Rene Thomas Folse, JD, Ph.D. is the host for this edition which reports on the following news stories: Court Declines to Restrain “Rude and Aggressive” Workplace Customer. Employer Cannot Discover Immigration Status in Wrongful Termination Case. Judge Dismisses DAs’ Case Against Law Firm for $5M ADA Shakedown. Re-Hearing Revives Legality of Employer Arbitration Agreements. LAPD Officers Hired by Film Maker for Traffic Control Not Employees. Neurosurgeon Pleads Guilty to Accepting $3.3M In Kickbacks. So Cal Chiropractor Sentenced to 14 Months for Kickback Scheme. International DME Maker to Pay $25 M to Resolve Kickback Case. How the Great Resignation Impacts Workers’ Compensation. Workers’ Comp Benchmarking Study Releases 9th Annual Report.
A federal jury convicted the president of a Silicon Valley-based medical technology company of participating in a scheme to mislead investors, commit health care fraud, and pay illegal kickbacks in connection with the submission of over $77 million in false and fraudulent claims for COVID-19 and allergy testing.
59 year old Mark Schena, who lives in Los Altos, California, served as the president of Arrayit Corporation. According to court documents and evidence presented at trial, Schena engaged in a scheme to defraud Arrayit’s investors by claiming that he had invented revolutionary technology to test for virtually any disease using only a few drops of blood.
In meetings with investors, Schena and his publicist claimed that Schena was the “father of microarray technology” and falsely stated that he was on the shortlist for the Nobel Prize. The evidence at trial showed that Schena also falsely represented to investors that Arrayit could be valued at $4.5 billion based on purported revenues of $80 million per year.
The evidence at trial showed that Schena, among other things, failed to release Arrayit’s SEC-required financial disclosures and concealed that Arrayit was on the verge of bankruptcy. Schena lulled investors who were concerned that the company was a “scam” by inviting them to private meetings and issuing false press releases and tweets stating that Arrayit had entered into lucrative partnerships with companies, government agencies, and public institutions, including a children’s hospital and a major California health care provider.
Schena also orchestrated an illegal kickback and health care fraud scheme that involved submitting fraudulent claims to Medicare and private insurance for unnecessary allergy testing. Arrayit ran allergy screening tests on every patient for 120 different allergens (ranging from hornet stings to codfish) regardless of medical necessity.
In order to obtain patient blood specimens, Schena paid kickbacks to marketers in violation of the Eliminating Kickbacks in Recovery Act and orchestrated a deceptive marketing plan that falsely claimed that the Arrayit test was highly accurate in diagnosing allergies, when it was not, in fact, a diagnostic test. Arrayit billed more per patient to Medicare for blood-based allergy testing than any other laboratory in the United States, the evidence at trial showed, and billed some commercial insurers over $10,000 per test.
In early 2020, Arrayit’s allergy testing business declined because the COVID-19 pandemic and stay-at-home orders reduced demand for allergy testing. Schena then falsely announced that Arrayit “had a test for COVID-19” based on Arrayit’s blood testing technology, before developing such a test.
Seeking to capitalize on the nationwide shortage of COVID-19 testing, Schena orchestrated a deceptive marketing scheme that falsely claimed that Dr. Anthony Fauci and other prominent government officials had mandated testing for COVID-19 and allergies at the same time and required that patients receiving the Arrayit COVID-19 test also be tested for allergies.
Schena also falsely claimed that the Arrayit COVID-19 test was more accurate than a PCR test for diagnosing COVID-19 infections, while concealing from investors and patients taking the test that the Food and Drug Administration had informed him that the Arrayit test was not accurate enough to receive an Emergency Use Authorization for use in the United States.
Schena was convicted of one count of conspiracy to commit health care fraud and conspiracy to commit wire fraud, two counts of health care fraud, one count of conspiracy to pay kickbacks, two counts of payment of kickbacks, and three counts of securities fraud.
He is scheduled to be sentenced on Jan. 30, 2023 and faces a maximum penalty 20 years imprisonment for the conspiracy to commit health care fraud and conspiracy to commit wire fraud; 10 years of imprisonment for each count of health care fraud; five years imprisonment for conspiracy to pay kickbacks; 10 years imprisonment for each count of payment of kickbacks; and 20 years imprisonment for each count of securities fraud.
Construction workers often face some of their industry’s most serious dangers – such as falls from elevation, being struck or crushed by equipment or other objects, and electrocution – but recent studies suggest another occupational concern is lurking silently at U.S. worksites: worker suicides.
The Centers for Disease Control and Prevention reports that the suicide rate for men in construction and extraction was five times greater than the rate of all other work-related fatalities in the industry in 2018, and these workers are four times more likely to end their own lives than people in the general population.
Overall, suicide rates in the U.S. have increased, and it has been the 10th leading cause of death since 2008.
To assist workers in an industry with one of the nation’s highest occupational suicide rates, the U.S. Department of Labor’s Occupational Safety and Health Administration has joined a task force of construction industry partners, unions and educators to raise awareness of the work stresses seen as the causes of depression and the thoughts and acts of suicide among construction workers. In addition to alerting other stakeholders, the task force encourages industry employers to share and discuss available resources with their workers.
“Construction workers cope with unique causes of stress, such as uncertain seasonal work; remote work and job travel that keeps workers away from home and support systems; long, hard days and completion schedules; and the job-related risks of serious injuries,” explained Assistant Secretary for Occupational Safety and Health Doug Parker. “Left unchecked, these stressors can affect mental health severely and lead to anxiety, depression, substance abuse and – in some cases – suicide.”
The coronavirus outbreak and pandemic only worsened the problem, researchers found. In August 2020, the CDC reported a considerable one-year increase in symptoms of anxiety disorder and depressive disorder in a survey of the U.S. population.
Moved by their concern for a growing problem, a group of industry volunteers joined in 2020 to launch the first Suicide Prevention Week for construction workers. In 2021, more than 68,000 workers in 43 states registered to participate in Construction Suicide Prevention Week, managed by a task force comprised of OSHA, Associated General Contractors, The Builders Association, leading construction companies and labor unions.
“Suicide can be prevented with professional help and assistance,” Parker added. “OSHA encourages employers, industry associations, labor organizations and workers to use all available resources to understand the problem and the warning signs of depression before tragedy strikes.”
The Construction Industry Alliance for Suicide Prevention (CIASP) is raising awareness about the risk of suicide within the construction industry by providing suicide prevention resources and tools to work towards a zero-suicide industry. They’ve created online training in collaboration with LivingWorks. To register and start the training visit https://preventconstructionsuicide.com/.
The National Institute for Occupational Safety and Health’s (NIOSH) National Construction Center: CPWR – The Center for Construction Research and Training supports North America’s Building Trades Unions (NABTU), as well as the entire industry, in addressing the suicide crises that is disproportionally affecting construction workers. CPWR created a website with several new printable resources (such as a hazard alert) to help organizations and individuals understand the issue of suicide, start a conversation, and play a role in supporting friends, co-workers and family members.
Attorney Camille Vasquez has found her next Hollywood client. She became a household name while successfully defending Johnny Depp in his defamation trial against ex-wife Amber Heard last June. According to the report in the New York Post, she now has signed on to represent “Yellowstone” actress Q’orianka Kilcher in her California Worker’s Compensation fraud case.
Vasquez,confirmed the news on Wednesday, saying she was “determined to defend” Kilcher who – ironically – plays attorney Angela Blue Thunder on the hit Paramount streaming series.Vasquez will take on the case alongside attorney Steve Cook, another partner at her firm, Brown Rudnick.
Brown Rudnick is an international law firm with roots in post-war 1940s Boston and New York City. Vasquez joined Brown Rudnick’s Orange County office in 2018 as an associate in the Litigation & Arbitration practice. She has more than 10 years of experience as a trial lawyer in high-stakes disputes, including defamation cases, contract disputes, business-related torts and employment-related claims.
She was a key member of the litigation team that won the jury verdict on June 1, 2022 for actor Johnny Depp. On June 7, her firm announced that she had been elevated to partner in the firm.
Steve Cook heads the firm’s White Collar Defense, Investigations & Compliance Practice Group. He is a former federal prosecutor and experienced trial lawyer who advises corporate and individual clients on complex civil and criminal matters, internal corporate investigations, grand jury investigations, and regulatory compliance matters.
He was also a member of the FBI’s Joint Terrorism Task Force, responsible for investigating and prosecuting threats of terrorist activity and terror financing networks.
In a statement given to Fox News, the pair said: “We are determined to defend Ms. Kilcher in this important case which examines the inherent flaws in the disability compensation system. Ms. Kilcher is a well-respected and pioneering actress in Hollywood, and we intend to clear her name.”
Kilcher was last seen in the Season 3 finale of “Yellowstone” back in 2020, with her character mysteriously absent from the fourth season, which aired earlier this year. However, according to some media reports, the starlet will return to screens in the fifth season of the mega-hit, which is set to premiere Nov. 13.
32 year old Q’Orianka Kilcher, who lives in North Hollywood, has been charged with two felony counts of workers’ compensation insurance fraud.
According to the report published by the California Department of insurance, while acting in the movie “Dora and the Lost City of Gold,” Kilcher allegedly injured her neck and right shoulder In October 2018. She saw a doctor a few times that year, but stopped treatment and did not respond to the insurance company handling her claim on behalf of her employer.
A year later, in October 2019, Kilcher contacted the insurance company saying she needed treatment. Kilcher told the doctor handling her claim that she had been offered work since her injury occurred but had been unable to accept it because her neck pain was too severe.
However an investigation found Kilcher had worked as an actress on the television show “Yellowstone” from July 2019 to October 2019, despite her statements to the doctor that she had been unable to work for a year.
It remains to be seen if this worker’s compensation criminal case will have the media attention, and intrigue, of the recently concluded Johnny Depp case. Kilcher appears to have hired a dream team of defense lawyers who are capable of a vigorous defense, and she and her attorneys have announced plans to conduct her case in such a high profile -media worthy- manner.
State Compensation Insurance Fund has reduced the number of opioid prescriptions for the injured workers they provide care for by 82% since 2014.
Additionally, over the course of the COVID-19 pandemic between 2020 and 2021, State Fund’s opioid reduction program resulted in a 14% decrease in the number of opioid prescriptions for injured workers, despite increasing levels of opioid use and overdose fatalities across the nation as reported by the National Institute on Drug Abuse 2022.
State Fund’s opioid reduction program is built around a comprehensive strategy to motivate physicians to avoid or reduce prescribing opioids to injured workers, and to educate injured workers about the risks of using opioids to manage pain.
The program focuses on three key areas, including early prevention and intervention in new cases; relapse and delayed recovery response programs; and reduction of chronic opioid usage in existing cases.
The program also includes peer-to-peer physician reviews; education for injured workers and treating physicians; and support for patients who are struggling to stop opioid use. Additional results include:
– – From 2014-2021, State Fund saw a nearly 80% decrease in the number of claimants on any opioid prescription and a 4.6% decrease from 2020-2021
– – The number of patients taking high doses of opioids (80+ MEDs) for more than three months has decreased by 91% from 2014-2021 and decreased by 11% from 2020-2021
“State Fund’s approach to reducing opioid use has continually been fine-tuned over the years,” said Dr. Dinesh Govindarao, chief medical officer at State Fund.
“Our results show that conscious, sustained education for patients and medical providers, paired with peer-to-peer physician collaboration, are invaluable tools in tackling the opioid crisis. Our hope is to see more providers adopt reduction programs, whether they take a comprehensive approach like ours or focus on specific issues.”
State Fund’s opioid reduction program is one way the organization works to fulfill its promise to protect and restore injured workers and help keep California working.
On Labor Day, Gavin Newsom signed the Fast Food Standards and Accountability Recovery Act – Assembly Bill 257 – giving the state’s 550,000 fast food workers a seat at the table and bargaining power.
In his signing statement Newsom said the new law “gives hardworking fast-food workers a stronger voice and seat at the table to set fair wages and critical health and safety standards across the industry. I’m proud to sign this legislation on Labor Day when we pay tribute to the workers who keep our state running as we build a stronger, more inclusive economy for all Californians.”
In the process of passing this law, the legislature specifically found that “For years, the fast food sector has been rife with abuse, low pay, few benefits, and minimal job security, with California workers subject to high rates of employment violations, including wage theft, sexual harassment and discrimination, as well as heightened health and safety risks.”
The legislature went on to establish its remedy. This new law will establish the Fast Food Council within the Department of Industrial Relations until January 1, 2029. It will be composed of 10 members to be appointed by the Governor, the Speaker of the Assembly, and the Senate Rules Committee, and would prescribe its powers.
The 10 members include one from the Department of Industrial Relations. Two representatives of fast food restaurant franchisors. two representatives of fast food restaurant franchisees. Two representatives of fast food restaurant employees. Two representatives of advocates for fast food restaurant employees. And one representative from the Governor’s Office of Business and Economic Development.
The code defines a “Fast food chain” to mean “a set of restaurants consisting of 100 or more establishments nationally that share a common brand, or that are characterized by standardized options for decor, marketing, packaging, products, and services.”
The purpose of the council is to establish sectorwide minimum standards on wages, working hours, and other working conditions related to the health, safety, and welfare of, and supplying the necessary cost of proper living to, fast food restaurant workers.
If a conflict exists between council’s standards, rules, or regulations and those issued by another state agency, the standards, rules, or regulations issued by the council would apply to fast food restaurant workers and fast food restaurant franchisees and franchisors, and the conflicting rules or regulations of the other state agency would not have force or effect with respect to these parties.
The Act would except from this application proposed standards within the jurisdiction of the Occupational Safety and Health Standards Board and would prescribe a process for the council to petition the board to adopt, amend, or repeal a standard.
The council must submit a report to the Legislature for a standard, or repeal or amendment of a standard, to become effective, and would specify that a standard, repeal, or amendment shall not take effect before October 15 of the same year.
A fast food restaurant operator is prohibited from discharging or in any manner discriminating or retaliating against any fast food restaurant employee for specified reasons, and would create a cause of action and right to reinstatement for employees in this connection, as well as a presumption of unlawful discrimination and retaliation in certain circumstances.
The law received widespread support from labor unions and worker advocacy organizations, with Mary Kay Henry, the president of the Service Employees International Union (SEIU), arguing that the bill addresses “challenges that workers have faced when trying to change policies by unionizing store by store.”
The law was opposed by franchise owners, fast food companies and the California Restaurant Association. Joe Erlinger, the President of McDonald’s posted an open letter which opposed the law, and he claimed “Economists say it could drive up the cost of eating at a quick service restaurant in California by 20% at a time when Americans already face soaring costs in supermarkets and at gas pumps.”
Musculoskeletal disorders (MSDs) are the most common workplace injury, impacting both employee wellbeing and business efficiencies – and the world’s top employers are taking action. Since launching the MSD Pledge three months ago in collaboration with Amazon, the National Safety Council proudly reports today more than 100 leading organizations have made a commitment to create safer outcomes for millions of workers worldwide by reducing MSDs by 25% by 2025.
The MSD Pledge was developed by the Council’s MSD Solutions Lab, a groundbreaking initiative established in 2021 with a mission to prevent MSDs by engaging key stakeholders, conducting research and sharing innovative solutions to benefit all workplaces and workers. In total, the more than 100 MSD Pledge members represent upwards of 2.6 million employees across every major global continent. By signing the pledge, these organizations commit to:
– – Analyze the causes of MSD injuries and invest in solutions and practices that reduce risks to workers
– – Leverage innovations and share learnings that improve safety practices
– – Build a culture of safety where everyone, at every level, is accountable for the safety and health of workers
– – Collectively reduce MSD risk and subsequent injuries across the pledge community by 25% by 2025
“While the business impact of MSDs is undeniable – amounting to billions of dollars every year in lost wages, compensation and productivity costs – the human toll of these injuries is even more significant. We could not be prouder to have so many top organizations step up and join us in this vitally important effort to ensure workers everywhere return home safely every day,” said Lorraine Martin, NSC president and CEO. “NSC has a longstanding record of convening diverse networks to tackle the most pressing safety challenges, and the MSD Pledge, now supported by leaders from nearly every sector and industry, is the latest example of this. Together, we’re spurring meaningful action against MSDs and will create scalable solutions to benefit workers on and off the clock.”
“We’re grateful for the opportunity to work with so many companies to address this important issue,” said Heather MacDougall, vice president of Worldwide Workplace Health and Safety at Amazon. “At Amazon, we are focused on continuous improvement, and we know we can learn from all the other organizations that have signed this pledge. The health and safety of our employees is our top priority and, while we are proud of the advancements we’ve made so far, we look forward to finding even more ways to advance safety across our network.”
“Fostering a culture of safety requires a continuous commitment to taking proactive, collaborative action on the industry’s most complex safety challenges, which is precisely what the MSD Pledge represents,” said Carla Davis-Madgett, Boeing’s Environment, Health & Safety vice president. “At Boeing, nothing is more important than safety – from the products we design and build to the teammates we empower across our entire enterprise. Joining this pledge not only affirms our existing dedication to employee wellbeing but equips us with unparalleled access to a network of forward-thinking leaders, resources and information to enhance our safety innovation leadership.”
The MSD Pledge is one of several initiatives launching this year by the MSD Solutions Lab to prevent workplace MSDs worldwide, including:
– – Advisory Council: Experts in safety, health, ergonomics and innovation support and inform the program’s work by engaging in, researching, solving, and amplifying MSD prevention efforts. New members will continue to join the advisory council to provide guidance.
– – MSD Research: Comprehensive research efforts to explore current and future MSD prevention-related strategies will be available to all industries to explore and glean insights, with the lab’s first white paper being released shortly.
– – Innovation Challenges: The lab will host its inaugural Safety Innovation Challenge at the 2022 NSC Safety Congress & Expo, where cutting-edge technology solutions focused on risk prevention and elimination of workplace MSDs will be showcased.
– – Small Business and University Grants: Provide grants to small businesses, universities and students to fund research and innovation that help companies of all sizes achieve impact.
To learn more about the MSD Pledge, the MSD Solutions Lab, and the risks associated with MSDs, visit the NSC website.
A gender discrimination class action lawsuit has just been filed in California against Amazon, which alleges its fulfillment centers are tailored for men, making it difficult for women to reach items on an 8 foot automated pod used in its fulfillment warehouses.
The lead plaintiff in this case is Amy Fujishige a woman, five feet in height, who worked for Amazon at its Fulfillment Center in Sacramento, California from about September 16, 2020, through about July 8, 2021 as a picker and counter. Fujishige alleges she began to run into issues regarding her Productivity Score almost immediately. Being five feet tall, she was not able to pick and scan items at the top of each pod without assistance from a Process Assistant or violating the safety policy against overreaching for items over her head.
But she had to meet the strict Productivity Score standards and stay out of the bottom 5% of Productivity Scores, Thus she would often try to grab highup items without using the stepladder to keep the amount of time spent retrieving an item at a minimum. When caught doing so, she would be reprimanded by a Learning Ambassador or people from the safety department for “overreaching.”
Amazon’s fulfillment centers have utilized pods, (i.e., movable stacks of shelves with “bins” of various sizes brought to and from workstations by automated robots) to store items that are “picked” for shipping when orders come in. These pods are eight feet (96 inches) in height.
In her lawsuit she alleges that Amazon has implemented employment policies and procedures at its fulfillment centers that, in operation, discriminate against female employees by inflicting significant adverse impacts upon them when compared to Amazon’s male employees assigned to the same tasks and positions.
Her attorneys allege that on average, in the United States, including California, adult men are significantly taller than adult women, and Amazon unnecessarily places female employees at its fulfillment centers at a significant disadvantage compared to male employees, in effect, punishing them for their generally shorter stature. And the safety policies and Amazon’s Quality and Productivity Performance Policies “are seemingly tailored to the height and strength of the male physique, rather than the female physique.”
Amazon sets targets for productivity each day and ranks warehouse employees by their “Productivity Score” on a weekly basis, which takes into consideration, among other things, the number of units (i.e., warehoused items to be stowed away in pods, counted for inventory, or picked for shipping to customers) scanned per hour.
Employees who need to use the stepladders or to wait for the assistance of Process Assistants more often allegedly will take more time to complete a task, on average, than those who do not, lowering the “Units Per Hour” or “UPH” and increasing their “Time Off Task” or “TOT”. This allegedly “confers an advantage to taller people over shorter people in achieving higher Productivity Scores.”
She goes on to allege that essentially “these policies and procedures operate to unfairly punish the bottom 5% of Amazon’s warehouse employees ranked by Productivity Scores, eventually culling them from the employment roster. Those subject to this cruel policy of decimation are disproportionately women due to their overall smaller stature compared to men in the general population. This includes Plaintiff, who stands five feet tall and was disciplined and eventually terminated for her low Productivity Scores.”
Ms. Fujishige claims she raised these issues to her managers whenever she was disciplined and written up for being the bottom 5% of Productivity Scores.
“Defendants have discriminated against Plaintiff and the putative class of similarly situated female employees in violation of FEHA because Amazon’s policies subjected them to different and adverse employment actions as a result of their sex, and they have suffered disparate impacts as a result of Amazon’s Quality and Productivity Performance Policy, including but not limited to its policies or practices regarding UPH, TOT, and Productivity Scores, in conjunction with the design of its pods and safety policies and procedures at its fulfillment centers.”
The Food and Drug Administration recently granted marketing authorization for an anterior cruciate ligament (ACL) implant, intended to serve as an alternative to ACL reconstruction to treat ACL tears. The FDA granted the marketing authorization to Miach Orthopaedics, Inc.
The device, the Bridge-Enhanced ACL Repair (BEAR) Implant, unlike traditional reconstruction, does not require the use of harvested tendons for ACL repair and is the only currently- available alternative to reconstruction with allograft, autograft or suture-only repair for the treatment of ACL rupture.
And the San Diego Union Tribune reports that Jenna Richardson of Oceanside, was the first in the area to choose BEAR over reconstruction after tearing her ACL while mountain biking in July. After reading every study she could find, the medical sales representative said she liked the idea of avoiding the ligament harvesting process which requires an additional incision and increases the amount of rehabilitation necessary after surgery. She also shied away from replacement with tissue from a deceased organ donor after several friends who went that route experienced additional tears.
Dr. Tim Wang, an orthopedic surgeon and sports medicine specialist at Scripps Clinic, performed the procedure on Aug. 22, making Richardson the first patient in San Diego County to undergo BEAR repair. “The early data and research shows that it’s as good as our standard of care with a potential for faster muscle recovery,” Wang said.
The ACL, a ligament stretching from the front to the back of the knee, aids in keeping the knee stable. Despite being a very common injury, until today, the only surgical treatment available for torn ACLs has been ACL reconstruction using allograft, autograft or suture-only repair.
Professional athletes are likely to continue going the reconstruction route for some time to come, said Dr. Tal David, a San Diego orthopedic surgeon whose practice often includes pro athletes.
As the only other surgeon in the county approved to perform BEAR procedures, David said that it’s difficult to recommend something brand new when a person’s livelihood hangs in the balance and the existing standard yields very good results.
“We’ve done many, many thousands of reconstructions over many years, and the risk of retearing is around 5 percent,” David said. “For professional athletes, I would say it’s about a predictable outcome.”
On the other hand, there are clear advantages to repair. In addition to avoiding a harvesting procedure David said that healing in place may prove better for recovery of the nerves that allow the body to sense knee position.
The BEAR Implant is a resorbable implant – meaning it is absorbed by the body – made from bovine collagen and is secured via suture to bridge the gap between the torn ends of a patient’s ACL. The patient’s own blood is injected into the implant during the surgical implantation procedure with the intent of forming a device-protected clot that enables the body’s healing process. Within about eight weeks of the BEAR Implant surgical procedure, it is absorbed and replaced by the body’s own tissue.
The BEAR Implant is indicated for skeletally mature patients at least 14 years of age with a complete rupture of the ACL, as confirmed by MRI. Patients must have an ACL stump attached to the tibia to construct the repair.
Dr. Martha Murray’s research on the development of the company’s BEAR® Implant was selected for the 2022 Orthopaedic Research and Education Foundation (OREF) Clinical Research Award. The award for “Bridge-Enhanced ACL Restoration: Translation from Academic Lab to FDA Approval” was presented at the Orthopaedic Research Society Annual Meeting Feb. 6 in Tampa Bay, Florida.
A neurosurgeon pleaded guilty to a federal criminal charge for accepting approximately $3.3 million in bribes for performing spinal surgeries at a now-defunct Long Beach hospital whose owner later was imprisoned for committing a massive workers’ compensation system scam.
55 year old Lokesh Tantuwaya, who lives in San Diego, pleaded guilty to one count of conspiracy to commit honest services fraud and to violate the federal Anti-Kickback statute. He has been in federal custody since May 2021. He was initially free after he was ordered to hand over his passport, a million dollars and the jet.
Later it was ruled he was a flight risk and confined him to Santa Ana jail only after federal agents learned he’d purchased his own private plane and had discussed “fitting it with an extended fuel tank, just in case he needed to go far away,” according to a motion to revoke bond.
According to his plea agreement and statements at his change-of-plea hearing, from 2010 to 2013, Tantuwaya accepted money from Michael Drobot, who owned Pacific Hospital in Long Beach, in exchange for Tantuwaya performing spinal surgeries at that hospital. The bribe amount varied depending on the type of spinal surgery.
Pacific Hospital specialized in surgeries, especially spinal and orthopedic procedures. Drobot conspired with doctors, chiropractors and marketers to pay kickbacks and bribes in return for the referral of thousands of patients to Pacific Hospital for spinal surgeries and other medical services paid for primarily through the California workers’ compensation system. During its final five years, the scheme resulted in the submission of more than $500 million in medical bills for spine surgeries involving kickbacks.
Tantuwaya entered into contracts with Drobot and Drobot-owned companies. Tantuwaya admitted in his plea agreement that he knew or deliberately was ignorant that the payments were being given to him in exchange for bringing his patient surgeries to Pacific Hospital. In furtherance of the scheme, Tantuwaya met with Drobot and Drobot’s employees. Tantuwaya further admitted to depositing bribe checks into his bank accounts.
Tantuwaya admitted that he knew the receipt of money in exchange for the referral of medical service was illegal and that he owed a fiduciary duty to his patients to not accept money in exchange for taking their surgeries to Pacific Hospital.
In total, Tantuwaya received approximately $3.3 million in illegal payments.
In April 2013, law enforcement searched Pacific Hospital, which was sold later that year, bringing the kickback scheme to an end. To date, 23 defendants have been convicted for participating in the kickback scheme.
Tantuwaya, was also named as a defendant in a civil federal lawsuit ( 8:13-cv-00956-AG-CW) filed by the State Compensation Insurance Fund involving a workers’ compensation fraud scheme at the Pacific Hospital of Long Beach.
The Los Angeles Times recently ran a feature story about how the California Medical Board protects negligent doctors. The Times cited at least ten California physicians, including Tantuwaya, as examples. The article pointed out that “license remains valid as he sits in jail awaiting trial.”
United States District Judge Josephine L. Staton scheduled a December 9 sentencing hearing, at which time Tantuwaya will face a statutory maximum sentence of five years in federal prison.
The FBI, IRS Criminal Investigation, United States Postal Service Office of Inspector General, and the California Department of Insurance investigated this matter. Assistant United States Attorneys Joseph T. McNally and Billy Joe McLain of the Violent and Organized Crime Section are prosecuting this case.