United States District Judge Frank D. Whitney has denied a motion to dismiss filed by two orthopedic surgeons hoping to stop a $2.8 million RICO lawsuit filed by GEICO.
GEICO is a group of insurance companies that underwrite automobile insurance. It filed the lawsuit against orthopedic surgeon Erik T. Bendiks, M.D., his medical practice Apex Spine & Orthopaedics, PLLC, Sonia P. Pasi, M.D., and her medical practice Advanced Pain Consultants, P.A. Both are providers of medical and physical therapy services to patients recovering from injuries sustained in automobile accidents.
In the initial lawsuit GEICO alleged that the physicians along with a non-party law firm and its owner violated the Racketeer Influenced and Corrupt Organizations Act (RICO). GEICO claims that the orthopedic surgeons inflated or falsified medical bills to enable larger settlements for automobile accidents.
In its Complaint, GEICO claims that the physicians working with the law firm, “masterminded and implemented a fraudulent and unlawful scheme.” GEICO alleges that in order to maximize payments for the lawyer of the injured individual and for the treating physician, the law firm and physicians entered into an unlawful referral and patient brokering scheme.
GEICO alleges that through the scheme the law firm would refer injured parties to the physicians and the physicians would submit “false insurance claims involving fraudulent invoices for medical services that were never performed, unwarranted, or unrelated to the corresponding insurance claim.” It is also alleged that the purported “false medical documentation” was then used to enable settlements in the automobile claims that were based on “inflated or fabricated medical conditions.”
Two days after the initial lawsuit was filed, Dr. Bendiks and his medical practice filed a motion to dismiss for failing to state a claim upon which relief may be granted. A few months later, Dr. Pasi and her medical practice also filed a motion to dismiss for both lack of jurisdiction and failure to state a claim.
Judge Whitney was not persuaded by the arguments of the moving parties and in a single Order denied all of the motions without a hearing on the motions. In the Order, Judge Whitney stated, “Here, the nature and scope of the claims alleged by Plaintiffs in their 90-page Complaint are much broader and more detailed than simply providing medical billing codes. Importantly, Plaintiffs allege specific, discrete, fraudulent acts which include details such as the who, what, when, where, and why for multiple patient-specific examples.”
Judge Whitney continued, “On the face of the Complaint, Plaintiffs have provided the particularity required under Rule 9(b) of the Federal Rules of Civil Procedure to plausibly state a claim.”
