The company recruited doctors with millions of dollars in consulting fees, royalties, and patent purchase fees, ostensibly for their work on Life Spine products. However, these payments were given as kickbacks to induce doctors to use and promote the sale of Life Spine devices. This practice violated the Anti-Kickback Statute of the False Claims Act, leading to fraudulent claims for payments submitted to Medicare and Medicaid.
On October 23, 2019, Life Spine Inc and two executives, CEO Michael Butler and Vice President Richard Greiber, agreed to pay almost $6 million in settlements to the federal government for the fraud and kickback allegations. The four whistleblowers received 20% of the settlement payments for coming forward to stop the company from continuing to defraud the government.
“We were proud to represent these individuals who came forward with these allegations against their former employer,” said Seeger Weiss co-founding partner, Stephen Weiss. “Their decision to bravely step up and cooperate with the government investigation led to this excellent outcome. Due to the Company’s strained fiscal condition, the parties were able to come together constructively in agreeing to resolve the claims on an ability to pay basis.”
The civil settlement was handled by Jennifer Jude, Jeffrey K. Powell, Lara K. Eshkenazi, and Rachael L. Doud of the U.S. Attorney’s Office for the Southern District of New York.