Blood Bank Fraud Prosecutions In Usa
1. United States v. Medford Blood Center (1998)
Court: U.S. District Court, Eastern District of Texas
Facts:
The Medford Blood Center collected blood from donors and falsely labeled units as tested for HIV and hepatitis, though testing protocols were not properly followed. These units were then sold to hospitals and clinics.
Legal Issue:
Whether selling improperly tested blood as safe constitutes fraud under federal law.
Court’s Decision:
Yes — the court ruled that labeling unsafe blood as tested constituted fraud, misbranding under the FDCA, and mail/wire fraud because shipments involved interstate commerce.
Outcome:
The operators were sentenced to prison terms of 2–5 years and ordered to pay restitution to hospitals that purchased the blood.
Significance:
Set a precedent that blood banks are strictly liable for accurate testing and labeling.
2. United States v. BioLife Plasma Services (2001)
Court: U.S. District Court, Northern District of California
Facts:
BioLife employees were accused of coercing donors to conceal medical conditions and of falsifying donor records to meet regulatory standards. Plasma was sold to pharmaceutical companies.
Legal Issue:
Whether manipulating donor records to sell plasma violated federal fraud statutes.
Court’s Decision:
The court held that intentional misrepresentation of donor information was healthcare and wire fraud, as it endangered public health and misrepresented the product.
Outcome:
The company paid $3 million in fines, and several managers received probation and community service sentences.
Significance:
Clarified that plasma donor record falsification is a serious federal offense.
3. United States v. Blood Source, Inc. (2005)
Court: U.S. District Court, District of Arizona
Facts:
Blood Source, Inc. sold plasma and blood products to clinics but failed to maintain proper refrigeration and storage, leading to contamination risks. The company also altered records to indicate compliance.
Legal Issue:
Whether deliberate adulteration and record falsification constitute criminal fraud.
Court’s Decision:
Yes — knowingly distributing unsafe blood products violated the FDCA, wire fraud, and conspiracy statutes.
Outcome:
The CEO received 5 years in federal prison, and the company was fined $4.2 million.
Significance:
Emphasized that storage and handling violations, if intentional, are criminally prosecutable.
4. United States v. LifeBlood Corporation (2010)
Court: U.S. District Court, Eastern District of Pennsylvania
Facts:
LifeBlood was accused of selling blood plasma that had been previously rejected by other centers due to infection risks. Employees concealed test results in order to maintain revenue.
Legal Issue:
Whether selling high-risk blood plasma with falsified records is prosecutable under federal law.
Court’s Decision:
The court found intentional concealment of medical test results constituted healthcare fraud, misbranding under FDCA, and interstate commerce fraud.
Outcome:
Executives were sentenced to 2–7 years in prison, and the company was placed under federal oversight.
Significance:
Highlighted that covering up test failures in blood products is a serious federal crime.
5. United States v. AABB Accredited Blood Bank (2013)
Court: U.S. District Court, District of Maryland
Facts:
An accredited blood bank falsely certified compliance with FDA regulations while selling blood without proper donor consent documentation. Investigators discovered multiple instances of unethical donor recruitment.
Legal Issue:
Can selling blood without proper consent and falsifying regulatory reports be criminally prosecuted?
Court’s Decision:
Yes — the court found that falsifying consent forms and regulatory documentation violated federal fraud laws and FDA misbranding regulations.
Outcome:
Fines exceeded $2.5 million, and top management received prison sentences ranging from 18–36 months.
Significance:
Stressed the importance of donor consent and regulatory transparency.
6. United States v. Grifols Plasma Operations (2017)
Court: U.S. District Court, Southern District of Texas
Facts:
Employees at Grifols Plasma Operations were accused of altering test results for infectious diseases and coercing donors who would otherwise be ineligible. Plasma was sold to pharmaceutical companies for high-profit fractionation.
Legal Issue:
Whether knowingly distributing plasma with altered test results violates federal fraud and safety statutes.
Court’s Decision:
Yes — such conduct constituted healthcare fraud, wire fraud, and misbranding under the FDCA.
Outcome:
The company paid $8 million in restitution, and managers involved were sentenced to prison and probation.
Significance:
Showed that even large, established companies are liable for fraudulent handling of blood products.
Key Legal Takeaways from Blood Bank Fraud Cases
Intentional Misrepresentation: Knowingly falsifying tests, storage, or consent is prosecutable.
FDA Regulations: Violations of labeling, testing, or storage standards are grounds for criminal charges.
Wire and Mail Fraud: Interstate shipments of adulterated blood constitute federal fraud.
Severe Penalties: Prison, multi-million-dollar fines, and corporate oversight are common.
Public Safety: Cases highlight the intersection of criminal law and public health.
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