Newsletter RSS

Mealey's Insurance Fraud

  • 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for LTC benefits due to the insured’s degenerative brain disorder, seeking a declaratory judgment that the policy is rescinded due to the defendants’ alleged material misrepresentations regarding the insured’s treatment for cognitive disorders when medical records showed that he had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.

  • August 30, 2024

    Bank Faces Another Negligence, Fraud Suit In Connection With Vesttoo Collapse

    NEW YORK — Asserting fraud and negligence claims against China Construction Bank Corp. (CCBC) and related entities, a company affected by the collapse of Vesttoo Ltd. filed suit in New York state court for damages that it says include at least $140 million in cedent premium payments that went into designated segregated accounts.

  • August 29, 2024

    Judgment Denied In Travelers’ Suit Seeking To Rescind Insured Contractor’s Policy

    WHITE PLAINS, N.Y. — A New York federal judge denied a motion for summary judgment by Travelers Casualty Insurance Co. in its suit seeking a declaratory judgment to rescind a general liability and property policy issued to a general contractor, finding though Travelers showed that the contractor made misrepresentations in the policy application regarding performing ineligible operations, Travelers failed to establish that those misrepresentations were material.

  • August 29, 2024

    After $90M Settlement Reached, Judge Dismisses FCA Suit Alleging False CMS Bids

    LOUISVILLE, Ky. — After being notified that Humana Inc. agreed to pay $90 million to settle a case against it, a Kentucky federal judge dismissed the case, which accused Humana of violating the False Claims Act (FCA) by receiving overpayments after it knowingly submitted false bids to the Centers for Medicare and Medicaid Services (CMS).

  • August 28, 2024

    Dispute Over FCA Public Disclosure Bar Distributed For Conference In Supreme Court

    WASHINGTON, D.C. — The U.S. Supreme Court on Aug. 28 distributed for conference 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.

  • August 28, 2024

    Life Insurer Seeks Rescission Of $1M Life Policy Over Health Misrepresentation

    CAMDEN, N.J. — A life insurance and annuity company sued the beneficiary of a $1 million life insurance policy in a New Jersey federal court, seeking to rescind the policy for purported misrepresentations in the policy application regarding the insured’s health history, asserting that had the insurer known about the insured’s health history, it would not have issued the policy.