FEDERAL JURY ANNOUNCES $43 MILLION VERDICT, FINDING PRECISION LENS AND PAUL EHLEN LIABLE FOR PAYING KICKBACKS IN VIOLATION OF THE FALSE CLAIMS ACT

MINNEAPOLIS and CINCINNATI, March 1, 2023 /PRNewswire/ -- On behalf of its client Kipp Fesenmaier, the law firm of Morgan Verkamp, LLC is pleased to announce that a federal jury has found The Cameron-Ehlen Group d/b/a Precision Lens and Paul Ehlen jointly liable for causing the submission of 64,575 false claims to Medicare, resulting in single damages of $43,694,641. 

Precision Lens is a distributor of intraocular lenses and other products used in cataract surgeries, and Mr. Ehlen was its majority owner.

Mr. Fesenmaier, a former employee of Sightpath Medical (a company that partnered with Precision Lens and Ehlen to provide kickbacks), filed suit against the defendants in November 2013, alleging violations of the False Claims Act, a law that allows whistleblowers to bring cases in the name of the United States against government contractors charged with fraud. Such cases seek to recover money back to the United States Treasury for false claims made to federal programs, including Medicare. Mr. Fesenmaier alerted the government that the defendants provided kickbacks—such as lavish trips, private flights, tickets to sports events and other entertainment, and discounted Delta SkyMiles—to ophthalmologists in order to induce those physicians to use Precision Lens products in cataract surgeries reimbursed by Medicare.

The United States investigated Mr. Fesenmaier's allegations and, in February 2018, the United States, through the U.S. Attorney's Office for the District of Minnesota, intervened in the case.

After presentation of evidence through a seven-week trial, a federal jury found that the United States and Mr. Fesenmaier proved that Precision Lens and Ehlen were liable for providing kickbacks to ophthalmologists in violation of the False Claims Act. Under the False Claims Act, the jury-determined single damages are tripled, and each false claim is subject to a civil penalty (which, for the claims at issue in this case, range from $5,500 to $11,000), triggering total damages and civil penalties starting above $486 million.

"Mr. Fesenmaier's courage and fortitude to bring the defendants' kickback scheme to light has helped to ensure that patients receive medical care that is in their best interests and that medical decisions are not impacted by the offer or provision of kickbacks," said Sonya Rao, a partner at Morgan Verkamp.

"Our firm is honored to represent Mr. Fesenmaier, who took significant personal and professional risk to expose this fraud on the government, which is, in essence, fraud on the taxpayers. When those who work in the healthcare arena don't play by the government's rules, we all suffer," said fellow Morgan Verkamp partner Chandra Napora.

This case exemplifies the strong public-private partnership created by the False Claims Act. Since the filing of this matter in 2013, Mr. Fesenmaier and his counsel have worked to support the government's prosecution of this case. From the government's intervention through trial, Mr. Fesenmaier and his counsel litigated as co-counsel with the United States, exactly as envisioned by the False Claims Act. As Morgan Verkamp's co-founding partner and lead trial counsel Jennifer Verkamp describes, "This working partnership contemplated by the False Claims Act enabled Morgan Verkamp to support the government's just efforts to recover fraudulently obtained money back to the Treasury. Morgan Verkamp proudly stands with other whistleblower firms in prosecuting these cases on behalf of and alongside the United States."

The United States was represented by Assistant United States Attorneys Chad Blumenfield, Bahram Samie, and Andy Tweeten, aided by paralegals Darcie Boschee and Laura Kolars.

Mr. Fesenmaier is represented by Jennifer Verkamp, Sonya Rao, Chandra Napora, and Rick Morgan, with the assistance of Morgan Verkamp attorneys Jillian Estes and Jonathan Lischak and paralegals Traci Smith and Staci Childress. Mr. Fesenmaier was also supported by local counsel Susan Coler and Nathaniel Smith, of Halunen Law.

The case, filed in the United States District Court for the District of Minnesota, is United States ex rel. Fesenmaier v. The Cameron-Ehlen Group d/b/a Precision Lens and Paul Ehlen, and the case number is 13-03003-WMW-DTS.

The Government's press release concerning the verdict can be read here.

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SOURCE Morgan Verkamp, LLC