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Mealey's Insurance Fraud

January 31, 2024
Magistrate Recommends Granting Judgment For Insurer In Yacht Fire Coverage Dispute

MIAMI — A Florida federal magistrate judge issued a report and recommendation advising granting summary judgment for a marine insurer seeking a declaratory judgment that it is not obligated to cover its insured’s loss related to fire damage of an 85-foot yacht, finding that because the insured made material misrepresentations in the policy application, the insurer is entitled to a ruling that the policy is void and there is no coverage.
January 30, 2024
9th Circuit Stays Mandate Reversing Court’s Dismissal In FCA Drug Pricing Suit

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals granted a 90-day stay of the mandate reversing and remanding a district court’s dismissal of a relator’s qui tam suit alleging violations of the False Claims Act (FCA) against pharmaceutical companies related to their alleged fraud by artificially inflating drug prices.
January 30, 2024
Judge Overrules Discovery Objections In FCA Suit, Says Scope Should Be Nationwide

SAN DIEGO — A California federal judge affirmed a magistrate judge’s discovery order and overruled Abbott Laboratories’ objections to the geographical scope of discovery in a suit alleging violations of the False Claims Act (FCA) and state false claims laws regarding an alleged kickback scheme to induce hospitals and physicians to use an Abbott cardiac medical device, finding that the complaint sufficiently alleges a “nationwide scheme.”
January 29, 2024
Judgment Entered For Insurer In Dispute Over Insured’s Asserted ‘State Of Health’

MIAMI — A Florida federal judge on Jan. 26 entered a default judgment in an insurer’s suit seeking to rescind a life insurance policy, finding that the insurer is entitled to a declaratory judgment rescinding the policy because of misrepresentations that the insured “was not in the state of health described in her application.”
January 26, 2024
Judgment For Insurer Affirmed In Fire Loss Coverage Dispute Over Misrepresentations

FRANKFORT, Ky. — A Kentucky appellate court affirmed in part a lower court’s grant of summary judgment for an insurer and an insurance agency in a dispute with a homeowner over denial of coverage for a fire, finding that summary judgment was correctly granted for the insurer and agency because of the misrepresentations made in the policy application despite it being completed by an insurance agent and signed by the homeowner.
January 26, 2024
Magistrate: Parties In FCA Suit Must Respond To Intervention By Specific Date

INDIANAPOLIS — An Indiana federal magistrate judge ordered parties to respond by Feb. 5 to the state’s motion to intervene in a suit filed by a health care network’s former employee, who alleges that his termination was in retaliation for his expressing concerns over the network’s purported False Claims Act (FCA) violations by illegally inducing physicians to refer patients to the network’s hospitals.
January 25, 2024
Vesttoo Bankruptcy Debtors: Proceeding In Israel Would Be More Efficient

WILMINGTON, Del. — A variety of objections have been lodged in Delaware federal bankruptcy court regarding the Official Committee of Unsecured Creditors’ Chapter 11 plan of liquidation for Vesttoo Ltd. and 48 affiliates, including one in which the debtors argue that the cases should be dismissed “so that more efficient insolvency proceedings can be filed in Israel.”
January 25, 2024
Summary Judgment Granted For Insurer In Row Over Overvalued Sunken Fishing Boat

FORT LAUDERDALE, Fla. — A Florida federal judge granted summary judgment to a commercial marine insurer seeking a declaratory judgment that it did not need to provide coverage for a fishing vessel it believes was intentionally sunk, finding no remaining issues of material fact that the insured made material misrepresentations in the policy application, including overvaluing the vessel by more than $35,000.
January 24, 2024
Doctors, Practices Seek Denial Of Reconsideration Or Appeal In GEICO’s RICO Suit

TRENTON, N.J. — Doctors and their practices asked a New Jersey federal court to deny GEICO’s motion for reconsideration or interlocutory appeal of the court’s order dismissing in part GEICO’s suit alleging fraudulent billing for unnecessary medical and chiropractic services for people injured in auto accidents and eligible for no-fault coverage.
January 22, 2024
Cert Denied In Hospital’s Challenge To FCA Suit Over False Reports To Medicare

WASHINGTON, D.C. — The U.S. Supreme Court on Jan. 22 denied a hospital’s petition for a writ of certiorari challenging the Fifth Circuit U.S. Court of Appeals’ decision that declined to dismiss a qui tam suit alleging that a hospital and its owners and officers violated the federal False Claims Act (FCA) by submitting false reports for Medicare reimbursement.
January 18, 2024
Committee Seeks To Bar Some Claimants In Vesttoo Cases From Liquidation Vote

WILMINGTON, Del. — The Official Committee of Unsecured Creditors on Jan. 17 asked a Delaware federal bankruptcy court to reclassify 49 disputed claims so the joint provisional liquidators (JPLs) that submitted them can’t vote on the committee’s Chapter 11 plan of liquidation for Vesttoo Ltd. and 48 affiliates.
January 16, 2024
Judge Denies Walgreen’s Dismissal Motion In FCA Suit On Remand From 4th Circuit

ABINGDON, Va. — A Virginia federal judge on Jan. 13 denied Walgreen’s motion to dismiss after the Fourth Circuit U.S. Court of Appeals reversed and remanded the judge’s previous dismissal of a suit filed by federal and state governments alleging violations of the False Claims Act (FCA) and Virginia law, finding in part that the federal and state governments “have plausibly alleged a materially false representation” regarding Walgreens’ alleged misrepresentation that certain patients met Medicaid eligibility requirements for hepatitis C drugs.
January 10, 2024
Injunction Issued In Allstate’s RICO Suit Against Doctors Over No-Fault Fraud

BROOKLYN, N.Y. — A New York federal judge granted Allstate’s motion for a preliminary injunction in its Racketeer Influenced and Corrupt Organizations Act (RICO) violations suit against physicians and their practices related to alleged billing for excessive services for no-fault insureds injured in auto accidents, finding that the injunction should be granted due to the likelihood of irreparable harm without a stay of the pending arbitrations between Allstate and the physicians and their practices.
January 09, 2024
Alaska Judge Denies Judgment For Insurer In Dispute Over Water Damage Coverage

ANCHORAGE, Alaska — An Alaska federal judge on Jan. 8 denied an insurer’s motion for summary judgment in its suit seeking a declaratory judgment that a homeowners policy does not provide coverage for the insured’s water damage, finding that fact issues remain regarding whether the insured advised the insurer that the second mortgage on his property “was subject to litigation.”
January 09, 2024
Judgment Issued For Insurer In Dispute Over Substance Abuse Misrepresentations

WASHINGTON, D.C. — A District of Columbia federal judge granted default judgment to a life insurer seeking to rescind a life insurance policy due to the insured’s purported misrepresentations in the policy application regarding his use of cigarettes or illegal drugs, finding that because the court clerk’s entry of default against the insured resulted in the allegations in the complaint being deemed admitted, the insurer is entitled to a judgment declaring the policy void.
January 09, 2024
Decision Revoking Insurance License Affirmed In Dispute Over Forged Applications

TRENTON, N.J. — A New Jersey appellate court affirmed a decision by the commissioner of the New Jersey Department of Banking and Insurance (NJDOBI) that imposed more than $60,000 in civil penalties and fees and revoked an insurance agent’s license related to his submission of forged insurance applications in violation of the New Jersey Insurance Producer Licensing Act (Producer Act) and the New Jersey Insurance Fraud Prevention Act (Fraud Act), finding “no basis for disturbing the Commissioner's reasoned determination.”
January 08, 2024
9th Circuit Denies Rehearing, Files Amended Opinion In FCA Drug Pricing Suit

SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on Jan. 5 denied a petition for a panel rehearing and a rehearing en banc, issuing an amended opinion of its decision reversing a district court’s dismissal of a relator’s qui tam suit alleging violations of the federal False Claims Act (FCA) against pharmaceutical companies related to their alleged fraud by artificially inflating drug prices, finding “that the qualifying public disclosures here do not collectively disclose a combination of facts sufficient to permit a reasonable inference of fraud.”
January 08, 2024
Judge Denies Insured’s Motion For Reconsideration In Home Policy Rescission Suit

HOT SPRINGS, Ark. — An Arkansas federal judge denied a homeowner’s motion for reconsideration of an order granting summary judgment to an insurer that rescinded the homeowner’s policy due to a misrepresentation in her policy application, finding that the homeowner failed to provide evidence of an error of law to “justify” amending the order.
January 04, 2024
High Court Distributes Petition Challenging FCA Suit Against Hospital, Owners

WASHINGTON, D.C. — The U.S. Supreme Court on Jan. 3 distributed for conference a hospital’s petition for a writ of certiorari challenging the Fifth Circuit U.S. Court of Appeals’ decision that declined to dismiss a qui tam suit alleging that a hospital and its owners and officers violated the federal False Claims Act (FCA) by submitting false reports for Medicare reimbursement.
January 03, 2024
Pharmaceutical Company To Pay $6M To End Kickback Claims In Marketing Plan

BOSTON — Pharmaceutical company Ultragenyx Pharmaceutical Inc. will pay $6 million to settle claims that it violated the False Claims Act (FCA) in its marketing efforts for its drug Crysvita, which treats a rare inherited disorder.
January 03, 2024
Allstate Sues Florida Pain Clinic For Fraud, Alleges Breach Of $2.5M Settlement

WEST PALM BEACH, Fla. — Nine days after a Florida pain clinic and the physician who runs it purportedly reneged on their $2.5 million settlement agreement with Allstate Insurance Co. to resolve fraud claims related to billing for services not performed or medically unnecessary, Allstate filed suit in a Florida federal court against the clinic and doctor alleging common-law fraud, unjust enrichment and violations of the federal Racketeer Influenced and Corrupt Organizations Act (RICO), Florida RICO Act and Florida Deceptive and Unfair Trade Practices Act (FDUTPA).
January 03, 2024
6th Circuit Affirms Judgment For State Farm In Suit Over Denial Of Fire Claim

CINCINNATI — The Sixth Circuit U.S. Court of Appeals affirmed a district court’s grant of summary judgment to State Farm in a suit against it for denying a claim for fire damage to an apartment building, finding that the district court correctly granted summary judgment after determining that the owner of the apartment building breached the fraud or concealment provision of his policy through misrepresentations regarding his whereabouts during the fire.
January 02, 2024
Judge Dismisses GEICO’s Fraud, RICO Claims In $2.3M No-Fault Suit Against Doctors

TRENTON, N.J. — A New Jersey federal judge on Dec. 30 dismissed in part GEICO’s suit against doctors and their practices alleging fraudulent billing for unnecessary medical and chiropractic services for people injured in auto accidents and eligible for no-fault coverage, finding that claims for Racketeer Influenced and Corrupt Organizations Act (RICO) violations, unjust enrichment and common-law fraud must be arbitrated pursuant to the New Jersey Insurance Fraud Prevention Act (NJIFPA) but that claims for NJIFPA violations are sufficiently alleged and therefore not subject to dismissal.
January 02, 2024
Committee Gets OK For Vote On Liquidation Plan In Vesttoo Chapter 11 Cases

WILMINGTON, Del. — A Delaware federal bankruptcy judge who is allowing the Official Committee of Unsecured Creditors to put its Chapter 11 plan of liquidation for Vesttoo Ltd. and 48 affiliates to a vote also granted its motions for leave to conduct discovery against two banking organizations.
December 22, 2023
Ohio Panel Affirms Judgment For Insurer In Dispute Over Voided Homeowners Policy

CLEVELAND — An Ohio appellate court affirmed a lower court’s grant of summary judgment to an insurer, an insurance agent and his agency in a breach of contract and bad faith suit related to the insurer’s voiding of a homeowners policy and refusing to pay a man’s fire damage claim, finding that there are no remaining issues of material fact and that the claims against the agent and his agency are time-barred under the statute of limitations.