Two former laboratory sales executives sentenced to federal prison for roles in health care kickback conspiracy

TYLER, Texas – Two former laboratory sales executives were sentenced to federal prison for conspiring to violate the Anti-Kickback Statute, announced Acting U.S. Attorney Abe McGlothin, Jr.

Stephen Kash, 51, of Winnie, was sentenced to 18 months in federal prison and ordered to forfeit $779,773.70 in criminal proceeds.  Courtney Love, 46, of Dallas, was sentenced to 12 months and one day in federal prison and ordered to forfeit $217,268.75 in criminal proceeds. The sentences were imposed by U.S. District Judge Jeremy D. Kernodle on April 24, 2025.

On September 22, 2022, Christopher Grottenthaler, 46, of Dorado, Puerto Rico; Blake Whitaker, 54, of Frisco; Stephen Kash; Chrissy Alfaro, 39, of Frisco; Courtney Love; Charles Dickens, 45, of Beaumont; Marty Flores, 67, of Montgomery; and Frederick Brown, 52, of Missouri City, were indicted for conspiring to commit illegal remunerations in violation of the Anti-Kickback Statute.  The statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federal health care programs.  The defendants were charged for their roles in a conspiracy through which physicians were incentivized to make referrals to rural hospitals and an affiliated lab in exchange for kickbacks which were disguised as investment returns; and in which marketers were incentivized to arrange for or recommend the ordering of services from rural hospitals and an affiliated lab.

Two rural Texas hospitals, Little River Healthcare (LRH) based in Rockdale, and Stamford Memorial Hospital based in Stamford, partnered with True Health Diagnostics (THD), a clinical laboratory based in Frisco, Texas, that specialized in advanced cardiovascular lipid testing.  For a fee, THD processed the blood tests while the hospitals billed the tests to insurers as hospital outpatient services, with the hospitals charging insurers a much higher rate than THD could receive as a clinical laboratory.  The hospitals utilized a network of marketers who in turn operated management services organizations (MSOs) that offered investment opportunities to physicians throughout the State of Texas.  In reality, the MSOs were simply a means to facilitate payments to physicians in return for the physicians’ laboratory referrals.  Pursuant to the kickback scheme, the hospitals paid a portion of their laboratory revenues to marketers, who in turn kicked back a portion of those funds to the referring physicians who ordered THD tests.  THD executives and sales force personnel leveraged the MSO kickbacks to gain and increase referrals and, in turn, to increase their revenues, bonuses, and commissions.

On July 14, 2022, Kash was also indicted for conspiring to commit money laundering for his involvement in a conspiracy to launder the proceeds of the kickback conspiracy.

This case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General, and the U.S. Department of Defense – Defense Criminal Investigative Service (DCIS) with assistance from the U.S. Secret Service and the U.S. Department of Commerce - Export Enforcement.  It was prosecuted by Assistant U.S. Attorneys Adrian Garcia, Nathaniel C. Kummerfeld, Lucas Machicek, and Robert Austin Wells.

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