Federal Jury Sides With Whistleblower Against Bloomington Company

BLOOMINGTON, MN — A Bloomington-based lens company will be penalized more than $43 million after a federal civil jury sided with prosecutors and a whistleblower, the U.S. Attorney's Office announced Tuesday.

Precision Lens and its owner, Paul Ehlen, paid illegal kickbacks to ophthalmic surgeons in exchange for products that would be reimbursed by Medicare, according to prosecutors.

Ehlen and his company's actions violated the federal False Claims Act and Anti-Kickback Statute, the jury agreed Tuesday.

In the course of the kickback scheme, Precision Lens filed 64,575 false claims to Medicare between 2006-2015, authorities said.

Whistleblower Kipp Fesenmaier originally brought the civil lawsuit and will receive a percentage of the money awarded at trial.

According to prosecutors, Precision Lens and Ehlen provided kickbacks to physicians in various forms, including:

• Use of a private jet
• "Exclusive" and "high-end" skiing, fishing, golfing, hunting, and sporting vacations
• Trips to New York City to see a Broadway musical, the College Football National Championship Game in Miami, and the Masters Tournament at Augusta National Golf Club
• The sale of frequent flyer miles

"The False Claims Act and the Anti-Kickback Statute provide assurance to the United States and Medicare beneficiaries that healthcare decisions are made based on the best interest of the patient and nothing else," said Assistant U.S. Attorney Chad Blumenfield in a news release.

"The jury’s verdict protects the integrity of the Medicare system for patients and those healthcare providers who operate fairly and legally. Companies may not use expensive trips and other items of value to persuade physicians to use their products, and physicians may not accept that remuneration. We thank the jury for its service throughout this lengthy trial."

Precision Lens maintained a secret slush fund to maintain its kickback scheme, prosecutors said.

"The government often relies on whistleblowers to bring fraud schemes to light that might otherwise go undetected," the U.S. Attorney's Office said.