U.S. Supreme Court leans toward SEC's power to recover ill-gotten gains

REUTERS

U.S. Supreme Court justices on Tuesday appeared inclined to back the Securities and Exchange Commission’s power to use federal courts to force defendants to surrender profits obtained through fraud as part of enforcement of investor-protection laws.

The nine justices heard an appeal by California couple Charles Liu and Xin Wang contesting a 2016 civil action brought against them by the SEC in federal court. They were ordered to disgorge almost $27 million, the amount they raised from foreign investors for a cancer treatment center that was never built. read more »

False Claims Act Lawsuit against Drug Maker Mallinckrodt

DEPARTMENT OF JUSTICE

The United States filed a complaint under the False Claims Act against Mallinckrodt in the U.S. District Court for the District of Massachusetts, the Department of Justice announced today.  The government alleges that Mallinckrodt has violated the False Claims Act by knowingly underpaying Medicaid rebates due as a result of large increases in the price of its drug

The allegations that are the subject of the government’s complaint were originally alleged in a case filed under the whistleblower, or qui tam, provision of the False Claims Act.  The act permits private parties to sue for fraud on behalf of the United States and to share in any recovery. read more »

Mallinckrodt's stock plunges after report of DOJ suit for alleged underpayment of Medicaid rebates

MARKETWATCH

Shares of Mallinckrodt plummeted 26% in afternoon trading Tuesday after Dow Jones Newswire reported that U.S. regulators has sued the specialty drug maker's subsidiary for allegedly underpaying Medicaid rebates. read more »

Herbalife sets aside $40M in FCPA probe

COMPLIANCE WEEK

Dietary supplement maker Herbalife said in a regulatory filing it has set aside $40 million in accrued liability concerning an investigation into the company’s compliance with the Foreign Corrupt Practices Act in China. read more »