UCLA Settles Whistleblower Case for $10 Million

Date Published:

University of California regents just agreed to pay $10 million to the now-former chairman of UCLA’s orthopedic surgery department to settle a whistleblower lawsuit.

Allegations include that the medical school permitted physicians to accept industry payments that may have impacted patient care, according to the LA Times. The settlement was reached this week in Los Angeles County Superior Court just prior to closing arguments in the whistleblower retaliation case brought by 54-year-old surgeon recruited to UCLA in 2009 to run its orthopedic surgery department.

The lawsuit, filed in 2012, was brought against UCLA, the UC regents, fellow surgeons, and senior university officials. Allegations include that they neglected to respond to the whistleblowers complaints concerning broad conflicts of interest and that they retaliated against him for his bringing the matters to their attention, the LA Times wrote. UCLA denied the allegations, and officials stated that they did not find any faculty wrongdoing or evidence of patient care put in jeopardy. According to the UC system, it paid the whistleblower to avoid the “substantial expense and inconvenience” of additional litigation, according to the LA Times.

The whistleblower testified that his concern heightened when he learned that colleagues with financial ties to medical device makers and other firms could influence patient care or key medical research, the LA Times reported. He also alleged that UCLA ignored the matter because the university would likely benefit financially when medical devices or drugs developed by its physicians proved successful.

One orthopedic surgeon about which the whistleblower complained later testified about receiving $250,000 in consulting fees in 2008 from device maker, Medtronic. The whistleblower told the LA Times, “These are serious issues that patients should be worried about…. These problems exist in the broader medical system and they are not restricted to UCLA.”

The whistleblower said he was pressured to step down as department chair, was denied patient referrals, and was unable to participate in grants and other activities, the LA Times wrote. As part of the settlement, the whistleblower left his position with UCLA faculty. He filed the whistleblower complaint in March 2011.

Chief compliance officer, Marti Arvin, said, the university “thoroughly and objectively investigated those allegations of noncompliance,” adding that. “We were able to determine the vast majority were unsubstantiated.” Two physicians did not meet university expectations in the way in which they handled outside outcome, she said. Dr. Nick Shamie, the orthopedic surgeon who testified at trial about consulting work he conducted for Medtronic and Dr. David McAllister, vice chairman of clinical operations for the orthopedic surgery department, who did not report payments received from the Musculoskeletal Transplant Foundation, wrote the LA Times.

Prior to 2009, just before the whistleblower was hired, the university was criticized by Congress over one of its top spine surgeons who did not report some $460,000 in payments received from Medtronic and other medical companies while researching their products’ use in patients, according to government records, the LA Times reported.

Meanwhile, Dr. Jeffrey Wang, who left the USC Spine Center in 2013, stepped down as head of UCLA’s spine program in 2009 when U.S. Senator Charles Grassley (Republican-Iowa) went public with his not having made disclosures as part of a wider probe into medical conflicts of interest. Some patients are suing Wang and UCLA in state court for negligence, fraud, and malpractice over surgeries involving Medtronic’s controversial Infuse bone graft, according to the LA Times. Also, last year, the UC regents paid $4.5-million to resolve a racial discrimination lawsuit filed by another UCLA surgeon.