A settlement has been reached with caps on Atrium Medical Corp. in the amount of $11.5 million to resolve allegations that the medical device company paid physician kickbacks in exchange for the physicians promoting unauthorized uses for medical stents.

The whistleblower, Esther S., who brought forth this False Claims Act lawsuit against Atrium was formerly employed as a sales representative and territory business manager with the company from 2007 until 2012.

In 2013, she filed the lawsuit against Atrium and in 2014 the federal government declined joining in the whistleblower lawsuit.

Esther alleged that Atrium promoted its product called the iCast to be used in a patient’s vascular system. The device had only been approved previously to treat tracheobronchial obstructions and was not approved for vascular use, according to the lawsuit.

“We are extremely happy to help resolve this matter for [Esther], and it is particularly gratifying since this case was declined by the government,” one of the plaintiff’s attorneys said in a statement. “This was a victory not only for client but for the many people whose taxes were spent on a device that was used in a way that was never approved by the FDA.”

Whistleblower Lawsuit Alleges Physician Kickbacks

According to the whistleblower lawsuit, New Hampshire-based Atrium Medical Corporation hosted dinners, provided other grants and instituted other physician kickbacks to encourage physicians to use the iCast in elderly patients’ vascular systems and then billed Medicare for the procedure.

During the plaintiff’s tenure there, Atrium sold about $382 million in iCast stents, of which 100 percent were for unapproved uses. These were paid for by Medicare, Medicaid, the U.S. Department of Veterans Affairs and military hospitals 70 percent of the time, according to the lawsuit.

According to the firm representing Esther, this settlement reached with Atrium was one of the largest ever reached by any whistleblower lawsuit where the government decided not to intervene.

Both parties agreed to the settlement on June 23 and the case was later dismissed on July 20 without prejudice by Chief Judge Orlando L. Garcia after receiving approval from the federal government as well as the states in which the whistleblower lawsuit was brought.

“Atrium is pleased to have resolved this litigation without any admission or finding of wrongdoing,” Atrium said in a statement. “The plaintiff in this case alleged that atrium had violated the False Claims Act by promoting its lifesaving stent, the iCast, for so-called off-label uses. Doctors are the ones who can choose when and where to use the iCast… Atrium is pleased to have this case wrapped up so it can continue offering innovative, life-enhancing medical devices without the distraction of litigation.”

Filing a Whistleblower Lawsuit Under the False Claims Act

If you have witnessed healthcare fraud against the government including fraudulent coding, arrangement involving physician kickbacks, providing unnecessary medical services or other types of fraud against the government, you may be able to file a lawsuit.

For your help in stopping fraud against the government, if the lawsuit is successful, you may be awarded between 15 and 30 percent of the settlement, and most settlements are well over one million dollars.

However, you must bring such claims under the False Claims Act and should do so with a specialized lawyer. Reporting to a hotline will not allow you to receive this compensation.

The Atrium Physician Kickbacks Whistleblower Lawsuit is Case No. 5:13-cv-00244, in the U.S. District Court for the Western District of Texas.