Commercial Litigation Update

Since October 2021, the Department of Justice (DOJ) has been implementing a variety of changes to its corporate criminal enforcement policies. These efforts all reflect DOJ’s focus on individual accountability, punishing recidivist misconduct, prioritizing compliance and responsible corporate citizenship, promoting corporate self-disclosure, and incentivizing whistleblowers to come forward. The latest development in these efforts is the Criminal Division’s Pilot Program on Voluntary Self-Disclosures for Individuals that DOJ released on April 15, 2024.

On December 26, 2023, the U.S. Sentencing Commission (“USSC”) proposed several amendments to its Guidelines Manual (the “Guidelines”). Two of these proposed amendments have the potential to especially impact sentencing decisions in white collar criminal cases. In particular,  one amendment changes the rule for calculating loss, and another provides new options regarding the consideration of acquitted conduct.

Rule for Calculating Loss

The USSC’s proposed revision to the Guidelines’ rules for calculating loss arises out of an effort to continually evaluate and ...

On March 7, 2024, Deputy Attorney General Lisa Monaco announced the launch of a 90-day sprint to develop and implement a pilot program for DOJ’s latest “carrot” to incentivize companies to invest in a culture of compliance: a whistleblower rewards program. In an address at the American Bar Association’s 39th National Institute on White Collar Crime, Monaco explained: “[t]he premise is simple: if an individual helps DOJ discover significant corporate or financial misconduct — otherwise unknown to us — then the individual could qualify to receive a portion of the ...

In an indictment announced on October 26, 2023 in Miami, the U.S. Department of Justice, Criminal Division’s Fraud Section, working with the FBI and HHS-OIG, brought what may be only the second federal criminal charges directly related to the Medicare Advantage (Medicare Part C) risk adjustment payment methodology.  DOJ enforcement in the Medicare Advantage risk adjustment space overwhelmingly has proceeded civilly under the False Claims Act. Although the allegations suggest conduct far more troubling than prior civil cases under risk adjustment, these criminal charges ...

On June 28, 2023, the U.S. Department of Justice (“DOJ”) and the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), along with other federal and state law enforcement partners, announced a nationwide health care fraud enforcement action targeting a variety of alleged health care fraud schemes. As has been the case over the last few years, DOJ and HHS-OIG have moved away from categorizing the enforcement action as a “takedown”. The government has not explained the naming change, but one explanation is that it is no longer properly considered a true “takedown” because the enforcement activity (charges, arrests) occurs over many weeks leading up to the day it is announced.  

With the release of the decision in Dobbs v. Jackson, questions regarding enforcement activity in states that restrict or ban abortion by statute have been raised and have remained mostly hypothetical. The frequency and scope of future enforcement activity remains unknown. Given the variety of laws now in effect in restricted and ban states, and that enforcement of such laws is subject to state prosecutorial discretion as well as the prevailing political climate, enforcement initiatives are expected to vary by state.

On June 24, 2022, the U.S. Supreme Court released its opinion in Dobbs v. Jackson Women’s Health Organization, overturning Roe v. Wade—the 1973 landmark ruling that established the constitutional right to abortion. Now, companies that operate in states where abortions are banned or restricted are facing a quagmire of laws and risks regarding enforcement. Additionally, the risk landscape is not static, but rather in flux, as the federal government (agencies such as the U.S. Department of Justice and the U.S. Department of Health and Human Services) and a myriad of states introduce new legislation and issue guidance on a near-daily basis.

Now that the Supreme Court of the United States has declared that authority to regulate abortion rests with the states, organizations operating across state lines face new and some unprecedented challenges created by the civil and criminal legal issues arising from risks of enforcement in any state where abortion is or will be banned (a “ban state”). Health care providers, employers, and other organizations with any nexus to such states will need to conduct careful analyses and may have to accept an unknown level of enforcement risk while various jurisdictions respond to their newfound power and determine if and how to wield it. The risks may extend to providers who deliver abortions, patients seeking abortions, companies who support their employees traveling to non-ban states to receive abortions, and their executives. The outer parameters of who is subject to enforcement risk are presently unknown but are likely to vary from jurisdiction to jurisdiction.

Has private equity’s role in the nursing home industry led to lower quality of care? In an article for Thomson Reuters Westlaw Today, “Is Private Equity Really the Boogeyman in Nursing Home Quality of Care?” attorneys Sarah Hall and Eleanor Chung consider both sides of the issue and look at some possible solutions.

Over the past 15 years, chief compliance officers (“CCOs”) for financial services firms have come under increased scrutiny as the Securities and Exchange Commission (“SEC”) and Financial Industry Regulatory Authority (“FINRA”) have brought more frequent enforcement actions seeking to hold CCOs personally liable. CCOs understandably have been concerned about this trend and financial service firms have focused on the chilling effect that the enforcement actions may have on the vital role CCOs play in their organizations and the quality of the COO applicant pool.