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Published: January 13, 2009
“The federal government was the one defrauded”
Whistleblower in alleged Planned Parenthood over-billing swindle appeals judge’s dismissal of federal lawsuit
 A former executive of Planned Parenthood-Los Angeles has filed an appeal of a federal judge’s dismissal of his whistleblower’s lawsuit against all Planned Parenthood affiliates in California and their statewide political action arm, Planned Parenthood Affiliates of California. The suit alleges the nine affiliates and PPAC knowingly engaged in a scheme to defraud state and federal taxpayers out of more than $180 million by deliberately over-billing the Medi-Cal program for contraceptives Planned Parenthood purchased at a deep discount.
On Jan. 5, attorneys for Victor Gonzalez, former vice-president for finance and administration of Planned Parenthood-Los Angeles, filed a notice of appeal with the Ninth U.S. Circuit Court of Appeals of a decision by Judge A. Howard Matz dismissing Gonzalez’s suit.
On Oct. 30, 2008, Matz ruled that Gonzalez did not qualify as a whistleblower under federal law because he was not the “original source” of information exposing the alleged Planned Parenthood fraud. Based on that ruling, on Nov. 14, 2008, Matz entered a judgment in the suit finding in favor of Planned Parenthood and against Gonzalez.
Since Gonzalez had “not shown that he is an original source of the over-billing allegations,” the federal district court lacked jurisdiction over Gonzalez’s whistleblower suit under the federal False Claims Act, said the judge’s ruling. Matz said an August 2004 report to the state senate’s Health and Human Services Committee had already made public Planned Parenthood’s over-billing practices before Gonzalez filed his claim.
In legal documents filed with the Ninth U.S. Circuit Court of Appeals, Gonzalez’s attorneys are asking the appellate panel to review the “original source” status of Gonzalez and to determine whether a report to a state legislative committee “qualifies as a public disclosure under the False Claims Act.”
Gonzalez secretly filed the lawsuit under the federal False Claims Act in U.S. District Court in Los Angeles in 2005. The suit was unsealed in 2008 following a prolonged review by the U.S. attorney’s office, which decided not to intervene in the case. Gonzalez worked for Planned Parenthood of Los Angeles from Dec. 9, 2002 until he was abruptly fired on March 9, 2004.
Gonzalez alleges he was fired for bringing "illegal accounting, billing and donations practices” to the attention of his superiors. The False Claims lawsuit alleges that Planned Parenthood’s irregular billing practices began in the late 1990s and continued until 2004, when Planned Parenthood was able to persuade the state legislature to change the law and allow it to bill the higher rates.
“The complaint documents what we believe is evidence of extensive, organized fraud by Planned Parenthood in California,” said Jack Schuler, Gonzalez’s attorney, in a prepared statement. “A previously buried and ignored California Department of Health Services 2004 Audit, which found more than $5 million in egregious over-billing in two years by the San Diego/Riverside Planned Parenthood affiliate, is an extraordinary indictment against Planned Parenthood. Here is the ultimate Hollywood movie set façade of a corporation that poses as charitable while grossly over-billing government programs funded to service the needy, not the greedy.”
According to Schuler, Planned Parenthood bought contraceptives and other medicines at deeply discounted rates because of their status as a charity, “then billed the state Medi-Cal program for 12 or more times their purchase price.” Both state and federal law explicitly prohibited such over-billing until the California legislature changed state law in 2004 at Planned Parenthood’s request, but after the fact of the earlier over-billing. The state has decided not to seek recovery of the millions in over-billing by Planned Parenthood before the 2004 change in the law.
But, said Schuler, the change in California law may be immaterial. “The federal government was the one defrauded and the federal government was not noticed until Mr. Gonzalez blew the whistle,” Schuler told California Catholic Daily in November. “This was a scheme by Planned Parenthood and its allies to cover up a fraud and Mr. Gonzalez blew the whistle.”
Posted Tuesday, January 13, 2009 12:08 AM By Dan
So when did California, mired in debt, require PP to repay the amount they defrauded the state? The editor replies: State health officials long ago decided not to pursue collection of the PP debt.
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Posted Tuesday, January 13, 2009 12:17 AM By Charles O'Connell
However this turns out, God will use it to help wake up the American people that PPFA & its various affiliates are intrinsically fraudulent. They seek to depreciate the influence of families & Churches, to drive a wedge between parents & children. This is the diabolical become banal. PPFA is widely regarded as a commendable civic organization, much as the KKK was thought of as a genteel civic booster at a time when its members were part of the old aristocracy. But a review of PP-Southwest Texas records recovered from a dumpster in the 1980s shows that their goal of reducing minority & poor populations is backfiring - the greatest utilizers of their 'services' are the same middle-class European-American people who have long been their most substantial supporters - the old Race Suicide pattern as it was described by Theodore Roosevelt in 1903. In the end, the serpent eats its own tail.
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Posted Tuesday, January 13, 2009 6:30 AM By St. Christopher
Much of the legal system is corrupt. Hopefully, Mr. Gonzalez will ultimately be successful, although the FCA is full of hurdles to inhibit individual plaintiffs.
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Posted Tuesday, January 13, 2009 6:53 AM By ted
The Federal Government being defrauded is a common thing, but it's ultimately taxpayers who got taken to the cleaners. had the government not been supporting PP, it could not have happened. Let us hope and pray that this type of case prompts the taxpayers' represenatatives to defund this evil organization entirely. They should never have been given a single dollar by those who have no choice whether or not to support evil.
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Posted Tuesday, January 13, 2009 7:25 AM By Angelo
I admire the work of pro-lifers. Its spreading like fire.
The ugly face of planned parenthood is being revealed.
They now seem to be what they really are. Some form
of a Secret Society seeking death. I Pray God give pro-lifers
wisdom and strenght to bring planned parenthood down.
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Posted Tuesday, January 13, 2009 8:33 AM By John
Why aren't our CA congress members demanding that PP be defunded?
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Posted Tuesday, January 13, 2009 9:42 AM By Camille
Now here is one way for the Governor to regain $5 million that was taken from the public's use and used for the benefit of a privileged private business few. But, no, needed funds have to be slashed from the state budget for ill children and the disabled. Has the Catholic Conference been notified of this egregious action on the part of Planned Parenthood? Have they been requested to demand the return of the people's money for the "truly underserved?" Let's hear from them about their friends in the lobbying busness.
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Posted Tuesday, January 13, 2009 4:25 PM By AnnCA
"Planned Parenthood is a government funded criminal enterprise" I saw that phrase on another site and it fits!
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Posted Tuesday, January 13, 2009 6:02 PM By JLS
The reason that RICO cannot be used against Planned Parenthood, is that it would include the government racateers who fund it.
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Posted Tuesday, January 13, 2009 6:04 PM By JLS
John, the California congresspeople love and want Planned Parenthood.
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Posted Tuesday, January 13, 2009 10:52 PM By BeauZeau
Questions literally scream out after reading this account: why did the US Atty's office decide not to intervene after a lengthy review? Why did the Calif. legislature change the law in PP's favor, then fail to go after the overbilled amounts prior to the change in the law? Why is PP regarded as a "charity," and who makes that designation? In giving this evil organization "untouchable" status, both the state and federal governments are making suckers out of the taxpayers and laughing about it.
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Posted Thursday, January 15, 2009 11:37 AM By Talitha Kumi
Baby killing genocidal materialist are thieving and lying and deceiving? Really? and Mr Gonzales didn't get the auditors memo to simply 'fahgetabodit'? Pray for, great Catholic warriors in the battlefield that is the Court of Law .
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© California Catholic Daily 2009. All Rights Reserved.
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