Mealey's Insurance Fraud

  • January 09, 2020

    Doctors’ Suit Over Constitutionality Of State’s Insurance Fraud Law Dismissed

    NEWARK, N.J. — A lawsuit brought by two doctors challenging the constitutionality of the New Jersey Insurance Fraud Prevention Act (IFPA) was dismissed Jan. 7 by a federal judge in New Jersey after he found that the plaintiffs lacked standing under Article III of the U.S. Constitution (Harshad Patel M.D., et al. v. Richard Crist, et al., No. 19-8946, D. N.J., 2020 U.S. Dist. LEXIS 2111).

  • January 08, 2020

    Podiatrist’s Conviction, Sentence For Fraudulently Billing Nail Avulsions Upheld

    CINCINNATI — A Sixth Circuit U.S. Court of Appeals panel on Jan. 6 upheld a podiatrist’s 24-month prison sentence and order requiring him to pay $83,252.63 in restitution, finding that the evidence presented during a trial support the conviction and that a federal judge in Tennessee did not err when calculating the amount of loss (United States v. John J. Cauthon, No. 18-5613, 6th Cir., 2020 U.S. App. LEXIS 393).

  • January 07, 2020

    GEICO Need Not Pay Claims For Upcoded Services, Judge Rules

    MIAMI — A federal judge in Florida on Dec. 20 granted in part a motion for summary judgment filed by the Government Employees Insurance Co. (GEICO) and its affiliates in a suit accusing a clinic of submitting false bills for physical therapy services, finding that the insurer is entitled to a declaration stating that it is not required to pay outstanding bills for services that were fraudulently upcoded and provided by unqualified individuals (Government Employees Insurance Co., et al. v. Quality Diagnostic Health Care Inc., et al., No. 18-20101-CIV-MARTINEZ/OTAZO-REYES, S.D. Fla., 2019 U.S. Dist. LEXIS 220674).

  • January 07, 2020

    California Panel: Lawyer’s Demand Letters To Insurer Can Support Fraud Claims

    LOS ANGELES — A California appeals court panel on Dec. 23 affirmed a ruling denying a lawyer and law firm’s motion to strike allegations brought against them by Allstate Insurance Co. over an alleged insurance fraud scheme, finding that demand letters sent by the defendants to the insurer are not protected activity under California law (People of the state of California, ex rel. Allstate Insurance Co. v. Kelly L. Casado, et al., No. B288742, Calif. App., 2nd Dist., 7th Div., 2019 Cal. App. Unpub. LEXIS 8572).

  • January 06, 2020

    Magistrate Judge Recommends Granting Motion To Enforce Subpoena On Nonparty

    MIAMI — A federal magistrate judge in Florida on Dec. 20 recommended granting a petition to enforce a subpoena that seeks the deposition of a Miami-based business owner, finding that his testimony could be relevant to a lawsuit brought by State Farm Mutual Automobile Insurance Co.  in federal court in New York against 20 defendants accused of submitting false claims for no-fault benefits because the defendants sent him large sums of money during the alleged scheme (State Farm Mutual Automobile Insurance Co. v. Vladimir Maistrenko, No. 19-MC-20850-SCOLA-TORRES, S.D. Fla., 2019 U.S. Dist. LEXIS 221150).

  • January 02, 2020

    Judge:  State Farm Sufficiently States RICO Claim Against Doctor Over Billing

    HOUSTON — A federal judge in Texas on Dec. 31 denied motions to dismiss filed by a doctor as well as the owners of a clinic where the doctor performed procedures on patients who were allegedly injured in automobile accidents, finding that State Farm Mutual Automobile Insurance Co. and an affiliate sufficiently stated a claim against the doctor under the Racketeer Influenced and Corrupt Organizations Act and claims for money had and received (State Farm Mutual Automobile Insurance Co. v. Nooruddin S. Punjwani, et al., No. H-19-1491, S.D. Texas, 2019 U.S. Dist. LEXIS 223054).

  • December 19, 2019

    Judge: Insurer Has Enough Evidence For Fraud Claim Against Insured, Caregiver

    OKLAHOMA CITY — An insurance company that reimbursed a former orthopedic surgeon for services that assisted him with activities of daily living (ADLs) has sufficient evidence to pursue claims for fraud and deceit against the insured and his caregiver, a federal judge in Oklahoma ruled Dec. 17 in denying the defendants’ motion for partial summary judgment, holding that the record shows that the defendants created a payment mechanism that misrepresented how the payment of the insured’s claims were being distributed (Allianz Life Insurance Co. of North America v. Gene L. Muse, et al., No. CIV-17-1361-G, W.D. Okla., 2019 U.S. Dist. LEXIS 217444).

  • December 18, 2019

    Doctor’s Conviction For Health Care Fraud Involving 5 Elderly Patients Upheld

    NEW ORLEANS — A Fifth Circuit U.S. Court of Appeals panel on Dec. 16 affirmed a doctor’s conviction for one count of conspiracy to commit health care fraud and five counts of health care fraud for submitting false bills for treatment of five elderly patients with dementia, as well as a federal judge’s decision to sentence him to 150 months in prison, holding that the evidence presented during trial was sufficient (United States v. Riyaz Mazkouri, No. 18-20650, 5th Cir., 2019 U.S. App. LEXIS 37167).

  • December 17, 2019

    United States: Pharmacy Fraudulently Refilled Long-Term Care Prescriptions

    NEW YORK — The U.S. Justice Department on Dec. 17 intervened in a whistleblower lawsuit alleging that long-term care pharmacy Omnicare Inc. fraudulently refilled prescriptions without physician authorization, sometimes for years (United States, et al, ex rel. Uri Bassan v. Omnicare, Inc., No. 15-4179, S.D. N.Y.).

  • December 13, 2019

    2 Indictments Charge 10 Former NFL Players With Health Care Fraud

    LEXINGTON, Ky. — Two indictments filed under seal on Dec. 6 in Kentucky federal court and unsealed Dec. 12 charge 10 former National Football League players with participating in a nationwide health care fraud scheme that resulted in the submission of $3.9 million in fraudulent claims to the Gene Upshaw NFL Player Health Reimbursement Account Plan between June 2017 and December 2018 and $3.4 million in payouts (United States v. Correll Buckhalter, et al., No. 19-cr-205, United States v. Robert McCune, et al., No. 19-cr-206, E.D. Ky.).

  • December 10, 2019

    Judge Finds Arbitration Does Not Trigger Jurisdiction Over Insurer’s Fraud Claims

    NEW YORK — A federal judge in New York on Dec. 5 denied an insurer’s motion to reconsider a ruling finding that an ambulatory services provider’s arbitration proceedings against the company trigger personal jurisdiction over the insurer’s fraud and unjust enrichment claims, holding that New York’s no-fault law allows the insured to attempt to collect unpaid claims through arbitration (Allstate Insurance Co., et al. v. Sangwoo Mah, et al., No. 19-cv-2866, E.D. N.Y., 2019 U.S. Dist. LEXIS 209836).

  • December 04, 2019

    Judge Rules Fraud Defendant’s Counsel Was Effective, Refuses To Vacate Sentence

    KALAMAZOO, Mich. — A federal judge in Michigan on Dec. 3 refused a to vacate a man’s 87-month prison sentence after he was convicted by a federal jury on charges of health care fraud and mail fraud, finding that he received effective assistance of counsel (United States v. Antonio Martinez-Lopez, No. 16-CR-62, W.D. Mich., 2019 U.S. Dist. LEXIS 207544).

  • December 04, 2019

    Defendants Accused Of Fraud Can Pursue Defamation Counterclaim, Judge Says

    FLINT, Mich. — Two therapists and two clinics accused of engaging in a scheme to submit fraudulent bills to State Farm Mutual Automobile Insurance Co. can pursue a counterclaim for defamation, a federal judge in Michigan ruled Dec. 2, finding that communications the insurer had with the defendants’ patients could support the cause of action (State Farm Mutual Automobile Insurance Co. v. Max Rehab Physical Therapy LLC, et al., No. 18-13257, E.D. Mich., 2019 U.S. Dist. LEXIS 207001).

  • December 04, 2019

    Aetna Permitted To Expand Discovery Terms, Custodians In Neonatal Fraud Lawsuit

    PHILADELPHIA — A Pennsylvania federal magistrate judge on Dec. 2 mostly granted a motion by Aetna Inc. to compel a neonatal health services provider to provide discovery of a electronically stored information (ESI) from broader search terms and a larger roster of custodians, deeming most of the information sought relevant and proportionate to the fraud claims against the company (Aetna Inc., et al. v. Mednax Inc., et al., No. 2:18-cv-02217, E.D. Pa., 2019 U.S. Dist. LEXIS 206984).

  • December 02, 2019

    Magistrate Recommends Staying Arbitration Proceedings Over Practice’s Billing

    BUFFALO, N.Y. — A federal magistrate judge in New York on Nov. 26 recommended granting a motion for a preliminary injunction that would stay arbitration proceedings brought by two doctors and a clinic accused by the Government Employees Insurance Co. (GEICO) and its affiliates of submitting fraudulent bills for no-fault insurance coverage, explaining that the insurer would be irreparably harmed if it was required to make payments on claims with questionable accuracy (Government Employees Insurance Co., et al. v. Mikhail Strut M.D., et al., No. 19-CV-728, W.D. N.Y., 2019 U.S. Dist. LEXIS 205801).

  • November 27, 2019

    Judge Finds Insurer Adequately Alleged Claim Under Insurance Fraud Statute

    PITTSBURGH — An insurance company seeking reimbursement of payments it made to a man who allegedly misrepresented his status of being fully disabled sufficiently stated a claim under Pennsylvania’s Insurance Fraud Statute, a federal judge in Pennsylvania ruled Nov. 25 in denying the man’s motion to dismiss the claim (Axis Insurance Co. v. Michael Franitti, No. 19-85, W.D. Pa., 2019 U.S. Dist. LEXIS 203918).

  • November 20, 2019

    Clinic Owner Pleads Guilty To Billing Medicaid For Services To Deceased Patient

    ST. LOUIS — The U.S. Department of Justice (DOJ) announced Nov. 19 that the owner of a behavioral health clinic pleaded guilty Nov. 18 in Missouri federal court to one count of making false statements regarding a health care matter for billing Missouri Medicaid for services that were provided for a patient who was deceased at the time (United States v Naim Muhammad, No. 18cr307, E.D. Mo.).

  • November 18, 2019

    Panel Says It Cannot Address Challenge To Guilty Plea In Fraud Case

    ATLANTA — A Georgia appeals panel on Nov. 15 refused to vacate a man’s guilty plea to a charge under the Racketeer Influenced and Corrupt Organizations Act for his role in an insurance fraud scheme, finding that the record does not support his argument that the trial court judge threatened him into entering the plea (Alfonza McKeever Jr. v. State, No. A19A1417, Ga. App., 2019 Ga. App. LEXIS 681).

  • November 15, 2019

    Insurer’s Fraud Suit Remanded After Judge Finds No Preemption By ERISA

    SANTA ANA, Calif. — An insurer’s lawsuit accusing a number of substance abuse treatment centers of common-law fraud, violation of California’ unfair competition law (UCL) and other claims can proceed in state court, a federal judge in California ruled Nov. 13, holding that the plaintiff company’s claims are not preempted by the Employee Retirement and Income Security Act (Health Net Life Insurance Co. v. Morningside Recovery LLC, et al., No. 19-cv-1342, C.D. Calif., 2019 U.S. Dist. LEXIS 197937).

  • November 14, 2019

    Panel:  Counsel’s Failure To Raise Youth Factors Argument Was Not Ineffective

    SAN FRANCISCO — A trial attorney’s failure to raise the youth factors argument in two U.S. Supreme Court rulings and one California Supreme Court case following a man’s conviction on two counts of insurance fraud did not constitute ineffective assistance of counsel, a California appeals panel ruled Nov. 13, finding that the contents of the presentence report prepared by the prosecution showed the defendant’s history of failing to comply with probation and post-sentence requirements (People v. Lamont James, Nos. A155627, A157772, Calif. App., 1st Dist., 2nd Div., 2019 Cal. App. Unpub. LEXIS 7507).

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