Federal authorities have reached a $75,000 settlement with two Milwaukee-area attorneys, Alex Eichhorn and Scott Wade, the law firm Tabak Law LLC, and workers’ compensation insurance claims adjuster Gallagher Bassett Services, Inc. The settlement resolves allegations that they unlawfully avoided paying money owed to the United States Department of Veterans Affairs (VA). This was announced by Richard G. Frohling, Acting United States Attorney for the Eastern District of Wisconsin.
The case, filed as United States v. Eichhorn et al., Case Number 25-cv-584 in April in the Eastern District of Wisconsin, involved a veteran who received medical care from the VA for a condition sustained while employed in the private sector. Attorney Eichhorn represented this veteran in workers' compensation proceedings against his employer and its insurers. During these proceedings, Attorney Eichhorn requested medical records from the VA.
Upon learning about the claim, the VA asserted its right to recover medical expenses under federal laws 42 U.S.C. § 2651(a) and 38 U.S.C. § 1729(a), known as the Federal Medical Care Recovery Act (FMCRA). Despite receiving notice of this claim, Attorney Eichhorn negotiated a settlement with Gallagher Bassett's counsel, Attorney Wade. The agreement involved accepting $90,000 with $75,000 earmarked for medical expenses but required the veteran to accept the risk of enforcement by the VA.
The government alleges that although assurances were made to an administrative law judge that settlement proceeds would satisfy the VA’s claim, Tabak Law LLC disbursed funds to itself and its client instead. After learning about this months later, it is alleged that defendants did not make good-faith efforts to resolve the claim and took steps to avoid obligations under FMCRA.
The lawsuit included causes of action under the False Claims Act and common law theories of recovery. The public is advised to review regulations concerning responsibilities under FMCRA and report any evidence of avoidance to their district’s U.S. Attorney’s Office.
Assistant United States Attorney Aaron R. Wegrzyn handled this matter with support from D’Anthony Graham and others from the Revenue Law Group in the VA’s Office of General Counsel.
It is noted that "the claims resolved by the settlement are allegations only" and there has been no determination of liability.
