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Date: 02-14-2023
Case Style:
United States ex rel. Gebhardt v. Spacelabs Healthcare, Inc.
Case Number: 19-cv-03503
Judge: Colleen Kollar-Kotelly
Court: United States District Court for the District of Columbia (Washington County)
Plaintiff's Attorney: United States Attorney’s Office in Washington
Defendant's Attorney:
Description: Washington, D.C. qui tam lawyers represent Plaintiff and Defendant on a claim that Defendant violated the False Claims Act.
Spacelabs Healthcare, LLC (Spacelabs) agreed to pay $2.5 million to resolve False Claims Act allegations that it overcharged the United States for patient monitoring equipment sold to the U.S. Department of Veterans Affairs (VA) and the Department of Defense.
“Those who do business with the United States must comply with their contractual commitments,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will ensure that the government gets the prices it bargained for when it cares for the health of our veterans and service members.”
The settlement resolved allegations that from 2014 to 2019, Spacelabs failed to follow the Price Reductions Clause in a VA contract, which required Spacelabs to provide the government with certain lower prices offered to another customer, resulting in the government paying more than it should have for patient monitoring equipment. The settlement also resolved allegations that Spacelabs failed to follow a related clause in a Defense Logistics Agency contract.
“Federal contractors are expected to deal honestly with federal agencies and faithfully abide by the terms of their government contracts,” said U.S. Attorney Matthew M. Graves for the District of Columbia. “This settlement demonstrates that our Office will diligently investigate and hold accountable those companies that fail to live up to their end of the bargain and unfairly overcharge taxpayers.”
“This settlement sends a clear message that the VA OIG will actively investigate allegations involving contractors overbilling for products provided to VA,” said Special Agent in Charge Kim R. Lampkins of the Department of Veterans Affairs Office of Inspector General’s Mid-Atlantic Field Office. “The VA OIG will continue to work with the Department of Justice and our law enforcement partners to ensure the integrity of VA programs and services.”
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Marci Gebhardt, a former Spacelabs Government Business Specialist, and Christopher Kelley, a former Spacelabs Government Accounts Manager. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. As part of this resolution, Gebhardt and Kelley will receive $437,500.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the United States Attorney’s Office for the District of Columbia, with assistance from the VA OIG.
The matter was handled by Senior Trial Attorney Greg Pearson and Assistant U.S. Attorney John Truong.
13 U.S.C. 3729 provides: Federal statute that sets criminal and civil penalties for falsely billing the government, over-representing the amount of a delivered product, or understating an obligation to the government. The False Claims Act may be enforced either by the Justice Department or by private individuals in a qui tam proceeding.
Outcome: Settled for $2.5 million. The claims resolved by the settlement were allegations only, and there was no determination of liability.
Plaintiff's Experts:
Defendant's Experts:
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