of this page.

* http://www.justice.gov/civil/docs_forms/C-FRAUDS_FCA_Statistics.pdf