Attorney General Eric Schneiderman today announced a $6.2 million settlement in a whistleblower case that alleged Lantheus Medical Imaging Inc. knowingly evaded paying New York state and city taxes.
Schneiderman alleged that Lantheus and its former parent company did not pay applicable New York state business franchise taxes, New York City corporation taxes or Metropolitan Transportation Authority surcharges from 2002 to 2006, when Lantheus was known as Bristol-Myers Squibb Medical Imaging. Meanwhile, they made millions of dollars in sales of its medical imaging products to hospitals, clinics and other facilities, and from its training and servicing activities in connection with its sales, he said.
“Lantheus’ failure to pay these taxes was indefensible,” Schneiderman said in a statement. “It’s simple – corporations doing business in New York are obligated to pay taxes on their earnings, and those companies that fail to do so will be held accountable. This resolution makes a huge difference for hardworking New Yorkers who pay their taxes and play by the rules.”
A tax services provider who became aware of Lantheus’ failure to pay the taxes filed a complaint against the company two years ago in state Supreme Court in Manhattan. Schneiderman’s investigation concluded that the company knowingly failed to pay more than $2.2 million in state and city taxes.
The state’s False Claims Act allows whistleblowers and prosecutors to take legal action against companies or individuals that defraud the government. Those found liable under the law must pay triple damages, penalties and attorneys’ fees. Whistleblowers may be eligible to receive up to 30 percent of any money recovered by the government as a result of the information they provide. In this case, the whistleblower will get $1.1 million and New York City will receive $693,143.
“This settlement demonstrates the enormous good that private whistleblowers, their counsel and our partners in the government can accomplish together for the taxpaying public,” said David Caputo of the law firm Kline & Specter, which represented the whistleblower. “It took courage for our client to come forward, and we applaud the Attorney General’s Office for acting on our client’s information as promptly and effectively as it did in this case.”