The Legal Intelligencer LI Top Verdicts 2015 June 21, 2016 : Page 8

8 • VerdictSearch’s Top PA Verdicts of 2015 > Continued from Page 7 that it was justified to enter into the decree and that it acted in good faith. The NCAA, however, maintained that the ruling expanded the scope of the litigation. The matter appeared to be on its way to a resolution by September 2014, but in October, the Commonwealth Court denied the NCAA’s unopposed motion to dismiss the case, saying the NCAA and Penn State were seeking to “usurp” the court’s authority. Trial had been scheduled for early February. The announcement on the proposed settlement came three days after a federal judge tossed a parallel suit that had been filed by the NCAA in the U.S. District Court for the Middle District of Pennsylvania. That suit, NCAA v. Corbett, alleged that the Endowment Act was unconstitutional. —The Legal Intelligencer Defense Counsel: • Laena P. Keyashian, Covington & Burling, New York. • Alison Tanchyk, Morgan, Lewis & Bockius, Miami. Comment: Pharmaceutical companies AstraZeneca and Cephalon have agreed to pay the U.S. government and several states a combined total of $54 million to settle claims that they underpaid rebates owed under the Medicaid Drug Rebate Program, according to the U.S. Department of Justice. Specifically, AstraZeneca is set to pay $46.5 million plus interest; $26.7 million of that will go to the government while the remainder will go to states participating in the settlement. Cephalon, in a separate settlement from the same case, is set to pay $7.5 million plus interest to resolve similar claims, of which $4.3 million will go to the government while the rest is distributed among the participating states. In total, 12 states are part of the settlement. Additionally, drug company Biogen has settled with whistleblower Ronald Streck— who alleged the companies defrauded the U.S. government and states by underpaying Medicaid rebates—for $1.5 million, according to a settlement agreement. The docket reflects that Biogen had been terminated from the litigation June 18. “The Medicaid Drug Rebate Program relies on drug manufacturers reporting accurate pricing information used in the rebate calculations,” said principal deputy assistant attorney general Benjamin C. Mizer—the head of the Justice Department’s Civil Division—in a DOJ release. “These settlements demonstrate the Department of Justice’s commitment to ensuring that state Medicaid programs receive the full amount of rebates from manufacturers that Congress intended.” AstraZeneca’s attorney, Laena P. Keyashian of Covington & Burling in New York, declined to comment. Alison Tanchyk of Morgan, Lewis & Bockius, representing Cephalon, did not immediately return a call seeking comment. A call to Biogen’s media office was not immediately returned. Todd Collins of Berger & Montague, one of the firms representing Streck, said the settlement came at the end of a long road. “We have been fighting this litigation for years; we still have more ahead of us,” Collins said. “We think these are important issues which put some money into the treasury and hopefully can serve as a reminder to anyone in the future who wants to put his thumb on the scale and charge too much, in this case underpay rebates.” According to the DOJ, drug companies must pay quarterly rebates to state Medicaid programs in exchange for Medicaid coverage of the companies’ drugs. Those rebates, the DOJ said, are partially based on the average manufacturer prices, or AMPs, that drugmakers report to the government for each of their covered drugs. “Generally, the higher the reported AMP for a drug, the greater the rebate the manufacturer pays to state Medicaid programs for the drug,” the DOJ said in a written statement. “These settlements resolve allegations that AstraZeneca and Cephalon underreported AMPs for a number of their drugs by improperly reducing the reported AMPs for service fees they paid to wholesalers. As a result, the government contends that AstraZeneca and Cephalon underpaid quarterly rebates owed to the states and caused the United States to be overcharged for its payments to the states for the Medicaid program.” According to Collins, the government has not yet released Biogen from litigation, despite its settlement with Streck. —The Legal Intelligencer FIDUCIARY Investors Awarded For Adviser’s Fiduciary Breaches Amount: $48.4 Million Type: Verdict Venue: American Arbitration Association Case Type: Breach of fiduciary duty, misrepresentation. Case Name: Sutow v. Family Endowment Partners Date: April 14, 2015. Court and Case No.:American Arbitration Association, 14-20-1300-0979. Arbitrator: Injuries: Financial losses. Plaintiffs Counsel: • Glenn S. Gitomer and Garth G. Hoyt, McCausland, Keen & Buckman, Radnor. Defense Counsel: • Robert S. Friedman, Mark E. McGrath and Thomas M. Monahan, Sheppard, Mullin, Richter & Hampton, New York, New York. Comment: An arbitrator awarded two investors more than $48.4 million for the alleged misrepresentations of a registered investment adviser and investment firm that the claimants’ counsel said bordered on a Ponzi scheme. The award against Family Endowment Partners LP and partner Lee D. Weiss included $17.4 million in actual damages, $990,705 in attorney fees and costs, and $30 million in treble damages. Philip S. Cottone of the American Arbitration Association issued the arbitration award. QUI TAM Drugmakers Settle With US Over Underpaid Medicaid Rebates Amount: $54 Million Type: Settlement Venue: U.S. Eastern District, Pa. Case Name: Streck v. Allergan Settlement Date of Settlement: July 8, 2015. Court and Case No.: E.D.Pa.; 2:08-cv-05135. Type of Action: Qui tam. Injuries: Lost revenue. Plaintiffs Counsel: • Benjamin C. Mizer, U.S. Department of Justice, Washington, D.C. • Todd Collins, Berger & Montague, Philadelphia. Continued on Page 11 > Black vs. Allegheny County et al . 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