Case File: United States ex rel. Martinelli v. Crown Medical Solutions, LLC, et al.
Case No.: 1:19-cv-01660
Court: U.S. District Court, Northern District of Georgia
Settlement Amount: $825,000, based on the defendants’ ability to pay
Announced: September 21, 2026
Period at Issue: November 1, 2017 through April 30, 2019
Defendants: Crown Medical Solutions LLC and its owners, Michelle and Philanzo King
Whistleblower: Karen Martinelli
Status: Allegations only. There has been no determination of liability.
A knee brace is not the kind of product that makes headlines. It is cheap and common, and doctors order it every day. That ordinary quality is what makes medical equipment billing so hard to police. A single claim looks small, and the real question is whether a physician actually ordered the item and the patient actually needed it.
According to the Justice Department, Crown Medical Solutions LLC and its two owners billed Medicare without being able to answer yes to those questions. On September 21, 2026, the department announced that the company and its owners agreed to pay $825,000 to resolve the allegations. None of it has been proven in court, and the defendants have not been found liable.
Who Is Crown Medical Solutions?
Crown Medical Solutions LLC was a supplier of durable medical equipment, the category that covers items a patient uses at home on a doctor’s orders. The Justice Department names the company’s owners as Michelle and Philanzo King, who are also parties to the settlement.
The release describes Crown in the past tense, and it does not say where the company was based. Some news outlets have given conflicting locations, so check the settlement agreement before attaching one to the company. The only location the DOJ confirms is the court, the Northern District of Georgia.
What the Government Says Happened
The United States alleges that from November 1, 2017 through April 30, 2019, Crown and its owners submitted Medicare claims for equipment that did not meet the program’s basic conditions. The DOJ’s description is specific about what was sold and why the billing is disputed:
- The equipment included knee braces, heel stabilizers and back braces
- The government says the items were not medically necessary, were not properly prescribed by a physician, or both
The alleged conduct covers about eighteen months. The press release does not give the number of claims or the dollar value of the billing behind the settlement, so the full scale is not public. Anyone who wants the finer detail will need to read the settlement agreement the DOJ links from its announcement.
Why Medical Necessity Is the Whole Case
Medicare does not pay for equipment simply because a supplier delivered it. It pays when a physician has prescribed the item and the item is reasonably needed for the patient’s condition. Those two requirements are what separate a legitimate claim from one the government can challenge.
The False Claims Act gives the government a way to act when it believes those conditions were not met. A supplier that knowingly bills for equipment without them can be treated as having submitted a false claim, even if the equipment was physically handed to a patient. The Crown settlement rests on that theory, and the DOJ stresses that it is only a theory until a court decides otherwise.
The Whistleblower Behind the Case
The case began with a private citizen, not a government audit. Karen Martinelli filed it under the whistleblower provisions of the False Claims Act, which let individuals sue on the government’s behalf and receive part of any recovery.
Martinelli will receive approximately $123,750, which is exactly 15% of the settlement and leaves about $701,250 after her share. The docket number, 1:19-cv-01660, points to a 2019 filing, which means the case took roughly seven years to reach a settlement. The DOJ does not describe Martinelli’s connection to Crown, so the post should not either.
The Money, the Timing and the Ability-to-Pay Basis
The $825,000 figure was set based on the defendants’ ability to pay. In DOJ settlements, that wording usually means the amount reflects what the defendants can afford and not the full value of the government’s claim. The release does not say how large the government’s original claim was.
The table below lays out the case timeline and puts the settlement next to other False Claims Act announcements from the same stretch.
| Event | Date | Detail |
|---|---|---|
| Alleged conduct begins | November 1, 2017 | Start of the period at issue |
| Alleged conduct ends | April 30, 2019 | End of the period at issue |
| Whistleblower case filed | 2019 | Based on the 1:19-cv-01660 docket number |
| Settlement announced | September 21, 2026 | $825,000, DOJ press release 26-1085 |
| Settlement | Amount | Announced | Detail |
|---|---|---|---|
| Crown Medical Solutions and owners | $825,000 | September 21, 2026 | Durable medical equipment billed to Medicare |
| AIDS Healthcare Foundation | $1.44 million | October 6, 2026 | Non-profit based in Los Angeles, California |
| Remedi SeniorCare | Over $5.3 million | September 17, 2026 | Maryland long-term care pharmacy |
| Signal Diagnostics | $20.5 million | September 30, 2026 | Failing to refund overpayments to the HRSA Uninsured Program |
| Independence Blue Cross | $22.5 million | September 30, 2026 | Pennsylvania insurance company |
What the Officials Said
Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division put the settlement in the context of the department’s wider healthcare fraud work:
“The Department of Justice is committed to fighting healthcare fraud and holding accountable those who exploit federal healthcare programs for personal profit.”
The press release also ties the case to a new enforcement structure. It notes that this year the Administration launched the Task Force to Eliminate Fraud and the National Fraud Enforcement Division, and it explains why the department sees fraud in federal programs as harmful:
“When unscrupulous actors exploit these programs for their own financial gain, they defraud the government, harm the people these programs are designed to aid and protect, and undermine American businesses that play by the rules.”
Who Handled the Case
The settlement was a joint effort between the Civil Division’s Commercial Litigation Branch, its Fraud Section, and the U.S. Attorney’s Office for the Northern District of Georgia. Commercial Litigation Branch Trial Attorney Anna Jugo and Assistant U.S. Attorney Neeli Ben-David handled the matter.
The Takeaway
At $825,000, Crown is one of the smaller settlements the Justice Department announced this autumn. The allegation behind it is easy to follow: a supplier billed for ordinary braces that the government says were either not needed or not properly ordered.
The settlement ends the case without a court ruling on the facts, and Crown and the Kings have not been found liable. It leaves behind a payment, a whistleblower claim filed in 2019, and a reminder that routine, low-cost items can still become the subject of a federal fraud case. The Justice Department asks anyone with information about suspected healthcare fraud to contact the Department of Health and Human Services tip line at 800-HHS-TIPS (800-447-8477).
SOURCE:
This article is based on the official Justice Department press release issued by the Office of Public Affairs on September 21, 2026 (press release number 26-1085). It was used to confirm the settlement amount, the allegation period, the case caption and number, the names of the defendants and the whistleblower, the whistleblower’s share, the ability-to-pay basis, and the statements of Assistant Attorney General Brett A. Shumate. The comparison settlements were confirmed from the related-content listings on the same DOJ page and the HHS-OIG enforcement action list. The claims resolved by the settlement are allegations only, and there has been no determination of liability.