Month: July 2022

Source: United States Department of Justice 2

Reliance Medical Systems LLC, a distributor of spinal implant devices headquartered in Bountiful, Utah, its owners, Bret Berry and Adam Pike, and two of their physician-owned distributorships have agreed to pay $1 million to resolve a lawsuit against them alleging that they violated the False Claims Act by paying physicians to use Reliance medical devices in spinal surgeries on their own patients.  

The Justice Department’s lawsuit alleged that the defendants operated physician-owned distributorships (PODs) that, in reality, were vehicles for the payment of kickbacks to induce physicians to use Reliance’s medical devices in their surgeries. The Anti-Kickback Statute prohibits offering or paying anything of value to encourage the referral of items or services covered by federal health care programs. 

The Justice Department contends that the defendants’ PODs paid physicians based on their referrals, made false statements to health care providers, and terminated physicians who did not refer enough patients. The complaint alleged that Berry and Pike were recorded attempting to induce a spine surgeon to join Kronos Spinal Technologies, one of Reliance’s PODs, by offering to pay him a share of the profits he generated for Kronos after he proved his “loyalty” to Kronos.

“As today’s settlement demonstrates, we will look to the substance, not just the form, of an arrangement to determine whether the payment of remuneration constitutes an illegal kickback,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to redressing the corrupting influence of kickbacks on federal health care programs, regardless of how companies seek to characterize such payments.”

“When health care companies try to boost their profits through kickbacks arrangements, they compromise the integrity of medical decision-making while increasing health care costs for everyone,” said Special Agent in Charge Timothy B. DeFrancesca of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Working with our law enforcement partners, our agency is committed to thoroughly investigating such schemes.”

The United States filed this lawsuit in 2014, and this settlement was reached after the first day of trial. The case is captioned United States of America v. Reliance Medical Systems, LLC, et al., No. 14-6979 (C.D. Cal.). 

This settlement is the most recent in a series of settlements with persons affiliated with Reliance Medical Systems. The Civil Division previously recovered over $9.25 million from owners of Reliance PODs.

The investigation and resolution of this matter illustrate the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

This matter was handled by the Civil Division’s Commercial Litigation Branch (Fraud Section) Attorneys Robert Chandler and David Finkelstein, with assistance from HHS-OIG.

The claims asserted against defendants are allegations only and there has been no determination of liability.

Source: United States Department of Justice

As part of the work that began several weeks ago and is ongoing, the Department of Justice’s Critical Incident Review Team examining the mass shooting at the Robb Elementary School in Uvalde, Texas, conducted its first site visit the week of June 27. Justice Department staff were joined by subject matter experts in conducting meetings and gathering pertinent information. This site visit, and all subsequent site visits, are just one piece of what will be a thorough and comprehensive review. We anticipate the cooperation of all the agencies involved in the response, as the department is committed to moving forward with a full, fair and complete accounting. The goal of the review is to provide an independent account of law enforcement actions and responses; identify lessons learned and best practices to help first responders prepare for and respond to active shooter events; and provide a roadmap for community safety before, during and after such incidents. The department will make its full findings and recommendations publicly available at the completion of the review.

Source: United States Department of Justice

Two men were sentenced today for conspiring to provide material support to the designated foreign terrorist organization Islamic State of Iraq and al-Sham/Syria (ISIS).

Kristopher Sean Matthews, aka Ali Jibreel, 36, of South Carolina, was sentenced to 20 years in prison, and Jaylyn Christopher Molina, aka Abdur Rahim, 24, of Cost, Texas, was sentenced to 18 years in prison.

According to court documents, since May 2019, Matthews conspired with Molina to provide services to ISIS by administering an encrypted, members-only chat group for persons who supported ISIS ideology; by collecting, generating, and disseminating pro-ISIS propaganda; and by disseminating firearms training materials and bomb-making instructions to each other and to other members of the chat group and others.

On Nov. 24, 2020, and Jan. 25, 2021, Matthews and Molina, respectively, pleaded guilty to one count of conspiracy to provide material support to ISIS. In addition, Molina pleaded guilty to one count of receiving child pornography. At today’s sentencing, Molina received another 216 months, to run concurrently, for the child pornography charge. Both men have remained in federal custody since their arrests on Sept. 21, 2020.

The San Antonio FBI’s Joint Terrorism Task Force (JTTF), with valuable assistance from the San Antonio Police Department, the U.S. Secret Service and the Gonzalez County Sheriff’s Office, investigated this case. 

Assistant U.S. Attorneys Mark Roomberg, William R. Harris and Eric Fuchs for the Western District of Texas and Trial Attorney George C. Kraehe and former Trial Attorney Felice J. Viti of the National Security Division’s Counterterrorism Section prosecuted this case on behalf of the government.

Source: United States Department of Justice News

A federal grand jury in New Orleans, Louisiana, returned an indictment charging a Louisiana man with seven counts of Possession of Animals in an Animal Fighting Venture.

According to court documents, David Guidry III, 47, possessed and received dogs for the purpose of having the dogs participate in animal fighting ventures.

On or around Oct. 24, 2017, a federal law enforcement team consisting of agents from the Department of Agriculture, the FBI and the U.S. Marshals Service and other agencies executed a search warrant on Guidry’s residence. The physical evidence from the search along with court-authorized wiretaps established that Guidry violated the federal anti-animal-fighting statute.

If convicted, Guidry faces up to five years in prison for each count of conviction. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Trial Attorney Matthew D. Evans of the Justice Department’s Environment and Natural Resources Division, Environmental Crimes Section and Assistant U.S. Attorney Jonathan L. Shih for the Eastern District of Louisiana are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Source: United States Department of Justice

The Justice Department announced today that Air France and KLM Airlines (AF/KLM) have agreed to pay $3.9 million to resolve their alleged liability under the False Claims Act for falsely reporting information about the transfer of U.S. mail to foreign posts or other intended recipients under contracts with the U.S. Postal Service (USPS). AF/KLM are international air carriers with headquarters in Paris and Amsterdam, respectively.

“The Department of Justice is committed to ensuring that government contractors provide the services for which they are paid,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “When contractors knowingly fail to meet their obligations, we will pursue appropriate remedies to redress the violations and deter future ones.”

USPS contracted with AF/KLM to take possession of receptacles of U.S. mail at six locations in the United States or at various Department of Defense and State Department locations abroad, and then deliver that mail to numerous international and domestic destinations. To obtain payment under the contracts, AF/KLM was required to submit electronic scans of the mail receptacles to USPS reporting the time the mail was delivered at the identified destinations. The contracts specified penalties for mail that was delivered late or to the wrong location. The settlement resolves allegations that scans submitted by AF/KLM falsely reported the time and fact that they transferred possession of the mail. 

“The USPS contracts with commercial airlines for the safeguarding and timely delivery of U.S. mail to foreign posts, including the mail sent to our soldiers deployed to foreign operating bases,” said Executive Special Agent in Charge Ken Cleevely of the USPS, Office of Inspector General (OIG). “The OIG supports the Postal Service by aggressively investigating allegations of contractual non-compliance within the mail delivery process, including the falsification of delivery information. Our special agents worked hand-in-hand with the Department of Justice to help ensure a reasonable resolution and we applaud the exceptional work done by the investigative and legal teams.”

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, with substantial assistance from the USPS Office of the Inspector General and the USPS Office of General Counsel. Senior Trial Counsel Don Williamson of the Civil Division’s Commercial Litigation Branch, Fraud Section, represented the government in the civil case.

This is the seventh civil settlement involving air carrier liability for false delivery scans under the USPS ICAIR Contracts, and collectively the United States has recovered more than $84 million as a result of its investigation of such misconduct. 

The claims resolved by the settlement are allegations only and there has been no determination of liability.