United States of America ex rel. Susan Ruscher et al. v. Omnicare Inc. et al.


The U.S. District Court for the Southern District of Texas, Houston Division, granted summary judgment for the defendant in this case involving healthcare payment and billing practices.

Retained by Williams & Connolly

Counsel for Omnicare Inc. retained Cornerstone Research and two experts to respond to claims that Omnicare violated the Anti-Kickback Statute and False Claims Act in sourcing business from skilled nursing facilities (SNFs). The relator alleged that Omnicare intentionally failed to collect Medicare Part A debt from the SNFs for which it provided long-term-care pharmacy services in order to maintain or extend its Medicare Part D business with those facilities.

Cornerstone Research worked with an expert on the billings and collections practices of pharmacy services providers in conducting an extensive review of the document record. Based on that review, the expert concluded that Omnicare was actively engaged in collections throughout the period of alleged kickbacks and that Omnicare’s practices were both reasonable and consistent with industry practices. He also explained why the dissemination of confidential company and customer information taken by the relator would likely cause significant harm to Omnicare. Similarly, an expert on skilled nursing facility management concluded that the document record did not reveal business conduct outside of what is normal in the SNF and pharmacy services provider industries with regard to billing and payment practices.

In granting summary judgment for Omnicare, a U.S. District Court judge for the Southern District of Texas concluded that the document record, “read in context, [does] not raise a question of material fact as to Omnicare’s intent with respect to its relationship with the SNFs,” and also observed that the “collection practices of Omnicare…would not seem exceptional, much less fraudulent.”

The court also denied the relator’s motion for summary judgment on Omnicare’s counterclaims for breach of fiduciary duty and misappropriation of trade secrets, among others. The court cited the billing expert’s opinions related to the potential for harm to Omnicare if its internal documents were made public.

For additional information about this case, please contact Carlos Brain.