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Mintz Wins Dismissal of False Claims Act Charges Against Shopko Stores

Shopko Stores, represented by Mintz, Cohn, Ferris, Glovsky and Popeo, P.C., has secured a dismissal of a False Claims Act suit brought by an ex-employee whistleblower who accused the company of knowingly overcharging Medicaid for the cost of pharmaceuticals.  Shopko Stores, headquartered in Green Bay, Wisconsin, owns and operates a retail pharmacy chain in small to mid-sized cities throughout the Midwest, Mountain, North Central and Pacific Northwest regions.  On November 5, 2013 a Wisconsin federal judge ruled that the ex-employee had not shown any false claims had been made to the government and, in an unusual move at this stage of litigation, dismissed the case entirely.  The case involved Medicaid billing rules for beneficiaries that also have private health insurance and allegations by the whistleblower that Shopko should have only sought reimbursement from various state Medicaid programs for the copayment amount owed by the beneficiary to the private health plan.  But, the judge found the legal theory of the whistleblower to be “untenable” and “without support in the plain language of the [Medicaid law], corresponding regulations, case law, or logic.”

The case was brought under the so-called qui tam provisions of the False Claims Act.  Under these procedures, prior to the case moving to active litigation, the government investigates the allegations and decides whether or not the matter has sufficient merit to take over the litigation from the whistleblower.  In this case, the Mintz legal team secured the declination from the government.

Shopko was represented by a multidisciplinary team of attorneys, including Thomas S. Crane and Ellen L. Janos, both Members in the firm’s Health Law Practice, and Breton T. Leone-Quick, Member in the Litigation Practice. All three attorneys work out of Mintz’s Boston office.

Attorneys in Mintz’s Health Law Practice, many of whom have held senior government positions or served as in-house counsel, represent for-profit and non-profit, domestic and international companies in connection with a wide variety of business and legal transactions, challenges and issues that they confront both on a daily basis and in bet-the-company matters. Clients span the full spectrum of the industry, including hospital systems, managed care organizations, laboratories, long-term care providers, durable medical equipment suppliers, behavioral health companies, pharmaceutical and medical device manufacturers, retail pharmacies and pharmacy benefit managers.