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Date: 09-16-1996

Case Style: United States of America, ex rel. Robert J. Merena, et al. v. Smithkline Beecham Clinical Laboratories, Inc.

Case Number: 97-1773, et al.

Judge: Donald W. VanArtsdalen

Court: United States District Court for the Eastern District of Pennsylvania

Plaintiff's Attorney: Freddi Lipstein, Frank W. Hunger, Assistant Attorney General, Michael R. Stiles, United States Attorney, Civil Division, Washington, D.C. and Marc S. Raspanti, David M. Laigaie, and Tamara L. Traynor of Miller, Alfano & Raspanti, P.C., Philadelphia, Pennsylvania.

Defendant's Attorney: Thomas H. Lee, II, Frederick G. Herold and David J. Caputo of Dechert, Price & Rhoads, Philadelphia, Pennsylvania

Description: Three False Claims Act (qui tam) action claims. Robert J. Merena filed the first of the claims against SmithKline on November 12, 1993 in the Eastern District of Pennsylvania. All three complaints alleged that SmithKline, which operates a nationwide system of clinical laboratories, adopted myriad complicated procedures for the purpose of defrauding state and federal healthcare programs, in particular Medicare and Medicaid. Most of the fraudulent schemes permitted SmithKline to bill the federal government for unauthorized and medically unnecessary laboratory tests. The origianl relators also alleged that SmithKline used various methods to evade Medicare and Medicaid requirements dictating the maxium level of reimbursement for certain services.

Outcome: Settled for $325,000,000.

Plaintiff's Experts: Unknown

Defendant's Experts: Unknown

Comments: Relators Clausen, Miller and LaCorte were denied a share of the settlement which was affirmed by the United States Court of Appeals, Third Circuit. See: 149 F.3d 227 (3rd Cir. 1998).

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