Whistleblower alleging Red Cross let tainted blood be released sees bulk of lawsuit dismissed

Thursday, April 27th 2006, 2:35 pm

By: News On 6

WASHINGTON (AP) _ A whistleblower who claims the American Red Cross failed to immediately alert regulators when more than 600 pints of contaminated blood were released in New Jersey saw the bulk of her lawsuit dismissed Thursday in federal court.

Michelle Hoyte also claims the agency fired her for complaining to her managers about the tainted blood. That part of her lawsuit is still intact, but the Red Cross has filed a motion to have that final portion dismissed as well.

After the brief hearing, in which a judge dismissed the False Claims Act portion of her lawsuit, Hoyte said she remained worried that the Justice Department and the Food and Drug Administration are not doing enough to make sure the Red Cross's blood supply is carefully monitored. Blood banking has become the Red Cross's biggest moneymaker, bringing in $2.14 billion in revenue in the last fiscal year.

``There's supposed to be an internal system for people to report incidents like this,'' Hoyte said. ``But the employees are afraid to do so for fear of being dismissed.''

At the hearing, John R. Fleder, attorney for the Red Cross, said the organization and the FDA are actively monitoring the blood supply.

``It's top priority is the safety, security and availability of the nation's blood supply,'' Fleder said of the Red Cross.

According to her lawsuit, Hoyte supervised a February 2004 audit of the Red Cross's Penn-Jersey blood collection facility in Philadelphia. The auditors discovered that 607 pints of blood were not collected properly and were exposed to air, violating agency procedures. Officials suspended the worker who collected the blood but Hoyte alleges they did not immediately alert regulators, or recall the blood.

The lawsuit says that it is still not known whether the blood that was released caused any infections or illnesses, or exactly what hospitals, blood banks or other facilities received the pints.

Hoyte complained to her managers about the blood and also went to the FDA, where she used to work. The FDA investigated her claim last year and found that 539 of the 607 units had been exposed to air.

In spite of the FDA's findings, Hoyte's attorney, Vincent McKnight, said the Red Cross has not been fined.

Hoyte included the Justice Department as a plaintiff in her case, but the government sought Thursday to have her False Claims Act motion dismissed, saying the government has investigated the case and the FDA has taken action. The Red Cross supported the motion, and U.S. District Judge Paul Friedman granted it.

The False Claims Act is designed to stop fraud in government procurement contracts. Many whistleblower lawsuits are filed under this law.

McKnight said he and Hoyte are discussing whether to appeal Thursday's ruling, but would continue the lawsuit suing the Red Cross for wrongful termination. Hoyte, who suffers from multiple sclerosis, said she does not have another job.