Teller Law Verdicts and Settlements
Stephen Teller Helps the FCC Recover $40 million in Rural Health Care Program Overpayments
GCI Communications Corp., based in Anchorage, Alaska, settled allegations of False Claims Act violations by agreeing to pay over $40 million. The settlement addresses accusations that GCI deliberately overcharged and breached FCC competitive bidding rules within the FCC’s Rural Health Care Program, which annually allocates upwards of $570 million to support telecommunications for rural health care providers. Read more about the settlement here.
Court of Appeals Upholds $1.25 Million Verdict
In July 2015, a Federal jury awarded a $1.25 million verdict to railroad engineer and Union safety advocate Mike Elliott in his whistleblower retaliation case against BNSF. BNSF appealed, claiming that the trial court mistakenly overlooked BNSF’s “sincere honest belief” that Elliott committed terminable conduct unrelated to his safety advocacy. After oral argument, the 9th Circuit Court of Appeals affirmed the verdict, finding the jury’s verdict was supported by substantial evidence, and that the “Business Judgment Rule” is not a legal defense in federal railroad whistleblower law. Read more about the findings here.
Jury Awards $1.25 Million in Whistleblower Retaliation Case
Elliott, a BNSF locomotive engineer and Union safety officer, reported BNSF’s failure to maintain its track in accordance with Federal safety standards. BNSF failed to fix the defects, so Elliott elevated his report to the Federal government. A jury found that BNSF targeted Elliott for retaliation because of his safety advocacy, that BNSF management staged an altercation to provide cause to fire Elliott, and faked evidence to support terminating the employment of this 18-year career employee. Sara Amies co-counseled with James K. Vucinovich, a railroad personal injury lawyer, and proved that BNSF illegally retaliated against Elliott under the Federal Rail Safety Act. After a six-day trial in July 2015, a federal jury in Tacoma reached a unanimous verdict and awarded Elliott $1.25 million, including the statutory maximum of $250,000 in punitive damages.
Teller Law Helps the US Government Recover 430K in Qui Tam Lawsuit
BidBuy Auctions, LLC (“BidBuy”), has agreed to pay $430,000 to resolve allegations that it undervalued light trucks imported from Canada in order to avoid paying significantly higher import duties. The settlement resolves a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act by Teller Law on behalf of a former BidBuy employee. As a reward for exposing the customs and duties fraud, the whistleblower will receive 23% of the recovery, totaling nearly $100,000.
Student Loan Fraud
In US ex Rel Nicol v. Divers Institute of Technology, 1998, a former director of student aid reported fraud to the Department of Education through a False Claims Act (Qui Tam) lawsuit. As the associate responsible for the claim, Teller filed the action, created the disclosure statement, and pursued the case towards the DOJ’s intervention and settlement. The school had stolen $805,000 in student loans and grant funds from the Department of Education over a period of years by falsifying student income data, and was forced to pay back triple damages because of the intentional nature of the fraud.
Result – The whistleblower received approximately $400,000 and was in a good position to seek further recovery for a wrongful termination claim after being forced to quit when he refused to pursue the fraud.
In US ex Rel [confidential] v. [name withheld], 2005, a healthcare provider opposed fraudulent billing by his employer for “upcoding” under the “incident to” Medicare billing rules and was wrongfully terminated from employment. Teller warned the employer through a “demand” letter that the action would be pursued, but the employer was unwilling to enter into early settlement discussions and the Qui Tam lawsuit was filed.
Result – The government forced a settlement of $478,000 in restitution, of which 20% went to the whistleblower. In addition, the wrongful discharge claim was resolved for another confidential six figure sum which went to the whistleblower directly.
Government Procurement Fraud
In US ex Rel Willson v. Alcatel-Lucent, 2012, a contracting manager working on a US Army project to build a first responder network in Iraq opposed fraud and was “laid off.” The relator had opposed waste and fraud, and the failure to perform testing which was required to be done before network was turned over the the Iraqi government.
Result – After his termination, he hired my firm to file a Qui Tam action under the False Claims Act, leading to the recovery of $4.2 million from Alcatel-Lucent with a share of $758,000 to Mr. Willson. We then negotiated an additional confidential sum as part of the wrongful termination claim.
Mortgage Quality Certification Fraud
In US ex Rel Nguyen v. Lennar Corporation, 2018, Universal American Mortgage Company, LLC, and Eagle Home Mortgage of California, Inc., paid $13.2 million to settle claims of fraud against the Federal Housing Administration. Teller and co-counsel represented the relator after she was terminated from her quality assurance position at the mortgage lender because of her refusal to participate in fraud. The mortgage company was falsely certifying that borrowers met the standards for government backing of their loans under the Direct Endorsement Lender housing insurance program.
Result – The whistleblower received $1,980,000 as the reward, and another smaller sum for the wrongful termination claim.
Off-Label Medical Device and Off Label Pharmaceutical Sales and Promotion Fraud
In [name withheld] v. DUSA Pharmaceuticals, 2020, Teller helped a former sales representative file a Qui Tam lawsuit under the False Claims Act after his termination from employment. The company had been using a variety of schemes to convince doctors to use a less effective method for treating pre-cancerous skin conditions and thereby sell more product.
Result – The government proved that Medicare paid substantially more to the company for its products than it should have paid, and DUSA repaid the government over $20 million in settlement. The relator received approximately $3.4 million as his share of the recovery.
Union Gap Settles With Former Clerk For $750,000
Union Gap, Wash. Former City Clerk Sherrie Testerman has accepted $750,000.00 to settle her discrimination lawsuit against the City of Union Gap and former Mayor Jim Lemon, said her Seattle-based attorneys, Patricia Kuderer and Stephen Teller. Her attorneys said in addition to the payment, the City has also agreed to provide Testerman with a letter of recommendation that reflects her high quality work performance over 24 years of dedicated service. Testerman collapsed at work and went out on medical leave in April of 2012. She did not return to Union Gap after enduring what she described as years of bullying at the hands of Jim Lemon.
“The City’s own policy guaranteed every employee the right to work in an environment free of discrimination and intimidation.” Kuderer said. “That obviously was not the case under Mayor Lemon. No one is above the law, and Sherrie Testerman proved that included Mayor Lemon.”
Teller added, “not only was the law strongly in her favor, but the City was really over a barrel with Jim Lemon as their main witness. Sherrie showed a lot of courage and determination to fight back like this. Jim Lemon was powerful bully, but we all know discrimination has to stop.”
Testerman described the workplace environment under Jim Lemon as abusive, offensive and discriminatory. She sued Lemon and the City in 2014 for $1.3 million for hostile work environment and for violating the City’s own anti-bullying policy. Her lawsuit followed one filed by the previous Clerk, Kathryn Thompson that contained similar allegations. Thompson’s lawsuit settled in May of 2014 for $950,000.00. Both Testerman and Thompson were represented by Kuderer and Teller.
The agreement to settle Testerman’s lawsuit was reached on September 1. The City’s insurer, Washington Cities Insurance Authority, was present on behalf of the city. Stephanie Alexander of Seattle represented the City and Lemon.
Union Gap Pays Former City Clerk Nearly $1 Million to Settle Lawsuit
Union Gap, Wash. Former City Clerk Kathryn Thompson agreed to settle her lawsuit against the City of Union Gap and former Mayor Jim Lemon for $950,000.00, said her Seattle-based attorneys, Patricia Kuderer and Stephen Teller. Full details of the settlement have not yet been released. According to her attorneys, in addition to the payment the City has also agreed to remove from Thompson’s personnel file the disciplinary-related documents and a posttermination performance evaluation Lemon authored that Thompson said contained false accusations and unfairly blackened her otherwise stellar 31-year municipal job performance record. She is also reported to be entitled to a positive letter of recommendation from the City that accurately reflects her high quality work performance.
“Kathy stood up to former Mayor Jim Lemon because she knew his abusive and demeaning behavior had to stop,” Kuderer said. “This settlement is complete vindication and should restore her excellent reputation in the community.”
Teller added, “I have been so impressed with the way Kathy has handled this. Jim Lemon hurt a lot of people, but he couldn’t break Kathy Thompson. She’s a smart and courageous person, and an excellent City Clerk. She will always have my respect and admiration for the courage she showed in this tough fight.”
Thompson said Lemon forced her to resign in January of 2012 after subjecting her to verbal abuse, unwarranted discipline, and false accusations of poor work performance and insubordination that occurred over several years. In September of 2012 she sued Lemon and the City for retaliatory discharge, sex discrimination, defamation and negligent infliction of emotional distress. She initially sought $2.6 million in damages but found replacement work nearly two years later that greatly reduced her monetary losses. Lemon was not present when the settlement was reached on May 29.
Kuderer and Teller also represent another former Union Gap City Clerk, Sherrie Testerman, who recently sued Lemon and the City for similar employment-related and other claims. Stephanie Alexander of Seattle defended the City and Lemon and remains their attorney for the Testerman case.
Teller & Associates Win $4.2 Million Settlement on Behalf of Client and U.S. Government in Qui Tam Case
My client filed a qui tam lawsuit on behalf of the U.S. government, alleging that Lucent Technologies World Services Inc. (LTWSI) violated the False Claims Act. As a former contract manager at LTWSI, my client had access to vital information regarding the false and fraudulent certificates that the telecommunications company had supplied to the U.S. Army.
In 2004, the U.S. Army hired LTWSI to develop an Advanced First Responder Network (AFRN) that would be used as an emergency response communications system for Iraqi citizens. My client alleged that LTSWI submitted false documents stating that the emergency system had successfully completed testing and was ready to send to Iraq in order to receive payment and an additional $8.5 million award for finishing the project ahead of schedule. My client also alleged that he had been wrongfully terminated for raising concerns over the company’s fraudulent conduct.
LTWSI agreed to pay a settlement of $4.2 million for violating the False Claims Act. As a whistleblower, my client also received a significant percentage of the total from the overall settlement with the U.S. government. My client also resolved his retaliation claims at the same time in a separate confidential agreement.