PEORIA, Ill. (25 News) – A settlement has been reached in a lawsuit paying $5.5 million to the government and to a whistleblower who helped send former Reditus Labs CEO Aaron Rossi to prison for defrauding taxpayers.
The whistleblower was Dr. Lorine LaGatta, a medical director at a Reditus affiliated lab, who raised concerns that Rossi and his Pekin-based firm were exploiting the COVID-19 pandemic to make money from the government.
LaGatta filed the lawsuit in 2022, which until now has been sealed, after she said she witnessed billing and kickback schemes.
25 News reports that a release from her lawyers said LaGatta was fired to silence her after she raised concerns internally.
LaGatta filed the whistleblower suit that led to investigations by state and federal authorities, the release said.
Under settlement terms, federal, state and Peoria County authorities will share almost $2.5 million.
LaGatta will receive $1.05 million as a reward for her role in the case. She will be paid another $1.5 million for wrongful termination, and the law firm representing her will get $500,000.
“Taxpayers should never have to foot the bill for improper billing,” LaGatta said in a prepared statement. “This outcome isn’t just about one lab or one person – it’s about protecting our healthcare system and our communities. My hope is that this settlement leads to better safeguards and a reminder that no one is above the law, even during a crisis.”
Her attorney, David Fish, said LaGatta has moved away from Illinois and is declining interviews.
“This settlement vindicates her and sends a clear message that whistleblowers must be protected,” Fish said. “By doing the right thing, Dr. LaGatta helped uncover the truth and return funds to Illinois and U.S. taxpayers.”
Rossi is serving a three-year federal prison sentence for double-billing taxpayers and private insurance companies, and an additional five years for defrauding his former Bloomington employer.
A court-appointed receiver is currently running Reditus Labs.
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