Health Diagnostic Laboratory CEO Tonya Mallory, pictured at the ribbon-cutting ceremony at HDL’s headquarters. Photos by Burl Rolett.
Tonya Mallory now has more than just the federal government to contend with.
Pennsylvania-based insurance giant Aetna this week added Mallory, Health Diagnostic Laboratory’s co-founder and former CEO, as a defendant in a lawsuit it filed against HDL in April.
The original suit alleged that HDL and its former third-party sales contractor, BlueWave Healthcare Consultants, initiated a scheme to solicit physicians to order HDL’s tests, offering them “processing and handling” fees for each test, even though the laboratory company is out of Aetna’s network. The two firms then allegedly did not charge patients co-pays, causing the insurer to pay inflated fees to HDL.
In an amended complaint filed Tuesday, Aetna states the same claims individually against Mallory, along with BlueWave’s founders Robert Bradford Johnson and Floyd Calhoun Dent.
“The illegal conduct engaged in by HDL and Bluewave was personally planned, authorized, directed and engaged in by Mallory when she was acting as the CEO, and by Dent and Johnson, who own and control Bluewave,” the amended suit states.
This is the second time that Mallory has individually been named in a suit relating to HDL’s alleged kickback scheme. The fallout from that began last year when a Department of Justice federal investigation into the payments became public. HDL has since agreed to settle with the DOJ in exchange for penalties of at least $47 million.
The federal government filed a claim against Mallory, Dent and Johnson in early August, alleging that the three orchestrated a massive kickback scheme and caused government agencies to pay hundreds of millions of dollars in improper reimbursements.
HDL plans to lease out part of its HQ building to VCU.
When reached by phone Wednesday, Mallory directed inquiries to her lawyer, Chris Hall of the law firm Saul Ewing. Hall declined to comment.
Mallory abruptly resigned from her position as CEO last year.
John Elliott of Elliott Greenleaf, the lawyer representing Aetna, did not return requests for comment by press time.
Aetna’s language in its amended claim echoes that used by the federal government. The insurer cites several figures that were included in the government’s complaint, including the fact that Mallory received $26 million in salary, bonuses and other compensation between 2008 and 2014, and that BlueWave earned over $74 million in commissions from HDL in 2012.
Aetna claims that Mallory and the BlueWave founders were aware of the kickbacks BlueWave’s sales force was paying physicians to induce them to order HDL’s tests, even though the laboratory was out of Aetna’s network. Out of network means the insurer does not have a contract in place with HDL that allows for negotiated rates.
And even after illegally inducing physicians to order those tests, the suit claims, HDL then refused to charge patients the necessary co-pays, which resulted in Aetna paying inflated fees to HDL. All this was done “at the express direction of and with the support of Defendants Bluewave, Dent, Johnson and Mallory,” the suit states.
Aetna alleges the same four counts in its amended complaint that it did originally: fraud, tortious interference with business and contractual relations, civil conspiracy and unjust enrichment.
The minimum amount of damages stated in the Aetna case is $150,000, “as well as punitive damages, costs of suit, and any other legal or equitable relief this Court deems appropriate.”
Aetna’s case against HDL has been put on hold – as have the other lawsuits the company was involved in – as part of its protection under Chapter 11 bankruptcy. HDL filed for bankruptcy in June and is currently in the midst of finding a buyer for the entire company. Aetna’s case against the other defendants could still move forward while its suit against the company is paused.
The company, which at its peak had around 800 employees, has reduced its numbers to 570 employees through several rounds of layoffs, the latest of which took place in August.
Since Mallory’s resignation, the company has also cut its charitable donations entirely, a process which began late last year and was finalized when HDL could no longer fulfill Mallory’s $4 million pledge to VCU Athletics.
Health Diagnostic Laboratory CEO Tonya Mallory, pictured at the ribbon-cutting ceremony at HDL’s headquarters. Photos by Burl Rolett.
Tonya Mallory now has more than just the federal government to contend with.
Pennsylvania-based insurance giant Aetna this week added Mallory, Health Diagnostic Laboratory’s co-founder and former CEO, as a defendant in a lawsuit it filed against HDL in April.
The original suit alleged that HDL and its former third-party sales contractor, BlueWave Healthcare Consultants, initiated a scheme to solicit physicians to order HDL’s tests, offering them “processing and handling” fees for each test, even though the laboratory company is out of Aetna’s network. The two firms then allegedly did not charge patients co-pays, causing the insurer to pay inflated fees to HDL.
In an amended complaint filed Tuesday, Aetna states the same claims individually against Mallory, along with BlueWave’s founders Robert Bradford Johnson and Floyd Calhoun Dent.
“The illegal conduct engaged in by HDL and Bluewave was personally planned, authorized, directed and engaged in by Mallory when she was acting as the CEO, and by Dent and Johnson, who own and control Bluewave,” the amended suit states.
This is the second time that Mallory has individually been named in a suit relating to HDL’s alleged kickback scheme. The fallout from that began last year when a Department of Justice federal investigation into the payments became public. HDL has since agreed to settle with the DOJ in exchange for penalties of at least $47 million.
The federal government filed a claim against Mallory, Dent and Johnson in early August, alleging that the three orchestrated a massive kickback scheme and caused government agencies to pay hundreds of millions of dollars in improper reimbursements.
HDL plans to lease out part of its HQ building to VCU.
When reached by phone Wednesday, Mallory directed inquiries to her lawyer, Chris Hall of the law firm Saul Ewing. Hall declined to comment.
Mallory abruptly resigned from her position as CEO last year.
John Elliott of Elliott Greenleaf, the lawyer representing Aetna, did not return requests for comment by press time.
Aetna’s language in its amended claim echoes that used by the federal government. The insurer cites several figures that were included in the government’s complaint, including the fact that Mallory received $26 million in salary, bonuses and other compensation between 2008 and 2014, and that BlueWave earned over $74 million in commissions from HDL in 2012.
Aetna claims that Mallory and the BlueWave founders were aware of the kickbacks BlueWave’s sales force was paying physicians to induce them to order HDL’s tests, even though the laboratory was out of Aetna’s network. Out of network means the insurer does not have a contract in place with HDL that allows for negotiated rates.
And even after illegally inducing physicians to order those tests, the suit claims, HDL then refused to charge patients the necessary co-pays, which resulted in Aetna paying inflated fees to HDL. All this was done “at the express direction of and with the support of Defendants Bluewave, Dent, Johnson and Mallory,” the suit states.
Aetna alleges the same four counts in its amended complaint that it did originally: fraud, tortious interference with business and contractual relations, civil conspiracy and unjust enrichment.
The minimum amount of damages stated in the Aetna case is $150,000, “as well as punitive damages, costs of suit, and any other legal or equitable relief this Court deems appropriate.”
Aetna’s case against HDL has been put on hold – as have the other lawsuits the company was involved in – as part of its protection under Chapter 11 bankruptcy. HDL filed for bankruptcy in June and is currently in the midst of finding a buyer for the entire company. Aetna’s case against the other defendants could still move forward while its suit against the company is paused.
The company, which at its peak had around 800 employees, has reduced its numbers to 570 employees through several rounds of layoffs, the latest of which took place in August.
Since Mallory’s resignation, the company has also cut its charitable donations entirely, a process which began late last year and was finalized when HDL could no longer fulfill Mallory’s $4 million pledge to VCU Athletics.