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Kmart whistleblower to receive $9.3 million in settlement

Kmart's financial struggles over the past few years have been well publicized. The retail outlet has closed hundreds of stores, with 45 more scheduled to lock their doors in early 2018. (According to the retailer’s website, it currently has 8 Wisconsin stores, including one a few miles south of Milwaukee.) So it's understandable that executives looked for ways to increase income for the chain.

One revenue-enhancer has come to a stop for the once-formidable retailer, however. Kmart Corp. has agreed to pay more than $32 million to settle claims that its pharmacies overbilled Medicare and Medicaid for generic drugs, the Department of Justice said. The whistleblower lawsuit stated that Kmart failed to report discounted drug prices to federal and state health care programs.

“This settlement should put pharmacies on notice," said the acting assistant attorney general for the Justice Department’s Civil Division. "There will be consequences if they attempt to improperly increase payments from taxpayer-funded health programs by masking the true prices that they charge the general public for the same drugs."

The man who blew the whistle on Kmart and filed the suit alleging False Claims Act violations is set to receive $9.3 million out of the settlement. He pursued the case against the retail giant even after the federal government declined to intervene, Bloomberg reported.

“The settlement shows we were right to continue to litigate the case, even though the government declined to intervene,” said the man's attorney. "We felt it was important to pursue because the alleged fraud was costing government healthcare programs many millions of dollars."

As we can see from this case, it is possible not only to proceed without government intervention, but also to triumph.

Those who know of fraud committed against the federal government can speak with an attorney experienced in providing skilled representation in qui tam cases.

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