The Federal False Claims Act protects U.S. taxpayers from fraud by encouraging whistleblowers to identify and bring qui tam lawsuits on behalf of the federal government against those who seek to defraud the government. Enacted after the Civil War to address unscrupulous merchants who sold the government defective products, the law is designed to ensure that the government is not defrauded. It imposes strict per claim fines and stiff penalties.
Below are the largest recoveries by whistleblowers in U.S. history.
GlaxoSmithKline — $250 Million Whistleblower Reward
Four whistleblowers brought qui tam lawsuits against GlaxoSmithKline under the False Claims Act alleging GSK conducted fraudulent drug marketing practices for over a decade. In 2012, following years of litigation, GSK agreed to pay the federal government and several state governments $3 billion. Whistleblowers received an estimated $250 million.
Bank of America — $169 Million Whistleblower Reward
Four whistleblowers brought qui tam lawsuits against Bank of America under the False Claims Act alleging Bank of America sold defective residential mortgage loans and other toxic securities to government-sponsored organizations Fannie Mae and Freddie Mac. In 2014, after years of litigation, the bank reached a $16.65 billion settlement with federal and statement governments and the whistleblowers received a combined payout of $169 million.
Johnson & Johnson — $167.7 million Whistleblower Reward
Multiple whistleblowers from Pennsylvania, Massachusetts and California brought qui tam lawsuits against Johnson & Johnson under the False Claims Act alleging the pharmaceutical company fraudulently marketed drugs to physicians and pharmacists for off-label purposes and bribed them with kickbacks. The whistleblowers litigated J&J in federal court and ultimately resolved the case with a $2.2 billion settlement and payment to the government. The whistleblowers in Pennsylvania received $112 million, the whistleblowers in Massachusetts received $27.7 million and the whistleblowers in California received $28 million.
HCA — $151 million Whistleblower Reward
Several whistleblowers brought qui tam lawsuits against Hospital Corporation of America (HCA Inc.) under the False Claims Act alleging the national hospital chain fraudulently marketed drugs to health professionals and performed medically unnecessary treatments and tests and misrepresented marketing expenses as patient costs. In 2003, HCA paid a $631 million settlement to the government. Whistleblowers were awarded a combined $151 million.
Tenet Healthcare — $150 million Whistleblower Reward
Whistleblowers brought qui tam lawsuits against Tenet Healthcare under the False Claims Act alleging Tenet conducted fraudulent drug marketing practices, overbilled for its services, billed for services it did not provide and used improper billing codes to bilk the government. In 2006, Tenet agreed to pay the government more than $900 million for its alleged unlawful billing practices. The whistleblowers received a $150 million reward.
HCA – Over $151.6 million Whistleblower Reward
Several whistleblowers brought qui tam lawsuits against Hospital Corporation of America (HCA Inc.) under the False Claims Act alleging HCA defrauded Medicare, Medicaid and other federal government health programs by billing them for unnecessary lab tests and patient visits, using improper billing codes to inflate their reimbursements, falsifying reimbursement costs and providing physicians with kickbacks for referrals. In 2000, HCA agreed to pay more than $840 million dollars. The whistleblowers received more than $151.6 million.
Pfizer — $102 million Whistleblower Reward
Six whistleblowers brought qui tam lawsuits against Pfizer under the False Claims Act alleging Pfizer conducted fraudulent drug marketing practices for several years. In 2009, following six years of litigation, Pfizer agreed to pay a settlement of $2.3 billion to federal and state governments. The federal government awarded $102 million to the six whistleblowers, with one of them receiving over $51.5 million.