USDC Central District of California
In September 2013, CPM reached a $19.4 million settlement of claims against Diagnostic Laboratories, Inc., the largest provider of laboratory and x-ray services to nursing homes on the West Coast. The case was filed in 2010 by two former employees of Diagnostic Laboratories. The California Attorney General’s office joined the case in late 2011. The lawsuit alleged that Diagnostic Laboratories sought to illegally induce the referral of Medicare and Medi-Cal business by providing nursing homes with significant discounts–discounts that were not passed along to Medicare and Medi-Cal. The case settled 10 days before the start of trial in the United States District Court for the Central District of California.
