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

Mealey's Insurance Fraud

October 16, 2023
High Court Won’t Review FCA Suit Alleging Fraudulent Compliance With HUD Rules

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 16 denied a former underwriter’s petition for a writ of certiorari seeking review and reversal of a Seventh Circuit U.S. Court of Appeals’ determination that she failed to show that a lender’s alleged violations of the federal False Claims Act (FCA) caused harm to the U.S. Department of Housing and Urban Development.
October 12, 2023
After 8th Circuit Upholds Ruling In Qui Tam Case, Relators Seek Panel Rehearing

ST. LOUIS — Arguing that an Eighth Circuit U.S. Court of Appeals panel “overlooked facts in the record” and “misapprehended the import” of United States ex rel. Schutte v. SuperValu Inc., relators asked the panel to rehear the qui tam crop insurance case in which a ruling against them was upheld.
October 11, 2023
Washington Panel Affirms Order Denying Surgery In Row Over Workers’ Comp Benefits

SEATTLE — A Washington state appellate court affirmed a lower court order upholding the state Board of Industrial Insurance Appeals’ (BIA) reversal of a Washington Department of Labor (DOL) decision to authorize and pay for surgery related to a man’s purported workplace injury, ruling that the lower court “did not exceed the scope of its review” when entering findings related to the man’s willful misrepresentation.
October 10, 2023
Summary Judgment Granted For GEICO In $3.8M No-Fault Insurance Fraud Suit

MIAMI — A Florida federal judge adopted a magistrate judge’s report and recommendation, granting in part GEICO’s summary judgment motion in a fraud and Racketeer Influenced and Corrupt Organizations Act (RICO) suit filed against a rehabilitation facility, its medical director and related entities, finding that summary judgment for GEICO is appropriate as to its claims related to the medical director’s supervision over health care services at a specified facility.
October 10, 2023
Certiorari Denied In Man’s Bid For Review Of His Insurance Fraud Conviction

WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 10 denied a petition for a writ of certiorari filed by a man seeking review of his insurance and tax fraud convictions who said the issuance of a search warrant resulting in his conviction lacked probable cause and violated his rights under the Fourth Amendment to the U.S. Constitution.
October 06, 2023
Magistrate Denies Relator’s Bid To Reopen Discovery In FCA Suit Against Medtronic

KANSAS CITY, Kan. — A Kansas federal magistrate judge on Oct. 5 denied a relator’s request to reopen discovery in his qui tam suit alleging that Medtronic and its related company and a hospital violated the False Claims Act (FCA) by participating in a scheme to provide medically unnecessary treatment resulting in the submission of false claims for payment to federal health care programs, finding that the relator failed to establish good cause to reopen discovery.
October 04, 2023
Judge: First-To-File Bar Inapplicable In FCA Suit Against Skilled Nursing Homes

PHILADELPHIA — A Pennsylvania federal judge denied a motion to dismiss by a therapy service provider and its contracted skilled nursing facilities (SNFs) in a qui tam suit filed against them alleging violations of the False Claims Act (FCA) when they purportedly billed Medicare and Medicaid for unnecessary services, finding that because the suit adds materially to a prior qui tam suit filed against the service provider, the first-to-file rule does not apply to bar the more recent claims.
October 04, 2023
Dismissal Granted In FCA Suit Against Hospitalists For Fraudulent Medicare Billing

CLARKSBURG, W.Va. — A West Virginia federal judge granted dismissal to a hospital and affiliated hospitalists in a qui tam suit filed against them, alleging that they violated the False Claims Act (FCA) by billing Medicare for services that were not actually performed, finding that the relator failed to show that the alleged false claims were submitted to Medicare for payment.
October 04, 2023
Unsecured Creditors In Vesttoo Chapter 11 Case Get Leave To Conduct Discovery

WILMINGTON, Del. — The Official Committee of Unsecured Creditors in the jointly administered Chapter 11 case of Vesttoo Ltd. and 48 affiliated entities has been granted leave by a Delaware federal bankruptcy judge to conduct discovery.
October 02, 2023
Judge Dismisses FCA Claims Against Psychiatric Hospital For Alleged ‘Psych Mill’

BATON ROUGE, La. — A Louisiana federal judge on Sept. 29 dismissed in part without prejudice a relator’s claims that a psychiatric hospital and related officials violated the federal False Claims Act (FCA) in a “psych mill” scheme by allegedly admitting patients based on Medicare coverage rather than medical need and extending Medicare patients’ stays based on purported false diagnoses, finding that the allegations fail to satisfy the materiality and particularity requirements of the FCA.
October 02, 2023
Panel Remands For Insurer To Plead Defenses ‘With Particularity’ In PIP Suit

DETROIT — A Michigan appellate court vacated and remanded a lower court order granting an insurer’s summary disposition motion in a breach of contract suit by its insured, seeking coverage for personal injury protection (PIP) benefits after sustaining injuries incurred in an auto accident, finding that though the insurer “failed to plead with particularity,” the insurer “may amend its affirmative defenses to state its fraudulent misrepresentation defense with particularity.”
September 28, 2023
Certification Request Denied In FCA Suit Over Defective Knee Replacement Devices

TUSCALOOSA, Ala. — An Alabama federal judge denied a motion by an orthopedic device manufacturer to certify for appeal an order denying summary judgment in relators’ suit asserting that the manufacturer violated the federal False Claims Act (FCA) by submitting for reimbursement to government health care programs claims for knee replacement devices it knew were defective, finding that the motion is untimely and will not likely shorten the litigation.
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.