Author: Alex Hontos

Alex Hontos

Alex is accomplished in Federal procurement law and government contracting, including the Federal Acquisition Regulations and the Contract Disputes Act; Federal civil-fraud provisions, including the False Claims Act and Anti-Kickback Act; and the specialized rules that govern claims against the United States, including bid protests.

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Consultant Guilty of Illegal Kickbacks By “Referring” Doctors’ Patients to Another Medical Provider in Exchange for Remuneration

Alex Hontos

Under 42 U.S.C. § 1320a-7b(b)(1)(A) it is a felony for a physician to solicit or receive a kickback “in return for referring” a Medicaid or Medicare patient to another medical provider. But as a recent decision by the Eighth Circuit in United States v. Iqbal demonstrates, physicians are not the only ones capable of making illegal referrals under the statute—consultants can, too. Defendant Iqbal was a...

Former CEO of Health System Agrees to Pay $1 million to Settle False Claims Act Case with U.S. Department of Justice

Alex Hontos

In the most recent example of its continued effort to hold individuals accountable for corporate misconduct, the U.S. Department of Justice (“DOJ”) announced on September 27, 2016, that the former CEO of Tuomey Healthcare System has agreed to pay $1 million to settle claims arising from his involvement in the hospital’s violations of the Stark Law.  In addition to the $1 million civil fine, the...

Federal Civil Penalties Going Up, Way Up.

Alex Hontos

The United States Department of Justice (“DOJ”) published an Interim Final Rule on June 30th nearly doubling the per-claim civil penalties for violations of a number of laws, including the False Claims Act (FCA), the Program Fraud Civil Remedies Act, and the Anti-Kickback Act.  For example, the FCA provides for mandatory per-claim penalties on top of treble damages.  Currently, the FCA penalties are set at...

Supreme Court Upholds Implied Certification Theory of Liability; Imposes Limitations on its Reach

Alex Hontos

In a unanimous decision, the Supreme Court today charted a middle course between competing interpretations of the scope of False Claims Act.  Universal Health Servs., Inc. v. United States ex rel. Escobar, Case No. 15-7 (June 16, 2016).  The Court upheld the viability of the so-called “implied-certification” theory under the FCA, but simultaneously clarified the contours of the theory and imposed significant limitations on its...

Failure to Disclose Best Pricing: Pharmaceutical Companies Settle FCA Claims for $784 Million

Alex Hontos

The Department of Justice announced late last month that pharmaceutical manufacturers Wyeth and Pfizer would pay $784 million to resolve a False Claims Act investigation and qui tam lawsuit arising from Wyeth’s failure to disclose its best pricing of drugs to the government.  The case was brought under the FCA’s qui tam provisions; the relators’ share of the recovery is nearly $100 million. The case...

CMS Finalizes Rule Requiring Healthcare Providers to Return Overpayments

Alex Hontos

Late last week, the Centers for Medicare & Medicaid Services (CMS) published its final rule regulating how healthcare providers must report and return overpayments. This rule implements the Affordable Care Act’s requirement that healthcare providers who receive an overpayment from Medicare return the overpayment within 60 days of its identification. Overpayments not returned within the 60-day limit become “obligations” to the Federal government within the...

University of Massachusetts Medical School Not a “Person” Under FCA; 1st Circuit Adopts “Arm-of-the-State” Test

Alex Hontos

In an opinion issued on January 27, 2016, the United States Court of Appeals for the First Circuit affirmed the dismissal of a qui tam lawsuit against the University of Massachusetts, holding that the University was “indistinguishable” from a state agency and, therefore, not a “person” subject to potential liability under the False Claims Act, 31 U.S.C. 3729(a)(1)(A). Relator Michael Willette, an employee of the University’s...

New Justice Department Directive Underscores Focus on Individuals—and Importance of Cooperation—in False Claims Act Investigations

Alex Hontos

In a recent memorandum issued to Main Justice litigating components and United States Attorney’s offices nationwide, Deputy Attorney General Sally Quillan Yates emphasized that “fighting corporate fraud and other misconduct” remains a top priority for the Department and the Federal government’s vow to seek “individual accountability for corporate wrongdoing.” The memorandum, which appears to be designed to respond to criticism regarding the Department’s response to...

Ninth Circuit Unanimously Overrules Long-Standing “Original Source” Precedent; Makes it Easier to Qualify as an Original Source Under the FCA

Alex Hontos

For 23 years, the Ninth Circuit required that a relator establish three elements to qualify as an “original source” under the False Claims Act: (1) the relator must have direct and independent knowledge of the information on which her allegations are based; (2) the relator must have voluntarily provided that information to the government before filing her qui tam lawsuit; and (3) the relator must...

Ninth Circuit Holds that Indian Tribes are not “Persons” subject to FCA

Alex Hontos

In a brief unpublished memorandum opinion released on June 15, 2015, the Ninth Circuit affirmed the district court’s dismissal of an FCA claim brought against a tribe, holding that tribes do not fit within the FCA’s definition of “persons.”  See Thomas Howard and Robert Weldy, ex rel. United States v. Shoshone Paiute Tribes of the Duck Valley Indian Reservation, No. 13-16118 (9th Cir. June 15, 2015).  Whistleblowers Howard and Berg, former tribal employees, alleged that the tribes...