The Department of Justice has put another notch on its Yates memo belt in securing a $2 million judgment against a home health provider and its owner personally.
A federal district judge issued the judgment Oct. 20 against Dynamic Visions Inc. and its owner Isaiah Bongam. The court previously granted the DOJ judgment on the issue of liability against Dynamic, and agreed that Bongam should be held personally responsible for Dynamic’s activities, which included forging physician signatures on patient care plans that were submitted to the District of Columbia’s Medicaid program.
The DOJ’s litigation strategy in the False Claims Act lawsuit aligned firmly with the 2015 Yates memo directive to hold individuals personally responsible for corporate fraud. While the court said there wasn’t sufficient evidence to tie Bongam to the forged signatures directly, it instead ruled that Bongam should be held personally liable for Dynamic’s actions because he was in sole control of the corporation.
Holding a person responsible for corporate liability, known as “piercing the corporate veil,” is available when the corporation is determined to be a mere shell or alter ego of a person, and therefore not deserving of the legal protection generally accorded the corporate form.
In this case, the court said not piercing the corporate veil to reach Bongam personally would be an “inequitable result,” citing Bongam’s disregard for corporate formalities and intermingling of personal funds with Dynamic’s accounts.
The judgment itself consisted of $1.5 million in damages and an additional $517,000 in fines for each alleged false claims submission. The DOJ asked for, and the court gave, the maximum $11,000 per claim damages for the 47 false claims that Dynamic submitted to Medicaid based on Dynamic’s egregious behavior.
Bongam is now on the hook for that judgment, unless it’s overturned on appeal. Bongam’s attorney told me that he intends to file an appeal, so stay tuned for an update.