Whistleblower Watch is a comprehensive source for all False Claims Act (FCA) news and information. Every quarter, Cozen O’Connor will provide in-house counsel and compliance professionals with a summary of the most notable FCA enforcement actions, settlements, and legal trends, as well as an in-depth look at emerging and significant FCA-related issues. Subscribe to stay on top of these changes and find out how they may affect you.
Recent FCA Settlements and Enforcement Actions
L3 Technologies Agrees to Pay $62M to Resolve FCA Claims Arising from Submission of False Cost and Pricing Data for Defense Contracts (District of Utah).
Aerospace and defense contractor L3 Technologies agreed to pay $62M to settle allegations it violated the FCA and the Truth in Negotiations Act (TNA) by knowingly submitting false claims to various defense agencies. L3 Technologies developed advanced defense technologies and commercial solutions, including the manufacture and sale of remote operations video enhanced receivers (ROVER), Video-Oriented Transceivers for Exchange of Information (VORTEX), and Soldier Intelligence, Surveillance, and Reconnaissance (SIR) receivers. L3 Technologies sold ROVER, VORTEX, and SIR products to the United States through fixed-price contracts. The Government alleged that, between October 2006 and February 2014, L3 Technologies failed to disclose accurate data relating to the cost of labor, material, and other manufacturing costs, falsely certifying that it had done so in dozens of government contract proposals.
Walgreens and Subsidiaries Agree to Pay Up To $350M to Settle Allegations They Sought Payment from Medicare and Other Federally Funded Programs for Illegally Filled Opioid Prescriptions in Violation of the FCA (Northern District of Illinois).
Pharmacy giant Walgreens Boots Alliance, Walgreen Co., and various subsidiaries agreed to pay $300M (plus another $50M if the company is sold) to resolve allegations that it violated the FCA by filling millions of illegal prescriptions for opioids and other controlled substances in violation of the Controlled Substances Act (CSA) and then seeking payment for those illegal prescriptions from Medicare and other federally-funded healthcare programs. The Government alleged that, from August 2012 through March 2023, Walgreens knowingly filled millions of unlawful prescriptions. According to the Government, these included prescriptions for excessive quantities of opioids, opioid prescriptions that were given earlier than necessary, and especially dangerous and typically abused opioids. Despite these clear 'red flags,' Walgreens filled the prescriptions anyway. The massive settlement demonstrates the Government’s clear intent to penalize pharmacy giants who contributed to the opioid crisis.
Florida Businessman Patrick Walsh and Companies Agree to Pay $20M to Resolve FCA Claims Regarding Fraudulent PPP Loans (Northern District of Florida).
Patrick Walsh and ten companies under his control entered into a consent judgment totaling $20M to settle allegations they violated the FCA by knowingly providing false information in support of Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EDIL) applications. In the settlement, Walsh admitted that he submitted PPP and EDIL loan applications with false information about the companies’ employee rosters and payrolls. For example, some of the companies for which he submitted applications were dormant or inactive. Walsh received approximately $8M in fraudulent loans as a result of his scheme, which he used to purchase a private island, invest in oil interests, and pay off personal debts. The matter arose from a whistleblower complaint filed in 2020, submitted by Walsh’s IT employee. This settlement suggests that the Government will continue to pursue Pandemic fraudsters through the ten-year statute of limitations for these claims. For more on the FCA as a weapon to fight Pandemic-related fraud, see our prior article here.
Gilead Agrees to Pay $202M to Settle FCA Claims Stemming from Illegal Kickback Payments Made to Prescribers of Its HIV Drugs (Southern District of New York).
Biopharma company Gilead agreed to pay $202M to the federal government and various states to settle claims that it paid kickbacks to doctors who prescribed its HIV drugs. According to the Government, Gilead paid those doctors millions of dollars in speaking fees, exorbitant dinners, travel, and other rewards in an effort to induce them to prescribe Gilead’s HIV drugs and increase sales. Between 2011 and 2017, Gilead paid over $23M to 548 healthcare providers as part of their HIV Speaker Programs, many of which took place in Hawaii, Miami, and New Orleans. The allegations against Gilead arose from a whistleblower complaint in 2016. Similar speaker programs have been the focus of many FCA investigations in recent years.
Health Net Federal Services, LLC and Centene Corporation Agree to Pay $11M to Settle FCA Claims Arising from Cybersecurity Violations (Eastern District of California).
California-based leader in healthcare administration, Healthcare Net Federal Services, LLC (HNFS), and its parent company, Centene Corporation, agreed to pay $11M to settle claims that it violated the FCA by falsely certifying compliance with cybersecurity requirements in certain government contracts. The Government alleged that, between 2015 and 2018, HNFS failed to meet cybersecurity controls and simultaneously falsely certified compliance in annual reports to the Department of Defense which was required to administer its TRICARE program to servicemembers and their families. This settlement is another example of the Government’s commitment to heighten FCA enforcement in the cybersecurity space. For more coverage of this topic, see our article here.
Assertio Therapeutics, Inc. Agrees to Pay $3.6M to Resolve FCA Claims Stemming from Marketing of Its Fentanyl Product (District of Columbia).
Specialty pharmaceutical company Assertio Therapeutics, Inc. agreed to pay $3.6M to settle claims it violated the FCA by submitting false claims for the marketing of break-through cancer pain drug Lazanda. The Government alleged that, between 2013 and 2017, Assertio focused its marketing on pain specialists who were prescribing high volumes of its drug, Lazanda, a transmucosal immediate-release fentanyl drug. The Government claims that Assertio’s marketing efforts, which included placing high-volume prescribers on its speakers’ bureau and advisory boards, caused prescribers to write Lazanda prescriptions for patients who did not have break-through cancer pain, ultimately resulting in the submission of false claims to Medicare and TRICARE. The matter was brought to the attention of the Government by two whistleblowers, former Assertio sales representatives.
Legal Trends and Insights
DOJ Implements Civil Rights Fraud Initiative to Combat Corporate DEI Programs and Antisemitism.
In early May, DOJ announced a new initiative intended to utilize the FCA to further the Trump Administration’s stated goals of ending discrimination by federal fund recipients – the Civil Rights Fraud Initiative. The goal of the Initiative is to utilize the FCA to investigate and pursue claims against recipients of federal funds, such as universities and colleges, that allow antisemitism within their institutions or implement 'divisive' DEI policies. We expect the Initiative may go beyond the reach of universities and colleges and is a message to government contractors and healthcare companies alike to take note. For our prior coverage of the new Initiative, click here. A copy of the underlying Memo can be found here. For more coverage, click here, here, and here.
Trump Administration Directs Aggressive Approach to FCA Cases.
Earlier this Spring, a senior DOJ official stated that the Trump Administration will remain focused on aggressively enforcing the FCA, highlighting enforcement of foreign trade issues amid recently imposed tariffs. Michael Granston, Deputy Assistant Attorney General in the DOJ Civil Division’s Commercial Litigation Branch, stated in a speech at the Federal Bar Association’s annual qui tam conference in Washington, D.C.: “The department wants to make clear – consistent with the new administration’s stated focus on achieving governmental efficiency and rooting out waste, fraud and abuse – that the department plans to continue to aggressively enforce the False Claims Act.” For more coverage of Granston’s remarks pertaining to the Administration’s goals, click here.
A Deeper Dive
The Supreme Court’s recent opinion in Thompson v. United States may have significant implications for the False Claims Act (FCA). In Thompson, the Court was tasked with interpreting 18 U.S.C. § 1014, which prohibits “knowingly mak[ing] any false statement” for the purpose of influencing certain federal agencies. 145 S. Ct. 821, 825 (2025). The Court concluded that misleading but true statements do not qualify – false means false. As we explain in this edition’s deeper dive, the Court’s reasoning may foreshadow how it will resolve one of the FCA’s most important circuit splits. Please see our client alert.