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When people think of a “whistleblower” they typically think of someone working inside a company who has witnessed fraud and chooses to expose it. But there is another type of valuable whistleblower: a competitor to the company. Competitors can be in a unique position to recognize the fraud and explain it to the government because they see how the competition is unfairly beating them in the marketplace. Two recent examples illustrate the value of the competitor whistleblower.
We had the privilege of representing whistleblower/relator Sanofi North America in the largest False Claims Act settlement of 2017. Sanofi sued Mylan over the pricing and underpaying of rebates on its drug EpiPen. Sanofi had a competing drug that was being undermined in the market by Mylan’s scheme, which Sanofi realized also resulted in defrauding the Medicaid program. The government settled Sanofi’s False Claims Act qui tam complaint for $465 million and thanked Sanofi for coming forward. (See Our Successes.) The settlement was also heralded by DOJ in its press release touting the banner year it had in 2017 for FCA recoveries. And, just last month, the government settled a False Claims Act qui tam complaint brought by a family owned business, Moldex-Metric, Inc., against its much larger competitor, 3M Company, alleging it supplied defective dual ended combat arms earplugs to the U.S. Defense Logistics Agency.
The potential of a competitor being a whistleblower is not limited to False Claims Act cases. It can also include an action under the Securities and Exchange Commission, Commodities Futures Trading Commission, and Internal Revenue Service whistleblower programs. If you think your competition is behaving unfairly or fraudulently in the marketplace, add being a whistleblower to your legal options. We can help you explore the possibilities.