For the first time after 20 years of legal proceedings, the Washington DC District Court, United States, issued a document to the public revealing the testimonies of victims of alleged human rights violations allegedly committed by the ExxonMobil company in Aceh by hiring a number of Indonesian military personnel.

Judge Royce C. Lambert, Tuesday (02/08), issued an 85-page memorandum of opinion containing the testimonies of the victims.

Most of them rejected the ExxonMobil company’s defense of the alleged human rights violations against 11 Acehnese.

The law firm Cohen Milstein Sellers & Toll PLLC, representing the plaintiffs, said the decision could pave the way for prosecuting alleged human rights violations by ExxonMobil.

This US company allegedly hired a number of Indonesian military personnel in the early 2000s to provide security guarantees at their natural gas facilities in Aceh.

The trial judge said the plaintiff’s eyewitness statements and internal ExxonMobil documents would help the jury find evidence whether the soldiers paid for assault, torture, or committed extrajudicial killings.

Will proceed to court

“We are grateful that the Court was moved by the evidence we presented, including dozens of eyewitnesses, and agreed that this ExxonMobil human rights case should go to court,” said Agnieszka Fryszman, lawyer for the plaintiffs and leader of the team of human rights advocates at law firm Cohen Milstein.

“This case has been going up and down the Supreme Court and tied up in pretrial litigation for more than 20 years. This was a major turning point for our client, who had been stuck for so long in hopes of getting justice. We hope to present our evidence to the jury,” Agnieszka said.

ExxonMobil as a defendant in this case has denied all the testimonies presented by the plaintiffs.

After starting a career in advertising working with the voice of Darth Vader, Christina Saler made a pivot into law school and has since dedicated her professional life to rooting out corporate wrongdoing.

Saler, a partner at Cohen Milstein, focuses primarily on shareholder litigation, representing public pension funds and other institutional investors as plaintiffs in class actions against publicly traded corporations and their officers and directors for securities fraud or breaches of fiduciary duty.

One of her current cases is centered around the pricing of prescription medicine. Working with the Ohio Attorney General, Saler and her team have been able to uncover the machinations of pharmaceutical middlemen that have allegedly kept prices of pharmacy drugs artificially high.

While this is something of a departure from her securities work, the prescription pricing cases fit into her ethos and reasoning behind practicing law, which is all about bringing transparency, accountability and lasting change for the public good.

A graduate of Rutgers University Law School, Saler is a Lawdragon 500 Leading Plaintiff Financial Lawyer.

Lawdragon: What do you like most about your practice?

Christina Saler: Over the years, I have forged many long-lasting relationships with the professionals and trustees entrusted with administering and overseeing pension funds for public employees and unionized workers. The public pension fund community is a collegial group with a tremendous responsibility – safeguarding the retirement money for teachers, firefighters, police officers, other public servants and members of trade unions. So I feel honored to have become a trusted client counselor.

LD: What types of matters are keeping you busy these days?

CS: Since 2017, there has been a growing concern about how Pharmacy Benefit Managers (PBMs) have used their position to affect the pricing and availability of prescription drugs. As you can imagine, this is a big concern for state-funded health plans, such as Medicaid and public employee plans, since healthcare costs tend to be one of the largest line items in a state budget.

PBMs provide prescription drug benefits and services to private health insurance plans, self-insured employers and state-run programs. You can think of them as “middlemen” because they negotiate with drug manufacturers on the cost of drugs that will be covered by the PBMs’ health plan clients, and they negotiate with pharmacies the costs to fill the prescriptions. PBMs also develop their own pharmacy networks. Currently, three PBMs – CVS Caremark, Express Scripts and OptumRx – control nearly 80 percent of the prescription drug market and operate with little transparency or accountability to states and consumers.

Independent pharmacists were the first to raise a public outcry about PBMs’ unfair and potentially fraudulent business practices. The pharmacists were feeling financially squeezed. But PBMs’ business practices weren’t only harming independent pharmacies. Our investigations on behalf of state attorneys general across the country have revealed that some PBMs’ abusive drug pricing and fee layering schemes cost many states hundreds of millions of dollars in fraudulent charges.

The complexity of the PBM industry cannot be understated; many of the major players are vertically integrated companies, meaning that a single holding company has wholly owned subsidiaries that are health plan insurers, MCOs, PBMs and/or retail pharmacy chains.

Although working in this space was a shift from my securities practice, it’s because of the strong relationships that I’ve forged over the years that I was in position to help lead this highly specialized work, starting in 2018 as special outside counsel to the Office of the Ohio Attorney General. Since then, our work has expanded considerably. So, right now, we represent many state attorneys general in their investigations of the PBMs servicing their states, have active litigation against OptumRx and Express Scripts in one state, and have settled several matters on behalf of some of these states against Centene Corporation, which is the largest provider of managed care services to state Medicaid programs. We have joined forces with a highly talented small firm in this massive effort. Together, we really are the only ones doing this type of work on behalf of the states.

Our investigations on behalf of state attorneys general across the country have revealed that some PBMs’ abusive drug pricing and fee layering schemes cost many states hundreds of millions of dollars in fraudulent charges.

LD: This sounds like it could have massive implications. How did you first start working with the Ohio AG on this?

CS: In 2018, we were retained by Ohio Attorney General Dave Yost’s Office to assist in his investigation of the State of Ohio’s PBM relationships. Among the Ohio agencies and entities requiring PBM services are the Ohio Medicaid program, which is overseen by the Ohio Department of Medicaid (ODM), the Ohio Bureau of Workers Compensation (BWC), the Ohio Department of Administrative Services (DAS) and the Ohio Highway Patrol Retirement System.

LD: What’s the current status of the cases?

CS: We have two matters in active litigation. Trial against OptumRx is currently set for October 2022. It was, however, the ODM litigation against Centene Corp. filed in March 2021 that was a watershed case.

LD: Tell us about that one.

CS: Ohio’s Medicaid program provides coverage to about 2.9 million Ohioans through Managed Care Organizations (MCOs). One such MCO, Centene’s Buckeye Health Plan, administered its pharmacy benefits and services via its captive PBM, Envolve Pharmacy Solutions. Working closely with the AG’s office, we conducted an extensive investigation and alleged that Centene’s MCO and PBM entities had breached Centene’s provider agreements with ODM, violating Ohio’s statutory law which governs the practices of MCOs.

Three months after we filed the case, on June 14, 2021, AG Yost announced that the litigation was resolved by a $88.3M settlement with Centene Corporation. The settlement, one of the largest in Ohio history, sent a message to PBMs nationwide that they cannot take advantage of the state or patients.

This victory in Ohio was just the start. Since June 2021, we have negotiated nine individual state settlements with Centene worth more than $360M to resolve investigations we had been conducting for those states, and we are working on finalizing several others.

LD: Congratulations. Can you talk about some of the challenges of managing a collection of cases of this magnitude?

CS: These are large, highly complex data- and contract-driven cases which require specific expertise in Medicaid regulations, drug pricing and claims data analysis. So we needed to not only become experts ourselves in this area of the law and fluent in the business practices PBMs deploy, but also assemble a team of industry and data experts to help identify any irregularities in the PBMs’ pricing of drug claims, processing and reporting to the states. Our investigations require a lot of coordination with our clients, too. In addition to working with the state AG’s offices, we also interact with the state agencies that procured the PBMs and utilize their services.

LD: What impact are these efforts having on the industry?

CS: Our work with state attorneys general has put pressure on PBMs. They are fully aware that states are scrutinizing these extraordinarily expensive contracts – and state legislatures are also focusing on the business practices that have put independent pharmacies out of business while PBM profits increased year-after-year. Also, at the federal level, the Federal Trade Commission launched an inquiry into PBMs on June 7, 2022. The FTC’s probe will scrutinize the impact of vertically integrated PBMs on the access and affordability of prescription drugs.

Litigation is an effective way to return money to the states that PBMs improperly charged. But I think legislation is the ultimate long-term solution. These two tools combined are bringing transparency to the industry that should, over time, bring down the cost of drugs to states and individual consumers.

LD: Was there an early experience or mentor who really helped shape the course of your professional life?

CS: I had a wonderful mentor named George Croner at Kohn Swift & Graft, which I joined fresh out of law school. George had attended the U.S. Naval Academy and, when he was in the Navy, he was the guy waving the jets onto the carrier runway. That guy! We worked on a lot of fiduciary duty shareholder rights cases in the context of limited partnerships, as well as a few interesting defamation lawsuits we took to trial against media defendants. George is retired now but was a very practical litigator and a brilliant writer. He took me under his wing and gave me a tremendous amount of responsibility and opportunities as a young associate.

I’m focused on relationships and helping investors and other clients address their losses through litigation in a pragmatic way. I think the “scorched earth” approach to litigation can be very destructive.

When I joined Cohen Milstein in 2017, I had already been practicing for 14 years. I had my own portfolio of work, clients, etc. So, my interests and goals were different. Cohen Milstein is very well known in the institutional investor and public pension community, so the firm offered a significantly bigger platform than I had before, which allowed me to broaden my representation of the clients I brought to the firm. Steve Toll, the managing partner of Cohen Milstein and Lawdragon Legend who brought me to the firm, has been incredibly supportive of my work, especially in developing the PBM matters. I respect his opinion and trust his assessment of delicate matters that have arisen as we’ve worked with the various states. I feel fortunate that I had George to guide me in my early career, and Steve to consult with in the latter part of my career.

LD: How would you describe your style as a lawyer? Or, how do you think others see you?

CS: I think my adversaries see me as very prepared and direct. I’m focused on relationships and helping investors and other clients address their losses through litigation in a pragmatic way. I think the “scorched earth” approach to litigation can be very destructive. Likewise, grandstanding or trying to come across as the smartest person in the room is incredibly unproductive and asserts the lawyers’ personal interests over the clients. Instead, what I strive to do is communicate clearly, build trust and methodically plan a strategy while remaining flexible. I think all of that is critical to the endgame in part because it advances the case and earns respect from opposing counsel and the bench.

LD: If you weren’t a lawyer, what would you be doing now?

CS: I’d be an entertainment agent. Seriously, I was heading in that direction. My first career was in advertising. Before going to law school in 2000, I worked at Tierney, an advertising and public relations agency based in Philadelphia. Our largest client was Bell Atlantic, which merged with GTE Corp. to become Verizon. I managed several creative campaigns, but my primary focus was managing the company’s expansive spokesperson contract with James Earl Jones. Yes, the voice of Darth Vader! In the 1990s, James Earl Jones was the voice and the face of Bell Atlantic, a role he continued to play for Verizon when the companies merged in 1999.

I worked very closely with James Earl for several years, reviewing all the creative and scripts for commercials, contracts, scheduling, personal appearances – everything had to go through me. We spent a lot of time together at the voiceover studio and on shoots, and we developed a great professional relationship and friendship. Of course, best laid plans. I met my husband when I was applying to law schools. He is a lobbyist, and I quickly became immersed in his political network. So, in law school my focus changed to working with public sector clients to get them relief when corporations play too fast and loose with the law.

Consumers accusing Reckitt Benckiser Group Plc of falsely claiming that its Woolite laundry detergent can “renew” or “revive” colors can bring their claims as a class action, a federal judge has ruled.

U.S. District Judge Beth Labson Freeman in San Jose, California ruled Friday that the thousands of consumers’ claims involved the same legal issues, rejecting the British consumer goods giant’s argument that how each consumer interpreted the product’s labeling varied too much among individuals.

. . .

For plaintiffs: Theodore Leopold of Cohen Milstein Sellers & Toll

School board members from five Virginia localities and Richmond’s schools superintendent have signed onto an amicus brief to the Supreme Court of Virginia opposing a former teacher’s claim that he was unlawfully fired for violating his district’s anti-discrimination and anti-harassment policies.

The brief, which was submitted by LGBTQ+ advocacy group Equality Virginia and more than 35 signatories, asks the Supreme Court of Virginia to uphold the King William Circuit Court’s dismissal of former teacher Peter Vlaming’s lawsuit against the West Point School Board.

School board members who joined the brief include those from Arlington, Fairfax and Stafford counties, and the cities of Charlottesville and Falls Church.

“Without clear protections, such as the commonwealth’s model policies for the treatment of transgender students in Virginia’s public schools and West Point’s anti-discrimination and anti-harassment policies, transgender children risk mental, emotional, physical, and sexual harm when they attend school,” the brief states. “Without these protections, transgender students suffer isolation and stigma when they are differentiated from their peers.”

. . .

Last July, Equality Virginia and law firm Cohen Milstein Sellers & Toll filed a separate brief in support of Virginia’s model policies to make schools safer and more inclusive for transgender students.

The two said in a joint statement on Wednesday that the West Point School Board must treat its transgender students equally, including by ensuring that staff address transgender students with the names and pronouns that reflect their gender identity.

. . .

“The harm of differentiating transgender students from their peers and failing to affirm their identities is well-established in the courts,” said S. Douglas Bunch, an attorney with Cohen Milstein Sellers & Toll, in a statement.

“Sadly, this effect is magnified when the hostile actor is a teacher,” he said. “School policies, such as one of using pronouns that reflect a transgender student’s identity, are there to mitigate these harms and allow all students to thrive in school.”

Public Company Accounting Oversight Board chair Erica Williams said Thursday the PCAOB is working on updated auditing standards and stricter enforcement and audit firm inspections, a day after Securities and Exchange Commission chair Gary Gensler urged the PCAOB to act faster on new standards.

. . .

Sarbanes-Oxley legacy

Williams also discussed the impact of Sarbanes-Oxley on the audit profession after scandals in the early 2000s involving companies like Enron, leading to the establishment of the PCAOB. “Led by Senator Paul Sarbanes, a Democrat from Maryland, and Representative Michael Oxley, a Republican from Ohio, both parties came together to craft legislation that passed nearly unanimously with strong, bipartisan support,” she said. “And 20 years ago this week, President George W. Bush signed into law the Sarbanes-Oxley Act of 2002. Among other things, the law we refer to today as SOX established the Public Company Accounting Oversight Board, or the PCAOB. For the first time, investors would have an independent audit watchdog putting their interests first.”

. . .

Even some plaintiff attorneys who have sued auditing firms agree that Sarbanes-Oxley has helped, but they still see room for improvement in audit regulation.

“I largely think Sarbanes-Oxley has been a really effective piece of legislation and regulatory reform, which is an odd thing to say these days, but it came at a time when government was working a little bit more effectively,” said Laura Posner, a partner at the law firm Cohen Millstein in New York, who recently won a $35 million settlement in a class action she led against KPMG, where the plaintiffs alleged that KPMG perpetuated a massive fraud by signing off on Miller Energy’s $480 million valuation of its Alaskan oil reserve assets. “But I think it was a necessary reform at a time when the markets were really roiled by what happened with Enron, WorldCom, Adelphi and Global Crossing. We had a lot of major scandals that really rocked investor confidence in the markets, and I think Sarbanes-Oxley went a long way toward bringing back investor confidence in the markets.” 

She cited the establishment of the PCAOB as an important factor. “It was conceptually really important that there was an actual cop on the beat, theoretically, and that there would be some independent oversight for the accounting industry,” Posner told Accounting Today in an interview. “That was important, although the PCAOB has not been without its own scandals, particularly most recently. Although it’s correlation, not causation, we’ve seen a significant reduction in the number of restatements that come out of public companies, but also the size of those restatements. We’re not seeing these mega earth-shattering restatements like we did during that era, and I think that has been largely very beneficial, both for corporations but more importantly for the investors in those corporations.”

Pet owners across the country hit IDEXX Laboratories with a proposed class action Monday in California federal court, accusing the animal health diagnostic services company of abusing its monopoly power and throttling the competition, which purportedly led to artificially inflated prices of test kits.

In a lengthy, 92-page complaint alleging violations of antitrust and numerous state consumer protection laws, pet owners said IDEXX has manipulated the market since 2018 to stake its dominant power in the animal diagnostic test kit space by shifting from distribution agreements to direct-sale, long-term exclusive agreements with veterinary practices.

The switch came after the Federal Trade Commission in 2013 stepped in to stop IDEXX from using exclusive distribution contracts and ordered its future distribution contracts to be nonexclusive and capped at two years, with a one-year renewal provision, the pet owners alleged Monday.

But that did nothing to restore competition, according to the suit.

“As the ink dried on its consent agreement with the FTC, IDEXX pivoted away from the distributor channel and began imposing long-term exclusive dealing contracts directly on veterinary practices as a means of continuing to lock in its dominant market position,” the pet owners alleged.

After the FTC action, IDEXX “upended its entire distribution network,” according to the pet owners. In 2015, the company said in its Form 10-K that it would take orders directly from veterinary practices, then ship the products, invoice, and receive payment for all its single-use rapid test kits and consumables, according to the suit.

These contracts typically run for six years, but IDEXX can lengthen them by including an automatic renewal provision. IDEXX extends most contracts well before their expiration, which ensures the contracts run longer than the six-year term, the pet owners alleged.

The case was brought by pet owners hailing from more than a dozen states, including California, Florida, Arizona, Massachusetts and New York, alleging that IDEXX blocked rivals and would-be competitors from entering the diagnostic testing market, which allowed IDEXX to charge supracompetitive prices for its products.
. . .

The pet owners are represented by Joshua P. Davis, Eric L. Cramer, Michael J. Kane, Andrew C. Curley, Najah A. Jacobs and Daniel Walker of Berger Montague, Brent W. Johnson, Richard A. Koffman, Daniel McCuaig, Daniel H. Silverman and Zachary Krowitz of Cohen Milstein Sellers & Toll PLLC and Jennie L. Anderson and Lori E. Andrus of Andrus Anderson LLP.

Read the article on Law360.

U.S. Department of Justice filed a civil complaint in federal court against Fresenius Vascular Care Inc. alleging that the company billed Medicare and other health plans for more than 1,000 unnecessary procedures in their access centers.

“…For the [Fresenius Vascular Access Centers (FVACs)] located in New York from about January 1, 2012, through June 30, 2018, at least 1,288 out of a total of 2,303 angioplasty procedures among 60 patients (55.92%) were medically unnecessary,” the 54-page, five-count complaint alleges.

The U.S. Attorney for the Eastern District of New York and the U.S. Department of Health and Human Services, Office of Inspector General’s Office of Investigations, which filed the complaint, alleges that Fresenius Vascular Care, a subsidiary of Fresenius Medical Care North America, performed and billed for procedures such as fistulograms and angioplasties to Medicare, Medicaid, Federal Health Benefits Program and TRICARE despite internal documents and a Fresenius-led study showing completing the procedures had little clinical benefit.

. . .

Whistleblower suit

The government filed its complaint after two nephrologists filed a whistleblower lawsuit against Fresenius Vascular Care alleging that the company was billing for unnecessary procedures.

“In their complaint, the whistleblowers allege that the defendants have engaged in a fraudulent scheme to receive government payments for unnecessary surgical procedures and testing,” Cohen Milstein Sellers & Toll PLLC, a law firm representing John Pepe, MD, and Richard Sherman, MD, said in a press release. “The complaint alleges that for many years, once a nephrologist has initially referred a patient with evidence of a clinically significant stenosis to a [Fresenius Vascular Care] facility, and the patient’s vascular access has been treated there, [Fresenius Vascular Care] then continues scheduling periodic follow-up visits every 2 to 4 months indefinitely. … These procedures are performed without evidence of problems in administering dialysis and without a referral by the patient’s nephrologist. Thus, the defendants have no reasonable basis for performing these medically unnecessary procedures and they are not reimbursable by the government health care programs. Nevertheless, defendants have submitted, or caused to be submitted, these fraudulent claims for payment and the government has, in good faith, paid them.”

• Class action closed, except for attorneys’ fee allocation
• Class co-lead counsel ordered to mediation

KPMG LLP’s $35 million settlement to resolve a 2016 securities lawsuit claiming its audit failures allowed Miller Energy Resources to misrepresent the value of key Alaskan oil and gas assets won a federal court’s final approval.

• New York state formally filed a False Claims Act case against dialysis company Fresenius on Tuesday, joining a major whistleblower lawsuit against the provider.
• The suit brought by the Eastern District of New York alleges Fresenius and a subsidiary illegally nabbed hundreds of millions of dollars from the government by performing potentially thousands of medically unnecessary and invasive vascular procedures on late-stage kidney disease patients.
• In June, the Department of Justice joined the lawsuit, which was originally filed in 2014 in New York against Fresenius and its business unit, Azura Vascular Care. Eighteen other states besides New York are included in the lawsuit and could potentially join the case, though a majority have declined to intervene so far.

Dive Insight:

End-stage renal disease patients typically need surgically-created access to their vascular systems to allow adequate hemodialysis to take place. Dialysis units monitor that access and can potentially refer a patient to a vascular access facility for surgery in the event there’s a narrowing in one or more of the vessels used during hemodialysis.

The complaint alleges that for years, Azura — after being referred and treating patients with evidence of narrowing vessels — continued scheduling followup visits every two to four months indefinitely for those patients. During those followups, Azura providers allegedly performed improper angiograms, or X-rays using chemical dye, on patients, along with invasive surgical procedures called angioplasties, without evidence such procedures were necessary and without a referral from a nephrologist.

Fresenius and Azura then submitted claims to programs including Medicare and Medicaid. Medicare covers ESRD treatment for patients regardless of age, spending more than $50 billion annually on the disease.

“I saw firsthand how Fresenius put patients in harm’s way to support their bottom line. The practice of conducting medically unnecessary procedures, especially on such chronically ill patients as those with end stage renal disease, is unethical, unlawful and should be stopped,” said John Pepe, a physician at Richmond University Medical Center and Staten Island University Hospital, in a statement provided to Healthcare Dive.

Pepe is one of the two practicing nephrologists who served as whistleblowers in the case. The other is Richard Sherman, a Rutgers University medical professor and medical director of dialysis at the Robert Wood Johnson University Hospital.

New Jersey, Florida and Georgia are still deciding whether to join the case. Cohen Milstein Sellers & Toll, the legal firm representing the whistleblowers, told Healthcare Dive it’s hopeful that states which have yet to decide to join the case may do so as the litigation proceeds.

The False Claims Act suit alleges that the defendants billed federal programs including Medicare and Medicaid for the cost of procedures, some of which were “risky and often unnecessary.”

The U.S. Attorney’s Office for the Eastern District of New York on Tuesday intervened in a lawsuit against Fresenius Vascular Care, which has been accused of performing unnecessary medical procedures on dialysis patients at outpatient facilities in New York.

The False Claims Act suit alleges that the defendants billed federal programs including Medicare and Medicaid for the cost of the procedures, which were described in the intervenors’ complaint as “uncomfortable, time-consuming interventions … unjustified by clinical and other information amassed by patients’ treating physicians and dialysis clinics.”

The “risky and often unnecessary” procedures included fistulagrams, in which a dye was injected into the patient’s blood vessel to visualize the port and surrounding blood vessels, and angioplasties, in which wires and balloons were inserted into narrowed blood vessels to restore blood flow, according to the complaint.

The complaint also alleged that the defendants falsified medical records to inflate the percentage of blockages within the patients’ veins, improperly justifying the procedures.

Many of the patients, who suffered from end-stage renal disease, were “elderly, disadvantaged members of minority groups” already facing multiple comorbidities, according to the complaint.

. . .

Jeanne Markey, co-chair of Cohen Milstein’s whistleblower and False Claims Act practice, released a statement regarding the intervention.

“When health care providers take advantage of patients’ trust, the government and taxpayers, all in the name of profit, they should be held accountable,” Markey said. “We are grateful to the U.S. Attorney for stepping in to lead this nationwide effort.”