Multiple Suits or Arbitration on Fraudulent Claims Irreparably Harm GEICO
Post number 5279
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GEICO Successfully Fights No Fault Auto Insurance Claims Fraud by Fraudsters Seeking Independent Trials or Arbitrations for Each Suspected Fraudulent Claim
In Government Employees Insurance Company, GEICO Indemnity Company, GEICO General Insurance Company, GEICO Casualty Company v. Bhargav Patel, MD, Patel Medical Care, P.C., John Doe Defendants 1 through 10, No. 24-191, United States Court of Appeals, Second Circuit (February 3, 2026) Government Employees Insurance Company (GEICO) and its subsidiaries, brought a civil action under the Racketeering Influenced and Corrupt Organization Act (“RICO”) against Dr. Bhargav Patel, Patel Medical Care, P.C., and other associated defendants.
GEICO alleged that the defendants orchestrated a scheme to exploit New York’s no-fault automobile insurance laws, submitting millions of dollars in reimbursement claims for treatments that were allegedly medically unnecessary, experimental, excessive, or even fictitious.
FACTS
After GEICO denied or disputed these claims, the defendants initiated over 600 independent collection actions in New York state courts and arbitration tribunals, seeking more than $2 million in judgments against GEICO.
LEGAL ISSUES
The case centers on the application of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961–1968, and the Anti-Injunction Act, 28 U.S.C. § 2283.
DISCUSSION AND ANALYSIS
GEICO sought a preliminary injunction to halt all of the defendants’ ongoing and future collection actions in state court and arbitration, arguing that these multiple proceedings threatened irreparable harm and could obscure the full scope of the alleged fraudulent scheme. The district court granted the injunction, finding GEICO had demonstrated irreparable harm due to the risk of inconsistent judgments and the piecemeal litigation of its fraud defenses.
On appeal, the Second Circuit reviewed the injunction for abuse of discretion and found none.
Reviewing the district court’s grant of a preliminary injunction for abuse of discretion, the Second Circuit identified none. The court did not clearly err in concluding that the parallel proceedings posed a risk of irreparable harm to GEICO: the potential of inconsistent judgments posed that risk, as did the possibility that the alleged overarching fraudulent scheme would be obscured by a requirement that GEICO’s fraud defense be asserted piecemeal in the numerous individual state collection proceedings.
Finally, in accordance with the recent decision in State Farm v. Tri-Borough NY Medical Practice, P.C., 120 F.4th 59 (2d Cir. 2024), the Second Circuit concluded that the preliminary injunction did not violate the Anti-Injunction Act.
To demonstrate that the district court’s failure to provide the requested relief will cause it irreparable harm, the movant must show an “injury that is neither remote nor speculative, but actual and imminent and that cannot be remedied by an award of monetary damages.” The injury must also be a “continuing” one.
BALANCE OF HARDSHIPS
The Second Circuit explained, when a preliminary injunction is sought based on a serious question going to the merits of a case the movant must further demonstrate that the balance of hardships tips decidedly in its favor. This factor requires the district court to balance the competing claims of injury and consider the effect on each party of the granting or withholding of the requested relief.
The district court determined that, if the expedited state court collections actions were to be stayed, Defendants would at the worst suffer from delayed recovery of payment. But if the federal court action is meritorious and the state court actions not stayed, the court reasoned, GEICO would suffer the irreparable harm described above weighing the hardships in favor of GEICO.
GEICO sufficiently alleged that the massive fraudulent scheme here becomes apparent only when the claims are analyzed altogether. The risks created by disaggregating the scheme into individual actions-both financial and of concealment-amount to allowing irreparable harm to GEICO if the actions are permitted to proceed.
The Second Circuit affirmed the district court’s order, upholding the preliminary injunction in favor of GEICO.
ZALMA OPINION
Insurance fraud is estimated to take $308 billion every year from the US insurance industry. GEICO alleged the defendants presented hundreds of fraudulent claims and whenever GEICO refused to pay they sued it piecemeal forcing GEICO into hundreds of trials where different results, to the detriment of GEICO would become a certainty causing it irreparable harm. The RICO suits give GEICO a chance to fairness and the injunction was necessary and proper to protect its assets from fraud.
(c) 2026 Barry Zalma & ClaimSchool, Inc.
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Arrest for Insurance Fraud is not a Violation of Constitutional Rights
Court Give Plaintiffs Acting as their Own Lawyer a Second Chance
Post number 5310
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In Arin Sutton et al v. Lori Pozuelos et al., No. 5:25-cv-03544-MRA-MAR, United States District Court, C.D. California (March 20, 2026) Plaintiffs Darin Sutton and Youtha Baker, proceeding pro se and in forma pauperis, initiated a civil rights action under 42 U.S.C. § 1983 against multiple defendants, including Lori Pozuelos, in the United States District Court for the Central District of California.
FACTUAL BACKGROUND
Plaintiffs allege violations of their constitutional rights, though the complaint’s factual allegations are stated in general terms and lack specific detail as to the actions of each defendant.
Plaintiffs are independent contractors who completed work in Missouri. ...
Suit Against Police Agency Dismissed
Post number 5309
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Conclusory Allegations, Unwarranted Deductions Of Facts Or Legal Conclusions Masquerading As Facts Will Not Prevent Dismissal.
In Hunter Seaborn Mackenzie Black v. Robert J. Perrault, Jr. and The Florida Department Of Financial Services, No. 8:25-cv-01466-WFJ-CPT, United States District Court, M.D. Florida, Tampa Division (March 19, 2026) Defendant Florida Department of Financial Services' (“DFS”) moved to Dismiss Count II of the Amended Complaint.. Plaintiff Hunter Seaborn Mackenzie Black (“Black”) has responded in opposition.
BACKGROUND
Plaintiff Hunter Seaborn Mackenzie Black was an independent salesman for a licensed roofing contractor, conducting door-to-door roofing sales in Florida. Defendant Florida Department of Financial Services ...
Fraudsters Fight Over Ownership of the Subject of Their Fraud
Post number 5308
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Convicted Fraudsters Try to Cheat Each Other
After failing to defraud insurers about the loss of a diamond ring the two admitted fraudsters sought possession of the seized ring which was neither lost nor stolen but was seized by the state.
In State Of North Carolina v. Kevin Ray Reece and Debra Lee Goldman, No. COA25-569, Court of Appeals of North Carolina (March 18, 2026) two fraudsters disputed the ownership of a platinum-banded diamond ring seized during a criminal investigation as the subject of Insurance Fraud.
FACTUAL BACKGROUND
Kevin Ray Reece pleaded guilty to two counts of felony obstruction of justice related to the ring and requested its return...
Insurance Condition Requires Following the Intent of the Parties
Post number 5307
Principles of Contract Interpretation Compels Reading Contract as Written
Read the full article at https://www.linkedin.com/pulse/portable-storage-containers-buildings-barry-zalma-esq-cfe-fkg1c and at https://zalma.com/blog.
In Eastside Floor Supplies, Ltd. v. SCS Agency, Inc., Hanover Insurance Company, et al., No. 2024-01501, Index No. 609883/19, 2026 NY Slip Op 01488, Supreme Court of New York, Second Department (March 18, 2026)
In May 2019, a fire damaged business personal property belonging to the plaintiffs, which was stored in portable storage containers at their Manhattan premises. At the time of the fire, the plaintiffs were insured under a businessowners insurance policy (BOP) issued by the defendant Hanover Insurance Company which provided general coverage for business personal property, and which included a specific extension for “Business Personal Property Temporarily in Portable Storage Units” (the portable storage ...
Insurance Condition Requires Following the Intent of the Parties
Post number 5307
Principles of Contract Interpretation Compels Reading Contract as Written
Read the full article at https://www.linkedin.com/pulse/portable-storage-containers-buildings-barry-zalma-esq-cfe-fkg1c and at https://zalma.com/blog.
In Eastside Floor Supplies, Ltd. v. SCS Agency, Inc., Hanover Insurance Company, et al., No. 2024-01501, Index No. 609883/19, 2026 NY Slip Op 01488, Supreme Court of New York, Second Department (March 18, 2026)
In May 2019, a fire damaged business personal property belonging to the plaintiffs, which was stored in portable storage containers at their Manhattan premises. At the time of the fire, the plaintiffs were insured under a businessowners insurance policy (BOP) issued by the defendant Hanover Insurance Company which provided general coverage for business personal property, and which included a specific extension for “Business Personal Property Temporarily in Portable Storage Units” (the portable storage ...
ERISA Saves Fraudulent Claims Suit
Post number 5306
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Allegations of Fraudulent Insurance Billing Must be Pleaded with Specificity
In Genesis Laboratory Management LLC v. United Healthcare Services, Inc. and Oxford Health Plans, Inc., No. 21cv12057 (EP) (JSA), United States District Court, D. New Jersey (March 13, 2026) Genesis Laboratory Management LLC (“Genesis”), a New Jersey-based molecular diagnostic and anatomic pathology laboratory, provided COVID-19 related testing services and submitted claims for reimbursement as an out-of-network provider to United Healthcare Services, Inc. (“United”) and Oxford Health Insurance, Inc. (“Oxford”). Metropolitan Healthcare Billing, LLC (“Metropolitan”), owned by the same individual as Genesis, handled the billing for Genesis.
FACTUAL BACKGROUND
United and Oxford, who administer both ERISA and ...
