iFraud Deep Dive

S1 E15 Hard To Believe This Is Reality - Union Mutual v Liakas First Amendment

• iFraud Foundation • Season 1 • Episode 15

Share episode

Get ready for this Deep Dive!  This episode breaks down the federal Racketeer Influenced and Corrupt Organizations Act (RICO) lawsuit brought by Union Mutual Fire Insurance Company against Liakas Law, P.C., and Dean Liakas.  We discuss the Defendants'  request for a pre-motion conference to dismiss the complaint.

In response, Plaintiff's counsel from Willis Law Group not only refutes these points, asserting Union Mutual's direct injury as an insurer, they detail specific of the allegations and it details an unbelievable story of alleged fraud, connections, and an incredible and complex web of fraudulent activity, medical negligence, and so much more!  All in all emphasizing the sufficiency and detail of their RICO pleading, and distinguishing cited case law regarding litigation activity as a predicate act in this context.







Support the show

SPEAKER_00:

Okay, picture this, a scheme, So elaborate, it weaves together completely fake accidents, medically unnecessary and sometimes incredibly harmful surgeries, and then add a whole complex web of legal and medical professionals, all allegedly conspiring to defraud millions.

SPEAKER_02:

Yeah, it sounds like something straight out of a thriller novel, doesn't it? But what we're about to unpack today is very much grounded in the real world, in actual legal documents.

SPEAKER_00:

Exactly. And that's precisely why we wanted to dig into this one. Today, we're taking a deep dive into a really fascinating, complex, and frankly, pretty shocking case unfolding right now in New York. Right. We've got a whole load of legal documents here related to a civil lawsuit, union mutual fire insurance company versus Liaca's Law, PC, and others.

SPEAKER_02:

Quite a stack of paper.

SPEAKER_00:

It really is. So our mission today is to unpack these sources, pull out the most important bits of information, the key insights, and help you understand the core allegations, who the alleged players are, and the surprising, almost unbelievable details of how this whole thing supposedly operated.

SPEAKER_02:

It's a perfect example of how, you know, even official information like legal filings can be overwhelming. But when you start seeing the patterns, wow, it tells a wild story.

SPEAKER_00:

Definitely. So let's get into it. Where do we start with this alleged fraud scheme and conspiracy?

SPEAKER_02:

Okay, so at its core, the central claim is this widespread fraud scheme and conspiracy. It allegedly started back in at least 2018.

SPEAKER_00:

OK.

SPEAKER_02:

But there seems to have been a big jump, a real escalation since about 2020. And we're not talking about just a few random incidents. The allegation is this was an organized enterprise.

SPEAKER_00:

An enterprise. And what was the main goal? What were they allegedly trying to achieve?

SPEAKER_02:

Well, the purpose, according to the lawsuit, was pretty straightforward, systematically defraud of insurance companies like Union Mutual Fire Insurance in this case.

SPEAKER_00:

How? What were the alleged methods?

SPEAKER_02:

It allegedly involved orchestrating fake trip and fall accidents, then manufacturing injuries, or at least grossly exaggerating minor ones. Then came providing medically unnecessary treatments, and this is key, including major surgeries. And finally, filing fraudulent personal injury lawsuits to get these huge inflated settlements. Wow. The documents put it pretty bluntly. The aim was to, and I'm quoting loosely here, get desperate people to fake or exaggerate accidents and injuries and undergo needless surgeries to draw out out the lawsuits and get these fraudulent windfall settlements.

SPEAKER_00:

That's incredibly direct.

SPEAKER_02:

It is. And they even compare it in the filings to a previous criminal conviction, United States versus Rainford, suggesting this isn't a totally new playbook.

SPEAKER_00:

Okay. So if it's an enterprise, a scheme this widespread, there must have been a lot of people involved. Who are the alleged players in this?

SPEAKER_02:

Oh, it's quite the cast of characters spanning several professions. At the center, allegedly orchestrating the whole thing, you have the legal service defendants, that's Lyakos Law, PC, and Dean The law. Yes. They're accused of being the masterminds, the coordinators. Yeah. They allegedly directed people called runners to find claimants, arrange the funding, controlled who the claimants saw for medical treatment to get false documentation. And then they initiated and pushed forward these allegedly fraudulent lawsuits using documents they knew were false, like verified complaints and bills of particulars.

SPEAKER_00:

You mentioned runners. What exactly was their role? How did they fit in?

SPEAKER_02:

There were apparently crucial. These are the people the runner defendants referred to as John Doe's one through 25 in the suit.

SPEAKER_01:

OK.

SPEAKER_02:

Their job was allegedly to recruit potential claimants and not just recruit, but to coach them on how to stage an accident or exaggerate their injuries convincingly.

SPEAKER_00:

So sort of teaching them how to perform the injury.

SPEAKER_02:

That's the allegation. Internally, they're apparently called investigators or brokers. Sometimes maybe to sound more legitimate, they were called paralegals or client services liaisons. Receptive titles. Seems like it.

SPEAKER_00:

OK, so beyond the law firm and the runners, the documents also name funding defendants like Prime Case LLC. What was their part in all this? Sounds like they were greasing the wheels.

SPEAKER_02:

That's a good way to put it. This is where the financial mechanics get really interesting. These companies allegedly provided high-interest litigation funding loans directly to the claimants.

SPEAKER_00:

Okay, so money for the person who fell.

SPEAKER_02:

Yes, but here's the really critical part. They also allegedly made upfront payments directly to the medical providers.

SPEAKER_00:

Ah, paying the doctors up front.

SPEAKER_02:

Exactly, to secure their cooperation in the scheme, as the lawsuit puts it. And these advances were often structured cleverly as ownership interest in future case payouts.

SPEAKER_00:

Why structure it like that?

SPEAKER_02:

Well, allegedly, to shield them from usury laws, laws that cap interest rates. The filings call this funding essential for the whole operation to work.

SPEAKER_00:

Makes sense. If you need doctors to do unnecessary things, paying them up front seems like a way to ensure that happens.

SPEAKER_02:

Precisely.

SPEAKER_00:

And that brings us to the medical providers themselves. This is where the alleged harm to individuals really seems to hit home. The list is pretty long. Let's start with Total Orthopedics, Drs. Avinasov, Lerman, and Levin.

SPEAKER_02:

Right. These are orthopedic surgeons. They're accused of recommending and performing surgeries that weren't medically needed and were very expensive. And get this. One of them, Dr. Lerman, actually had his authorization to treat injured workers denied by the New York State Workers' Comp Board.

SPEAKER_01:

Denied? Why?

SPEAKER_02:

The reason cited was performing highly invasive surgeries without proper medical justification. They said he showed wanton disregard that amounted to professional misconduct.

SPEAKER_00:

Wow. That's a serious finding.

SPEAKER_02:

It is. And here's another detail. Operative report written by dr lerman and dr levin were allegedly identical verbatim copy paste jobs used across numerous different patient cases

SPEAKER_00:

wait identical reports for different people undergoing surgery

SPEAKER_02:

that's the allegation dr lerman's report for example supposedly popped up in 25 other separate cases

SPEAKER_00:

that just sounds blatant it's not even changing the details

SPEAKER_02:

it suggests a template a standardized process rather than individualized patient care and it wasn't just them McCulloch Orthopedic Surgical Services, with Dr. Cappiola, another orthopedic surgeon, is accused of using similar identical operative reports.

SPEAKER_00:

Okay, so a pattern emerges there. What about neurosurgery? Gotham Neurosurgery and Dr. Anders Cohen are mentioned.

SPEAKER_02:

Yes. Dr. Cohen is a neurosurgeon alleged to have performed unnecessary spinal fusions. And a particularly concerning detail is that these fusions were often done with only half of the standard instrumentation.

SPEAKER_00:

Half. What does that mean practically?

SPEAKER_02:

It often led predictably to the fusions failing and causing more spinal damage for the patient down the

SPEAKER_00:

line. That's horrific.

SPEAKER_02:

It gets more complicated. His wife apparently used to be a medical coordinator for the Lyakas firm.

SPEAKER_00:

Oh, a connection there.

SPEAKER_02:

Mm-hmm. And there are allegations of kickback arrangements, including him traveling from New York to a specific hospital in New Jersey to do these surgeries.

SPEAKER_00:

Which hospital was that? Was it involved too?

SPEAKER_02:

Yes. Hudson Regional Hospital in New Jersey. They allegedly got direct payments from the funding companies inside submitted highly inflated leap-ins, basically, claims for payment on the patient cases.

SPEAKER_00:

So the hospital was in on it, too, allegedly.

SPEAKER_02:

They're accused of being part of the kickback scheme, yes, and even arranging transport for the New York patients to get out to their facility in Jersey.

SPEAKER_00:

Okay, this web is getting wider. What about the diagnostics? You need scans, MRIs, right? Accelerate Radiology and Dr. Prakash are named.

SPEAKER_02:

Right, they're accused of producing knowingly falsified clinical and diagnostic findings. Essentially, writing MRI reports that routinely deviate from what the scans actually showed about the claimant's conditions.

SPEAKER_00:

Falsified reports.

SPEAKER_02:

That's the claim. And here's a striking detail. The company allegedly operates out of an office that doesn't even have an MRI machine.

SPEAKER_00:

So where were the scans done?

SPEAKER_02:

They relied on undisclosed facilities. Plus, the owner of the company that came before Accelerate Radiology allegedly altered MRI reports. So it raises serious questions about the evidence base for these injuries.

SPEAKER_00:

Definitely. And pain management. Obviously. Often a step before surgery.

SPEAKER_02:

Yes. Pain physicians of New York with doctors Kosharsky and Reifman. They allegedly provided the manufactured justification for surgeries.

SPEAKER_01:

How?

SPEAKER_02:

Through false clinical exam reports and giving unnecessary injections, kind of building a paper trail through surgery. Dr. Reifman in particular has ties to a previous illegal patient referral and kickback scheme.

SPEAKER_00:

History repeats itself, maybe.

SPEAKER_02:

Potentially.

SPEAKER_00:

Yeah.

SPEAKER_02:

And lastly, there's Jean-Paul Errol Toussaint accused of creating knowingly false and or materially misleading records and specifically falsifying range of motion reports, which are key for assessing injury severity.

SPEAKER_00:

OK, so we've got this extensive network, the lawyers coordinating, the runners recruiting, the funders paying, the doctors operating and diagnosing. How did it all actually work together day to day? Was there like a playbook?

SPEAKER_02:

That's exactly how it's described. A cookbook approach, a predetermined step by step process.

SPEAKER_00:

OK, walk us through it.

SPEAKER_02:

So it starts with a claimant, often someone who doesn't speak English well, allegedly being recruited and coached on how to exaggerate their fallen injuries.

SPEAKER_01:

Right.

SPEAKER_02:

They're then directed straight to the Lyakas firm. They're told, allegedly told, that having surgeries will significantly boost their potential payout.

SPEAKER_00:

Ah, incentivizing surgery from the start.

SPEAKER_02:

Exactly. And then they're offered this litigation funding, but it's contingent on them sticking to the plan, participating in these predetermined rote protocol treatments.

SPEAKER_00:

So it's not driven by medical new book, but by this alleged cookbook.

SPEAKER_02:

That's the core allegation. The medical providers, allegedly working together, order unnecessary tests, MRIs of like every major joint just in case. Wow. And then they allegedly rely not on the actual scan images, but on these falsified reports. This rote protocol treatment and these falsified findings create the justification on paper for these preplanned cookbook surgeries.

SPEAKER_00:

Let's make this concrete. The documents give specific claimant examples, right? These are the moments that really show the alleged pattern. What about claimant A?

SPEAKER_02:

Okay, claimant A allegedly fell from just standing height. Minor incident, you'd think, but ended up needing a spinal fusion.

SPEAKER_00:

Okay.

SPEAKER_02:

For a condition that wasn't even found on his MRI.

SPEAKER_00:

How is that

SPEAKER_02:

possible? Good question. And the operative report for his surgery. Identical, allegedly, to 17 other cases. He later needed corrective surgery because the first one wasn't right.

SPEAKER_00:

Unbelievable.

SPEAKER_02:

And it gets stranger. Several of his family members also had suspiciously similar trip and fall accidents, ended up with the same law firm, same doctors.

SPEAKER_00:

That really strains coincidence, doesn't it?

SPEAKER_02:

It certainly raises eyebrows.

SPEAKER_00:

Okay, what about claimant B? There was something about an occult meniscal tear.

SPEAKER_02:

Yes. This one's quite technical but revealing. Claimant B was diagnosed before knee surgery with an occult meniscal tear.

SPEAKER_00:

What does occult mean here?

SPEAKER_02:

It means hidden, something you can't see on preoperative imaging like an MRI. It can only be discovered during the surgery itself.

SPEAKER_00:

So diagnosing it before surgery makes no sense.

SPEAKER_02:

Exactly. It's a medical contradiction. A preoperative diagnosis of an occult tear is basically impossible. Later, this same Clayman had a lumbar spine fusion by Dr. Levin based on what the suit calls imagined justification with no diagnostic support.

SPEAKER_00:

Just wow. OK. Clayman D's story also seemed telling, especially the timing and the type of surgery.

SPEAKER_02:

Right. Clayman D's alleged fall happened just seven days after his brother's fall. Right around the corner from each

SPEAKER_00:

other. Seven days apart. Same area.

SPEAKER_02:

And both represented by Liaka's law. Then, Dr. Cohen allegedly performed a one-sided spinal fusion on claimant D.

SPEAKER_00:

One-sided? But what was the actual problem?

SPEAKER_02:

The condition noted was bilateral affecting both sides, but the surgery only addressed one side.

SPEAKER_00:

Why do that? That seems incomplete, medically negligent even.

SPEAKER_02:

The allegations suggest it wasn't about complete medical care. He also allegedly used a cookbook operative report from a case back in 2019 and this one sided approach. It allegedly caused the surgery to fail for the brother who then needed revision surgery.

SPEAKER_00:

So the surgery itself seemed designed to fit the template, not the patient's actual needs.

SPEAKER_02:

That appears to be the claim. The audacity is notable.

SPEAKER_00:

Absolutely. What about claimant F? The one who went to the ER with just a scratch.

SPEAKER_02:

Yes. Klamath presents the emergency room. Records show only a superficial abrasion. Crucially, no complaints of neck pain.

SPEAKER_01:

Okay.

SPEAKER_02:

Six days later, a doctor finds him totally disabled. Nine days after the fall, Dr. Cohen diagnoses neck pain and performs a C3-C4 neck surgery.

SPEAKER_00:

But what did the scans show?

SPEAKER_02:

Two separate MRIs showed nothing wrong with his neck.

SPEAKER_00:

Nothing wrong, but he gets neck surgery.

SPEAKER_02:

That's the allegation. Dr. Cohen's operative report for this surgery was called utterly fictional in the lawsuit and again was allegedly used verbatim in four other cases.

SPEAKER_00:

So why? Why do such a risky, apparently baseless surgery?

SPEAKER_02:

The source material points towards a possible financial incentive from the company that made this specific implant used in that surgery.

SPEAKER_00:

A direct link between the device and the decision to operate. That's a powerful allegation. It is. And claimant G, her story sounded like a surgical nightmare.

SPEAKER_02:

It really does. She needed spinal surgery for a nerve issue on her left side. Dr. Cohen operated, but allegedly. He operated on the right side.

SPEAKER_01:

The wrong side.

SPEAKER_02:

And installed screws on the wrong side. And then, allegedly, omitted mentioning a key implant, a TLIF cage, that should have been inserted from the operative report.

SPEAKER_00:

Just completely wrong.

SPEAKER_02:

A post-op CT scan apparently showed that Dr. Cohen's description of what he did and the results were utterly incompatible with the actual surgical outcome.

SPEAKER_00:

What happened with her case?

SPEAKER_02:

It was eventually settled at a falsely manufactured and fraudulently inflated amount. The alleged care It's staggering.

SPEAKER_00:

Truly is. Okay, one more. It does

SPEAKER_02:

raise questions. No pain, no objective

SPEAKER_00:

injury.

SPEAKER_02:

Right. without any diagnostic films to back it up. And Dr. Cohen performed a one-sided back surgery, even though her conditions were bilateral. And guess which side he operated on?

SPEAKER_00:

Let me guess, not the side that needed it more.

SPEAKER_02:

Allegedly, he focused on the side with less imperative conditions. And perhaps most damningly, all the internal hospital documents listed her condition as chronic and degenerative, not dramatic from a recent fall.

SPEAKER_00:

So the hospital's own records contradicted the claim of a recent injury causing this.

SPEAKER_02:

That appears to be the case based on the filings. It's hard to square a minor fall, no objective findings, and chronic conditions conditions with the surgeries performed.

SPEAKER_00:

OK, so we see the alleged pattern through these examples. Let's talk about the money again. How did the financial flow actually work to benefit everyone in the scheme?

SPEAKER_02:

Right. It's described as this self-sustaining cycle of alleged profit. The medical providers, they profit from these hugely inflated liens on the cases, plus those upfront payments from the funders. The Lyakas firm, the lawyers, they get their cut through contingency fees from the big inflated settlements they allegedly engineer.

SPEAKER_00:

Right. but on inflated amounts.

SPEAKER_02:

Exactly. And the funding defendants, they make their money back, allegedly with astronomical interest, on the advances they made.

SPEAKER_00:

So everyone in the alleged network gets paid well. What about the claimant, the person who actually had the fall, the surgery?

SPEAKER_02:

That's the really grim part, according to the documents. The claimants, the actual individuals who went through all this, often walk away with the smallest portion of any money recovered.

SPEAKER_00:

So they bear the physical risk, the potentially botched surgeries and get the least financial benefit.

SPEAKER_02:

That's the picture painted. The lawsuit even gives examples of what it calls alleged money laundering, where proceeds over$10,000 were structured or layered into legitimate income streams to hide where the money came from.

SPEAKER_00:

And they mention mail and wire fraud, too.

SPEAKER_02:

Yes, extensively. Things like mailing the falsified bills of particulars or medical records counts as alleged mail fraud. using electronic filing systems for the lawsuits or for the UCC statements related to the funding liens that's alleged wire fraud. It shows how basic infrastructure was allegedly used to further the scheme.

SPEAKER_00:

OK, this is clearly a massive, complex legal fight. What are the specific legal claims Union Mutual, the insurance company, is making against Liacus Law and all the other defendants?

SPEAKER_02:

They're bringing some very serious charges. Multiple violations of ICO, the Racketeer Influenced and Corrupt Organizations Act.

SPEAKER_00:

ICO. That's usually associated with organized crime.

SPEAKER_02:

It is. And using it in a civil context like this is significant. They're alleging racketeering activity, conspiracy to violate ICO, and even using income derived from that racketeering to invest back into the scheme.

SPEAKER_00:

Wow. What else?

SPEAKER_02:

Common law fraud, aiding and abetting fraud. Unjust enrichment, basically saying the defendants got money they weren't entitled to and violations of New York's general business law, Section 349, which deals with deceptive business practices. They want damages, obviously, but also injunctive relief to stop these alleged practices.

SPEAKER_00:

A full court press. So how are the defendants, particularly Acas law, responding? What's their defense strategy?

SPEAKER_02:

They're trying to get the whole case thrown out. dismissed.

SPEAKER_00:

On what grounds?

SPEAKER_02:

Their main arguments are, first, that Union Mutual doesn't have standing the legal right to sue because, they claim, the insurance company didn't suffer a direct injury.

SPEAKER_00:

Hmm. How can they argue the insurer wasn't directly injured by paying out allegedly fraudulent claims?

SPEAKER_02:

Their argument seems to be that the injury is somehow indirect, maybe filtered through the claimant. They also argue the allegations are conclusory, meaning they lack enough specific factual detail. And critically, they argue that normal litigation That argument about direct injury seems key.

SPEAKER_00:

How does Union Mutual counter that?

SPEAKER_02:

Union Mutual fires back pretty strongly. They say their injury is direct because under New York law, an insurer's duty to defend kicks in the moment a claim is filed, regardless of whether it's ultimately valid or fraudulent. They have to start spending money immediately.

SPEAKER_00:

So the filing itself triggers a direct cost?

SPEAKER_02:

Exactly. And they cite specific case law, State Farm v. Triborough, which they say directly refutes the defense's point about litigation activity. That case apparently established that when you have these alleged predetermined treatment protocols and pay-to-play arrangements, litigation can be part of our IACUSHA scheme.

SPEAKER_00:

So the context matters.

SPEAKER_02:

Right. Union Mutual argues the whole scheme was specifically designed to get around normal checks and balances, like HIPAA privacy rules and attorney-client privilege. Forcing the insurance company to rely on information that turned out to be false.

SPEAKER_00:

OK, so it's a complex legal back and forth. We've gone through the alleged scheme, the players, the examples, the legal arguments. Let's pull back a bit. Beyond the courtroom drama, what does all this mean for you, the listener? What are the broader implications here?

SPEAKER_02:

Yeah, this is really important. This deep dive shows how a scheme like this, if the allegations are true, has really dramatic and widespread effects on consumers, not just the insurance companies. How so? Well, first, it clogs up the court system with fraudulent cases. It forces insurers to spend huge amounts on needless investigative, legal, other claims, and defense-related spend. And it leads to these fraudulently obtained settlement That's a massive waste of resources across the board.

SPEAKER_00:

And those wasted resources, that spending, it has to come from somewhere, right? It doesn't just vanish.

SPEAKER_02:

Precisely. It doesn't just hurt the insurance company's bottom line. It ultimately leads to wrongfully driving up the cost of legitimate insurance business operations.

SPEAKER_00:

Which means?

SPEAKER_02:

Which means needlessly escalating premiums to the ultimate consumers of liability insurance and the cost of healthcare. At the end of the day, that's everyone. You. Me. We all end up paying more because of alleged fraud like this.

SPEAKER_00:

So it directly hits our wallets through higher insurance costs and potentially higher health care costs, too.

SPEAKER_02:

Absolutely. And this isn't just some obscure legal theory. We're seeing headlines about this kind of thing now. Things like MS-13, Russian mobsters use migrants in elaborate injury scam, even getting spinal surgery to pull it off.

SPEAKER_01:

Wow.

SPEAKER_02:

Or construction workers in NY faking falls on sites part of larger fraud scheme. These headlines suggest this isn't an isolated case, but but points to a much broader systemic vulnerability.

SPEAKER_00:

So we've really unpacked an incredibly intricate alleged fraud scheme today. We've seen how all these different players, lawyers, doctors, funders, runners could potentially fit together to form this cohesive criminal enterprise, according to the lawsuit.

SPEAKER_02:

Yeah, it's a pretty sobering look at how deeply these kinds of activities can apparently embed themselves within our legal and medical systems.

SPEAKER_00:

It really is. This deep dive reveals how a complex system, one undesigned, you know, to provide justice and care can allegedly be twisted and exploited for massive personal gain.

SPEAKER_02:

And often at the direct expense of vulnerable people who get caught up in it and ultimately the wider public footing the bill. It definitely leaves you wondering about the hidden costs, the ethical shortcuts that might be lurking beneath the surface of what look like routine processes.

SPEAKER_00:

It really makes you think, doesn't it? What does this tell us about just how vigilant we need to be? How much critical thinking is required in a world just saturated with That's the

SPEAKER_02:

big question. And maybe what other complex systems out there might be vulnerable to this kind of sophisticated exploitation? And how can we, just as informed citizens trying to navigate it all, get better at telling the real story from the fake one?