Penalty Amount
$384,192,156
Connecticut joined 39 other states and the federal government in a $384 million False Claims Act settlement with Abbott Laboratories over allegations that the company failed to manufacture powder infant formula and nutritional therapy products in compliance with federal and state requirements at its Sturgis, Michigan, and Casa Grande, Arizona facilities. Abbott allegedly manufactured formula in conditions that risked microorganism contamination and failed to disclose contamination test results to the FDA during 2019 and 2022 inspections. The settlement resolves claims that Abbott caused false claims to be submitted to the WIC program and state Medicaid programs between January 1, 2018, and December 31, 2022.
Abbott will pay $348,700,868 to the United States to resolve federal False Claims Act allegations and $35,491,288 to participating states for claims related to their state Medicaid programs, for a total of $384,192,156. Connecticut's share attributable to its Medicaid program is $936,629.70.
This enforcement action centered on Abbott's failure to meet 'statutory, regulatory, and contractual requirements' in manufacturing products sold to government programs, so in-house teams (particularly in healthcare, food, and manufacturing) should review government contracts and vendor agreements for compliance-with-law representations, quality control and manufacturing standards clauses, and warranties of regulatory conformity. Contracts should include explicit obligations to disclose adverse test results, inspection findings, or contamination events to customers and regulators promptly, along with audit rights allowing counterparties to verify manufacturing facility compliance. Vendor agreements with suppliers to regulated facilities should flow down FDA (and analogous) manufacturing requirements, and customer contracts for government-funded programs (WIC, Medicaid) should contain certifications, indemnification for false claims liability, and cooperation obligations during regulatory inspections.
Entity
Abbott Laboratories
Industry
Healthcare"an agreement with Abbott Laboratories (Abbott) to settle allegations that the company caused false claims to be submitted to federal and state programs"
"will pay $348,700,868 to the United States to resolve the False Claims Act allegations and $35,491,288 to participating States for claims related to their state Medicaid programs"
"initially filed in 2022 in the United States District Court for the Western District of Michigan under the federal False Claims Act and various state false claims statutes"
"Abbott allegedly failed to maintain its manufacturing equipment, failed to control the presence of water that put the products at increased risk of microorganism contamination, and, in certain instances, failed to disclose test results indicating the presence of microorganism contamination"
"Connecticut has joined 39 other states and the federal government to reach an agreement with Abbott Laboratories"
$384.2M
Abbott Laboratories agreed to pay more than $384 million — including $977,558 to Oregon — to resolve allegations that it sold powder infant formula and nutritional therapy products made in unsafe manufacturing conditions to Medicaid and food assistance programs such as WIC between January 2018 and December 2022. Investigators found Abbott failed to maintain manufacturing equipment and control water at its Sturgis, Michigan, and Casa Grande, Arizona, facilities, and withheld test results showing contamination during FDA inspections in 2019 and 2022. The settlement was negotiated by the National Association of Medicaid Fraud Control Units on behalf of the federal government and 39 states.
$625K
Connecticut reached a $625,000 settlement with Frontier Communications Parent Inc. over an April 2024 breach in which compromised employee and vendor credentials were used to access internal systems and exfiltrate unencrypted personal information of 58,841 Connecticut residents. The settlement requires Frontier to strengthen its security program, implement specific safeguards and training, and obtain an independent third-party assessment.
$2.6M
Connecticut and New York found that Boston Children’s Health Physicians and its security vendor, XTIUM, failed to use reasonable safeguards, resulting in hackers accessing sensitive personal, medical, and employee information. The companies agreed to pay penalties totaling $2.64 million and implement enhanced cybersecurity measures.
Connecticut joined a coalition of state attorneys general filing a notice in Character Technologies, Inc.’s bankruptcy proceedings, raising concerns about the company’s safety and privacy practices and the sensitive information it holds. The states seek protections for children and consumers if the company’s business or assets are sold or transferred; the filing does not impose a fine or other remedy.
Attorney General William Tong and Consumer Counsel Claire Coleman petitioned PURA to review how Connecticut public utilities use artificial intelligence, citing potential data privacy and cybersecurity risks, algorithmic errors, and misleading outputs. The petition asks PURA to examine utility AI systems, safeguards, vendors, and data security practices; it does not report a finding of violation or an imposed penalty.
$2.0M
Connecticut Attorney General William Tong announced a settlement with RZ Smoke, Inc. over allegations that it distributed and sold high-potency cannabis products without a state license. The stipulated judgment is $2 million, with $375,000 payable to the State and $1.6 million suspended to ensure compliance; the company is barred from specified cannabis activities in Connecticut unless licensed.