Whistleblower lawsuits have become somewhat of a cottage industry. And my, how that cottage is growing.
As part of a larger effort to crack down on fraud, the government has been encouraging employees who see something to say something. By pointing out unscrupulous billing practices and other apparent chicanery, those who sound the alarm stand to reap handsome rewards. As in 25% to 30% of a lawsuit’s proceeds, or 15% to 25% should the government take over.
When you put those percentages against actual numbers, the results can take your breath away. False Claims Act cases led to more than $2.8 billion in recoveries last year, according to the Justice Department.
The overwhelming majority — 84% — were initiated by whistleblowers. These cases generated more than $2 billion in settlements. Moreover, almost 90% of the cases filed in 2018 targeted fraud in the healthcare sector, the report found.
But while whistleblowers stand to gain a ZIP code upgrade and lots of other prizes, it’s not a risk-free gambit. For one, they can pretty much kiss their old jobs goodbye. Then there’s the very real possibility that a court will rule against them. Plus there’s this: The target might fight back.
That certainly appears to be what’s happening in West Virginia. There, Wheeling Hospital is suing a former executive who went the whistleblower route.
The 247-bed hospital sued Louis Longo, the hospital’s former executive vice president. The provider claims he breached his fiduciary duty by lying, defaming the institution, putting his personal interests first and trying to extort funds.
“We are pursuing action against Mr. Longo for his purported dishonest conduct, and we will vigorously defend our hospital and physicians against the fraudulent claims he filed against us,” Bruce Archer, general counsel for Wheeling Hospital, said in a statement earlier this week.
The counter-punching comes after Longo alleged the hospital made more than $10 million in unlawful kickbacks to physicians as a way to gain patient referrals. His charges were filed in the U.S. District Court for the Western District of Pennsylvania.
In a separate lawsuit filed last week in the U.S. District Court for the Northern District of West Virginia, the hospital claimed Longo’s charges merely were an attempt to “contort the legal process to his own personal advantage and wealth.” Two lawsuits targeting one whistleblower? Looks like they’re not fooling around.
At this point, it’s hard to say whether Longo or the facility ultimately will prevail. As for the respective attorneys, they already have won — as evidenced by their ever-increasing total of billable hours.