Mealey's Insurance Fraud

  • September 27, 2023

    8th Circuit Affirms Ruling Against Relators In Qui Tam Crop Insurance Case

    ST. LOUIS — In a ruling that drew a partial concurrence, an Eighth Circuit U.S. Court of Appeals panel upheld a challenged ruling in a qui tam crop insurance case, saying in part that “gaps in proof are fatal” to the plaintiffs’ claims under the False Claims Act (FCA).

  • September 27, 2023

    Pa. Federal Judge Dismisses FCA Retaliation Claims By Fired Sleep Study Workers

    PHILADELPHIA — While a Pennsylvania federal judge said it was “very unfortunate” that two longtime employees of Abington Memorial Hospital were terminated for “minor infractions” or possible retaliation for reporting that the hospital’s sleep center was using recalled continuous positive air pressure (CPAP) sleep apnea devices and respirators on its patients, the complaint failed to plead that the use could have defrauded the federal government, dooming their False Claims Act (FCA) retaliation claim.

  • September 27, 2023

    Summary Judgment Denied In FCA Suit Against Physicians Providing Nursing Home Care

    EAST ST. LOUIS, Ill. — An Illinois federal judge denied motions to strike and for summary judgment in a federal False Claims Act (FCA) suit filed by the government against companies that provide physician and nurse practitioner services for residents of long-term care (LTC) facilities, finding that there is a dispute as to material facts in this case and that the allegations sought to be stricken are relevant to the government’s claims.

  • September 26, 2023

    Mich. High Court Won’t Review Ruling Affirming Insurer’s Summary Judgment Denial

    LANSING, Mich. — The Michigan Supreme Court declined to review an appellate court decision affirming a lower court’s denial of summary disposition to an auto insurer in a suit filed against it by an insured auto accident victim seeking personal injury protection (PIP) and underinsured motorist (UIM) benefits.

  • September 26, 2023

    Magistrate:  Declaratory Judgment Suit Doesn’t Deprive Insured Of Jury Trial

    KANSAS CITY, Kan. — A Kansas federal magistrate judge denied an insurer’s motion to strike a yacht owner’s jury trial demand in the insurer’s declaratory judgment suit against the owner, seeking a determination that the owner’s claim for yacht damage is excluded from coverage, finding that the declaratory judgment suit does not deprive the owner of the right to a jury trial on the counterclaims.

  • September 25, 2023

    Dismissal Granted As To Payment Suspension For Fraud-Related Medicare Billings

    DETROIT — A Michigan federal judge granted in part the secretary of Health and Human Services’ motion to dismiss a suit alleging that the Centers for Medicare and Medicaid Services (CMS) violated the due process clause of the Fifth Amendment when CMS suspended reimbursement payments to medical practices providing geriatric medical care, finding that the medical practices failed to identify “a property interest that is protected by the Due Process Clause.”

  • September 22, 2023

    Judge Denies Dismissal Motions In Coverage Dispute Between Yacht Owner And Insurer

    KANSAS CITY, Kan. — A Kansas federal judge denied dismissal motions filed by an insurance underwriter and a yacht retailer in an insurer’s declaratory judgment suit seeking a determination that a yacht’s insurance policy was void for misrepresentations in the insurance application and that the owner’s claim for yacht damage is excluded from coverage, finding that the court lacks personal jurisdiction over the retailer and underwriter.

  • September 20, 2023

    Judgment Entered Against Insured In Fraud Dispute Over $841,881 In Benefits

    SAN FRANCISCO — A California federal judge on Sept. 19 entered default judgment against an insured who received more than $800,000 for long-term care benefits under a rider to her life insurance policy, finding that default judgment is appropriate due, in part, to no “excusable neglect” on the part of the insured in her failure to appear.

  • September 20, 2023

    Lender Waives Right To Respond To Cert Petition In FCA Suit Over Mortgage Fraud

    WASHINGTON, D.C. — A mortgage lender on Sept. 19 waived its right to respond to a relator’s petition for a writ of certiorari with the U.S. Supreme Court, seeking review and reversal of the Seventh Circuit U.S. Court of Appeals’ decision upholding a lower court’s grant of summary judgment for the lender in the relator’s False Claims Act (FCA) suit alleging that the lender made false representations to the U.S. Department of Housing and Urban Development.

  • September 19, 2023

    Judge Reopens FCA Suit Alleging Walgreens Engaged In Medicare Fraud

    MIAMI — A Florida federal judge granted a relator’s motion for reconsideration in his federal False Claims Act (FCA) suit filed on behalf of the U.S. government against Walgreens related to alleged Medicare fraud, finding that the case should be reopened, allowing the relator to file an amended complaint, because filing claims in a separate action will result in statute of limitations concerns and implicate the public disclosure bar.

  • September 18, 2023

    Magistrate Recommends Granting Default Motion As To Fraud Claims In No-Fault Suit

    BROOKLYN, N.Y. — A New York federal magistrate judge issued a report recommending granting GEICO’s motion for default judgment as to common-law fraud claims in its suit against retailers of durable medical equipment (DME) and orthotic devices (OD), alleging that the retailers submitted thousands of fraudulent no-fault insurance claims for medically unnecessary DME and OD, finding that GEICO “sufficiently alleged the elements for their common law fraud claims.”

  • September 15, 2023

    Judgment For Insurer Reversed In PIP Suit Seeking Coverage For Brain Injury

    DETROIT — A Michigan appellate court reversed and remanded a lower court’s grant of summary disposition to a personal injury protection (PIP) insurer for a passenger who incurred a purported brain injury in an auto accident, finding that questions of fact remain regarding the passenger’s application for benefits as to the veracity of his statements and whether he knowingly made misrepresentations that were material to his claim for benefits.

  • September 15, 2023

    Unsecured Creditors In Vesttoo Chapter 11 Case Want To Conduct Discovery

    WILMINGTON, Del. — Arguing that it “is the only independent fiduciary capable of conducting a thorough and conflict-free investigation,” the Committee of Unsecured Creditors in the jointly administered Chapter 11 case of Vesttoo Ltd. and 48 affiliated entities on Sept. 14 asked a Delaware federal bankruptcy court for leave to conduct discovery.

  • September 15, 2023

    Professional Services Exclusion Does Not Bar Coverage, Delaware High Court Affirms

    WILMINGTON, Del. — The Delaware Supreme Court on Sept. 14 affirmed a lower court’s $4,907,612.95 final judgment in favor of an insured in its lawsuit seeking coverage for approximately $18 million in losses arising from an underlying False Claims Act investigation, finding that the management liability insurance policy’s professional services exclusion did not bar coverage and that the insurer did not act in bad faith.

  • September 13, 2023

    Judge Says Insurer Has No Duty To Defend In Wrongful Death Suit Against Architect

    TAMPA, Fla. — A Florida federal judge granted an insurer’s request for declaratory judgment that it has no duty to defend or indemnify its insured architect in a wrongful death suit filed against the architect by the family of a man who died while working on a construction project, finding that the architect “made material misrepresentations on the policy application that voided the policy under the rescission doctrine.”

  • September 07, 2023

    Judge Reevaluates Order, Grants Judgment For Insurer In Policy Rescission Suit

    HOT SPRINGS, Ark. — An Arkansas federal judge vacated a prior order denying multiple summary judgment motions in a suit over the rescission of an insurance policy, finding that the policy’s concealment of fraud clause “precludes coverage for the fire loss” at the insured property due to the insured’s misrepresentations regarding foreclosure on another property.

  • September 06, 2023

    Judge Denies Default Judgment In Insurer’s Suit Seeking Rescission Of CGL Policy

    MOBILE, Ala. — An Alabama federal judge on Sept. 5 denied an insurer’s motion for default judgment and dismissed a suit seeking rescission of a commercial general liability policy and a declaration that the insurer does not have a duty to defend the insured in an underlying breach of contract suit, finding that the court lacks subject matter jurisdiction because the insurer failed to show that the amount in controversy exceeds the $75,000 jurisdictional threshold.

  • August 31, 2023

    Panel Affirms Judgment For Insurer In Row Over Fraud In PIP Coverage Application

    DETROIT — A Michigan appellate court affirmed a lower court order granting summary disposition to an insurer in a personal injury protection (PIP) suit filed by a bicyclist seeking coverage for injuries sustained when a car hit him, finding that judgment for the insurer was appropriate because the lower court correctly considered the bicyclist’s medical records as evidence due to fraudulent information he submitted in his application for no-fault benefits.

  • August 31, 2023

    Judgment Granted For Insurer In Suit Seeking To Void Commercial Insurance Policy

    NEW YORK — A New York federal judge granted an insurer’s summary judgment motion in its declaratory judgment suit against its insured and a claimant seeking to recover against the policy, finding that the commercial insurance policy is void ab initio because there is no dispute that the insured’s failure to disclose outstanding code violations on the insurance application constituted material misrepresentation.

  • August 31, 2023

    Wrangling Over Automatic Bankruptcy Stay Continues In Letter Of Credit Fallout

    WILMINGTON, Del. — Arguing that the filing of a Chapter 15 case violates a consent order, Chapter 11 debtor Vesttoo Ltd. and 48 affiliated entities on Aug. 30 asked a Delaware federal bankruptcy court to issue a contempt order and sanctions against Bermuda-based White Rock Insurance (SAC) Ltd. and “the putative joint provisional liquidators [JPLs] of segregated cells.”

  • August 29, 2023

    Motion To Quash Subpoena Denied In $5.6M RICO Suit Against New Jersey Pain Clinic

    NEWARK, N.J. — A New Jersey federal magistrate judge on Aug. 28 denied a motion to quash GEICO’s subpoena served upon the New Jersey Office of the Insurance Fraud Prosecutor (OIFP) in a $5.6 million Racketeer Influenced and Corrupt Organizations Act (RICO) and fraud suit filed against a pain clinic and its owner and multiple chiropractic practices, alleging that the pain clinic unlawfully obtained personal injury protection (PIP) benefits by paying kickbacks to chiropractors in exchange for referrals, finding that the subpoena “does not unnecessarily hinder the OIFP and that the records may be disclosed.”

  • August 28, 2023

    3rd Circuit Reverses Judgment For Hospice Agency In Medicare Fraud Suit

    PHILADELPHIA — The Third Circuit U.S. Court of Appeals on Aug. 25 reversed and remanded a district court’s grant of summary judgment to a hospice provider whose former employees alleged that the provider violated the federal False Claims Act (FCA) by fraudulently billing Medicare in admitting and recertifying patients who were not actually eligible for hospice, finding that while the government’s failure to act for a long period of time is evidence of a lack of the materiality required under the FCA, “it was erroneous to treat this factor as determinative of immateriality.”

  • August 28, 2023

    Discovery Row Outlined In Insurer’s Suit Over Alleged Fraud Scheme

    NEW YORK — An insurer that alleges it sustained losses exceeding $135 million due to “systematic breaches of fiduciary duty, fraud, and other misconduct” has asked a New York federal court for a discovery conference over disputes with four defendants, which argue in an Aug. 25 opposition that the request should be denied because “[g]ood cause exists to shift expenses of discovery.”

  • August 25, 2023

    6th Circuit Affirms Finding That Insurer Couldn’t Void Policy In Fire Coverage Row

    CINCINNATI — The Sixth Circuit U.S. Court of Appeals affirmed a district court’s determination that a homeowners insurer could not void a policy after a jury returned a verdict in favor of the Tennessee homeowner and their insurance agency in a fire coverage dispute, finding that the insurer failed to prove that the homeowners’ misrepresentation about not having automatic water sprinklers in their home increased the risk of loss needed to void an insurance policy pursuant to Tennessee law.

  • August 25, 2023

    Partial Dismissal Granted In Insurer’s Fraud Suit Against Biohazard Remediation Company

    BOSTON — A Massachusetts federal judge granted a biohazard remediation company and its employees’ partial motion to dismiss a fraud and Racketeer Influenced and Corrupt Organizations Act (RICO) suit alleging that the company defrauded an insurer by engaging in a scheme to create fraudulent charges for remediation, finding in part that the insurer failed “to allege two distinct entities” to establish a RICO claim.