Los Angeles Toxicology Lab Sued for Alleged Kickback Schemes; Complaint Proceeds Past the Motion to Dismiss

A former sales rep filed a qui tam complaint under the Federal and California False Claims Acts and the California Fraud Insurance Prevention Act, blowing the whistle on Pacific Toxicology Lab (PacTox) for various alleged kickback schemes involving medical practices that use the lab. The complaint alleges that the lab illegally induced the practices to refer Medicare and Medicaid patients by:

• Performing lab tests on the practices’ commercial patients at a “loss leader” rate, and then allowing the MDs to bill for those tests as though they had been performed in-office;
• providing free point-of-care urine test cups; and
• providing in-house “collector” personnel to some high-volume referring docs.

The complaint also alleges that PacTox paid sales reps as independent contractors on straight commission, an arrangement that ran afoul of the Anti-Kickback Statute.

The judge in the case recently denied Defendant’s motion to dismiss; now the case moves into the discovery phase.

Read the complaint here, and the order denying the motion to dismiss here.

Individuals with information about Pacific Toxicology Labs or the practices alleged in the complaint may contact the whistleblower attorneys of Brown, LLC by calling (877) 561-0000.

Please note that the complaint and the description of the complaint are merely allegations and have not been proven as of this writing. The Defendant has not admitted to these allegations and is vigorously defending and contesting the allegations.