DOJ Requests $490 Million Award After False Claims Act Kickback Verdict

The United States Department of Justice asked a federal judge in Minnesota to order an ophthalmology distributor to pay around $490 million in damages after a False Claims Act kickback verdict. The DOJ requested this verdict after a federal jury found that Precision Lens, and its founder Paul Ehlen, owe over $43 million under anti-kickback statute violations.

Case background

Kipp Fesenmaier, a Minnesota resident, brought an FCA suit against Precision Lens and Paul Ehlen about ten years ago. He previously worked for Sightpath Medical Inc., and a corporate predecessor, Midwest Surgical Services Inc. The original complaint stated Fesenmaier worked in the same industry for the defendant’s competitors. Five years ago, the DOJ intervened in Fesenmaier’s suit.

The jury ruled that Precision Lens and Ehlen provided kickbacks to physicians. These kickbacks included travel and entertainment perks, like “high-end skiing, fishing, golfing, hunting, sporting and entertainment vacations, often at exclusive destinations.” The companies also offered trips to New York City to see a Broadway musical, the Masters golf tournament in Georgia and the College Football National Championship game in Miami. These perks were used to encourage doctors to choose Precision Lens’ ophthalmic supplies and equipment, particularly tools used in cataract-related operations and other procedures covered by Medicare.

The government has asked the U.S. District Court judge to award $489.53 million for the 64,575 false claims found. These penalties are at the minimum end of the statutory range, but include $131 million in treble damages. These are designed to be both compensatory and a deterrent in nature.

If you believe an employer is engaged in an illegal kickback scheme, you can blow the whistle. An experienced whistleblower attorney at Kardell Law Group can help. Call today for a consultation.