Halunen Law - Protecting the Public with Wistlblower Protections

The Star Tribune published an article today about how a mental health agency, Complementary Support Services, that was supposed to provide quality services to a vulnerable population, instead is reported to have engaged in rampant fraud that “bilked the state’s Medicaid program of millions of dollars and provided inadequate supervision of unlicensed practitioners.” That private agency is now the subject of a federal and state False Claims Act qui tam lawsuit that resulted from a report to the government by a former employee.

The False Claims Act is designed to encourage citizens to challenge conduct that cheats private agency clients and wrongfully takes taxpayers money to do so. It also provides whistleblower protection to employees who are treated badly or fired because they challenge, report or refuse to engage in illegal conduct. The goal of the law is to stop fraud in its tracks by encouraging oversight by employees, recipients of services and the public.

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For-Profit School Student Mislead Under False Claims Act

In the past several years For-Profit Colleges and Universities have been under intense scrutiny by both state and federal agencies for claims that they mislead prospective students about placement rates, starting salaries, and credit transfer. Students often obtain federally insured student loans and grants to attend these schools. In fact, the Department of Education has estimated that about 90% of students obtain some form of student aid to attend For-Profit schools- a significantly higher percentage than those who attend public and private post-secondary institutions. However, after graduation, students from For-Profit schools are much more likely to default on their loans because they are unable to secure employment as readily as their peers who graduate from public and private universities and colleges.

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The Minnesota Court of Appeals recently handed down a victory for employees in Sletten v. Crop Production Services. The Court of Appeals ruled that an employer could be liable for damages when it made false promises to an employee that caused him to turn down a more lucrative job offer. Halunen attorneys represented the employee, Brian Sletten.

Mr. Sletten was working as a manager for Crop Production Services (“CPS”) when another company offered him a higher-paying position. Mr. Sletten enjoyed his job and liked his co-workers at CPS. He told CPS he was considering the higher-paying job offer.

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Minnesota False Claims Act Expands Time for Whistleblower Claims

On April 22, 2013, Governor Dayton signed HF 290 into law, which modified Minnesota’s False Claims Act found at Minn. Stat. § 15C. The bill primarily changed the statute so that it would reward and facilitate False Claims Act cases at least as effectively as the federal law. By making these changes Minnesota should be eligible to receive a 10% higher recovery from Medicaid fraud cases involving Minnesota.

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SusanMColerRoss Brindle, host of the Legal Journal on Business 1570, interviewed Halunen attorney Susan Coler about Whistleblowers and the False Claims Act (FCA). Ms. Coler discussed on the air how the FCA works, what types of fraud typically fall under the act, what people need to know if they are aware of fraud against the government, and the monetary incentives available for those people who alert the government to fraud. These claims are also called qui tam claims.  Please click on Susan’s photo at left to listen to the radio broadcast.

I think we’d all like to think that if we were put into a situation where we knew that something was wrong, that we’d speak up, but that’s not always the case, especially in a workplace environment. Many people would be afraid that if they did speak up, it could cost them their jobs. Recently, LifeWatch Services Inc. has agreed to pay $18.5 million to settle charges that it submitted false claims to federal health care programs. All of this came to light because two former sales representatives chose to speak up and report the abuse.

The sales representatives filed the whistle-blower suits in December 2009 and May 2011 under the provisions of the False Claims Act. With this filing the two will receive approximately $3.4 million plus interest as their share of the settlement proceeds.

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