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Asbestos Disease Clinic in Libby, Montana, Must Pay $6M for False Claims

Legislation & Litigation

Written by Michelle Whitmer

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Reading Time: 4 mins

Publication Date: 08/10/2023

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An acclaimed health clinic in a small Montana mining town known for treating asbestos patients has been ordered to pay almost $6 million in penalties and damages.

The Center for Asbestos Related Disease clinic, known as CARD, faced a federal False Claims Act case filed by BNSF Railway in 2019. In June a jury found the clinic filed 337 false claims for patients who received Medicare and other benefits that they were not qualified to accept.

U.S. District Judge Dana Christensen wrote in a July 18 order that the clinic demonstrated “a reckless disregard for proper medical procedure and the legal requirements of government programs,” according to The Associated Press.

The penalties imposed on CARD are intended to prevent future misconduct. Christensen also noted concerns about the clinic’s high-profile doctor, Brad Black, who self-diagnosed an asbestos-related disease, and the high rates of opioid prescriptions from the clinic for people who may not have a legitimate diagnosis, the AP reported.

BNSF filed the lawsuit alleging CARD failed to get outside confirmation that those patients had an asbestos-related disease such as mesothelioma, asbestosis or asbestos-related lung cancer. Black, the clinic’s doctor, claimed other doctors can miss signs of asbestos-related illness that are specific to Libby residents.

The railroad company is a defendant in several separate lawsuits over its role in the asbestos contamination that affected thousands of residents in Libby and nearby areas. It was awarded 25% of the proceeds, which is allowed under the False Claims Act.

Attorneys for the clinic filed an appeal, stating the facility could face bankruptcy if forced to pay the judgment, according to the AP.

A railway spokesperson told the AP the clinic’s actions were a waste of taxpayer money and diverted resources from people who needed it.

“The focus of this trial was on CARD’s treatment of the hundreds of people who were not sick,” spokesperson Lena Kent told the AP. “It’s a sad chapter in this saga that this trial was necessary to restore the focus on those who are truly impacted and who should continue to have access to the benefits and care they deserve.”

History of Libby Asbestos Mining

Libby, a small town in northwest Montana, was once a prosperous vermiculite mining town. The mineral, used for insulation, formed along asbestos veins, making the asbestos hard to separate from vermiculite.

W.R. Grace & Company took over mining in 1963 and knew of the dangers the asbestos contamination posed but didn’t warn workers or residents. Instead, it distributed leftover vermiculite in playgrounds, backyards, gardens, roads, driveways and populated areas in Libby, increasing the asbestos exposure among the residents.

Mining ended in 1990, and since then about 2,400 people in the area have been diagnosed with an asbestos-related disease. According to CARD, at least 1 in 10 people in Libby currently have an asbestos-related illness.

The U.S. Environmental Protection Agency began cleanup in Libby in 2000 after a series of news articles highlighted the dangers there. Later it was designated an asbestos Superfund site. Today, the EPA considers Libby safe.

Libby Asbestos Lawsuits

The federally funded CARD clinic in Libby was recognized as a Center of Excellence by Montana lawmakers, which meant it could obtain additional funding to meet its local obligations in Lincoln County.

It has been at the forefront of treating residents in Libby and nearby who had adverse effects from living in an EPA Superfund site. The clinic provides asbestos screenings, resources and advocacy for people living there. It sees about 35 new patients monthly.

Thousands of Libby residents and former mine workers have filed lawsuits against Montana state agencies for failing to warn them of the dangerous asbestos. The first lawsuits were filed in the mid-1990s against W.R. Grace & Company, which paid out millions in claims and then filed for bankruptcy. Several major group payouts have compensated affected Libby residents.