Illinois-based medical imaging company Cardiac Imaging, Inc. and its CEO have agreed to pay an $85.4 million settlement to resolve whistleblower claims that the company paid illegal kickbacks to physicians in a scheme to defraud government programs in violation of the False Claims Act (FCA).
The agreement is the largest single district civil settlement in the history of the U.S. District Court for the Southern District of Texas.
Whistleblower Exposes Healthcare Fraud
The case was filed in 2018 as a qui tam whistleblower suit by a former Cardiac Imaging employee who alleged that the company and CEO Samuel Kancherlapalli violated the Anti-Kickback Statute and Stark Law by paying physicians $500 for each patient referred to the company’s mobile cardiac PET scan services. The scheme defrauded Medicare, Medicaid and other federal healthcare programs in violation of the False Claims Act (FCA), according to the complaint and U.S. Department of Justice.
“Our healthcare system relies on brave whistleblowers like our client to expose fraud, waste and abuse that defraud the government and contribute to rising healthcare costs for all of us,” said attorney Caitlyn Silhan, a partner at Dallas-based Waters Kraus & Paul who focuses on qui tam whistleblower litigation. “We are honored to represent whistleblowers who report allegations of fraud to the government.”
Under the FCA, whistleblowers are entitled to between 15 and 30 percent of the money recovered in their cases.
In addition to Ms. Silhan, the whistleblower was represented by Waters, Kraus, and Paul partner Charles Siegel and Marchand Law partner David Marchand. Houston-based Assistant U.S. Attorney Melissa Green and Washington D.C.-based Samuel Lehman, Jake Shields, and Zachary Williams took the lead on the case for the government.
The lawsuit is U.S.A. v. Cardiac Imaging Inc., et al., No. 18-cv-2674.
What is the False Claims Act?
The False Claims Act is a federal law designed to combat fraud against the government by individuals, businesses and entities. Key components of the law include:
- Anyone who knowingly submits, or causes to submit, false claims to the government can be held liable.
- Violators of the FCA can face severe penalties, including monetary penalties up to three times the government’s losses plus additional fines.
- The FCA is designed to encourage whistleblowers to report fraud. Whistleblowers — often employees or insiders with knowledge of fraudulent activities — can file lawsuits on behalf of the government and may receive a portion of the recovered funds if the case is successful.
- Known as “qui tam” actions, these lawsuits empower individuals to take legal action against those defrauding the government. Whistleblowers are entitled to between 15 and 30 percent of financial recoveries.
Waters Kraus & Paul Whistleblower Settlements
In October 2021, Waters Kraus & Paul attorneys were part of a legal team working with the Massachusetts Attorney General’s office that obtained a record $25 million whistleblower settlement against a mental health services provider for billing the government for services provided by unlicensed, unqualified staff.
How Do We Fight Fraud Against the Government?
Seek justice on behalf of taxpayers with the help of our experienced attorneys. Our Dallas, Texas, whistleblower team has battled corporate giants for 20 years, aggressively fighting to hold corporations, individuals, and other entities accountable for fraud committed against the government. If you believe you have a whistleblower case, we can help.