Hagens Berman Blog

Whistleblower News: False Claims Act, Spoofing, Juul, Biogen

11/08/2019

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$22.05 Million to Resolve Allegations of False and Inflated Average Wholesale Prices for Ingredients Used in Compounded Prescriptions

The Department of Justice announced today that Fagron Holding USA LLC (Fagron) has agreed to pay $22.05 million to resolve allegations concerning the establishment of false and inflated Average Wholesale Prices (AWPs) by its wholly owned subsidiary Freedom Pharmaceuticals Inc. (Freedom) for active pharmaceutical ingredients used in compound prescriptions.  Freedom’s pricing scheme caused pharmacies that purchased Freedom’s compound ingredients to submit false prescription claims to the Defense Health Agency, which administers the TRICARE Program for the Department of Defense and the Department of Labor’s Office of Workers Compensation Programs (federal healthcare programs).

The settlement resolves allegations contained in two separate actions filed against Freedom, PSI, and B&B under the whistleblower or qui tam provisions of the False Claims Act.  Under the False Claims Act, private parties may sue on behalf of the government for false claims for government funds and to receive a share of any recovery.  The whistleblowers will receive a combined total of $3,749,000 plus accrued interest from the proceeds of the settlement. read more »

CFTC Orders Proprietary Trading Firm to Pay Record $67.4 Million for Engaging in a Manipulative and Deceptive Scheme and Spoofing

Result Is the Largest Total Monetary Relief Ever Ordered in a Spoofing Case

The U.S. Commodity Futures Trading Commission today issued an order filing and settling charges against Tower Research Capital LLC, a proprietary trading firm, arising from a manipulative and deceptive scheme, spanning nearly two years and involving thousands of occasions of spoofing in equity index futures products traded on the Chicago Mercantile Exchange (CME) and Chicago Board of Trade (CBOT). The order finds that Tower, by and through three former Tower traders, engaged in this unlawful activity while placing orders for, and trading futures contracts through, Tower accounts, which benefited Tower financially while causing $32,593,849 million in market losses. read more »

Juul halts sales of mint-flavored e-cigarette popular with teenagers

Mint product accounts for 70% of Juul’s sales

Study found mint was high school students’ favorite flavor

Pressure to end the sales mounted after a former Juul executive claimed in a wrongful termination lawsuit that the company knew teens would buy mint products when mango was taken off the market.

“You need to have an IQ of 5 to know that when customers don’t find mango they buy mint,” the then chief executive, Kevin Burns, allegedly told employees, according to the lawsuit. read more »

Biogen hit back at whistleblowing sales manager, jury finds, levying $6M in damages

Former Biogen sales manager Danita Erickson reported a colleague's misconduct and got fired a few months later. Now, she's won $6 million in damages from a jury that determined she'd been wrongfully terminated for blowing the whistle.

Erickson, a former Biogen territory manager based in Tacoma, Washington, sued the drugmaker last year for retaliation and discrimination after she reported a violation of the False Claims Act. Instead of backing her up, Erickson's boss focused on her health condition and later terminated her, the lawsuit alleged.

Biogen denied the claims and asked the court to toss the case, but a jury this week sided with Erickson and awarded a $5.9 million verdict. read more »