Although the year has not ended, there have been a number of significant False Claims Act settlements. In fact, the nine largest settlements this year total over $700 million. What’s really shocking is the connection to the state of New Jersey in the largest of the settlements.
To answer the above question, the largest three whistleblower cases this year all have connections to New Jersey and, further, four out of the top five settlements had a connection to New Jersey as well.
The largest settlement this year involved Ranbaxy, Inc., based in Princeton New Jersey. The settlement was $500 million. The second largest settlement involved New Jersey based C.R. Bard. The Bard settlement exceeded $48 million. Coming in “third place” was Par Pharmaceuticals based in Woodcliff Lake, New Jersey. Par settled for $45 million.
In following the settlements, by size, a plastic surgeon from Florida came in fourth place settling for $26.1 million.
In fifth place was CH2M Hill, with offices in Parsippany and Paterson, New Jersey. Hill settled for $18.5 million.
The False Claims Act provides for a payment to the individual that provides the first information to the United States government involving fraud. Although there are specific requirements, the person reporting the information to the government must have unique information that the government did not previously possess. In all of the above cases, the individual or individuals that reported the information to the federal government received rewards in excess of 15% of the amount recovered by the United States government. Needless to say, these rewards represent a strong incentive to report the fraud beyond the obvious motive of “doing the right thing”.