Center for Investigative Reporting Covers CPM's Spinal Screw Case
The Center for Investigative Reporting published a 4,000-word article yesterday detailing a Southern California medical equipment supplier’s scheme to use private plane rides, international vacations and cash-stuffed envelopes to recruit doctors to use his company to buy spinal surgery screws – many of which were apparently counterfeit.
CIR reported that Roger Williams’ payments to unscrupulous physicians yielded impressive dividends as his company, Spinal Solutions, LLC, grew into an $18 million-a-year business. Williams, in turn, tapped the now-bankrupt company’s ill-gotten revenue stream to fund his own extravagant visits to strip clubs and the purchase of three personal planes, a 6,300-square-foot mansion, and a yacht he named “Spare Change.”
Mr. Williams profited handsomely from his apparent use of kickbacks to compliant physicians, who in turn ordered Spinal Solutions screws at a steep markup over production cost for surgeries in California, Nevada, Wisconsin, Maryland and Texas, according to CIR. Nevertheless, Williams sought to increase his profit margin further by apparently ordering counterfeit screws from a Temecula machinist. As CIR reported, it is not known how many, if any, of these counterfeit screws were implanted in the backs of patients who underwent spinal surgeries nationwide with implants sold to hospitals by Williams and Spinal Solutions.
This is the same Spinal Solutions – and the same Roger Williams – Cotchett, Pitre & McCarthy clients sued in May 2012 in a qui tam action alleging violations of the California False Claims and Insurance Fraud Prevention acts. As CIR relayed, the case portrays the use of the spinal screws as part of “a larger scheme to bilk California’s workers’ compensation system, an employer-funded program designed to help those injured on the job. Some hospitals billed insurance carriers as much as $12,500 a screw before a 2012 change in state law shut down the astronomical markups. From that, Spinal Solutions stood to reap several thousand dollars from the sale of a single screw.”
CPM attorneys Niall McCarthy, Justin Berger and Ryon Nixon are handling the suit, which is now pending in Los Angeles County Superior Court. In addition to Roger Williams, his wife, Mary Williams, and their company, Spinal Solutions, the suit names Southern California hospitals, hospital executives, spinal-fusion surgeons, and medical equipment manufacturers and distributors as defendants for their contributions to the sprawling scheme to defraud the State of California and its residents. CPM’s clients in the case are two whistleblowers: a former employee of one of the medical-device defendants, and a former employee of two California workers compensation carriers. (As with all qui tam suits brought under federal or state False Claims statutes, cases brought by plaintiffs, or “relators,” under the California False Claims Act are filed for the benefit of the relator and the state government, with recoveries divided between the relator and the State.)
Cotchett, Pitre & McCarthy has also filed multiple lawsuits on behalf of individuals for whom the impact of this fraud is more intimate: patients who are living with these counterfeit, non-FDA-approved spinal fixation implants in their bodies. For example, CPM attorneys Frank Pitre, Alexandra Hamilton, Robert Hutchinson and Joanna LiCalsi filed a case in Los Angeles County Superior Court in July on behalf of a Southern California resident who underwent two surgeries in which doctors apparently affixed counterfeit screws along her spine; these unregulated and potentially harmful devices remain in the plaintiff’s body, as removal would create too great a risk of additional injury or death.