On May 15, the U.S. Attorney’s Office for the District of Minnesota announced the conclusion to its False Claims Act (FCA) case against Cameron-Ehlen Group, Inc. dba Precision Lens and its owner Paul Ehlen. Judge Wilhelmina M. Wright’s judgment against the Defendants found they owed the government over $487 million as a result of FCA and Anti-Kickback Statute violations. The judgment followed a trial in February 2023 in which a federal civil jury returned a verdict in favor of the U.S. government. The jury found that the government proved that Precision Lens and its owner caused the submission of 64,575 false claims to the Medicare program and $43,694,641 in single damages between 2006-2015.
The initial allegations against Precision Lens and its owner came from a lawsuit filed by the whistleblower Kipp Fesenmaier. Fesenmaier filed under the qui tam provision of the FCA which enables private citizens to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. Qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery. The U.S. Attorney’s Office for the District of Minnesota acknowledged that “the government often relies on whistleblowers to bring fraud schemes to light that might otherwise go undetected.” The amount of money that will be awarded to Fesenmaier has not been announced yet.
The seven-week trial at District Court brought numerous details of the government’s allegations to light. According to the government’s press release, “the Defendants provided kickbacks to physicians in various forms, including travel and entertainment. The United States identified multiple examples of trips, including high-end skiing, fishing, golfing, hunting, sporting, and entertainment vacations, often at exclusive destinations. For many of the trips, the Defendants transported physicians to luxury vacation destinations on private jets. These included trips to New York City to see a Broadway musical, the College Football National Championship Game in Miami, Florida, and the Masters golf tournament in Augusta, Georgia. The Defendants also sold frequent flyer miles to their physician customers at a significant discount, enabling the physicians to take personal and business trips at well below fair market value.”
“This judgment affirms Congress’ intent to hold individuals and companies accountable when they use illegal kickbacks to defraud federal healthcare programs,” said Bahram Samie, Deputy Civil Chief for the United States Attorney’s Office for the District of Minnesota. “Medicare beneficiaries are entitled to know with certainty that their physician’s decision-making has not been compromised by a private flight, expensive ski-trip, or any other unlawful inducement. This office is committed to investigating misconduct and recovering funds unlawfully obtained from federal healthcare programs.”
Court Enters $487 Million Judgment Against Precision Lens and Owner Paul Ehlen for Paying Kickbacks to Doctors in Violation of the False Claims Act