Walgreens Whistleblower Who Received $25M Must Take Bid for More Settlement Money to State Courts

A Walgreens whistleblower who received more than $25 million from a federal fraud settlement must turn to state courts to pursue a share of the pharmacy chain’s separate $4.7 billion opioid settlement with states, a federal judge has ruled.

U.S. District Judge Joan H. Lefkow of the Northern District of Illinois on September 29 declined to decide pharmacist T.J. Novak’s claims to additional settlement money and dismissed them without prejudice. The ruling leaves Novak free to pursue the claims in the individual states.

Lefkow did not decide whether Novak is entitled to another payment. She found that answering the question would require resolving unsettled issues under the laws of 28 states after the federal claims that brought the case into federal court had already ended.

Novak sued Walgreens in 2018, alleging the company billed Medicare and Medicaid for invalid controlled substance prescriptions. He brought the case under the federal False Claims Act and similar state laws, which permit private whistleblowers to pursue certain fraud claims on behalf of governments and receive a portion of money recovered.

The federal government later joined the case. In April 2025, Walgreens agreed to pay $300 million to resolve allegations that it unlawfully filled millions of prescriptions for opioids and other controlled substances and sought reimbursement for many of them from Medicare and other federal health care programs.

Of the $300 million settlement, $150 million was tied to the False Claims Act allegations. Novak received a 17.25% whistleblower share, totaling more than $25 million. Walgreens denied wrongdoing.

Novak then sought additional money from Walgreens’ separate 2022 opioid settlement with state and local governments.

Under that agreement, Walgreens agreed to pay more than $4.7 billion over 15 years to resolve opioid-related claims involving more than two dozen states. The settlement directed much of the money toward opioid treatment, prevention and abatement programs.

The agreement also resolved claims that overlapped with allegations Novak had brought on behalf of states. In January 2024, the federal court dismissed the state Medicaid portions of his case after the states moved to end them following the multistate settlement.

Novak argued that because the states had settled claims covered by their own false claims laws, he was entitled to a whistleblower share of the proceeds. Twenty-seven states opposed his request.

Lefkow found that there was no single answer that could be applied across all of the states. Deciding Novak’s request would require the federal court to interpret each state’s false claims law, opioid settlement rules, and related judgments on issues their own courts had not resolved.

With the federal portion of the case finished, Lefkow declined to keep jurisdiction over those remaining state claims. She dismissed Novak’s requests without prejudice and terminated the federal case.

Novak can still seek a portion of the state settlement money, but he will have to pursue those claims in the relevant state courts.