Stryker Sues Justice, HHS for Damaging Subpoenas

Stryker is suing the federal government for issuing what it claims were “oppressive and over-broad” subpoenas to harass the company and harm its business.

The company filed suit against the Justice Department and HHS in the U.S. District Court for the District of New Jersey over government-issued subpoenas that were part of an investigation into whether the corporation paid bribes or submitted false claims for Medicare and Medicaid reimbursement.

“Stryker’s business has been and continues to be injured by Defendants’ abuse of process,” the suit says. The company claims in court documents that the government continually issued subpoenas despite overwhelming and compelling evidence that Stryker did not commit any violations.
 
Last October, Stryker and four of its competitors settled with the U.S. attorney for the District of New Jersey over an earlier investigation into whether the companies paid surgeons kickbacks for using their devices. As part of the settlement, Stryker, Zimmer, Biomet, DePuy Orthopedics and Smith & Nephew agreed to permit government-appointed external monitors to oversee contracts between each company and its consulting surgeons for 18 months.

At the same time, the government entered into deferred prosecution and corporate integrity agreements with Stryker’s four competitors, which paid a total of $310 million in fines. While Stryker consented to federal monitoring, it did not agree to pay the fines, the suit says.

The government entered a nonprosecution agreement with Stryker because the firm had voluntarily cooperated with the investigation before any of the other companies, a Stryker representative said.