SOURCE: Allstate Insurance Company - SW

Allstate Insurance Company - SW

January 19, 2016 08:00 ET

U.S. Appellate Court Upholds Major Win for Allstate in Medical Fraud Suit

LAS VEGAS, NV--(Marketwired - January 19, 2016) -  On Dec. 17, 2015, the U.S. Court of Appeals for the 9th Circuit affirmed an $8.6 million judgment in favor of Allstate Insurance Company against former Las Vegas chiropractor Obteen N. Nassiri.

Nassiri began defrauding Allstate in 2003 by exaggerating clinical findings, submitting improbable diagnoses, billing for services not rendered, providing unnecessary and excessive treatment, misrepresenting billing, making inappropriate referrals and exhibiting a general pattern of illegal and fraudulent conduct, according to the Allstate lawsuit, originally filed in 2008 in the U.S. District Court of Nevada.

The Chiropractic Physicians' Board of Nevada revoked Nassiri's license in 2010.

"Medical fraud drives up costs for everyone -- and in this case it was egregious fraud," said Melinda Wilson, an Allstate spokesperson. "This is a notice to every fraudster out there: Allstate is going to battle fraud wherever we find it to protect our policyholders and all consumers. We're gratified the courts in this case continue to help us fight that battle."

In June 2013, following a 10-day trial, the jury awarded $1.1 million in damages against Obteen N. Nassiri, Advanced Accident Chiropractic Care, ONN Management, Digital Imaging, and Digital X-Ray Services, LLC. Following the trial, the District Court trebled the damages under Federal and Nevada State RICO laws, increasing the award of damages to $3.5 million, and added pre-judgment interest of $1 million. Punitive damages, attorney fees, costs and additional pre-judgment interest were added to the award, increasing the total amount of the judgment to $8.6 million. 

Nassiri was the only defendant who appealed the 2013 decision, arguing the District Court erred in admitting the testimony of Allstate's damages and in denying his motion for summary judgment. The appellate court rejected his contentions and upheld the jury's decision.

The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer, protecting approximately 16 million households from life's uncertainties through auto, home, life and other insurance offered through its Allstate, Esurance, Encompass and Answer Financial brand names. Allstate is widely known through the slogan "You're In Good Hands With Allstate®." The Allstate brand's network of small businesses offers auto, home, life and retirement products and services to customers in the United States and Canada. In the 20 years since Allstate became a fully independent public company, The Allstate Foundation, Allstate, its employees and agency owners have donated more than $405 million to support local communities.

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