May 1, 2024 News

Berger Montague Defeats Multiple Motions to Dismiss in Case Alleging NIH Grant Fraud

Berger Montague PC is pleased to announce that having defeated defendants’ motions to dismiss, its whistleblower case will proceed against Magee-Womens Research Institute and Foundation (“Foundation”) and the University of Pittsburgh (“University”) for alleged grant fraud against the National Institutes of Health (“NIH”). This is a significant victory in a case that the government declined to prosecute. This is the second major victory in less than a month for Berger Montague’s False Claims Act, Qui Tam, & Whistleblower Group, chaired by Sherrie Savett, which recently secured affirmative partial summary judgment against CVS Caremark in a case involving overcharging for Medicare Part D prescriptions.

This case is brought in the United States District Court for the Western District of Pennsylvania under the False Claims Act, which allows private whistleblowers to bring claims on behalf of the government to recover for fraud against the government.

The whistleblower’s allegations involve the mishandling of many millions of dollars in taxpayer-funded grants the Foundation received from NIH for medical research about women’s health, which was conducted in collaboration with University scientists. The whistleblower alleges that the Foundation fraudulently induced NIH to award grants and disburse funds by falsely certifying that the Foundation’s accounting systems complied with relevant guidelines and regulations, even though its accounting systems were, among other things, unable to trace budget expenditures, produce accurate monthly reports or verify that the grant funds were properly spent. She also alleges that the Foundation and University conspired to improperly transfer federal grant funds earmarked for specific projects to cover unrelated cost overruns in other grants and thus misrepresented the services provided pursuant to the federal grants. In the Court’s April 24, 2024 Opinion, the Court found that these claims were well-pleaded and could proceed to discovery, finding that the Foundation’s accounting system was “anything but” sufficient and “cost transfers from non-federal accounts to federal accounts were widespread and improper.”

The whistleblower also alleges that she was terminated from her position at the Foundation mere hours after reporting False Claims Act violations to her superiors. This claim will also proceed.

The Berger Montague team is led by Sherrie Savett, and includes William Fedullo, Joy Clairmont, Barbara Podell, and Will Ellerbe. The attorneys are supported by paralegal David Filbert and legal assistant Connie Simon. The Firm is co-counsel with Emily Lambert of the Lambert Law Office and Kathryn Schilling of Schilling Law.

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