According to the story in the L.A. Times:
--there are two versions of what happened; so to be as fair as possible I'll first give UCLA's version.
Dr. Robert Pedowitz became chair of the orthopedic surgery department at the medical school in 2009. After voicing his concerns to higher officials about how many of his colleagues were taking industry money, in a manner he described as negatively affecting patient care, he stepped down in 2010. In 2012 he sued UCLA and some of his colleagues, charging retaliation for his speaking out, in the form of interfering with his getting research grants and patient referrals.
UCLA investigated the charges Dr. Pedowitz had brought and found a few irregularities, but mostly that no laws or university rules had been violated, and patients had not been compromised. Despite this clean bill of health, the UC regents have now decided to settle with the doctor to the tune of $10M, not because they're admitting any wrongdoing, but to "avoid the 'substantial expense and inconvenience' of further litigation."
Now for the other side of the story. Dr. Pedowitz (noting that the problems he faced are rife among academic medical cents and hardly are unique to UCLA) found when he came on board that one surgeon in his department was being paid $250,000 by the device maker Medtronic for consulting work. That same physician was trying to enroll patients in a research project involving Medtronic products. Sen. Charles Grassley (R-IA) had previously spotlighted a UCLA spine surgeon who had accepted $460,000 from Medtronic and other companies but had somehow failed to disclose these payments. UCLA, Pedowitz and his attorney charge, was too interested in the money to be made by these surgeons and by their potential commercial discoveries to rein in these practices.
I won't say who's right in this dispute, except to note that last time I checked, you could buy an awful lot of legal expense and inconvenience for $10M; so you can draw your own conclusions of which side the UC regents thought was going to win had the case gone all the way through the court.