Government Employees Insurance v. Uptown Health Care Management, Inc.
Plaintiffs GEICO allege a scheme where defendants, including Uptown Health Care Management d/b/a East Tremont, Hisham Elzanaty, Alan Goldenberg, Dr. Hisham Ahmed, and Dr. Jadwiga Pawlowski, fraudulently billed GEICO for millions in services. GEICO contends East Tremont was ineligible for reimbursement under New York's no-fault insurance laws, operating without a legitimate medical director, violating its operating certificate, and paying kickbacks for referrals. The complaint raises six causes of action, including declaratory judgment, RICO violations (18 U.S.C. §§ 1962(c), 1962(d)), common law fraud, aiding and abetting fraud, and unjust enrichment. Defendants moved to dismiss under Rule 12(b)(1) for Burford abstention and Rule 12(b)(6) for failure to state a claim, arguing GEICO's claims would invalidate a DOH license and interfere with state oversight. Citing the similar Allstate Ins. v. Elzanaty action, the court denied defendants' motions, affirming that insurers can challenge fraudulent licensing and conduct under RICO and fraud claims, even if state authorities have approved the facility. The court concluded that such claims do not disrupt New York's regulatory scheme and need not be raised exclusively with the DOH or through an Article 78 proceeding.