New lawsuit by US Government against Stanford University General Counsel Debra Zumwalt is unsealed

October 11, 2019 0 comments

According to, recently unsealed lawsuit (unsealed going forward from July 30, 2019) in Federal Court alleges healthcare fraud by Stanford and Stanford Healthcare in Palo Alto, California. Stanford General Counsel and Vice President Debra Zumwalt is a named Defendant for her alleged knowledge and cover-up of the billing fraud. The lawsuit is United States et. al., vs. Stanford et. al., Case No. CV 17-08726-DSF (AFMx).

The suit was filed in December 2017 on behalf of the United States and California as an under-seal Complaint. Ms. Juarez specializes in false claims acts and represents the Relator in this case.

The last widely publicized “Qui Tam” action against Stanford was the 1990’s false claims lawsuit brought by Paul Biddle on behalf of the U.S. and the taxpayers. That suit resulted in a major change at Stanford where the then Stanford President Donald Kennedy resigned after testifying before a Congressional Committee on the fraud allegations. The suit against Stanford, whose counsel was Ms. Debra Zumwalt, was dismissed in 1996.

Notably, Zumwalt, the current Stanford General Counsel is a named defendant in the current lawsuit. Ms. Zumwalt was promoted to her current position at Stanford after a couple of legal victories for Stanford, which drew national attention some twenty years ago over allegations and several lawsuits alleging that it had over-billed the government.

Stanford and Stanford Healthcare are organized under IRS rules as purported not-for-profit organizations who pay no taxes. The lawsuit alleges that Stanford unlawfully collected more than $4 billion dollars of healthcare revenues in 2016 alone using institution wide upcoding and unbundling schemes, and that Stanford’s tax returns show it nearly doubled its Medicare revenues from the government from 2012 ($460.4 million) to 2016 ($755.7 million) without an explainable, reasonable, or proportionate increase in expenses or overhead.

Now it will be up to Federal Judge Hon. Dale Fisher to rule if Stanford and Ms. Zumwalt will be put on trial for their alleged billing fraud spanning nearly a decade, with allegations of $468 million of damages according to the Complaint.

This is the second lawsuit against Stanford University’s Debra Zumwalt involving Tax Fraud. Medical artificial intelligence company MedWhat and its CEO Arturo Devesa, via its investor the Stanford-StartX Fund LLC, are currently involved in a lawsuit against the University, its Board of Trustees and Ms. Zumwalt for alleged misrepresentations to Devesa and MedWhat hiding the legal structure of the Fund and IRS tax-exempt tax fraud and money laundering violations tied to commingling of school funds and university bank accounts in now shutdown for-profit legal separate venture capital firm Stanford-StartX Fund LLC and its manager Suzanne Fletcher. The Fund announced it was shutting down after MedWhat filed a lawsuit against Stanford University for Fraud. Case Number: CGC18565596


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