Lawyer Convicted of Workers’ Compensation Fraud
Post 5031
Read the full article at https://www.linkedin.com/pulse/guilty-paying-kickbacks-cappers-defraud-insurers-zalma-esq-cfe-9uybc, see the full video at https://rumble.com/v6r8bl0-guilty-paying-kickbacks-and-cappers-to-defraud-insurers.html and at https://youtu.be/ZXEaXW1pGZs and at https://zalma.com/blog plus more than 5000 posts.
In The People v. Jon Woods, G061948, California Court of Appeals, Fourth District, Third Division (March 18, 2025) a jury convicted Jon Woods of 37 felony counts of workers’ compensation fraud.
Woods was a worker’s compensation attorney who had made business arrangements that involved unlawful kickback and referral fees.
Woods contended that the Williamson rule (In re Williamson (1954) 43 Cal.2d 651, 276 P.2d 593) precluded convictions on counts 5 through 37. The Williamson rule states that where the Legislature has defined a specific crime with a lesser punishment, the conduct described by that crime may not be charged as a more general crime with a harsher punishment. Woods argued that his conduct was covered by a more specific statute, Labor Code section 139.32, which makes it a misdemeanor to refer work to third-party servicers in exchange for compensation.
THE WORKERS’ COMPENSATION SYSTEM
Workers’ Compensation is a scheme where employers agree to promptly compensate employees for injuries sustained on the job regardless of fault, and employees agree to the limited remedies available under the scheme.
The Legislature passed laws to protect insurers and the overall workers’ compensation system from abuse, including making it a crime to participate in a kickback scheme which was the criminal conduct of Woods, Gonzales and Arguello.
FACTS
Woods arranged with Edgar Gonzales to use copy services business called USA Photocopy, which provided subpoena services for workers’ compensation attorneys. USA Photocopy paid for some of Woods’s business expenses, including the salary of certain employees hired by Woods.
Woods’s arrangement with Arguello involved a marketing company that advertised to obtain workers’ compensation clients. Using Arguello’s copy service for subpoenas was a condition of engaging his advertising service. Woods paid Arguello’s businesses $1,425,000 in fees for advertising services over the course of their relationship.
Arguello pleaded guilty to federal criminal charges related to worker’s compensation fraud and was sentenced to four years in federal prison. He also pleaded guilty to charges brought by the Orange County District Attorney.
The Attorney General alleged four aspects of Woods’s relationships with Gonzales and Arguello that were illegal. These included operating as a runner or capper service, providing fully signed and retained clients prior to any interaction with Woods, a quid pro quo arrangement, and an illegal cross-referral service.
After conviction Woods was sentenced to four years in prison and ordered to pay restitution in the amount of $701,452.
THE APPEAL
Woods appealed, and the court reversed counts 5-37 based on the Williamson rule. Woods contended that his conduct is covered by a more specific statute that criminalizes kickback schemes, which is what Woods was accused of participating in, Penal Code Section 550.
DISCUSSION
Absent some indication of legislative intent to the contrary, the Williamson rule applies and there does not need to be perfect overlap between the general and specific statutes.
The People’s theory of how Woods violated Penal Code section 550 was precisely that he violated Labor Code section 139.32 and, therefore, the Williamson rule applies. The Court of Appeals agreed with Woods under these circumstances, and thus reversed his conviction on counts 5-37. This will also require reversal of the white-collar sentencing enhancement based on these charges, as well as a restitution award based on these charges. The restitution order of $701,452 was reversed without prejudice to the court reassessing restitution at a new sentencing hearing. In all other respects, the judgment was affirmed.
ZALMA OPINION
A lawyer committing fraud taking advantage of the Workers’ Compensation system where his crimes resulted in more than a million dollars of kickbacks and payment for cappers who illegally signed up clients for Woods. The court only found that the state overcharged Woods and required him to serve an appropriate sentence for his fraud on the Workers’ Compensation system, employers and their insurers. Jail and an appropriate amount of restitution to the defrauded insurers should be assessed.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to Newsbreak.com https://www.newsbreak.com/@c/1653419?s=01; Go to Barry Zalma videos at Rumble.com at https://rumble.com/account/content?type=all; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg
Go to the Insurance Claims Library – https://lnkd.in/gwEYk
Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to the Insurance Claims Library – https://lnkd.in/gwEYk
Arsonist Tried To Represent Himself, Failed, and Sought Habeas Relief
Post number 5357
Read the full article at https://www.linkedin.com/pulse/he-who-acts-his-own-lawyer-has-idiot-client-barry-zalma-esq-cfe-d4bwc, See the full video at and at and at https://zalma.com/blog.
Karacson’s Arson for Profit Attempt Required Skill & Experience to Succeed
In Steve Ellis Karacson v. David Shaver, Warden, No. 25-1089, United States Court of Appeals, Sixth Circuit (May 20, 2026) Steve Karacson was convicted in Michigan state court of arson and insurance fraud after evidence showed he burned his own insured home. Investigators found multiple points of origin, gasoline odor, and evidence tying him to the scene, including cell-phone location data and a receipt showing he had purchased a gas can and gloves shortly before the fire.
FACTS
Karacson initially had appointed counsel, but his relationships with both appointed attorneys ...
Foolish to Repeatedly Disobey Court Orders
All That Remains For Trial Is Plaintiff’s Damages On Each Of These Claims And Establishing Proximate Causation Of Those Damages.
Post number 5348
See the full video at and at and at https://zalma.com/blog plus 5300 posts.
In Linh Wang v. Esurance Insurance Company, No. C24-0447-JCC, United States District Court, W.D. Washington, Seattle (May 1, 2026) John C. Coughenour, United States District Judge, found that throughout this case, culminating with its briefing on Plaintiff’s renewed motion and that Defendant has subjected Plaintiff to unnecessary motion practice for clearly discoverable information and made dubious representations (including to the Court).
FACTUAL BACKGROUND
This case involves an underinsured/uninsured motorist insurance bad faith claim arising from a 2017 motor vehicle collision. The plaintiff, Linh Wang, alleges that Esurance Insurance ...
The Right to Negotiate with Insurer is Not an Assignment of Claims
Post number 5347
Read the full article at https://www.linkedin.com/pulse/ambiguous-contract-repair-assignment-barry-zalma-esq-cfe-2xppc, see the full video at https://rumble.com/v79is1s-ambiguous-contract-to-repair-not-an-assignment.html and at and at https://zalma.com/blog plus more than 5300 posts.
Nebraska Requires an Actual Assignment to Allow Contractor to Sue Insurer
In Millard Gutter Company, a corporation doing business as Millard Roofing and Gutter v. Farmers Mutual Insurance Company of Nebraska, also known as Farmers Mutual Insurance, also known as Farmers Mutual, No. A-24-818, Court of Appeals of Nebraska (May 5, 2026) Millard sued Farmers as an assignee of Jane Anzalone who had hired Millard Gutter to repair the roof of her home and agreed to allow Millard Gutter to coordinate with her insurer, Farmers Mutual, concerning reimbursement for repairs authorized under her insurance policy.
FACTUAL BACKGROUND
In ...
Qui Tam Case Without Evidence to Prove Fraud Fails
Post number 5369
Read the full article at https://www.linkedin.com/pulse/qui-tam-insurer-contended-defrauded-barry-zalma-esq-cfe-pgfgc and at https://zalma.com/blog plus more than 5550 posts.
In People Of The State Of California Ex Rel. Heath & Yuen, APC v. Silver Bird Auto Leasing, LLC et al., B342847, California Court of Appeals, Second District, Eighth Division (June 5, 2026) Heath & Yuen, APC defended parties in an automobile collision case involving a McLaren and a tour van. After that case settled for $25,000, the firm filed a qui tam action under California’s Insurance Frauds Prevention Act (IFPA) against Silver Bird Auto Leasing, LLC, X-Law Group, PC, and Filippo Marchino. The firm alleged three fraudulent acts in the underlying litigation:
1. the complaint falsely stated the McLaren was making a “legal turn,”
2. respondents produced a fraudulent repair bill/estimate, and
3. respondents failed to disclose Marchino’s GEICO insurance and its payment for repairs....
Full Faith and Credit Act Controlled
Read the full article at https://lnkd.in/evHXiiFE and at https://zalma.com/blog.
Posted on June 9, 2026 by Barry Zalma
Post number 5368
Posted on June 9, 2026 by Barry Zalma
In Prime Insurance Company, Inc. v. Medicab Transportation, LLC, Jason Rhodes, and Dale Johnson v. Prime Insurance Company, Inc and Prime Property & Casualty Insurance, Inc. No. 2:24-cv-421-SPC-KRH, United States District Court, M.D. Florida, Fort Myers Division (June 3, 2026) Medicab, a paratransit company, bought two policies in 2021: a Business Auto Policy from PPCI and a Commercial Liability Policy from Prime. Both policies, as originally written, appeared to cover injuries arising from loading and unloading patients from Medicab vans.
After a patient, Margaret St. Aubin, fell while being unloaded from a van and suffered injuries, her Estate made a $1 million demand. Prime and its claims administrator concluded that the Commercial Policy’s loading/unloading language had been included by mutual mistake, because...
Full Faith and Credit Act Controlled
Read the full article at https://lnkd.in/evHXiiFE and at https://zalma.com/blog.
Posted on June 9, 2026 by Barry Zalma
Post number 5368
Posted on June 9, 2026 by Barry Zalma
In Prime Insurance Company, Inc. v. Medicab Transportation, LLC, Jason Rhodes, and Dale Johnson v. Prime Insurance Company, Inc and Prime Property & Casualty Insurance, Inc. No. 2:24-cv-421-SPC-KRH, United States District Court, M.D. Florida, Fort Myers Division (June 3, 2026) Medicab, a paratransit company, bought two policies in 2021: a Business Auto Policy from PPCI and a Commercial Liability Policy from Prime. Both policies, as originally written, appeared to cover injuries arising from loading and unloading patients from Medicab vans.
After a patient, Margaret St. Aubin, fell while being unloaded from a van and suffered injuries, her Estate made a $1 million demand. Prime and its claims administrator concluded that the Commercial Policy’s loading/unloading language had been included by mutual mistake, because...
