Mealey's Insurance Fraud

  • May 24, 2024

    Judge Grants Judgment To Insurer In Dispute Where Bar Owner Made False Statements

    MINNEAPOLIS — A Minnesota federal judge granted summary judgment to a business liability insurer that was sued for denying coverage for fire damage to its insured bar, finding that the bar’s owner, who pleaded guilty to arson for the fire that destroyed the bar, made false statements to defraud the insurer, and those actions were imputed to the bar.

  • May 21, 2024

    3rd Circuit Won’t Review Class Certification In Suit Related To FCA Violations

    PHILADELPHIA — The Third Circuit U.S. Court of Appeals denied a petition seeking interlocutory review of a district court’s order granting class certification in a suit alleging that Teva Pharmaceuticals Industries Ltd. and its executives violated the Securities Exchange Act by artificially raising the price of its stock and concealing information about the multiple sclerosis drug Copaxone, the subject of a False Claims Act (FCA) suit alleging that Teva engaged in a kickback scheme that increased the price of the drug, finding that “interlocutory review is not appropriate” at the class certification stage as to a merits review of the Securities Exchange Act.

  • May 16, 2024

    Justice Says ‘Adjudged’ Constitutes Judgment In Insurance Coverage Dispute

    NEW YORK — A New York state court justice denied medical providers’ motion to renew an order granting summary judgment for insurers in the insurers’ suit seeking a declaratory judgment that denial of claims for no-fault benefits was appropriate due to the insured’s purported material misrepresentations about her residence, finding that the motion for renewal was untimely as it was filed more than 30 days after entry of the final judgment that included the term “adjudged.”

  • May 15, 2024

    Judge Overrules Abbott’s Objections To Discovery Order In FCA Suit Over Kickbacks

    SAN DIEGO — A California federal judge on May 14 overruled Abbott Laboratories’ objections and affirmed a magistrate judge’s discovery order that denied Abbott’s motion to compel production of certain documents in a suit alleging violations of the False Claims Act (FCA) and state false claims laws regarding Abbott’s alleged kickback scheme to induce hospitals and physicians to use an Abbott cardiac medical device, finding that Abbott is not entitled to discover certain documents, which are considered privileged work product.

  • May 14, 2024

    4 Entities Hurt By Vesttoo Collapse Sue China Construction Bank, Others For Fraud

    NEW YORK — Asserting that they were some of the “biggest victims” of the alleged fraud underlying the collapse of Vesttoo Ltd., entities including Porch Group Inc. and Homeowners of America Insurance Co. (HOA) sued China Construction Bank Corp. (CCBC) and related parties in a New York federal court for fraud and negligent supervision and retention.

  • May 09, 2024

    Magistrate Denies Motion For Indicative Relief In FCA Suit Alleging Overcharging

    SAN FRANCISCO — A California federal magistrate judge denied a relator’s motion for an indicative ruling that pursuant to the Ninth Circuit U.S. Court of Appeals’ decision in United States ex rel. Silbersher v. Valeant Pharms. Int’l, Inc., a similar False Claims Act (FCA) suit brought by the same relator, the magistrate judge should grant the relator “relief” from the judgment on appeal to the Ninth Circuit after dismissing his claims that pharmaceutical companies overcharged the federal government and states under Medicare and Medicaid.

  • May 08, 2024

    3rd Circuit Issues Mandate On Ruling Compelling Arbitration In GEICO’s Fraud Suit

    PHILADELPHIA — The Third Circuit U.S. Court of Appeals on May 7 issued a mandate regarding its decision reversing and remanding district court rulings consolidated on appeal that claims under New Jersey’s Insurance Fraud Prevention Act (IFPA) cannot be arbitrated, finding that GEICO’s IFPA claims against multiple medical providers related to purported fraudulent claims for medical expenses reimbursement under no-fault laws “must be compelled to arbitration” pursuant to the Federal Arbitration Act (FAA).

  • May 07, 2024

    2nd Circuit Issues Mandate Regarding Dismissal Of FCA Claims Affirmed On Appeal

    NEW YORK — The Second Circuit U.S. Court of Appeals on May 6 issued a mandate regarding its ruling affirming a district court’s dismissal of a relator’s claim against a pharmaceutical company for violations of the federal False Claims Act (FCA) but vacating and remanding the lower court’s dismissal of state law claims, finding that the district court correctly found that the relator failed to show that the pharmaceutical distributor acted willfully pursuant to the FCA when allegedly giving customers business management tools in exchange for their agreements to purchase drugs.

  • May 07, 2024

    State Farm Sues Spine Centers, Asserts Claims For $3.3M In Fraud Referral ‘Scheme’

    TAMPA, Fla. — State Farm sued a Florida medical provider and related entities and physicians in a Florida federal court, asserting that the defendants violated the Florida Deceptive and Unfair Trade Practices Act (FDUTPA) by participating in a “scheme,” where the provider unlawfully referred patients to surgery centers for a brokered fee and submitted or caused to be submitted charges of more than $3.3 million for inclusion in settlement demands to State Farm.

  • May 06, 2024

    Motion To Compel Granted In Bad Faith Row With Insurer Making Fraud Counterclaim

    SEATTLE — A Washington federal judge on May 3 granted in part an insurer’s motion to compel more complete responses to interrogatories in a bad faith suit filed against the insurer that counterclaimed for a declaration that it has no obligation to cover the insured due to his purported fraudulent misrepresentations about his auto accident injuries, finding that the insurer made reasonable requests, including requests for the insured’s social media postings.

  • May 03, 2024

    7th Circuit Affirms FCA Liability Ruling, Finds Error In Medicare Damages

    CHICAGO — The Seventh Circuit U.S. Court of Appeals on May 2 affirmed a district court’s judgment finding an owner and his three related health care companies liable for violating the False Claims Act (FCA) and Anti-Kickback Statute (AKS) regarding fraudulent Medicare billing but vacated in part the damages calculations, finding that the court erred in calculating damages related to Medicare claims that may or may not have been related to the kickbacks.

  • May 02, 2024

    Chris Brown’s Recording Studio Insurer Appeals $2M Judgment To 6th Circuit

    MEMPHIS, Tenn. — The insurer of a recording studio owned by musician Chris Brown on May 1 appealed a Tennessee federal judge’s final judgment requiring the insurer to pay $2,066,217.30 of a $2.5 million jury verdict to a co-defendant and lessee of the studio after Brown was previously found liable for submitting a fraudulent insurance claim for burglary and fire at the studio.

  • May 01, 2024

    Retaliation Claim Dismissed Against DME Supplier With $24.2M In FCA Liability

    HUNTINGTON, W.Va.  — A West Virginia federal judge on April 30 granted a durable medical equipment (DME) supplier’s motion to reconsider his ruling denying summary judgment for a retaliatory discharge claim regarding a former employee’s reporting to supervisors alleged overbilling by the supplier that settled a separate False Claims Act (FCA) suit for $24.2 million, finding that the previous order should be revised “to prevent manifest injustice.”

  • May 01, 2024

    9th Circuit Denies Homeowner’s Rehearing Bid In Fire Loss Coverage Dispute

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on April 30 denied a homeowner’s request for rehearing and rehearing en banc of its decision affirming a district court’s grants of summary judgment for insurers in two coverage disputes consolidated on appeal regarding whether the homeowner misrepresented in the insurance application that she used her property for commercial purposes or that she had prior losses.

  • April 30, 2024

    California Nursing Home Chain Settles COVID-Related Medicare Fraud Claims For $7M

    WASHINGTON, D.C. — The U.S. Department of Justice (DOJ) announced that a California-based chain of skilled nursing facilities (SNFs) and two of its executives agreed to pay  $7,084,000 to settle a federal False Claims Act (FCA) suit related to alleged fraudulent billing for a higher level of skilled care than needed under Medicare Part A for facility residents who did not test positive for COVID-19 but were near a person who did, thereby fraudulently increasing the SNFs Medicare revenue.

  • April 30, 2024

    Judgment Denied In Suit Against DME Supplier Subject To $24.2M In FCA Liability

    HUNTINGTON, W.Va.  — A West Virginia federal judge denied in part a durable medical equipment (DME) supplier’s motion for summary judgment in a suit alleging retaliation, retaliatory discharge and outrage regarding a former employee’s reporting to supervisors alleged overbilling by a supplier that settled a separate False Claims Act (FCA) suit for $24.2 million, finding that disputed material facts remain regarding whether she was terminated for retaliatory reasons.

  • April 26, 2024

    Motion To Strike Denied In Insurance Coverage Row Over Gloves Missing At Sea

    NEW YORK — A New York federal judge on April 25 denied a motion to strike an insurer’s defenses that the policy at issue is void for material misrepresentations in a supplier’s suit seeking a declaratory judgment that the insurer is obligated to indemnify the supplier for the loss of a cargo of gloves that never arrived in the United States after being shipped from Malaysia, finding that the supplier provided no legal authority for its argument that the insurer did not give notice for policy rescission.

  • April 25, 2024

    Liberty Mutual Sues Sibling Medical Providers For Fraud, RICO Violations

    FLINT, Mich. — Liberty Mutual sued a physical therapy provider, a chiropractic provider and the brothers who run them in a Michigan federal court, asserting violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) and common-law fraud related to alleged overbilling for medically unnecessary services or for those that were not provided.

  • April 24, 2024

    Panel Reverses Judgment On ‘Claim Not Pled’ In Insurance Policy Cancellation Row

    MIAMI — A Florida appellate court reversed and remanded a lower court’s grant of summary judgment for alleged misrepresentation in a policy application in a suit filed by an insured’s assignee against a now-insolvent insurer, seeking a declaration that the insurer had improperly canceled its insured’s policy, finding that the lower court erred in granting the assignee’s motion for summary judgment on a “claim it never pled.”

  • April 23, 2024

    Certain Claims Barred By Settlement In Suit Accusing Hospital Of FCA Violations

    WEST PALM BEACH, Fla.  — A Florida federal magistrate judge granted in part a hospital’s motion for judgment on the pleadings regarding its defense that claims against it are barred by a settlement agreement between it and a physician claiming that he was suspended in retaliation for reporting his concerns that the hospital was submitting false claims for payment to the federal government in violation of the False Claims Act (FCA), finding that the physician’s claims for tortious interference related to purported fraud inducing him to resign were released as part of the settlement.

  • April 18, 2024

    N.J. Panel Affirms Order Granting Judgment For Progressive In Auto Claim Row

    TRENTON, N.J. — A New Jersey appellate court on April 17 affirmed a lower court order granting summary judgment to Progressive Insurance Co. in its insured’s breach of contract and bad faith suit after Progressive denied the insured’s auto accident claim for alleged misrepresentation in the policy application, finding “no reason to second-guess” the lower court’s finding that the insured “lacked standing to pursue a claim for the payoff of her lease.”

  • April 18, 2024

    Chapter 11 Liquidation Plan Becomes Effective In Vesttoo Bankruptcy Cases

    WILMINGTON, Del. — In a notice outlining several bar dates, the Official Committee of Unsecured Creditors told a Delaware federal bankruptcy court that a Chapter 11 plan of liquidation for Vesttoo Ltd. and its dozens of affiliates went into effect after conditions precedent were “satisfied or waived.”

  • April 17, 2024

    N.Y. Justice: State Farm Has No Duty To Pay No-Fault Claims For ‘Vitiated’ Policy

    NEW YORK  — In an opinion published April 16, a New York state justice granted summary judgment to State Farm in its suit against its insured, persons purportedly injured in an auto accident and health care providers that submitted claims to State Farm for payment regarding treatment for alleged injuries, finding that “the policy is vitiated” due to the claimants’ failure to appear for examinations under oath (EUOs).

  • April 16, 2024

    Parties In Mold, Construction Defects Suit File Supplemental Authorities In 11th Circuit

    ATLANTA — An insurer and insureds involved in a dispute over coverage for mold damage discovered in an insured hotel filed supplemental authorities on April 15 in the 11th Circuit U.S. Court of Appeals, citing cases that each side claims are relevant to the issue of whether the policy at issue provides coverage for losses caused by a construction defect even if the cost to fix the defect is not covered.

  • April 15, 2024

    Judge Dismisses Malpractice Claimant From Professional Liability Coverage Suit

    LAS VEGAS — One day after the parties filed a joint stipulation of dismissal, a federal judge in Nevada dismissed an underlying malpractice claimant from a professional liability insurer’s lawsuit alleging that the attorney insured fraudulently concealed one or more material facts on his renewal insurance applications.