This settlement resolves allegations that Newark Manor provided substandard and worthless care to residents of the nursing facility.

Attorney General Kathy Jennings announced today that the State of Delaware has reached an agreement with Newark Manor Nursing Home (also known as Premiere Healthcare, Inc.), its owner Bruce Boyer, administrator David Boyer and former administrator Susan Comegys, to settle allegations that Newark Manor: (1) provided substandard and worthless services to its residents; (2) inaccurately reported certain residents’ clinical conditions; (3) failed to provide adequate staffing to provide resident care; and (4) failed to prevent harm to its residents. Newark Manor is a privately owned for-profit intermediate care nursing facility in Newark and licensed by the State of Delaware.

“Elderly nursing home residents are among the most vulnerable citizens of Delaware. We are committed to holding facilities accountable and will not tolerate substandard care, or an unsafe environment, for residents of facilities. Today’s settlement holds Newark Manor and its owner responsible for the substandard care provided and sends a message that we will continue to hold facility owners responsible for resident care provided throughout Delaware,” said Attorney General Jennings.

The civil settlement resolves allegations that, from 2011 through 2017 Newark Manor:

1. 1. persistently failed to provide adequate nursing care including supervision to vulnerable residents of Newark Manor, causing falls, fractures, and other significant injuries;
   2. failed to meet the required daily care hours per resident;
   3. failed to act on monthly pharmacy recommendations, and supply prescribed medication to certain residents;
   4. failed to take steps so that residents were not burned by hot coffee, and failed to adequately treat burns;
   5. failed to maintain hygiene standards;
   6. failed to maintain effective strategies to prevent falls;
   7. failed to ensure that the resident environment was free of accident hazards; and
   8. created incorrect care plans for their residents.

Newark Manor and its owner have agreed to pay $381,000 to resolve this case with $175,000 going to the Division of Medicaid and Medical Assistance within the Department of Health and Social Services. Newark Manor’s owner will reinvest the remaining $206,000 into capital improvements at the facility that will enhance resident care. Additionally, Newark Manor will be subject to a two-year Corporate Integrity Agreement, which subjects Newark Manor, its owner and management, to extensive compliance obligations. The Attorney General’s Medicaid Fraud Control Unit will monitor Newark Manor’s compliance with the settlement terms.

Director Christina Kontis, Deputy Attorney General Laura Najemy, special investigator Paul Reutter, nurse analyst Brian Galbreath, all of the Medicaid Fraud Control Unit, along with forensic accountant Clyde Hartman of the White Collar Crime Unit, handled this case.

With people already making summer vacation plans, the Consumer Protection Unit of the Delaware Department of Justice warns Delawareans to be careful when looking for a vacation rental. Scammers operating rental schemes find legitimate rental postings and capture the information and photos of the property, and then list it on Craigslist or other online advertising platforms. Unsuspecting consumers looking for a good deal on a vacation rental find the bogus posting, send a deposit, and receive confirmation of their rental only to arrive to find other people in the home, unable to gain access, or otherwise turned away from the property they believed they had rented.

Scams also can occur with regards to long term leases for homes or apartments, where scammers may even have changed to locks illegally on a property and allow someone to move in, even though they are not the true owner.
All consumers should be diligent before entering into any type of lease for a rental property or providing any deposit or rental payment by taking these steps first:

• Consider working with a licensed realtor or property management company when possible;
• If using an online search engine or website, research whether the property appears on other websites or listing platforms and make contact with the listing agents to determine which is the legitimate advertisement;
• Research who the true owner of the property is by doing a parcel search online: In Delaware, one can search New Castle County properties at http://www3.nccde.org/parcel/search/; Kent County properties at http://kent400.co.kent.de.us/PropInfo/PIName.HTM, and Sussex County properties at, https://sussexcountyde.gov/zoning-and-sales-information;
• Carefully review the posting, advertisement or lease for misspellings and grammatical errors;
• If you are looking at a rental through an online listing site, you should familiarize yourself with the site’s policies for detecting and dealing with potentially fraudulent listings;
• Never pay any security deposit or rental payment in cash—always use a check, money order or credit card—and demand a receipt;
• For long-term leases:
  o Demand a written lease in advance, that includes the identification and contact information of the landlord, as well as identification of the bank where your security deposit (if applicable) will be held;
  o When possible, request a walk-through before agreeing to rent or paying any deposit;
  o Talk to neighbors to learn more about the property and the owners—be cautious of properties with a recently deceased owner or foreclosure;
  o If you meet the person claiming to be the landlord, request to see their credentials, such as a business card or realtor’s license, and identification; you should also make note of the make and model of their car and the license plate number.

Consumers who believe they may have been scammed should contact their local police department and file a report. They can also call the Attorney General’s toll-free Consumer Hotline at 1-800-220-5424 or email the Consumer Protection Unit of DOJ at consumer.protection@delaware.gov. If the listing was posted on an online platform, such as Craigslist, the consumer should also file complaints with the online platform and with federal law enforcement at www.ic3.gov.

Cornerstone Credit Services no longer operating in Delaware

Attorney General Matt Denn announced that 35 Delawareans victimized by a national debt services provider recently received refunds for fees and costs paid for unlawful debt management services rendered by Cornerstone Credit Services, a Wisconsin company. In December 2017, the Wilmington law firm of Cross & Simon and the Consumer Protection Unit (CPU) of the DOJ’s Fraud and Consumer Protection Division reached a settlement with Cornerstone, under which Cornerstone ceased doing business in Delaware and refunded fees and costs totaling more than $115,000 to Delaware consumers.

Delaware law requires that debt management services providers doing business in the state register with the Attorney General, obtain a license, and fulfill a number of other requirements. The relevant statute exempts law firms providing legal services, and evidence produced during the litigation showed that Cornerstone had hired a law firm as its purported local representative in Delaware in an attempt to evade the statutory requirements. In 2015, the Cross & Simon law firm filed an action in the Court of Chancery alleging that Cornerstone’s business model was a sham and that the company had been charging fees to Delaware customers while not substantially lowering their debts. In 2017, the CPU moved to intervene in the litigation on the side of the plaintiffs, in order to ensure that any resolution of the case would include relief for all affected customers. In December 2017, the case settled.

Over the past two weeks, CPU representatives have been distributing checks, in some cases totaling several thousand dollars, to each of the consumers affected. “This is another example of how our CPU protects Delaware consumers,” Attorney General Denn said. “I want to thank Rick Cross and Cross & Simon, and Deputy Attorney General Michael Clarke and Chief Special Investigator Alan Rachko and their team, for their diligence in pursuing this case for the benefit of the Delaware customers, some of whom were facing significant financial difficulties.”

The Medicaid Fraud Control Unit of the Delaware Department of Justice will join the United States and other states to settle allegations against Mylan Inc. and its wholly-owned subsidiary, Mylan Specialty L.P. (collectively “Mylan”). The settlement will resolve allegations that Mylan knowingly underpaid rebates owed to the Medicaid program for the drugs EpiPen and EpiPen Jr. (“EpiPen”) dispensed to Medicaid beneficiaries. As part of the settlement, Delaware will receive $899,882 in restitution and other recovery, which will be returned to the Delaware Medicaid program.

The allegations against Mylan were that it was misstating the nature of its EpiPen drug and mischaracterizing the price at which it sold the EpiPen, in order to reduce the amount of rebates that it was required to pay state Medicaid programs.

“This settlement will relieve some of the budget pressure on the state’s Medicaid program in the coming year,” Attorney General Matt Denn said. “We will continue to expand our efforts to work with our law enforcement colleagues to ensure that people do not take advantage of the state’s largest health care program.”

Mylan Specialty owns the exclusive rights to sell EpiPen in the United States and possesses legal title to the New Drug Codes (“NDCs”) for EpiPen. The federal Medicaid Drug Rebate Statute requires participating pharmaceutical manufacturers or NDC holders, such as Mylan, to sign a Rebate Agreement with the Secretary of the United States Department of Health and Human Services as a precondition for obtaining Medicaid coverage for their drugs and to pay quarterly rebates to State Medicaid programs for drugs dispensed to Medicaid beneficiaries. NDC holders are required to provide information to CMS concerning their covered drugs. In particular, they have to advise CMS regarding the classification of a covered drug as an “innovator” or “noninnovator” drug, as the amount of rebates owed varies depending on the drug’s classification. The amount of the rebate also depends on pricing information provided by the manufacturer. For drugs classified as “innovator” drugs, NDC holders must report their “Best Price,” or the lowest price for which it sold a covered drug in a particular quarter.

Specifically, the settlement resolves allegations that from July 29, 2010 to March 31, 2017, Mylan submitted false statements to the Centers for Medicare and Medicaid Services (“CMS”) that incorrectly classified EpiPen as a “noninnovator multiple source” drug, as opposed to a “single source” or “innovator multiple source” drug. Mylan also did not report a Best Price to CMS for EpiPen, which it was required to do for all “single source” and “innovator multiple source” drugs. As a result, Mylan submitted or caused to be submitted false statements to CMS and/or the states relating to EpiPen for Medicaid rebate purposes, and underpaid its EpiPen rebates to the state Medicaid Programs.

Deputy Attorney General Tiphanie Miller and Senior Auditor Ellen Yates worked on the case for Delaware.

The investigation stemmed from two qui tam actions, United States ex rel. sanofi-aventis US LLC v. Mylan Inc., et al. (No. 16-cv-11572-ADB), and United States ex rel. Ven-A-Care of the Florida Keys, Inc. v. Mylan Inc., et al. (No. 17-10140-ADB), pending in the United States District Court for the District of Massachusetts. A qui tam case is one where an individual – known as a relator – claims to have specific knowledge of charges submitted for payment to the local, state or federal governments that are improper under federal or state False Claims Act laws; the federal, state or local government can either intervene in the action and participate with the relator as a plaintiff, or the state can decline to intervene and allow the plaintiff/relator to attempt to recover those losses on behalf of the state.

The total amount Mylan will pay to the United States and the individual states is $465 million.

Any Delawarean who suspects fraudulent billing or other fraud can report Medicaid Fraud by calling the Department of Justice Healthcare Provider Fraud Hotline at (302) 577-5000. Anonymous tips are accepted.

In response to a Wall Street Journal article describing a national coalition of Attorneys General investigating whether manufacturers have engaged in unlawful or deceptive practices in the marketing and sale of opioids, Attorney General Denn confirmed Thursday that the Delaware Department of Justice is actively participating in this investigation.

Attorney General Denn also announced that his office will issue an invitation to private law firms to submit competitive bids to be appointed as special counsel for the Department of Justice to conduct further investigation regarding opioid manufacturers for violation of Delaware state law in the sale and marketing of opioids. The detailed Request for Proposal requires that the work be done on a contingency fee basis so it would not involve the use of state funds.

The national coalition of Attorneys General is examining what role manufacturers of opioid drugs may have played in creating or prolonging the nation’s opioid epidemic. The coalition of Attorneys General is using its investigative tools, including subpoenas for documents and testimony, to determine the appropriate course of action. The national coalition of state Attorneys General is not disclosing the specific companies that are the current subjects of its investigation, which has been underway for some time.

The Request for Proposal for private firms to investigate possible claims may result, if the facts and law provided a legal basis, in a separate lawsuit brought by and in Delaware. The RFP contains detailed provisions to ensure fairness, competitiveness, and transparency in the retention of a law firm, and appropriate state control over any decision to initiate litigation and the conduct of any litigation that is initiated. The RFP is expected to be posted at bids.delaware.gov and attorneygeneral.delaware.gov by the end of next week.

“These efforts to hold manufacturers of opioids financially responsible where the law allows are an important part of our overall effort to improve prevention and treatment of substance abuse,” Attorney General Denn said. “If our investigations reveal that the manufacturers of these products violated Delaware law, we will seek to have them help pay for the fight to end the epidemic.”