On September 30, 2010, The US District Court in Alabama granted the defendants motions to dismiss this case finding that the government’s claim was time barred by the statute of limitations.
The current case of U.S. v. Striker stems from a mass tort settlement in a famous consolidated case of Tolbert v. Monsanto and Abernathy v. Monsanto Co (Abernathy) that involved 20,500 plaintiffs and made national news. The facts state that from 1929 to 1971, Monsanto Company and its predecessors produced polychlorinated biphenyl’s (PCBs) at a chemical plant one mile west of downtown Anniston, Alabama. As a result of an EPA finding that PCB exposure causes cancer, birth defects, still births, etc, mass scale tort litigation erupted across Alabama beginning in 1996. On August 20, 2003 a “global settlement” of $300 million was announced. By mid September 2003, $275 million of the $300 million settlement was deposited into the court established settlement account.
On December 1, 2009, the US Department of Justice, on behalf of the Secretary of Health and Human Services filed a civil action, in U.S. v. Stricker, against the chemical companies named in the Abernathy Settlement, their insurance carriers and subsidiaries, and certain plaintiff attorneys who represented the Abernathy plaintiffs and allegedly received the settlement funds. The U.S. claimed that Medicare made medical payments of $67,156,770.01 on behalf of 907 recipients of the Abernathy settlement prior to settlement, and that under the Medicare Secondary Payer (MSP) Act the defendants where obligated to reimburse Medicare. In addition, the U.S. Government sought double damages plus interest.
On September 30, 2010 Judge Karon Bowdre ruled that the US case was time barred by the statute of limitations and dismissed the case. In her ruling the judge offered a lengthy explanation of how the Federal Claims Collection Act’s statute of limitations applied to the facts in this case. However, in the end she ruled that the government’s claims against the corporate defendants were barred by the 3-year statue of limitations and the government’s claims against the attorney defendants were barred by the six year statute of limitations.
While there are certainly many conclusions one can draw from this case, one thing is overwhelming clear; the days of ignoring Medicare are over. Medicare may have been late and lost this case but make no mistake; they will not be late next time.
To view the US v. Stricker opinion in its entirety, please click here.