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The Supreme Court has agreed to hear an appeal of the reinstatement of a whistleblower’s qui tam case against defense contractor KBR, Inc. alleging violations of the False Claims Act.  The 4th U.S. Circuit Court of Appeals reinstated the case in 2013 after concluding that the whistleblower had not blown the six-year statute of limitations, because the statute was tolled while the country was at war pursuant to the Wartime Suspension of Limitations Act.

The whistleblower, Benjamin Carter, initially filed the underlying qui tam action in the United States District Court for the Eastern District of Virginia.  The district court dismissed the whistleblower’s case, and held that the original qui tam matter had been filed beyond the False Claims Act’s six-year statute of limitations.  The whistleblower appealed the dismissal.

According to the whistleblower, KBR provided logistical assistance to the U.S. military in Iraq pursuant to a government contract.  The whistleblower was employed by KBR as a reverse osmosis water purification unit operator at two camps serving the U.S. military in Iraq from mid-January to April 2005.  The whistleblower’s complaint alleged that KBR did not purify the military’s water in Iraq until May 2005, despite billing the federal government for water purification during the period January to April 2005.  In addition, the whistleblower claimed that KBR instructed its employees to bill the government for twelve-hour work days, regardless of whether they actually worked for twelve hours.

The appellate court reversed the lower court’s decision.  According to the Court of Appeals’ decision, it found that the Wartime Suspension of Limitations Act was applicable because the country was at war when the False Claims Act allegations were presented.  In addition, it held that the whistleblower was not precluded from bringing a new action once the original actions were dismissed.

KBR then submitted a petition for a writ of certiorari to the Supreme Court of the United States. On July 1, 2014, the Supreme Court granted the petition. Oral argument and a decision are expected in the court’s next term which begins in October.

To read about other cases brought under the qui tam provisions of the False Claims Act, click here.

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Baptist Health System, Inc. (“Baptist Health”) will pay $2.5 million to settle allegations by a whistleblower in a qui tam lawsuit that it submitted false claims to Medicare, Medicaid, and TRICARE.  According to its website, Baptist Health was founded in 1955, and is the only locally governed health system in the Jacksonville, Florida area. Baptist Health is the parent company of a network of affiliated hospitals, to wit: Baptist Medical Center Jacksonville, Baptist Medical Center Beaches, Baptist Medical Center Nassau, Baptist Medical Center South and Wolfson Children’s Hospital.

In January 2012, a former patient referral coordinator for the neurology practice at Baptist Medical Center Jacksonville, Verchetta Wells, filed a whistleblower lawsuit against Baptist Health and Dr. Sean Orr under the qui tam provisions of the False Claims Act in the U.S. District Court for the Middle District of Florida.   The whistleblower alleged that Dr. Orr, the former Chief of Neurology at Baptist Medical Center Jacksonville, intentionally misdiagnosed healthy patients with serious neurological conditions like brain lesions and multiple sclerosis in order to bill government health care programs for expensive treatments and medications.  The whistleblower claimed that the submission of bills to government health care programs for treatments that were not medically necessary violated the False Claims Act.

The whistleblower claimed that when Baptist Health discovered Dr. Orr’s alleged fraud against government health care programs, it worked to conceal his conduct rather than report it to the federal and Florida authorities.   According to the Justice Department, Baptist Health uncovered Dr. Orr’s misconduct in or around October 2011, but did not disclose it to the government until September 2012.

According to the qui tam complaint, hundreds of patients received unnecessary treatments and medications as a result of the misdiagnoses. The whistleblower claimed that Baptist Health did not initially report Dr. Orr’s conduct in hopes of avoiding liability.

Baptist Health will pay $2.5 million to settle the False Claims Act allegations.  Of the settlement amount, the Florida Medicaid program will receive approximately $19,000  and the whistleblower will receive $424,155 as her reward under the qui tam  provisions of the False Claims Act.

To see if you may have a valid qui tam case, click here.