Abbott Laboratories has filed a lawsuit against the Department of Justice (“DOJ”), alleging that the DOJ has abused secrecy provisions in the False Claims Act (“FCA”).  The FCA is a law that governs the filing of whistleblower lawsuits, under which private individuals bring claims on behalf of the federal government to report fraud and misconduct.  Under a qui tam provision of the FCA, whistleblowers are entitled to between 15-30% of the damages awarded to the government by courts.
In a 1995 federal lawsuit ultimately filed in Boston, Ven-A-Care pharmacy in Florida sued multiple pharmaceutical corporations, including Abbott Laboratories, in a whistleblower lawsuit. That lawsuit alleged that Abbott had fraudulently inflated prices.
FCA lawsuits are filed under a seal, meaning that only the whistleblower, the DOJ, and the court have access to information regarding the lawsuit.  As a result, pharmaceutical corporations claim that they are at a disadvantage.  The DOJ can obtain documents without informing the corporation that the documents relate to pending litigation.  Also, although the seal only lasts for 60 days under the FCA, the court can extend the seal if the court deems the extension necessary.
Abbott alleges that the DOJ extended the seal for the Ven-A-Care lawsuit for more than 11 years, and did not preserve the evidence that it obtained under seal.  Because this evidence allegedly was not preserved, there are now evidentiary gaps that could harm the company during trial.  Abbott wants the court to bar damages on claims where there’s missing payment data; order the government to provide state-by-state evidence of fraud; consider missing evidence in Abbott’s favor and order the government to prove that it didn’t knowingly pay claims on terms it now calls false and fraudulent.
Previously, the American Civil Liberties Union (“ACLU”) sued DOJ over the FCA seal.  The ACLU believed that the seal prevents the press and public from learning about the serious fraud allegations that underlie most whistleblower lawsuits.
For more information on the False Claims Act or whistleblower lawsuits, contact a whistleblower lawyer.

Tags: Whistleblower lawsuits

This entry was posted on Monday, June 22nd, 2009 at 12:05 pm and is filed under Whistleblower lawsuits. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.