RICO Suit Against Law Firm & Health Care Pros Fails

Posted on October 28, 2026 by Barry Zalma

UBER AND FEDEX FIGHT FRAUD

Racketeer Influenced and Corrupt Organizations Act (RICO) is Designed to Defeat Fraud Perpetrators

In Uber Technologies, Inc., et al. v. Simon & Simon P.C., et al., Civil Action No. 25-5365, United States District Court, E.D. Pennsylvania (October 13, 2026) Uber Technologies, Inc. and Federal Express Corporation sued attorney Marc Simon, his firm Simon & Simon, P.C., and several medical professionals and practices under the Racketeer Influenced and Corrupt Organizations Act (RICO).

They allege the defendants orchestrated a scheme to generate and litigate fraudulent personal injury claims arising from motor vehicle accidents involving Uber and FedEx drivers. Uber and FedEx incurred defense costs and paid settlements on some claims. The court earlier denied a motion to dismiss, finding proximate causation adequately pleaded. Fact discovery is set to close December 21, 2026.

Discovery showed Uber’s insurer, Farmers Insurance Exchange, paid Uber’s defense fees and costs and initially paid settlements and judgments in the underlying suits; Aleka Insurance, Inc., a captive insurance subsidiary owned by Uber, reimbursed Farmers. Uber also reimbursed its own employees for out-of-pocket costs to attend a personal injury trial allegedly part of the scheme. In mid-discovery, Simon & Simon and Marc Simon (the “Simon Defendants”) moved for partial summary judgment, arguing Uber lacks RICO standing.
LAW.

RICO’s civil remedy, 18 U.S.C. § 1964(c), permits “any person injured in his business or property” by racketeering conduct to sue and “recover threefold the damages he sustains and the cost of the suit, including a reasonable attorney’s fee.” “Actual monetary loss” qualifies as injury to business or property, and RICO requires a direct injury proximately caused by the predicate acts. Congress sets no minimum amount of loss and says nothing about barring recovery by insured parties or those reimbursed by third parties. Remedial statutes, including RICO, are construed liberally. Under the collateral source rule, a tort victim may recover from the tortfeasor regardless of compensation received from independent or collateral sources. Summary judgment is improper where a genuine issue of material fact exists.
DISCUSSION.

The Simon Defendants argued Uber suffered no injury to business or property because Farmers paid Uber’s attorney’s fees and settlements; reimbursement to Farmers came from “another insurance company,” Aleka; any chain of payments from Uber to Aleka to Farmers was “well beyond the first step in the causal chain,” defeating proximate cause; the collateral source rule does not apply to RICO; and Uber’s out-of-pocket employee costs were “trivial” and arose in a case where Uber was not a named defendant, so the negligent driver — not the scheme — caused them. In effect, they contended only Farmers, which was neither sued nor targeted, could have standing. Uber responded that the racketeering activity injured it directly, that Aleka is its own captive insurer and an integral part of its business with no outside revenue, and that Aleka’s payments to Farmers “decrease[] Uber’s balance sheet.”
ANALYSIS.
Genuine Issue Of Material Fact.

The Simon Defendants did not dispute Uber paid its employees’ out-of-pocket trial costs. No authority requires a minimum quantum of damages for RICO standing; even one dollar of loss suffices. Who caused those costs — the scheme or the negligent driver — is a disputed fact for trial, and this loss alone could give Uber standing even under the Simon Defendants’ theory.
No Lack Of Standing As A Matter Of Law.

Section 1964(c), read liberally, does not bar recovery by insureds whose insurers pay defense costs and indemnity.

A RICO plaintiff does not lose standing by acting through a representative — principal directly injured despite using an agent), and an insurer that is a “mere conduit” for payment does not strip the targeted party of standing.

Courts outside RICO likewise allow recovery of defense costs paid by an insurer. Wrongdoer cannot reduce damages by showing compensation from another source. A party “incurs” fees when liable for them, regardless of who pays. Farmers acted as Uber’s representative and conduit; requiring the insured to pay first and then seek recovery for its carrier would be unwarranted.

Uber also has standing under the collateral source rule, which courts have applied in RICO cases; otherwise, defendants could escape liability whenever a third party relieved the victim’s injury. is distinguishable because the scheme there targeted the patients’ insurers, whereas here the scheme targeted Uber.
CONCLUSION

The court denied the Simon Defendants’ motion for partial summary judgment. Uber has RICO standing because a genuine issue of material fact exists on at least one claim, and because its insurer’s payments to the Simon Defendants and their claimants on Uber’s behalf do not, as a matter of law, deprive Uber of standing. Uber may proceed on its racketeering theories.

The Court of Appeals concluded that the Simon Defendants’ Motion for partial summary judgment against Uber failed. The Court of appeals also found Uber enjoyed standing to assert racketeering claims against the Simon Defendants based on a genuine issue of material fact as to at least one claim and notwithstanding its insurer Farmers compensated the Simon Defendants and their claimants on Uber’s behalf in other underlying cases in the state court.

As a result the Court of Appeals allowed Uber to proceed on its racketeering theories against the Simon Defendants.
ZALMA OPINION

Corporations and Insurers who believe they are the victim of motor vehicle accident fraud do not pay and forget fraud. They are becoming pro active and, like Uber and FedEx in this case, file RICO suits to get damages from those they believe perpetrated the fraud. The defendants tried to dismiss the RICO suit with technical claims against the victims filing the RICO suit. Uber and FedEx should be praised and emulated for the effort to punish fraudsters.

(c) 2026 Barry Zalma & ClaimSchool, Inc.

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