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 non-ERISA health insurance plans, allege that Genesis and Metropolitan, along with unnamed parties, submitted fraudulent reimbursement claims under various health plans.
ISSUES
1. Whether Genesis, Metropolitan, and associated parties submitted fraudulent claims for reimbursement under the health plans administered by United and Oxford.
2. Whether the Counterclaim Defendants’ motion to dismiss all counterclaims should be granted in whole or in part.
3. Which specific counterclaims, if any, survive dismissal under federal and state law standards.
LAW
The case involves federal, state, and common law claims, including those under the Employee Retirement Income Security Act of 1974 (ERISA) for certain plans, and state law for non-ERISA plans.
The legal issues center on allegations of fraud, improper billing, and the submission of false claims for reimbursement under health insurance policies administered by United and Oxford.
DISCUSSION
The Counterclaim Defendants moved to dismiss all counterclaims asserted by United and Oxford, who opposed the motion and filed a reply. The Court decided the motion on the papers without oral argument. The allegations involve both ERISA-governed and non-ERISA health plans, implicating different legal standards.
ANALYSIS
The Court found that the motion to dismiss warranted a mixed outcome, granting it in part and denying it in part. This indicates that some of the counterclaims did not meet the threshold for dismissal at this stage, while others were sufficiently challenged to warrant dismissal.
Federal Rule of Civil Procedure 12(b)(6)
Pursuant to Federal Rule of Civil Procedure 12(b)(6), a court accepts all well-pled factual allegations as true, construes the complaint in the plaintiff’s favor, and determines whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.
To survive a Rule 12(b)(6) challenge, a plaintiff’s claims must be facially plausible. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.
Counterclaimants Seek Recoupment Of Overpayments Based Upon Three Sets Of Allegations, All Of Which Appear To Underlie Each Counterclaim.
Counterclaimants do not state any claim against Metropolitan, nor do they state any state law or common law claim The Court will therefore grant the Motion in part and will dismiss multiple counts. Counterclaimants do, however, state an ERISA claim and a claim for declaratory judgment based upon the Cash Price Allegations as those allegations relate to ERISA plans. The Court will therefore deny the Motion in part and permit Counts One and Ten to proceed.
ERISA preempts state law and common law claims based on the Cash Price Allegations. Counterclaimants’ State law claims based on Genesis’s posted cash price for COVID-19 testing are preempted by § 1144(a).
Counterclaimants Need Only Satisfy Plausibility, And They Have Done So Here With Respect To Genesis.
Because the CARES Act did not modify non-ERISA plans, Counterclaimants cannot plead facts that would make their Cash Price Allegations actionable in the context of non-ERISA plans.
Because Counterclaimants adequately plead a violation of ERISA against Genesis, however, Counterclaimants may proceed with Count One against Genesis for overpayments under ERISA plans based on the Cash Price Allegations. Counterclaimants fail to explain why any diagnostic test (such as a COVID-19 test) needed to have been performed “separately” or only pursuant to a physician’s orders.
Accordingly, the Court will grant the Motion as to all claims based on the Ancillary Testing Allegations and will dismiss those claims without prejudice.
ZALMA OPINION
ERISA actions are singularly federal issues and if properly alleged can be stated in a federal court action. Other actions need to be pleaded carefully and the counterclaimants failed to do so and those allegations were dismissed without prejudice giving the parties the opportunity to try to plead their cases more carefully.
(c) 2026 Barry Zalma & ClaimSchool, Inc.
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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
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Foolish to Repeatedly Disobey Court Orders
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Post number 5348
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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
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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
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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...
