© 2016 The Texas Lawbook.
By Mark Curriden
(July 29) – A West Texas federal False Claims Act case that focused on the corporate marketing of a medical device has settled out of court for $11.5 million.
Lawyers involved in the four-year-long litigation pending in San Antonio say that New Hampshire-based Atrium Medical Corp. agreed to pay Esther Grace Sullivan, a former sales executive-turned-whistleblower, in order to resolve the case before trial, which was set to start in September.
The settlement is one of the largest in U.S. history under the federal False Claims Act involving a medical device where the government declined to intervene, said Chris Hamilton, a partner at the Dallas law firm Standly Hamilton, which represents Sullivan.
Sullivan, who is now 43 and lives in Raleigh, N.C., sued Atrium in 2013, claiming that the company paid improper kickbacks to doctors for promoting the unapproved use of medical stents in patients’ arteries.
From 2007 to 2012, Sullivan worked as a sales representative and territory business manager for Atrium.
The company engaged in an extensive nationwide scheme to promote its iCast brand stent for use in the vascular system, even though it was federally approved only for treating tracheobronchial obstructions, Hamilton said.
The lawsuit claimed that Atrium used a system of referral dinners to induce physicians to implant the stents in the arteries of elderly patients while submitting payment claims to Medicare.
Atrium provided financial grants and other kickbacks to doctors in violation of the federal Anti-Kickback Statute.
“It is particularly gratifying, since this case was declined by the government,” Hamilton said. “This was a victory not only for our client but for the many people whose taxes were spent on a device that was used in a way that was never approved by the FDA.”
Waters & Kraus, a Dallas law firm that specializes in qui tam actions, and lawyers in North Carolina and Boston also represented Sullivan in the litigation.
© 2016 The Texas Lawbook. Content of The Texas Lawbook is controlled and protected by specific licensing agreements with our subscribers and under federal copyright laws. Any distribution of this content without the consent of The Texas Lawbook is prohibited.
If you see any inaccuracy in any article in The Texas Lawbook, please contact us. Our goal is content that is 100% true and accurate. Thank you.