FCA-Seventh Circuit

On May 3, 2023, the US Court of Appeals for the Seventh Circuit sided with the policyholder, resolving a large insurance coverage dispute relating to a $100 million settlement involving claims under the federal Anti-Kickback Statute and the federal False Claims Act.  Astellas US Holding, Inc. v. Fed. Ins. Co., No. 21-3075, 2023 WL 3221737 (7th Cir. May 3, 2023).  In so doing, the court held that Illinois public policy does not forbid a liability insurer from covering its insured’s payments to resolve compensatory damages it may owe even if characterized by the government and insured as “restitutionary,” while reiterating that Illinois public policy prohibits insurance for “genuine restitution it owes the victims of its intentional wrongdoing.”[1]  Determining the amount of a False Claims Act (“FCA”) settlement that is compensatory in nature was made easier by a change in the tax code implemented by The Tax Cuts and Jobs Act of 2017 requiring all False Claims Act settlements to detail the percentage of the settlement amount that is compensatory in nature (and, therefore, is tax deductible), providing an important marker for policyholders seeking insurance coverage for at least a portion of the settlements they reach to resolve FCA investigations.

On May 3, the 7th U.S. Circuit Court of Appeals sided with the policyholder, resolving an insurance coverage dispute over a $100 million settlement related to claims under the federal Anti-Kickback Statute and the federal False Claims Act.

Read on for analysis of this decision, which tries to clarify the difference between compensatory damages, which…

Amulet Capital Partners has announced it has acquired Alliance Clinical Network (ACN).

ACN, based in Dallas, is a clinical site platform serving patients, pharmaceutical sponsors and contract research organizations. Founded in 2014, ACN owns and operates six clinical research sites across three states.

Amulet, based in Greenwich, Conn., is a middle market private…

On May 18, 2023, during an “Ask FINRA Senior Staff” panel held as part of FINRA’s 2023 Annual Conference, Christopher Kelly, Acting Head of FINRA Enforcement, provided a first look into how FINRA Enforcement intends to address CAT reporting violations as the industry nears the three-year anniversary of the first Phase of CAT go-live and ahead of any published enforcement activity to date.

Over the past year, website operators have experienced a proliferation of lawsuits under the Federal Video Privacy Protection Act (“VPPA”), a Reagan-era statute prohibiting the nonconsensual disclosure of an individual’s video tape rental history. Despite its nondigital origin, litigation under the VPPA has successfully targeted the ubiquitous use of tracking technologies on businesses’ websites, creating a risk of significant class-action damages under VPPA’s $2,500 per violation statutory-damages clause. Read on for more details about the risk of litigation under the VPPA and how best to avert it.

Notable litigation filed during April 2023 includes: (1) SEC v. French, et al., (2) Gary Kennedy v. Ghap, LLC, et al., (3) Abanda v. OurBloc LLC, et al., (4) Sunrise NPL, LLC v. Easy Financial, LLC, et al., and (5) Joseph v. General Conference Corporation of Seventh Day Adventist et al.