Date: 06-17-2024

Case Style:

United States of America v. Laura Perryman

Case Number: 23-cr-117

Judge: Roberto A. Lange

Court: The United States District Court for the Southern District of New York

Plaintiff's Attorney: The United States Attorney’s Office for New York City

Defendant's Attorney:

Click Here For The Best
New York City, New York Criminal Defense Lawyer Directory

Description:

New York City, New York criminal defense lawyer represented the Defendant charged with Creating And Selling A Fake Component That Was Implanted Into Patients
Former CEO Of Medical Device Company Sentenced To Six Years In Prison For Creating And Selling A Fake Component That Was Implanted Into Patients

Stimwave was a medical device company that manufactured and distributed implantable neurostimulation devices. As the founder and CEO of Stimwave, Laura Perryman oversaw the design of the StimQ PNS System (the “Device”), a neurostimulator system designed to treat chronic pain by providing electrical currents to peripheral nerves. The Device included a component containing electrodes (the “Lead”) and a receiver component that acted as an antenna, transmitting energy from an external power source to the Lead (the “Pink Stylet”). From at least in or about 2017 up to and including 2020, PERRYMAN, as Stimwave’s CEO, engaged in a multi-year scheme (the “Scheme”) to design, create, manufacture, and market an inert, non-functioning component of the Device — called the “White Stylet.” The White Stylet was marketed as a receiver of radiofrequency energy, but it was made of plastic and could not function as a receiver.

Stimwave sold the Device to doctors and medical providers for approximately $16,000. PERRYMAN instructed health care providers to bill medical insurance providers, including Medicare, for implanting the Device into patients through two separate reimbursement codes. One code was for implantation of the stimulator portion of the Lead, and a second was for implantation of a receiver. The billing code for implanting the Lead provided for reimbursement at a rate of between approximately $4,000 and $6,000, while the billing code for implanting a receiver provided for reimbursement at a rate of between approximately $16,000 and $18,000.

Soon after the Device was released, physicians informed Stimwave that they were having trouble implanting the Pink Stylet in certain patients because the Pink Stylet was too long. PERRYMAN knew that the Pink Stylet could not be cut or trimmed to shorten it without interfering with the functionality of the Pink Stylet as a receiver. And, without a receiver component for doctors to implant and seek reimbursement for, doctors would incur a substantial financial loss with every purchase of the Device, thereby making it more difficult for PERRYMAN to sell the Device to doctors and medical providers at the approximately $16,000 price.

However, Stimwave — at the direction of PERRYMAN — did not lower the price of the Device so that its cost to doctors and medical providers could be covered by reimbursement for the implantation of only the Lead. Nor did PERRYMAN recommend that doctors not implant the Device or its receiver component in cases where the Pink Stylet could not fit comfortably. Instead, PERRYMAN directed that Stimwave create the White Stylet — a dummy component made entirely of plastic, but which PERRYMAN misrepresented to doctors as a receiver alternative to the Pink Stylet. The White Stylet could be cut to size by the doctor for use in smaller anatomical spaces and was created solely so that doctors and medical providers would continue to purchase the Device for use in those scenarios and continue to bill for the implantation of a receiver component. To perpetuate the lie that the White Stylet was functional, PERRYMAN oversaw trainings for doctors that indicated the White Stylet was a “receiver,” when in fact it was made entirely of plastic, contained no copper, and therefore had no conductivity. In addition, PERRYMAN directed other Stimwave employees to vouch for the efficacy of the White Stylet as a receiver, when she knew that the White Stylet could not function as a receiver.

As a result of these misrepresentations regarding the functionality of the White Stylet, PERRYMAN caused doctors and medical providers to implant the White Stylet into patients and submit reimbursement claims for implantation of the White Stylet to health insurance providers, including Medicare.

Outcome:

Defendant was found guilty and sentenced to six years in prison.

Plaintiff's Experts:

Defendant's Experts:

Comments: