Thanks. Let me summarize my question and hope you are able to answer to the point.
1) I am suing the defendant in civil court as mis-representation of business earning and breach of contract (i.e the contract has warantee of financial truth and fairness). In this regards, XXXXX XXXXX asking for the refund of the entire business purchase. In terms of damage caused to plaintiffs, it is large.
2) Because the business is in government healthcare. The business mis-representation also violated government Medicaid's billing regulation and drug prescription rule. But the damage to government may not be significant even if the violation is obvious and conclusive. The US attorney may not pursue this defendant based on damage caused to public or government.
The question: if the government found violation of defendant's conduct in terms of false billing and drug prescription, but the government does not pursue the case further, will that be negative to the civil case?
Let me give you the detail scenario here:
Dr. A is a healthcare business owner. Dr. A hired Dr. B to treat patients from Medicaid, and Dr. A is an absentee owner and he does not practice and treat patient.
Dr. B is a doctor but he is not credentialed to treat Medicaid patient. In KY, a doctor is required to be credentialed by Medicaid program in order to treat Medicaid patients. Because Dr. A owns the business, he wants to make money through Dr. B who cannot treat Medicaid patients. As a result, Dr. A uses his own Medicaid credential to bill Medicaid pretenting he is the doctor who actually treated patients. The Medicaid, without kowing Dr. B actually treated patients, paid Dr. A. Dr. A then take a commisson to pay Dr. B. In this whole process, Medicaid never knows Dr. B. Dr. A also did similar thing to prescribe controled substances like pain management drug to Medicaid patients because Dr. B does not have such license.
When Dr. A sold his business, he failed to disclose above information to the buyer. In the purchase contract, the buyer is waranteed the financial statement are "truth and fair". The buyer also assume the earning are legimate because the doctors produced those earning are suppose to be fully licensed and credentialed and billing (to Medicaid) are legimate. So, the buyer is suing for damage caused by
mis-representation of earning and breaching of contract.
Now from government's point view, Dr. A's conduct is problematic and a violation of the Medicaid regulation. Should the government have known that the true biling used by Dr. A, the government would not have paid him. However, the government may not charge Dr. A on criminal case or fine him because although Dr. A billed for service not rendered by himself, the service was provided by Dr. B. This is a lot of different in the typical fraud case when a doctor billed government for service nobody rendered. Considering cost and other factors, government may only do administration or education correction. This may include warning etc.
Now, the goal of plaintiff and government are different. Defendant caused different damage to plaintiff and government. The question here is whether the plaintiff sitll has ground against the defendant given the government does not pursue the defendant on criminal or other severious punishment including refund or fine.