Trident USA Health Services LLC to Pay $8.5 Million to Resolve False Claims Act Liability for Alleged Kickback Scheme
PHILADELPHIA, PA – First Assistant U.S. Attorney Jennifer Arbittier Williams announced today an $8.5 million civil settlement to resolve two False Claims Act cases, United States et al. ex rel. Ravi Srivastava v. Trident USA Health Services LLC, Symphony Diagnostic Services No. 1, Inc. dba MobilexUSA, Civil Action No. 16-2956 (E.D. Pa.), and United States ex rel. Peter Goldman v. Symphony Diagnostic Services No. 1, LLC, d/b/a MobilexUSA, Civil Action No. 19-cv-01603 (E.D. Pa.). The lawsuits were filed by whistleblowers Ravi Srivastava and Peter Goldman, respectively, on behalf of the United States. The defendant is MobilexUSA, also known as Trident USA Health Services, LLC (Trident).
Trident provides mobile diagnostic services, including mobile x-rays, to individuals residing in skilled nursing facilities. The United States pays Trident to provide mobile x-rays to Medicare and Medicaid participants in these skilled nursing facilities. Whistleblower Srivastava had been Trident’s Chief Information Officer, and whistleblower Goldman had been a Trident regional sales manager. Based upon these whistleblowers’ allegations that Trident was engaged in a kickback scheme with skilled nursing facilities, the government investigated Trident’s pricing arrangements and its costs to provide mobile x-rays at these facilities.
Based upon its investigation, the government alleges that, from approximately June 2006 through September 2019, Trident engaged in illegal “swapping” arrangements under which Trident provided mobile x-rays to skilled nursing facilities at prices below Trident’s costs to provide the services, or below fair market value, for the purpose of inducing the facilities to refer lucrative federal health program business to Trident. Federal law prohibits the payment of kickbacks in exchange for the referral of federal healthcare business, including for healthcare that will be paid by the federal government through Medicare or Medicaid. Trident, like other companies that submit claims for payment to Medicare or Medicaid, is required to certify that it is compliant with federal anti-kickback laws. The government alleges that Trident’s certifications of anti-kickback law compliance were false certifications.
On February 10, 2019, Trident filed for bankruptcy protection. In bankruptcy, Trident sought to extinguish the government’s ability to collect any damages or penalties from Trident in connection with the illegal swapping arrangements. Despite Trident’s bankruptcy, the government and whistleblowers Srivastava and Goldman and their counsel worked together closely and continued their vigorous pursuit of the government’s claims, resulting in the $8.5 million settlement.
First Assistant U.S. Attorney Williams said: “Companies that violate the False Claims Act through illegal swapping arrangements, or by any other illegal scheme violating federal laws designed to protect the public fisc, will not find a safe harbor in bankruptcy court. The government will not relent or be deterred in our pursuit of justice for America’s taxpayers.”
Whistleblower Srivastava will receive $2,018,750.00 as his share of the government’s $8.5 million recovery, and whistleblower Goldman will receive $106,250.00. The whistleblowers were represented by attorneys Sherrie R. Savett, Esq. and Russell D. Paul, Esq., of Berger Montague, Philadelphia, PA, and James D. Young, Esq., of Morgan & Morgan Complex Litigation Group, Jacksonville, FL, respectively. “The whistleblowers and their lawyers provided vital and exceptionally valuable support to the government’s effort in this case, even after Trident’s bankruptcy put any recovery in doubt,” stated Williams.
This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General. The lawsuits were handled by Assistant U.S. Attorneys Joel M. Sweet and Veronica J. Finkelstein, Auditor Dawn Wiggins, and Investigator Jeffrey R. Braun, from the U.S. Attorney’s Office for the Eastern District of Pennsylvania, along with Trial Attorneys Alex Thor Pogozelski and Michael J. Podberesky of the Civil Frauds Branch of the Department of Justice. Assistant U.S. Attorney Jessica Hu of the U.S. Attorney’s Office for the Southern District of New York represented the United States in Trident’s bankruptcy proceedings.
The government’s settled civil claims are based on allegations. There has been no court determination of liability.