During discovery in an SEC administrative and cease-and-desist proceeding instituted in December 2012 (pursuant to Sections 9(b) and 9(f) of the Investment Company Act of 1940)[1] the SEC Division of Enforcement (DOE) inadvertently produced 11 privileged e-mails to the respondents. This is noteworthy because the production included an e-mail forwarding a whistleblower complaint from the SEC Tips, Complaints, and Referrals (TCR) system.
DOJ Recovers Up To $48 Million in False Claim Act Case Resulting From Whistleblower Report
In yet another large recovery for the DOJ, on December 6, 2012, DFB Pharmaceuticals, and its subsidiary, Healthpoint Ltd., agreed as part of a settlement to pay up to $48 million to resolve allegations that Healthpoint caused false claims to be submitted to Medicare and Medicaid for an unapproved drug, Xenaderm. This settlement resulted from allegations against Healthpoint in a multi-defendant whistleblower action brought under the qui tam, or whistleblower, provisions of the False Claims Act.
2/3 Of DOJ’s Nearly $5 Billion Recovery Under False Claims Act Derived From Whistleblower Suits in 2012
On December 4, the Justice Department announced a record-breaking recovery of $4.9 billion in settlements and judgments in civil cases brought under the False Claims Act (FCA) for the fiscal year ending September 20, 2012. This year’s recovery eclipses the prior record by more than $1.7 billion. The last fiscal year’s recovery comprises more than a third of the total recoveries of $24.2 billion since the Act was amended in 1986.