Facts

In 2016, Plaintiff Mary Lynn Rapier filed a complaint against 10 defendants for violations of the California Insurance Code and other employment related claims. In 2018, the California Department of Insurance intervened and continued prosecution of the action. In May 2018, CDI amended the complaint to include a total of 16 defendants. One of the defendants, Prime Healthcare Services Inc., a 45-hospital system and its affiliate, Encino Hospital Medical Center were sued for insurance fraud.

PLAINTIFF'S CONTENTIONS: Plaintiff presented witnesses who testified that Serenity Recovery Center at Encino Hospital had licensing issues. An expert witness testified about her investigation of plaintiff's fraud claims and stated that the way defendants completed the standard form defendants used to bill insurance companies was defective.

DEFENDANT'S CONTENTIONS: Defendants denied the contentions. Defendants contended that CDI overreached and pursued a case beyond its limited jurisdiction.

Result

Defendants secured a complete defense verdict against CDI and Rapier.

Other Information

This set case precedent that claims under the Insurance Frauds Prevention Act are equitable in nature and are not subject to a jury trial.