Mealey's Insurance Fraud : Mealey's : Legal News & Analysis

Mealey's Insurance Fraud

October 07, 2024
Judge Denies Motion To Strike As ‘Highly Inappropriate’ In GEICO’s PIP Fraud Suit

FORT LAUDERDALE, Fla. — A Florida federal judge denied a physical therapy provider’s motion to strike in a suit filed by GEICO against it and other entities alleging that the defendants submitted more than $2.8 million in fraudulent charges for unnecessary services for personal injury protection (PIP) insurance charges, finding that the defendants’ request to strike pages of GEICO’s reply brief supporting its partial summary judgment motion “is a highly inappropriate request” without supporting legal authority.
October 07, 2024
U.S. Supreme Court Denies Cert In FCA, Anti-Kickback Violations Row

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 7 denied certiorari of a qui tam relator’s petition seeking review of a Second Circuit U.S. Court of Appeals ruling affirming a district court’s dismissal of federal False Claims Act (FCA) suit alleging violations of the Anti-Kickback Statute (AKS), where the relator argued for review to resolve the split between circuit courts regarding whether knowledge that a party’s conduct violates the law is required to show willfulness pursuant to the AKS.
October 07, 2024
U.S. Supreme Court Denies Certiorari In FCA Public Disclosure Bar Dispute

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 7 denied a petition for certiorari filed by pharmaceutical companies seeking review of the Ninth Circuit U.S. Court of Appeals’ ruling that the public disclosure bar was not triggered in a case where it reversed a district court’s dismissal of a suit accusing the companies of violating the False Claims Act (FCA) by artificially inflating drug prices.
October 07, 2024
U.S. High Court Won’t Review Ruling Upholding FCA Settlement Agreement Orders

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 7 denied a petition for writ of certiorari filed in the U.S. Supreme Court by the owner of medical clinics seeking review of the Sixth Circuit U.S. Court of Appeals’ ruling upholding a district court’s orders enforcing a settlement agreement and compelling the owner to seek U.S. government consent to dismiss claims for federal False Claims Act (FCA) violations in a separate qui tam suit.
October 07, 2024
Judge: Insurer Will ‘Quibble’ With Analysis In $2M Life Policy Ruling For Spouse

SEATTLE — A Washington state federal judge denied a life insurer’s motion for summary judgment but granted a cross-motion for summary judgment by a decedent’s spouse and beneficiary of the decedent’s $2 million life insurance policy, finding that though the insurer “will quibble with” the interpretation of the policy application where the insured answered “no” to questions about visiting his physician but did visit his dentist, “there is no dispute that ‘physician’ is at least ‘fairly susceptible’ to two interpretations” in the insurer’s suit seeking to rescind the policy due to the insured’s purported material misrepresentations.
October 03, 2024
Discovery Ruling Issued In Insurance Fraud Suit Seeking Relief Under ERISA, UCL

LOS ANGELES — A California federal magistrate judge substantially granted a motion to compel discovery filed by a cheese manufacturing company in its suit against surgery centers for alleged fraudulent billing for health care plan benefits related to unnecessary or unperformed medical services, restitution under the Employee Retirement Income Security Act (ERISA) and violations of California’s unfair competition law (UCL), finding in part that the defendants’ privacy concerns are outweighed by the need for the discovery information that will be reviewed under a stipulated protection order that will address those concerns.
October 03, 2024
Lab Testing Company Settles FCA Unnecessary Testing Allegations For $27M

WASHINGTON, D.C. — The U.S. Department of Justice (DOJ) on Oct. 2 announced that Precision Toxicology LLC, a urine drug testing toxicology laboratory, agreed to pay $27 million to resolve allegations that it violated the False Claims Act (FCA) and similar state false claims statutes for its role in billing Medicare, Medicaid and other federal insurers for medically unnecessary urine drug tests and for providing remuneration to physicians who agreed to refer laboratory testing to Precision.
October 03, 2024
Insurer Calls Motion ‘Self-Serving’ In $2M Life Policies Misrepresentation Row

MACON, Ga. — Pacific Life Insurance Co. filed a response brief in a Georgia federal court asking the court to deny a motion in limine filed by the beneficiary of two $1 million life insurance policies who is seeking to exclude evidence that the insurer would have issued the policies at a different premium had it known of the policy application misrepresentations.
October 02, 2024
Insurer Seeks To Rescind Rider Of $200K Life Policy Over Health Misrepresentations

CHICAGO — Transamerica Life Insurance Co. on Oct. 1 filed a complaint in an Illinois federal court against its insured and the owner of a $200,000 life insurance policy with a long-term care (LTC) rider after they submitted a claim for LTC benefits due to the insured’s degenerative brain disorder, seeking a declaratory judgment that the policy is rescinded due to the defendants’ alleged material misrepresentations regarding the insured’s treatment for cognitive disorders when medical records showed that he had undisclosed cognitive deficits resulting from a prior coma.
October 02, 2024
Florida Federal Judge Tosses FCA Suit For ‘Unconstitutional’ Qui Tam Appointment

TAMPA, Fla. — Drawing on a dissent issued by U.S. Supreme Court Justice Clarence Thomas in United States ex rel. Jesse Polansky, M.D., M.P.H. v. Executive Health Resources, a Florida federal judge on Sept. 30 granted defendants’ dismissal motion in a qui tam suit alleging that medical providers and Medicare Advantage (MA) insurers violated the False Claims Act (FCA), finding that the relator lacks standing pursuant to Article II of the U.S. Constitution to pursue a qui tam action on the government’s behalf.
September 26, 2024
Claims Objection Bar Date Extension Sought In Liquidation Of Vesttoo

WILMINGTON, Del. — A Delaware federal bankruptcy judge has been asked to extend the claims objection bar date by 180 days in the Chapter 11 liquidation of Vesttoo Ltd. and its dozens of affiliates.
September 23, 2024
Panel Reverses, Says Insurer Failed To Show It Was Entitled To Rescind Policy

DETROIT — A Michigan appellate court reversed and remanded a lower court’s ruling that granted a no-fault insurer’s motion for summary disposition in a suit against it by its insured, seeking benefits related to an auto accident, finding that the insurer cannot show injury due to the insured’s misrepresentation in her policy application regarding household members absent evidence showing that without the misrepresentation, it would not have issued the policy or would have charged a higher premium.
September 23, 2024
Confidentiality Stipulation Filed In $300M Ponzi Fraud Case Involving Insurers

MIAMI — Plaintiffs and defendant Wells Fargo filed a confidentiality stipulation in a Florida federal court in a putative class action suit alleging that Wells Fargo aided and abetted fraud in a “massive” Ponzi scheme purportedly orchestrated by owners of insurers, some of whom are now in receivership, resulting in elderly investor victims losing more than $300 million after scheme operators sold them promissory notes secured by collateral in stranger-oriented life insurance policies (STOLIs).
September 20, 2024
Summary Judgment Granted To Insurer For ‘Legal Fraud’ In Insurance Application

TUCSON, Ariz. — An Arizona federal judge granted summary judgment to a homeowners insurer in its suit seeking to rescind its insured’s policy for material misrepresentation in the insurance application, finding that the insured’s misrepresentation that the property was his primary residence and failure to correct the policy’s terms representing this residency “constitute legal fraud,” thereby making rescission “proper.”
September 18, 2024
8th Circuit Affirms Dismissal Of FCA Suit Alleging Medicare Advantage Fraud

ST. LOUIS — The Eighth Circuit U.S. Court of Appeals affirmed a district court’s dismissal of a qui tam plaintiff’s suit asserting False Claims Act (FCA) violations against a marketing organization and health insurers related to their alleged falsification of insurance agent certifications required by the Centers for Medicare and Medicaid Services (CMS) and violations of Medicare Advantage marketing regulations, finding that the lower court did not err in dismissal because none of the marketing organization’s “alleged schemes are material to CMS’s” agreement with the insurers.
September 11, 2024
Magistrate Partially Grants Insured’s Motion To Compel Discovery In Yacht Damage Row

KANSAS CITY, Kan. — A Kansas federal magistrate judge on Sept. 10 granted, in part, a motion to compel discovery filed by an insured in a coverage dispute in which an insurer seeks a determination that a yacht that was damaged is excluded from coverage, finding in part, that because some of the discovery requests are overbroad, the court must limit them.
September 11, 2024
Dismissal Denied In Suit Seeking To Void Insurance Policies For Misrepresentation

SCRANTON, Pa. — A Pennsylvania federal judge denied a motion to dismiss filed by an insurance broker that said the judge should decline to exercise jurisdiction over the insurer’s suit seeking to rescind a policy and a declaration that its owes no duty to defend or indemnify the insured insurance broker in two underlying tort actions related to purported misrepresentations, finding that the absence of parallel state court proceedings and applicable case law factors weigh in favor of exercising jurisdiction over the case and that Pennsylvania law is “well-settled” regarding insurance policy rescission.
September 11, 2024
Judge Dismisses FCA Case Against Sanofi In Insulin Drug Medicaid Rebate Dispute

LOS ANGELES — A California federal judge granted dismissal to pharmaceutical company Sanofi in a qui tam suit filed against it by a former Medicaid provider alleging that Sanofi committed fraud in violation of the federal False Claims Act (FCA) and similar state laws by reporting false pricing information to the Centers for Medicare and Medicaid Services (CMS) regarding insulin marketed under the brand name “Admelog,” finding that the provider failed to plead the complaint with the appropriate scienter.
September 11, 2024
Insurer Dismisses Suit To Void Policy, Deny Coverage For Code Violation Fraud

LOS ANGELES — A commercial insurer, without explanation, dismissed without prejudice its suit against its insured limited liability company in a California federal court seeking rescission of the insured’s policy and a declaration that the insurer is not obligated to pay for fire damage to the property due to the insured’s alleged material misrepresentations in the policy application regarding the absence of safety code violations and liens on the property when an investigation revealed otherwise.
September 10, 2024
Magistrate Grants In Part Motions To Exclude Expert Testimony In FCA Kickback Suit

OAKLAND, Calif. — A California federal magistrate judge on Sept. 9 granted in part a health system’s motions to exclude expert testimony of relator’s witnesses in a qui tam suit alleging that the defendants violated the federal False Claims Act (FCA) and similar California law by paying kickbacks to certain physician groups, finding that certain portions of testimony should be excluded, including one witness’s opinion that a medical group was double billing.
September 09, 2024
Judge Grants Dismissal In Part In FCA Violation Suit Over COVID-19 Test Billing

NEWARK, N.J. — A New Jersey federal judge on Sept. 6 granted in part a motion to dismiss filed by a COVID-19 testing provider in a qui tam suit alleging False Claim Act (FCA) violations and violations of a similar New Jersey state law related to improper billing for COVID-19 tests, granting the motion because the provider is not an original source but denying it because the amended complaint satisfies the pleading standard and because “the claims are not barred by the” FCA limitations and are not unconstitutional.
September 06, 2024
5th Circuit Affirms Judgment For Insured In Bid To Void Workers’ Comp Policy

NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals affirmed a lower court’s ruling granting summary judgment to an insured, a related party and an underwriter in a workers’ compensation insurer’s negligence, breach of fiduciary duty and declaratory judgment suit seeking to rescind its insured’s policy, finding that the district court did not err in granting summary judgment, in part, because the insurer failed to show that the underwriter breached any duties to the insurer.
September 05, 2024
Life Insurer Seeks To Void $1.5M Policy For Memory Issue Misrepresentations

NEW ORLEANS — A Pennsylvania-based life insurer filed a declaratory judgment suit in a Louisiana federal court against the beneficiary of a $1.5 million life insurance policy issued on the life of a decedent, seeking to void the policy due to multiple misrepresentations the decedent allegedly made in the policy application regarding memory and psychological issues and related treatment.
September 04, 2024
Magistrate Grants Motion To Compel Discovery In Medicare Advantage Fraud Dispute

TAMPA, Fla. — A Florida federal magistrate judge on Sept. 3 granted a relator’s motion to compel discovery from medical providers and affiliated providers in a suit alleging that the medical providers and Medicare Advantage (MA) insurers violated the False Claims Act (FCA), finding that “while there do appear to be differences between employed and affiliated providers, the Court does not find these differences to be relevant or significant enough to exclude affiliated providers from discovery.”
September 04, 2024
Partial Summary Judgment Granted For Providers In Whistleblower FCA Suit

WILLIAMSPORT, Pa. — A Pennsylvania federal judge granted in part summary judgment in a suit alleging that a hospital and a federally qualified health center (FQHC) violated the federal False Claims Act (FCA) by unlawfully retaliating against a physician by terminating him after he alleged FCA violations, finding that summary judgment is appropriate for the retaliation and the whistleblower claims because there is a lack of evidence showing that the purpose of the alleged whistleblowing was to support the FQHC’s independence from the hospital.