On February 8, the U.S. District Court for the District of Minnesota ruled that a $487 million False Claims Act (FCA) damages award entered last year against Precision Lens and its co-founder violated the Eighth Amendment’s prohibition on excessive fines and ordered the judgment reduced by more than half.
A defendant found to have violated the False Claims Act is liable for three times the amount of the government’s damages plus statutory penalties of between approximately $13,000 to $27,000 per false claim. Despite this potentially staggering liability, few courts have found False Claims Act damage awards to violate the Eighth Amendment. Precision Lens adds an important data point to that analysis.
The case arose from allegations that Precision Lens and its owner paid kickbacks to ophthalmic surgeons to use Precision Lens products in cataract surgeries. The allegations included taking physicians on private planes to high-end hunting, sporting, and entertainment events.
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