DOJ Declines to Prosecute in First Healthcare Declination Under New Corporate Enforcement Policy

On July 29, 2026, the Department of Justice’s (DOJ’s) National Fraud Enforcement Division announced that it had declined to prosecute Campus Eye Management Holdings LLC and its wholly owned subsidiary, Campus Eye Management LLC (together, the Campus Eye Entities), for healthcare fraud, illegal health care kickbacks and bribes, and conspiracy. The declination was issued under Part I of DOJ’s new “Corporate Enforcement and Voluntary Self-Disclosure Policy” (the CEP), which Acting Attorney General Blanche announced on March 10, 2026. As part of the resolution, the Campus Eye Entities agreed to pay US$1 million of disgorgement in victim compensation. The resolution did not extend to the former CEO, E. Bruce DiDonato, whom DOJ contemporaneously indicted on seven criminal counts arising from the same underlying conduct.

The CEP’s Framework for Voluntary Self-Disclosure

The CEP addresses the benefits available to companies that voluntarily disclose, cooperate in regard to, and remediate potential criminal misconduct. It adopts a three-part structure classifying self-disclosures into tiers with diminishing benefits. Under Part I, a company that voluntarily self-discloses misconduct, fully cooperates with DOJ’s investigation, and timely and appropriately remediates will receive a declination if no aggravating circumstances are present, though the company must still pay all disgorgement, forfeiture, and restitution. Under Part II, a company that does not qualify for a Part I declination — because its self-report does not meet all voluntary self-disclosure requirements or because aggravating circumstances are present — may still receive a non-prosecution agreement (absent egregiousness or multiple aggravating factors) with a term of less than three years, no independent compliance monitor, and a penalty reduction of 50-75%. Under Part III, companies that do not qualify for Parts I or II may receive reductions of up to 50%, and prosecutors otherwise retain full discretion over the form of resolution, term, monitor, and other compliance obligations. For more information on the CEP, please see our prior Client Alert.

The Campus Eye Resolution

Campus Eye Management LLC is a management services organization that provides billing, administrative, and back-office support to an optometry practice, as well as management services —including billing and collection — to an affiliated eye surgery center. The practice’s founder E. Bruce DiDonato and private equity investors formed the Campus Eye Entities in July 2021. DiDonato remained sole owner and president of the practice while serving as CEO of both Campus Eye Entities and as a member of the board overseeing Campus Eye Management and the surgery center from December 2021 through March 2023. DiDonato’s scheme began around 2015, predating the Campus Eye Entities. According to DOJ, DiDonato “marketed and sold [the Campus Eye Entities] to private equity investors, based in part on the lucrative reimbursements he received from Medicare.”

Per DOJ’s declination letter, during his tenure as CEO of the Campus Eye Entities, DiDonato caused Campus Eye Management LLC to submit fraudulent claims to Medicare and other insurers for duplicative and medically unnecessary diagnostic tests performed by the optometry practice and procured through the payment of kickbacks. DOJ’s declination letter alleges that DiDonato’s scheme resulted in payments of approximately US$3.7 million to the optometry practice. The Campus Eye Entities voluntarily self‑disclosed the misconduct to DOJ, undertook remediation, and cooperated with the investigation.

DOJ credited Campus Eye’s timely and voluntary self-disclosure, its full and proactive cooperation (including detailed factual disclosures and continued cooperation with ongoing investigations and prosecutions), the absence of aggravating factors, and its timely remediation efforts, which included revising billing, payment, and compensation policies and strengthening its compliance program through new compliance personnel, ongoing risk assessments, and compliance training. Although the scheme generated roughly US$3.7 million in improper reimbursements, DOJ agreed to accept US$1 million in disgorgement after an independent ability-to-pay analysis concluded that a larger payment would threaten the companies’ continued viability. DOJ indicted DiDonato on multiple counts, including healthcare fraud and kickback offenses, carrying potential penalties of up to 10 years’ imprisonment each.

Implications for Healthcare Companies and Private Equity Sponsors

The Campus Eye Entities declination confirms that DOJ intends to make good on the CEP’s promise of a clear, predictable path to declination for companies that self-report promptly, cooperate fully, and remediate meaningfully, even in the current active healthcare fraud enforcement environment. When announcing the Campus Eye Entities’ resolution, Assistant Attorney General Colin McDonald reiterated that DOJ’s policies afford companies that take responsibility for their misconduct “a clear path to a declination.” AAG McDonald’s statement signals that DOJ views this resolution as a template for future self-disclosures by healthcare companies. Simultaneously, the parallel indictment of the Campus Eye Entities’ founder illustrates that corporate cooperation and a subsequent declination do not protect responsible individuals from criminal prosecution, and DOJ expects companies to cooperate with such investigations and prosecutions.

For healthcare companies and private equity sponsors, the resolution underscores the value of robust pre- and post-acquisition compliance diligence. Companies discovering potential misconduct should, in consultation with counsel, evaluate the CEP’s disclosure framework early to maximize the benefits available under the policy.

As DOJ continues to apply the CEP across industries, Latham & Watkins will monitor developments and provide updates. For questions, please contact our White Collar Defense & Investigations Practice.