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Feb. 19, 2013

Eastern Kentucky disability lawyer accused of collecting millions through fraud;


An Eastern Kentucky lawyer who has represented hundreds of people in Social Security disability cases schemed with a federal judge to commit wholesale fraud, two whistle blowers charge in a civil complaint.

Eric C. Conn received millions of dollars from the government for handling disability claims that the administrative law judge improperly approved, the complaint alleges.

Many people were approved for lifetime disability payments they didn't deserve, which could eventually cost the federal government tens of millions of dollars, said Benjamin J. Vernia, one of the attorneys who filed the claim.

"The numbers are astronomical," Vernia said Tuesday.

The judge named in the complaint, David B. Daugherty, improperly manipulated a docketing system to get control of Conn's cases, the lawsuit alleges.

In 2010, Daugherty approved 99.7 percent of the claims before him, when the national average was 62 percent, the complaint said.

Conn received a payment for each successful disability award.

The Social Security Administration paid Conn $3.8 million for disability cases in 2010 alone, the third-highest amount nationwide, The Wall Street Journal said in a November 2011 article.
A court motion in the case indicates federal authorities are conducting a criminal investigation in the case.

Conn issued a statement Tuesday saying he had not seen the complaint and could not comment on it until he had.

"I can certainly say that I have always tried to represent my clients in the best and most appropriate way possible, within all the laws and rules," Conn said in the prepared statement.

Federal disability payments are an important source of income in Eastern Kentucky. The number of people receiving Supplemental Security Income, or SSI, for instance, is above the national average.

Conn has been perhaps the most visible disability lawyer in Eastern Kentucky, billing himself as Mr. Social Security and advertising his services on large billboards.

He hired bluegrass-music legend Ralph Stanley and the "Obama Girl," a model who did a video saying she had a crush on the presidential candidate, to record a video promoting his effort to win appointment to a federal Social Security advisory panel.

Conn's office at Stanville, in Floyd County, has a 19-foot-tall statue of Abraham Lincoln in the parking lot. His website brags that the statue is the second-largest sitting likeness of Lincoln in the world — smaller only than the Lincoln Memorial in Washington, D.C. — and cost $500,000.

The Wall Street Journal reported in a May 2011 story that Conn sometimes brought an inflatable replica of himself to hearings.

The complaint against Conn was filed under the federal False Claims Act, under which whistle blowers can get a portion of the money recovered in cases in which the federal government is defrauded.

The law creates an incentive for people to find and investigate fraud against the government, U.S. District Judge Amul Thapar said in an order filed Tuesday. Few such cases are filed in the federal Eastern District of Kentucky, Vernia said.

Vernia and Lexington attorneys Mark A. Wohlander, a former assistant federal prosecutor, and Brian A. Ritchie filed the lawsuit for two whistle blowers in October 2011.

The case was sealed until Tuesday, however. That was because the federal government had asked for several stays throughout 2012 as it considered whether to join the case.
The government ultimately said it could not decide whether to intervene by a deadline Thapar had set. Conn said in his statement that it is noteworthy the government decided not to take over the case.

The whistle blowers in the case are Jennifer Griffith and Sarah Carver. Both worked in the Huntington, W.Va., office of the Social Security Administration, which handled appeals in disability cases from Eastern Kentucky, according to the complaint.

Their lawsuit seeks to recover money for the federal government. If they win the case, Griffith and Carver would get a portion of the money recovered, and their attorneys would receive fees.

The lawsuit also seeks a fine of $11,000 for each false claim.



Bill Estep: (606) 678-4655.

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