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April 29, 2024
Telling the Truth Can't Be Defamatory

After Health Provider Entity's Management is Arrested for Fraud Reporting Suspicion to Beneficiaries is not Defamation

Read the full article at https://lnkd.in/gvC28cS4, see the full video at https://lnkd.in/giQW_bJK and at https://lnkd.in/gYSqE46x, and https://zalma.com/blog plus more than 4750 posts.

BrainBuilders, LLC appealed from an order granting summary judgment in favor of defendants Optum, Inc., et al (collectively, defendants) in Brainbuilders, LLC v. Optum, Inc., Optum Services, Inc., et al, No. A-0621-22, Superior Court of New Jersey, Appellate Division (April 19, 2024) resolved claims of defamation.

FACTS

Letters dated July 25, 2017 and August 2017 sent by the Optum entities to BrainBuilders' patients following an investigation into purported fraud by individuals associated with BrainBuilders.

BrainBuilders provides healthcare services to children on the autism spectrum. As an out-of-network or non-participating healthcare provider, BrainBuilders receives reimbursement for claims only if a patient's health insurance plan allowed "out-of-network benefits" or the insurer made a "single case agreement" for the patient's care.

The Optum entities are the health claims administrator for health plans issued or administered by the Oxford entities and UHC entities. The Optum entities do not sell or issue health insurance policies. Rather, they provide support for defendants who issued health insurance policies to individual insureds. The Optum entities also evaluate insurance claims submitted by providers to its affiliated insurers, including BrainBuilders. The Optum entities often investigate whether a provider has requested reimbursement beyond the provider's entitlement, such as by misrepresenting or inflating the services provided.

In June 2017, four individuals related to the management of BrainBuilders were arrested and charged with conspiracy to defraud Medicaid. A criminal complaint, alleging misappropriation of funds, was filed against several individuals affiliated with BrainBuilders. The arrests were reported in the news media and the Optum entities learned of the arrests on July 14, 2017.

Subsequently the Optum entities sent letters to BrainBuilders' patients insured by the Oxford and UHC entities (July 2017 letters). The July 2017 letters explained the Optum entities were suspending payment for services provided by BrainBuilders due to potential insurance fraud and other violations of state and federal law.

BrainBuilders sued defendants asserting the following causes of action:

1 conspiracy;
2 tortious interference with business relations;
3 tortious interference with prospective economic advantage;
4 negligence trade libel;
5 defamation, libel, and slander; and
6 unjust enrichment and
7 quantum meruit.

BrainBuilders alleged the statements in the July and August 2017 letters were false and defamatory. Defendants moved for summary judgment and the motion judge granted defendants' motion and dismissed BrainBuilders' claims with prejudice. Further, around the same time period, the judge noted the Optum entities "separately uncovered evidence suggesting BrainBuilders was engaged in fraud, waste, or abuse." Thus, the judge concluded, "[w]hen read with context, no reasonable person" could interpret the July or August 2017 letters "as fallacious or injurious.

The law of defamation is grounded on the principle that people should be free to enjoy their reputations unimpaired by false and defamatory attacks. To prevail on a defamation claim, a party must demonstrate: (1) the assertion of a false and defamatory statement concerning another; (2) the unprivileged publication of that statement to a third party; and (3) fault amounting at least to negligence by the publisher.

True Statements are not Actionable as Defamation.

Our courts have stated that true statements are absolutely protected under the First Amendment from liability for defamation. The allegedly defamatory statements in the July and August 2017 letters related to BrainBuilders' "potential fraud," potential "violations of state and federal law," and concerns for "quality of care or member safety." It is uncontroverted that several of BrainBuilders' officers were arrested for conspiracy to defraud Medicaid in association with "income they received from BrainBuilders." These individuals were arrested because they potentially committed fraud. Additionally, the arrests raised legitimate concerns regarding the quality of care rendered by BrainBuilders.

Moreover, BrainBuilders claimed it conferred only benefits to the insured members and not defendants. Under these circumstances, the Appellate Division was satisfied BrainBuilders failed to proffer any support for its unjust enrichment and quantum meruit claims.

ZALMA OPINION

It takes a certain amount of unmitigated gall to sue for defamation an entity that reported that the plaintiffs officers were arrested for Medicaid fraud, a major felony. Their officers were arrested - albeit I could find no report on the result of the charges - for insurance fraud, telling their customers about the arrests in good faith is not defamation since the statements were true.

(c) 2024 Barry Zalma & ClaimSchool, Inc.

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What else you may like…
Videos
Posts
September 18, 2026
Expert May Only Testify to What Experience Supports

Insurance Expert May Not Testify to Speculative and Contains Unsupported Conclusions.

Posted on September 18, 2026 by Barry Zalma

See the full video at and at https://rumble.com/v7fmifw-expert-may-only-testify-to-what-experience-supports.html

In Michele A. Over, and The Estate Of Paul R. Over v. State Farm Mutual Automobile Insurance Company, and State Farm Fire And Casualty Company, Civil Action No. 23-cv-02243-PAB-STV, United States District Court, D. Colorado (September 14, 2026) Michele and Paul Over sued State Farm Fire and State Farm Auto over hail-damage and stolen-vehicle claims.

The operative dispute concerned State Farm Auto’s motion to exclude or limit opinions from plaintiffs’ insurance-industry expert, Aaron Castillo. Castillo.

Law

The proponent of expert testimony must establish by a preponderance of the evidence that an expert is qualified and that the opinions are helpful, sufficiently grounded, and reliably derived and applied. Experience-based opinions must explain how the...

00:03:10
September 17, 2026
Convicted on 29 Tax-Refund-Fraud Counts

150 Months in Prison for Tax Fraud
Post 4846

Posted on September 17, 2026 by Barry Zalma

See the full video at https://lnkd.in/g8rh3JBX and https://lnkd.in/gmkdy-9C, In United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.

FACTS

In United States Of America v. Thomas Addaquay, United States Of America v. Thomas Addaquay, Nos. 25-10609, 25-10611, United States Court of Appeals, Eleventh Circuit (September 9, 2026) the Eleventh Circuit affirmed all challenged convictions, the 150-month aggregate sentence, and the challenged $4,123,474.55 restitution award.
FACTS

Thomas Addaquay controlled United Consolidated Accounting and Business Services (UC), nominally a check-cashing business.

The government proved a three-stage tax-refund scheme that converted the resulting refund checks into usable funds through ...

00:05:23
September 14, 2026
Court Enforces Fifth Amendment & Refuses to Compel Answers

Major Fraud Perpetrator Asserts Fifth Amendment Privilege to Avoid Prosecution

Post 5489

Posted on September 14, 2026 by Barry Zalma

Fraudster Refuses to Answer Questions About His Alleged Fraud

See the full video at https://lnkd.in/gvicAMDr and at https://lnkd.in/gvicAMDr

In Great American Insurance Co. v. Gemstone Property Management, LLC, et al., No. 23-cv-9100 (LJL), United States District Court, S.D. New York (September 8, 2026) Great American Insurance Company alleged that it was defrauded through a scheme in which Subin Associates, LLP recruited individuals to stage construction-site injuries, arranged unnecessary medical treatment and litigation funding, and pursued fraudulent personal-injury claims.

Luis Manuel Garcia Salcedo, resulted in a $6 million settlement. Non-party Jose Hernandez allegedly worked as an assistant manager at Subin, operated Hernandez Associates, and owned litigation-funding companies that shared office space with Subin and provided services to its clients.

After Great American ...

00:05:14
October 16, 2026

Alleged Defamatory Statements Must be Of and Concerning Plaintiffs

Posted on October 16, 2026 by Barry Zalma

To Prove Defamation the Statement Must be Of and Concerning the Plaintiffs

Post 4867

In Michael Moloney and Sergio Cantu v. United Services Automobile Association, No. 04-25-00519-CV, Court of Appeals of Texas, Fourth District, San Antonio (October 14, 2026) Michael Moloney and Sergio Cantu appealed from the trial court’s granting of a traditional motion for summary judgment in favor of United Services Automobile Association (“USAA”) on their defamation claim.
BACKGROUND

Moloney and Cantu sued USAA for defamation, alleging that they are the principals of Informed Roofing & Restoration, LLC (“Informed Roofing”), which is primarily engaged in the residential roofing repair and replacement business, and that an employee or agent of USAA had made false and defamatory statements to the San Antonio Police Department (“SAPD”) concerning them.

Specifically, Moloney and Cantu alleged that an employee of ...

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October 15, 2026
Zalma’s Insurance Fraud Letter – October 15, 2026

ZIFL – Volume 30, Issue 20 Subscribe to ZIFL here https://lnkd.in/gfpn78FM

Posted on October 15, 2026 by Barry Zalma

THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL

Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud.

ZIFL is published 24 times a year is written by Barry Zalma.

It is provided FREE to anyone who visits the site at https://lnkd.in/gVT5G9s

Six Insane Fraud Schemes the Trump Administration Has Uncovered Stealing from the taxpayer has now become a multi-billion-dollar industry in America. Obamacare has been a magnet for scammers.

Florida Insurance Agent Pleads Guilty in $300,000 Premium Finance Scheme

Daniel Raney, 41, who managed Raney Insurance and Raney Ventures in Pensacola, was arrested after AFCO Direct.

RIFE WITH FRAUD ALLOWS DEMANDS TO ESTABLISH RESTITUTION

Six Insane Fraud Schemes the Trump Administration Has Uncovered

Stealing from the taxpayer has now become a multi-billion-dollar industry in America – and the ...

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October 14, 2026
District Court has Wide Discretion in Sentencing

Sentence for Stealing from Veterans Administration Reasonably Considers State Insurance Fraud & Arson Convictions

Post 4863

Posted on October 14, 2026 by Barry Zalma

In United States Of America v. Anthony Curtis Brewer, No. 26-10745, United States Court of Appeals, Eleventh Circuit (October 8, 2026) Anthony Curtis Brewer became the fiduciary for an incapacitated recipient of Department of Veterans Affairs survivor benefits and agreed to use her funds solely for her care and support without commingling them with his own.

The VA determined that he misused $67,232.33 and removed him as fiduciary in 2022. Brewer pleaded guilty to theft of more than $1,000 in government property under 18 U.S.C. § 641. At sentencing, the district court attributed $53,567 in loss to him, producing an advisory Guidelines range of 15 to 21 months.

Citing the victim’s vulnerability, Brewer’s attempts to avoid responsibility, and his other fraudulent conduct — including state convictions for arson and insurance fraud — the court ...

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