Jackson Walker Achieves Favorable Settlement for Clients in Qui Tam Lawsuit

June 23, 2015 | Client Results

Jackson Walker successfully represented the relators in a qui tam lawsuit brought under the False Claims Act against a South Texas hospital. The parties recently agreed to settle claims brought under the Act for a total of $23,550,000.

The relators, three cardiologists who formerly practiced at the hospital, sued the hospital, its administrator, and another cardiologist employed by the hospital, alleging that the defendants committed numerous violations of the False Claims Act concerning improper incentives for patient referrals. They further alleged that the defendants knew that these incentives violated the Anti-kickback Statute and the Stark Law.

The defendants moved to dismiss the case based on qualified immunity. The district court denied the defendants’ motion to dismiss, and the U.S. Court of Appeals for the Fifth Circuit affirmed the district court’s ruling. The defendants sought panel rehearing and later en banc rehearing; however, the Fifth Circuit rejected both motions for rehearing.

Under the terms of the settlement, the hospital agreed to pay the federal government $21,750,000, of which the relators will receive $5,981,250. The defendants also agreed to pay $1,800,000 in attorneys’ fees to relators.

The relators were represented by Jackson Walker partners Monte James and Josh Romero, and the defendants were represented by a Houston law firm.

The qui tam settlement marks the second high-profile victory Jackson Walker has achieved on behalf of the cardiologists. On December 17, 2012, Jackson Walker attorneys Monte James and Josh Romero secured an $8 million settlement for the clients in a separate lawsuit against the hospital of which the clients received approximately $5 million.