HOUSTON — A Texas appeals court panel on July 9 upheld a man’s conviction for insurance fraud after finding that his insurer was properly named in his indictment and that any variations in the company’s name in evidence that was presented during trial were immaterial (Mohamed Saleh Awad v. Texas, No. 14-18-00250-CR, Texas App., 14th Dist., 2019 Tex. App. LEXIS 5687).
DETROIT — A federal magistrate judge in Michigan on July 2 ordered a nonparty attorney accused of referring individuals injured in automobile accidents to clinics that allegedly submitted fraudulent bills to State Farm Mutual Automobile Insurance Co. to produce a majority of the records the insurer requested in a subpoena, holding that evidence presented by the company could support the inference that he is the center of the scheme (State Farm Mutual Automobile Insurance Company v. Elite Health Centers Inc., et al., No. 16cv13040, E.D. Mich., 2019 U.S. Dist. LEXIS 110767).
MIAMI — A federal judge in Florida on June 11 denied motions to dismiss filed by two doctors and two medical clinics accused by State Farm Mutual Automobile Insurance Co. and State Farm Fire and Casualty Co. (State Farm) of engaging in a scheme to submit fraudulent claims for personal injury benefits, holding that the insurer’s allegations satisfy the heightened pleading requirement of Federal Rule of Civil Procedure 9(b) and that the company’s amended complaint is not a shotgun pleading (State Farm Mutual Automobile Insurance Company, et al. v. Health and Wellness Services Inc., et al., No. 18-21325-Civ-Scola, S.D. Fla., 2019 U.S. Dist. LEXIS 105269).
HARRISBURG, Pa. — A federal judge in Pennsylvania on June 27 sentenced a man to two years’ probation and ordered him to pay $29,337 in restitution after he pleaded guilty to fraudulently receiving Medicaid and Supplemental Nutrition Assistance Program (SNAP) benefits from 2014 to 2018 (United States v. Nagy M. Abdelhamed, No. 18cr314, M.D. Pa.).
LITTLE ROCK, Ark. — A federal judge in Arkansas on June 27 dismissed without prejudice a mental health counseling franchise’s claims that four former employees who filed a False Claims Act suit against it breached the terms of noncompete agreements when leaving the company, finding the court lacked jurisdiction (United States, ex rel. Jacqueline Clemente, et al. v. Lead Teach Mentor LLC, et al., No. 16CV00875, E.D. Ark., 2019 U.S. Dist. LEXIS 107748).
TAMPA, Fla. — The owner of a medical marketing company who is already serving 14 years in prison for health care fraud, money laundering and identity theft was found guilty by a federal jury in Florida on June 25 for paying illegal kickbacks to medical clinics as part of a $2.2 million fraud scheme (United States v. David B. Lovelace, No. 14cr512, M.D. Fla.).
MIAMI — A Florida appeals panel on June 26 ordered a new trial over an insurance company’s denial of a woman’s claim under her homeowners policy to recover losses stemming from a January 2010 burglary, holding that the trial court judge erred when striking the insurance company’s affirmative defense for insurance fraud and not giving the company leave to amend the defense (American Integrity Insurance Company v. Maria Estrada, No. 3D16-966, Fla. App., 3rd Dist., 2019 Fla. App. 10020).
BIRMINGHAM, Ala. — A federal judge in Alabama ruled June 24 that a Nigerian woman cannot introduce evidence of cultural differences to support her defense that she was coerced and in a state of duress when she submitted fraudulent bills to Medicare and private insurers for allergen immunotherapy for patients when it was medically unnecessary, explaining that the defendant did not provide any examples of what evidence she would submit (United States v. Patrick Emeka Ifediba, et al., No. 18-cr-0103-RDP-JEO, N.D. Ala., 2019 U.S. Dist. LEXIS 104710).
HATTIESBURG, Miss. — A federal magistrate judge in Mississippi on June 24 scheduled an Aug. 18 trial date for a physician and a pharmacist charged with submitting more than $7 million in bills for medically unnecessary compounded medications to TRICARE, the health care benefit program serving U.S. military, veterans and their respective family members, and private health care benefit programs (United States v. Shahjahan Sultan, M.D., et al., No. 19cr28, S.D. Miss.).
ATLANTA — A Georgia appeals panel on June 19 upheld a trial court judge’s affirmation of an administrative law judge’s (ALJ) decision that an insurance company waived its void policy defense when seeking to deny coverage of a workers’ compensation claim, holding that the company decided to cancel a construction company’s policy over misrepresentations in the policy application rather than rescind the policy (Grange Mutual Casualty Company v. Adam Bennett, et al., No. A19A0497, Ga. App., 4th Div., 2019 Ga. App. LEXIS 339).
ST. LOUIS — A man who used the name and nursing license of an actual licensed registered nurse to obtain a position at a rehabilitation facility and used other personal information to rent apartments, take out loans and lines of credit and apply for insurance policies was sentenced to 57 months in prison by a federal judge in Missouri on June 12 (United States v. Benjamin D. Danneman, No. 19cr202, E.D. Mo.).
BALTIMORE — A federal judge in Maryland on June 11 dismissed without prejudice counterclaims for defamation, civil conspiracy and tortious interference with prospective business advantage brought by medical clinics and health care providers accused by State Farm Mutual Automobile Insurance Co. of submitting fraudulent bills for no-fault benefits coverage, finding that claim denial letters did not include defamatory statements and that the allegations did not support a claim for civil conspiracy (State Farm Mutual Automobile Insurance Co., et al. v. Slade Healthcare Inc., et al., No. ELH-17-3696, D. Md., 2019 U.S. Dist. LEXIS 98374).
MIAMI — A federal judge in Florida on June 3 granted in part a doctor and clinic owner’s motion to dismiss a lawsuit brought by State Farm Mutual Automobile Insurance Co., finding that while the insurer can pursue a claim under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA) for the defendants’ submission of more than 1,700 allegedly fraudulent bills, it must amend its allegations to comply with the heightened pleading requirement of Federal Rule of Civil Procedure 9(b) (State Farm Mutual Automobile Insurance Company v. Manuel V. Feijoo, et al., No. 18-cv-23329-KMM, S.D. Fla., 2019 U.S. Dist. LEXIS 93343).
LOS ANGELES — A California appeals panel on June 17 affirmed a jury’s decision to order two women to pay $6.3 million for violating California Penal Code Section 550 when creating sham law firms to submit fraudulent claims to Allstate Insurance Co., finding that the trial court judge did not abuse his discretion when denying one defendant’s ex parte motion for a stay and that the defendants’ submission of claims from sham firms violated the statute (People, ex rel. Allstate Insurance Company, et al. v. Christine Suh, et al., No. B280293, Calif. App., 2nd Dist., 7th Div., 2019 Cal. Unpub. LEXIS 4058).
MIAMI — The owner of a pharmacy and pain management clinic was sentenced to 78 months in prison and ordered to forfeit $1.4 million by a federal judge in Florida on June 14 after the man pleaded guilty for his role that involved the submission of $2.2 million in fraudulent claims to Medicare (United States v. Scott Novick, No. 18-cr-20563, S.D. Fla.).
DETROIT — A federal magistrate judge in Michigan on June 14 denied a motion to quash a subpoena for a deposition filed by the manager of an imaging clinic who is not a party to fraudulent billing scheme lawsuit brought by State Farm Mutual Automobile Co., finding that it would not pose an undue burden (State Farm Mutual Automobile Insurance Company v. Elite Health Centers Inc., et al., No. 16cv13040, E.D. Mich., 2019 U.S. Dist. LEXIS 99897).
BIRMINGHAM, Ala. — An Alabama federal judge on June 14 denied a motion to remand filed by insureds alleging claims for breach of contract and bad faith arising out of a water and mold damage claim after determining that the insurers produced sufficient evidence showing that the amount in controversy exceeds the federal jurisdictional minimum of $75,000 (Matthew B. Menendez, et al. v. American Strategic Insurance Corp., et al., No. 19-443, N.D. Ala., 2019 U.S. Dist. LEXIS 99975).
ALBANY, N.Y. —New York’s highest court on June 11 affirmed an appeals court’s ruling that stood by a jury’s verdict that 54 New York automobile insurers and self-insurers are not responsible for paying $20 million in pending claims because a physician did not own and control the professional medical corporation under whose name he sought to collect first-party no-fault benefits from the insurers, finding that the lower court did not err in declining to give a jury charge that required a finding of fraudulent intent or conduct that was "tantamount to fraud" to reach its verdict in the insurers’ favor (Andrew Carothers, M.D., P.C. v. Progressive Insurance Company, No. 39, N.Y., App., 2019 N.Y. LEXIS 1641).
ALBANY, N.Y. — A New York pharmacist on June 5 entered into an agreement with the federal government in New York federal court to pay $100,000 to resolve allegations that she violated the federal False Claims Act (FCA) as well as the state’s version of the statute when falsely billing Medicare and Medicaid from March 2010 through March 2017 for prescriptions that were never dispensed to patients (United States, ex rel. Barbara Lopez v. Nassau Pharmacy, No. 16-cv-1338, N.D. N.Y.).
CHICAGO — A federal judge in Illinois on May 30 accepted a woman’s change of plea from not guilty to guilty on one charge of conspiracy to commit health care fraud for her role in the submission of $1.7 million in false bills to the U.S. Department of Labor’s Office of Workers Compensation Programs (OWCP) for constant treatment of one patient that she was not providing (United States v. Chante Carrothers, et al., No. 18cr374, N.D. Ill.).