Strip clubs, free fishing trips – and more

According to a recent article in the Wall Street Journal, Kelley’s lawsuit alleges that in exchange for doctors agreeing to use Medtronic’s spinal products in surgery, Medtronic provided “regular entertainment” at a Memphis strip club called Platinum Plus. The club closed last year after the owner pled guilty to charges that dancers were engaging in prostitution at the club.

Doctors were also allegedly taken on extravagant all expenses paid fishing trips to Alaska that were couched as “think tank” trips. However, according to the article, “drinking” replaced “thinking” on these trips. In addition, doctors were allegedly allowed to share in the patent royalties of products in which they had not contributed any input, were issued credit cards, paid for “consulting” work in which no “consulting” was ever done and that the company “paid for fishing guides and clothing for the doctors, and that ‘women were also provided for the doctors.’”

Is this legal?

No. The False Claims Act strictly prohibits companies from giving doctors inducements to use products that are covered by Medicare or Medicaid. While Medtronic settled the case for $40 million in 2006, the Journal stated that only a small portion of the case was made public. The rest has been sealed. Medtronic either refuted the allegations or would not comment on them due to the settlement.

Healthcare Whistleblower lawsuits

Medtronic’s former senior legal counsel seems to have a conscious by blowing the whistle on her former employer’s alleged illegal tactics – and she was likely well compensated for her bravery in coming forward. Most whistleblowers, also called relators, receive a substantial percentage of the overall settlement or verdict – which is commonly between 15 and 25 percent. So, in this case, Kelley received anywhere from $6 to $10 million.

If you believe that you’ve witnessed illegal activity that violated the False Claims Act, contact an experienced whistleblower lawyer.