U.S. Attorney’s Office for the Southern District of New York Recovers $3.7 Billion in Forfeitures and Civil Actions In Fiscal Year 2016
U.S. Attorney’s Office for the Southern District of New York Recovers $3.7 Billion in Forfeitures and Civil Actions In Fiscal Year 2016
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced this week that the U.S. Attorney’s Office (Office) obtained recoveries of more than $1.4 billion in forfeiture actions, more than $2.2 billion in civil actions, and more than $31 million from restitution, criminal fines, and special assessments, between October 1, 2015, and September 30, 2016.
The U.S. Attorney’s Office sued and reached settlements in complex civil actions involving, among others, mortgage and health care fraud.
In April 2016, Wells Fargo Bank, N.A., settled a False Claims Act lawsuit brought by the Office alleging that Wells Fargo had engaged in reckless underwriting of Federal Housing Administration mortgage loans for nearly a decade. As part of the settlement, Wells Fargo paid $1.2 billion and admitted to certain conduct alleged in the complaint.
In January 2016, CenterLight Healthcare, Inc., and CenterLight Health System, Inc. (collectively, “CenterLight”), agreed to pay $46.7 million to resolve FCA claims arising from the enrollment of ineligible members in CenterLight’s managed long-term care plan. Under the terms of the settlement, CenterLight paid a total of $46,751,086.74 to the Medicaid Program, $18,700,434.70 of which went to the United States. In addition, CenterLight was required to reform its business practices and admit to conduct alleged in the complaint.
In July 2016, the U.S. Attorney’s Office simultaneously filed a False Claims Act lawsuit and entered into a $13.375 million settlement with Motives Incorporated, an importer of clothing, and Motives Far East and Motives China Limited, foreign manufacturers of clothing (collectively, “Motives”), for conspiring to underpay customs duties. As part of the settlement, Motives paid a total of $13.375 million and admitted to allegations in the complaint.
In June 2016, the Office simultaneously sued and settled with Salix Pharmaceuticals, Inc. (Salix), a specialty pharmaceutical company. The settlement, in the amount of $54 million, resolved claims that Salix violated the Anti-Kickback Statute and False Claims Act by using its “speaker programs” as a mechanism to pay kickbacks to doctors to induce them to prescribe Salix drugs and medical devices that were reimbursed by federal health care programs. In connection with the settlement, Salix admitted to paying doctors to serve as “speakers” at events that were primarily social in nature, that were held at high-end restaurants, and where the “speakers” spent little or no time discussing the relevant Salix product.
Civil recoveries are handled by the SDNY U.S. Attorney’s Office’s Civil Division, which is led by Jeffrey Oestericher.
Faruqi & Faruqi, LLP focuses on complex civil litigation, including securities, antitrust, wage and hour and consumer class actions as well as shareholder derivative and merger and transactional litigation. The firm is headquartered in New York, and maintains offices in Atlanta, Los Angeles and Philadelphia.
Since its founding in 1995, Faruqi & Faruqi, LLP has served as lead or co-lead counsel in numerous high-profile cases which ultimately provided significant recoveries to investors, direct purchasers, consumers and employees.
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