Jason Marcus and Julie Bracker, Bracker & Marcus, Marietta, Georgia.

When a noted neuroscientist became concerned about pervasive corruption and kickbacks at a Detroit-area hospital system, he was warned he would be “destroyed” if he rocked the boat.

Worried that the local legal community was likely to have pervasive ties to William Beaumont Hospitals, Dr. David Felten went online to find a firm specializing in whistleblower cases and came up with what was then Bothwell Bracker & Vann in Roswell in Georgia.     

The firm filed a False Claims Act complaint in federal court in Michigan in 2010, the first of four qui tam actions in which Felten, followed by three other former employees, leveled allegations including Medicare and Medicaid fraud and violations of the Stark Laws, which bar doctors from self-referring patients to providers with whom the physician or family member has a financial relationship.

Over the next eight years Felten, now 70, lost his job and was blackballed by the medical research community that once hailed him for launching the study of psychoneuroimmunology.

Felton’s complaint in Michigan’s Eastern District Court said a clinical chief warned him to “just go along with the physicians, help them to do what they want, and not create waves or try to be a crusader. If you keep creating waves, you will be destroyed.”

Bothwell Bracker also had its troubles, which exploded in a litigious breakup when nonequity partner Julie Bracker and associate Jason Marcus split off from sole shareholder Michael Bothwell to launch Bracker & Marcus in 2015.    

Felten jettisoned Bothwell, staying with Bracker & Marcus and adding Caplan Cobb partner Michael Caplan to the roster to litigate ongoing retaliation claims against the hospital.

The arrangement paid off last week, when the U.S. Department of Justice announced it reached an $84.5 million settlement with Beaumont Hospital.

Out of that, Bracker said Felten and the other relators are legally entitled to between 15 percent and 25 percent.   

“Dr. Felten was the first to file, so we do have the ‘first to file’ position,” Bracker said.  

A civil suit Bothwell filed in 2015 over his ex-colleagues’ abrupt departure settled in 2017. Bracker said the confidential settlement included terms ensuring there will be no disputes over the ultimate fee distribution.  

In an email, Bothwell also hailed the settlement, citing “thousands of hours and millions of dollars in fees” his Bothwell Law Group put into the case.

“We are very excited that the government has now negotiated this substantial resolution with Beaumont Hospital on the kickback claims, and we think that Dr. Felten and the taxpayers are well served by this result,” Bothwell said.

Under the terms of the settlement, Beaumont signed a five-year corporate integrity agreement with the Department of Health and Human Services’ Office of Inspector General.

In a statement, Beaumont President and CEO John Fox said a new management team that took over the hospital system in 2014 “implemented additional compliance and legal review processes to ensure our effective compliance with the complex regulations applicable to health systems and to provide additional assurance that these types of issues do not arise again.”

“We will continue to work with the HHS to ensure the highest levels of compliance and transparency at all levels of the organization,” it said. “Most importantly, we will continue forward with our focus on our critical mission of delivering compassionate, extraordinary care to our patients, families and the communities we serve.”

From my point of view, this has been a high point of my career because of this relator,” Bracker said. “Dr. Felten had everything to lose, but he just could not stand the corruption he was seeing.”

Caplan said Felton’s retaliation claims are still being litigated.

Dr. Felten’s courage in reporting unlawful conduct to the government subjected him to retaliation and significant reputational harm,” said Caplan in a statement. “We intend to aggressively pursue Dr. Felten’s rights and obtain a full recovery on his behalf.”