United States of America v. Valley View Drugs, Inc.

I. INTRODUCTION AND BACKGROUND

On July 22, 2016, relator Linda Dibenedetto filed a complaint under the gui tam provisions of the False Claims Act (“FCA”), 31 U.S.C. §§ 3729-3733, against defendants Valley View Drugs, Inc. (“Valley View”); David Michael Jensen; Pro-Med Marketing, LLC; John Pal Singh Janda; Western Medical Solutions, Inc.; Gary Dean Schoonover; Samia Solutions, LLC; Michael Steven Sinel; Michael David Roub; Edward’s Healthy Living Pharmacy, Inc. (“Ed’s”); and Trojan Medical Billing, Inc. (“Trojan”). Dkt. 1. The relator alleges that Valley View, a pharmacy that prepares and dispenses compounded drugs, and its owner Jensen paid kickbacks to physicians to induce them to prescribe drugs compounded and dispensed by Valley View and Ed’s. Id. 4 37-54. Valley View allegedly created and used Trojan as a billing entity to seek government reimbursement for illegally prescribed drugs. Id. 450. The other defendants are physicians and marketers to whom Valley View allegedly paid kickbacks. Id. 37-54. The relator alleges that the United States was defrauded out of at least $20 million as a result of this scheme. Id. § 53. In June 2016, a grand jury returned an…