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IRS Whistleblowing Potential

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Trying to save money, the federal government is cutting funding for the IRS. The result may be a loss of revenues costing taxpayers untold billions. By the end of Fiscal Year 2010, $330 billion dollars in federal taxes will remain uncollected. In context, $330 billion dollars represents nearly 9 times the projected savings of the recently agreed upon budget. However, in the recent budget agreement, lawmakers decided that no additional funds would be used to hire new IRS agents.

Although there is evidence that for every dollar spent on enforcing the tax code the investment results in up to ten dollars of revenue for the government. Politicians, fearing to align themselves with the tax man, have shown reluctance in supporting funding for additional IRS agents.

The idea is particularly troublesome in that the federal deficit continues to mount and broader compliance of the already existing tax code would help relieve the burden of an exploding deficit. Egan Young’s recent case is a prime example of the need for a strong IRS. An anonymous Whistleblower client of Egan Young received the very first mandatory tax fraud reward under the 2006 IRS Whistleblower rules. The program which had been in place since the end of 2006, had taken nearly five years to distribute its first mandatory reward. The IRS acting on the tip of the Whistleblower, and the advocacy of attorney Eric Young, netted in excess of $20 million in unpaid federal taxes. This recent case highlights the need for a strong IRS. $20 million from one case represents near 2/3 of the savings the federal government cut in its recent budget negotiations. The addition of IRS agents, resources for the whistleblower office, and increased investment in IRS infrastructure would be a nearly 10 to 1 investment in paying down the exploding federal deficit.

Spinal Cord Injury Litigation in Pennsylvania

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Survivors of the most severe car or truck accidents can expect a wide range of physical, practical, financial and emotional challenges if they face the prospect of life with a permanent disability. For those rendered paraplegic or quadriplegic through permanent damage to the spinal cord, the challenges can last a lifetime.

At McEldrew Young in Philadelphia, we understand the legal and personal challenges that severely injured people face in the aftermath of a disabling motor vehicle accident or the neurological damage that medical negligence can sometimes cause. While our ultimate objective is to help you recover the financial compensation necessary to assure your personal and family security over the long term, we also support our clients and their families through the immediate challenges that a catastrophic injury invariably presents.

Maximizing Insurance Coverage in Spinal Cord Injury Cases

In spinal cord trauma cases that result from car accidents, it is often the case that the combination of the other driver’s liability coverage together with our client’s own UM/UIM motorist benefits will represent only a fraction of the total compensation you will need over a long period of time. We therefore work hard to identify other potential defendants and other sources of insurance coverage to maximize your total compensation. Sometimes we find that a road was negligently designed or maintained, and in some cases we can demonstrate that a defective car component aggravated the injuries or even caused the accident.

Truck accident litigation presents a different set of problems. While there is usually enough insurance in place to cover the damages we can prove on our client’s behalf, commercial insurance defense lawyers are highly motivated to minimize their exposure to liability and damages. You can expect tough opposition on liability issues, comparative fault issues, and the details of your damages evidence.

Experienced and Personalized Client Service

With almost 30 years of experience in complex litigation against negligent drivers, physicians and their insurers, Philadelphia personal injury attorney James McEldrew has recovered millions of dollars on behalf of people with permanent spinal cord injuries. His trial experience and willingness to present a case to a jury adds important leverage to his case settlement negotiation strategies. Additionally, his careful attention to detail in the development and presentation of a damages demand means that no element of your right to compensation will be overlooked or unsupported by evidence.

While your legal claims proceed through the court system, McEldrew Law works closely with clients, their families and their medical treatment team to assure the best possible care and treatment. With a carefully limited caseload, we also make sure that our clients receive prompt and highly personalized service whenever they want to discuss the case or a new problem with their attorney.

Call for a Lawyer’s Advice About Spinal Cord Injury Claims

For a free consultation with an attorney who knows how to win spinal cord injury cases under a wide range of circumstances, contact McEldrew Young in Philadelphia for a free consultation.

Former NBA Great Lucius Allen Blows the Whistle on Bristol-Myers Squibb

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As reported by the Los Angeles Times here, California Insurance Commissioner Dave Jones announced Friday that his office had joined a previously sealed whistleblower lawsuit against the company, calling it the largest health insurance fraud case ever pursued by a California state agency.

Two of the three whistleblowers in the case are former Lakers player Lucius Allen and his wife, Eve, who worked for the drug company as employees and provided access to the basketball team, whose players participated in “Lakers Dream Camps” set up by the drug company for doctors and their family members, the lawsuit said. The lawsuit was filed in 2007 but was sealed until the state joined the case recently.

New York-based Bristol-Myers Squibb issued a statement: “Bristol-Myers Squibb believes this lawsuit has no merit and the company will defend itself vigorously.”

The case is the latest major legal action against Bristol-Myers Squibb over allegations of health care fraud. The pharmaceutical giant paid $515 million in 2007 to settle allegations by the federal government and other states that it used a kickback scheme to defraud the Medicare and Medicaid insurance programs, officials said.

The California lawsuit alleges that Bristol-Myers Squibb targeted the private insurance industry, making thousands of payments to “high prescribing doctors” who wrote prescriptions for its well-known drugs, including Plavix, Abilify and Pravachol.

Jones said that insurance companies in California had spent more than $3.5 billion to cover the costs of the drugs Bristol-Myers Squibb sought to promote through its kickback scheme.

“We need to be sure that doctors are prescribing drugs because those drugs are best for their patients and not because a pharmaceutical company provided doctors with trips and kickbacks,” Jones said. “These illegal practices drive up the cost of health insurance for millions of Californians.”

This is just another example of pharma companies illegally utilizing a “pay-to-play” strategy. The concept is simple, pay doctors and they will write scripts for our drugs. The concept is clearly illegal, drains taxpayer funds and most importantly creates serious patient harm issues. When choosing which drug to prescribe, the doctor’s primary concern should be the patients’ health and not the doctor’s bottom line!

McEldrew Young represents whistleblowers nationwide. For a free confidential consultation, please call Eric L. Young, Esquire at (215) 367-5151 to speak to one of our whistleblower lawyers.

New York State Amends False Claims Act

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New York is leading the way at preventing tax fraud at the state level becoming the first state to creates a reward for whistleblowers. The amendment to New York’s False Claims Act will provide for an award to the whistleblower so long as the defrauding taxpayer earns more than $1 million in annual net income and defrauds the state of more than $350,000.

The whistleblower may earn up to 30 percent if he brings the case alone and up to 25 percent if the government decides to intervene. These percentages are based upon a number of factors including the amount of the whistleblower’s assistance.

As reported on The Post Standard, “The tax department guesses that billions of tax dollars go unpaid every year. In recent years, starting with Gov. Eliot Spitzer, the state has poured money into the department’s enforcement unit for staff, sting operations and sophisticated data collection systems to bust tax cheats. Spitzer appointed Comiskey to lead the effort and he set a record in his first year, bringing in $3 billion — $1 billion more than the year before. The effort continued under Gov. David Paterson. This year’s state budget relied on $221 million in extra tax fraud collections to help close the budget gap.

“New York state’s been exceptionally aggressive in the last few years during the budget crisis at collecting any source of tax revenue they can find, fairly or unfairly,” said Tim Lynn, a lawyer at Green & Seifter, an expert in business tax credits. “This is another weapon in their arsenal to cure their budget problems.”

Lynn said he suspects cases could come in the area of sales taxes or fuel and highway use taxes — the kinds of taxes where employees are aware of the amount of money that should have been paid. It is less likely there will be cases involving income taxes, which are confidential and handled by bookkeepers, he said.

The state first passed a whistle-blower law, called the False Claims Act, in 2007. It is modeled after the federal law. Until now, the law has mostly been used in Medicaid fraud cases. The old state law, like the federal law, specifically exempted tax fraud.

In three years, Medicaid fraud cases brought under the False Claims Act have recovered about $200 million for the state.

By 2014, the state estimates it will recover about $20 million a year from tax fraud.

Schneiderman likes to call it “the false claims act on steroids.”

McEldrew Young represents whistleblowers nationwide. For a free confidential consultation, please call Eric L. Young, Esquire at (215) 367-5151 to speak to one of our whistleblower attorneys.

Pipe Manufacturer in Hot Qui Tam Water

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Once again, another example of the limitless areas that can get a defendant into qui tam trouble: A whistleblower has accused pipe manufacturer JM Eagle (“World’s Largest Manufacturer of Plastic Pipe”) of falsifying test results concerning the quality of its products. The whistleblower, John Hendrix, claims that the company’s pipes have ruptured after one year when they are supposed to last 50 years. This can lead to fires, explosions, and, of course, leaks. The big problem for JM Eagle stems from the fact that the company has sold pipe to a plethora of state and local governments, as well as the federal government.

Mr. Hendrix is a former employee of JM Eagle and discovered the problems when he was asked to oversee the company’s quality control process. When he realized that the company had been manipulating its cerfification test results, he pressed management to do something, but it refused and Hendrix was eventually fired.

Although the federal government declined to join Hendrix’s lawsuit, numerous states and municipalities have signed on. They include Nevada, Delaware, Tenessee, and more than 40 water authorities in California (and if you live in California or other parts of the west, you know that water is something you don’t mess around with!). Nevada has been particularly hard hit with expenses related to faulty pipe. The state has already spent about $5 million to replace JM Eagle pipe that was supposed to supply water to a prison complex. Apparently, the pipe exploded several times per year. Even darker times may be ahead, however: the state has spent $57 million on PVC pipe from JM Eagle for use in government buildings and other projects.

JM Eagle has an interesting back story. The company’s parent is Formosa Plastics Group, which is Taiwan’s biggest diversified industrial company.  The company’s founder, Wang Yung-ching, helped make Taiwain into an economic “tiger,” and he died the second richest man in the province.  His children, including JM Eagle’s CEO, continue to fight over Yung-ching’s massive fortune (Yung-ching died intestate, i.e., without a will).

One of the central claims of Hendrix’s suit is that JM Eagle hired inexperienced workers to save money, thereby reducing the quality of the piping and necessitating the company to engage in a coverup. As more governments realize that they may have been duped into buying faulty pipe, they may join the suit in an effort to shore up their dwindling budgets. Keep an eye out for more on JM Eagle in the future.

McEldrew Young represents whistleblowers nationwide. For a free confidential consultation, please call Eric L. Young, Esquire at (215) 367-5151.

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