Personal Injury News: Pick Of Last Month: January-2025
Carvana Reaches $1.5M Settlement Over CT Complaints
An Arizona-based online used car dealer, Carvana, has agreed to pay over $1 million to settle customer complaints in Connecticut.
Backdrop of the settlement
The settlement follows a three-year investigation into the company, which faced numerous consumer complaints regarding delays in registration, payments, and vehicle deliveries. Many of these issues arose during the pandemic when demand for used cars surged, leading to rapid growth for Carvana.
Settlement amount
Connecticut Attorney General announced that $1 million from the settlement will be used to establish a consumer restitution fund. Additionally, Carvana will pay a $500,000 penalty to the state, with the possibility of reducing it by half if the company fully complies with the settlement terms.
AG's statement
“This settlement ensures that Carvana adheres to all Connecticut laws,” the AG stated. “We will closely monitor their compliance to guarantee they treat Connecticut consumers fairly moving forward.”
Carvana's response
Carvana responded by emphasizing its commitment to customer satisfaction, stating, “We have always worked hard to provide the best experience, including addressing issues when they arise. We are happy to continue assisting Connecticut customers with past concerns, such as pandemic-era paperwork delays.”
The settlement aims to ensure that Carvana improves its operations and prevents similar issues in the future.
AG Morrisey Reaches $119.5M Settlement with Altice
The West Virginia Attorney General has reached a $119.5 million settlement with Altice USA to address thousands of consumer complaints regarding the company’s internet service quality and customer care issues in the state.
Investigation and Consumer Complaints
The Attorney General’s Office began investigating Altice in 2021 due to concerns about the services provided under its former Suddenlink and current Optimum brands. Complaints included issues with billing, technician visits, and overall service reliability. Since the start of the investigation, Altice has invested over $75 million in West Virginia to upgrade its internet infrastructure.
Breakdown of the Settlement
As part of the settlement, Altice has committed to investing an additional $119.5 million in the state to resolve the investigation without litigation. This includes:
$75 million already invested since 2021
$40 million in future investments between 2025 and 2027
$4 million in consumer credits
A $500,000 payment to the state
Additionally, the settlement follows a $2.2 million fine imposed by the Public Service Commission (PSC) on Altice’s predecessor, Suddenlink Communications, in 2022 for neglecting customer complaints and reducing essential maintenance work.
Infrastructure Upgrades and Penalties for Non-Compliance
Altice's investment aims to improve broadband infrastructure, allowing residential customers throughout its service area to access internet speeds of up to 1 Gig download and 100 Mbps upload. The company has committed to completing these upgrades by December 2027. If the project is not completed on time, Altice could face additional fines of up to $40 million.
Assurance of Voluntary Compliance
Without admitting wrongdoing, Altice entered into an Assurance of Voluntary Compliance with the state. The Attorney General emphasized that the agreement is a significant victory for consumers, ensuring they receive the level of service they deserve.
Public Service Commission Findings
From 2020 to 2023, the Attorney General’s Office received more than 2,300 complaints from West Virginia residents about service issues. The PSC’s investigation in 2022 found that Suddenlink had reduced its full-time workforce, cut back on maintenance spending, and altered customer communication methods to the detriment of service quality.
Consumer Compensation and Refunds
As part of the settlement, Altice has agreed to improve infrastructure across multiple counties. Current residential customers falling within specific criteria outlined in the Assurance of Voluntary Compliance will receive a $25 credit on their accounts, totaling approximately $4 million in consumer relief. Former customers can also submit claims for potential cash refunds.
Future Internet Service Improvements
Altice will expand its hybrid coaxial-fiber internet system to provide all residential customers with access to 1 Gig download and 100 Mbps upload speeds. The company expects to spend $40 million on these enhancements, with full project completion anticipated by the end of 2027.
Ongoing Monitoring and Compliance
The Attorney General’s Office will closely monitor Altice’s compliance to ensure the company follows through on its commitments and West Virgin.
Kane’s Furniture Settles $1.48M Sex Discrimination Lawsuit
Kane’s Furniture, LLC, a Florida-based retail company, has agreed to pay $1,482,748 in monetary relief and implement significant equitable measures to resolve a federal class-action sex discrimination lawsuit, according to the U.S. Equal Employment Opportunity Commission (EEOC).
Discriminatory Hiring Practices
The EEOC lawsuit alleged that, since at least 2021, Kane’s Furniture systematically excluded female applicants from driver and warehouse positions at its distribution center and 18 retail locations across Florida. Recruiters allegedly screened out women during the hiring process, violating Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on sex.
Legal Action and Settlement Terms
After unsuccessful attempts at a voluntary resolution through conciliation, the EEOC filed suit (EEOC v. Kane’s Furniture, LLC, Civil Action No.: 8:23-cv-02067-SDM-NHA) in the U.S. District Court for the Middle District of Florida, Tampa Division. Under the three-year consent decree, Kane’s Furniture will:
Revise hiring policies to ensure compliance with anti-discrimination laws.
Implement new Equal Employment Opportunity (EEO) policies and training programs.
Appoint an independent expert to monitor compliance, investigate complaints, and oversee training.
Provide annual reports to the EEOC on any sex discrimination complaints.
EEOC’s Commitment to Equal Opportunity
“Sixty years after the Civil Rights Act, some employers still refuse to hire women,” said the EEOC Chair. “This resolution reinforces the fundamental principle of equal employment opportunity.”
The EEOC Assistant Regional Attorney emphasized that Kane’s Furniture disregarded qualified applicants solely based on their gender, and the settlement ensures women have fair access to traditionally male-dominated roles.
The EEOC Miami District Director added, “This settlement highlights our dedication to eliminating hiring barriers and ensuring equal opportunities for all job seekers.”
Justice Dept. Allocates $1B+ to Terrorism Victims
On December 30, 2024, the Special Master overseeing the U.S. Victims of State Sponsored Terrorism Fund (the Fund) authorized payments totaling $1.035 billion to nearly 19,000 victims of state-sponsored terrorism.
Initial Payments Issued in Early January
During the first week of January, the Fund distributed over $766 million to approximately 14,700 claimants. Payments will continue to be issued on a rolling basis until all authorized distributions are completed.
Justice Department’s Commitment to Victims
“This year, the Fund has authorized over $1 billion in compensation, bringing the total amount distributed to more than $7 billion,” stated the Principal Deputy Assistant Attorney General, who leads the Justice Department’s Criminal Division. “Our division, through its Money Laundering and Asset Recovery Section, remains committed to seeking justice for victims of state-sponsored terrorism.”
Importance of Justice Over Monetary Compensation
While acknowledging the significance of the payout, the Special Master emphasized that no financial compensation can fully account for the losses and trauma suffered by victims. “As many victims have expressed, this is not just about the money—it is about justice,” the Special Master said. “The department’s dedicated team continues to fight for justice on behalf of these victims.”
Fund’s Background and Financial Sources
The Fund was established by Congress and is managed by the Justice Department’s Criminal Division, specifically the Money Laundering and Asset Recovery Section. Since its inception, the Fund has allocated over $6 billion in four rounds of distributions and one set of lump sum catch-up payments. With this latest distribution, total authorized payouts now exceed $7 billion.
Apart from an initial congressional appropriation of approximately $1 billion, the Fund relies on proceeds from Justice Department prosecutions, U.S. government enforcement actions, and additional congressional appropriations for lump sum payments.
Increasing Number of Eligible Claimants
In 2024, the Fund accepted over 4,500 new claimants, increasing the total number of eligible recipients to more than 20,000. However, outstanding and unpaid claims now exceed $120 billion. As more victims of state-sponsored terrorism apply, claims are expected to continue rising in the coming years.
While the available funds are insufficient to fully compensate all claims, the Fund aims to provide a measure of justice and support to those affected by acts of terrorism.
Medicare Insurer, CEO Settle Fraud Case for $100M
A Western New York health insurance provider and the CEO of its medical analytics arm have agreed to pay up to $100 million to settle Justice Department allegations of fraudulent Medicare billing.
The settlement resolves claims that Independent Health Association of Buffalo and its former subsidiary, DxID, exaggerated or fabricated health conditions to increase Medicare reimbursements.
Settlement Terms and Payment Structure
Under the settlement, Independent Health will pay up to $98 million, while the CEO of DxID will contribute $2 million. The agreement does not include an admission of wrongdoing. Independent Health is required to make guaranteed payments of $34.5 million in installments through 2028, with additional payments contingent on financial performance.
DOJ’s Stance on Medicare Fraud
A DOJ deputy assistant attorney general emphasized that the settlement serves as a warning to the Medicare Advantage industry against submitting inflated claims. This case marks one of the largest payments ever made by a health plan based solely on a whistleblower's fraud allegations and one of the first cases targeting a data analytics firm for its role in overbilling.
Whistleblower's Role in Exposing Fraud
The lawsuit originated from a whistleblower complaint filed by a former medical coding professional. The whistleblower, who will receive at least $8.2 million from the settlement, accused DxID of improperly adding diagnosis codes to patient records without medical justification. The professional stated that the Centers for Medicare & Medicaid Services (CMS) created an environment where health plans could profit from inflated diagnoses, leading to billions of dollars in wrongful payments.
Medicare Advantage and Fraudulent Billing Practices
Medicare Advantage plans cover over 33 million beneficiaries and are expected to expand further under the incoming Trump administration. However, as the program grows, regulators have struggled to curb fraudulent billing practices. Private insurers are incentivized to document severe health conditions, as CMS reimburses plans based on patient risk scores. The DOJ has pursued numerous cases where insurers allegedly exaggerated patient illnesses to receive higher payments.
DOJ’s Case Against DxID and Independent Health
The DOJ’s civil complaint, filed in September 2021, accused Independent Health and DxID of knowingly submitting false Medicare claims. DxID specialized in data mining patient records to find additional diagnoses, allegedly inflating patients’ risk scores. The company reportedly earned up to 20% of the additional payments generated through its coding efforts. DxID shut down in 2021.
Examples of Alleged Fraudulent Claims
According to the lawsuit, Independent Health and DxID billed Medicare for conditions that were either exaggerated or unsupported by medical records. Examples included:
Coding an 87-year-old patient with "major depressive disorder" despite medical records describing his mood as “transient.”
Listing chronic kidney disease and renal failure for patients without documented evidence of those conditions.
- Billing for past conditions, such as heart attacks, that required no ongoing treatment.
The Role of Data Mining in Medicare Billing Fraud
The DOJ complaint highlighted a pitch by the DxID CEO, who promoted the company’s services as "too attractive to pass up." The firm operated on a contingency basis, taking a percentage of the additional Medicare payments generated through its coding process. The DOJ accused the CEO of stating that renal failure diagnoses were particularly lucrative, as "the majority of people over 70 have it at some level."
Group Health’s Previous Settlement
The whistleblower originally filed the case in 2012 against Group Health Cooperative in Seattle, one of the nation’s oldest managed-care groups. The suit alleged that DxID had helped Group Health submit over $30 million in improper claims for 2010 and 2011. One example cited in the complaint involved billing for “major depression” in a patient described by his doctor as having an “amazingly sunny disposition.”
Group Health, now Kaiser Foundation Health Plan of Washington, denied wrongdoing but settled for $6.3 million in 2020. The DOJ filed a second complaint in 2021 against Independent Health, another client of DxID, leading to the current settlement.
Whistleblower Retaliation and Impact on CMS Enforcement
The whistleblower reported losing her job after her case became public in 2019 and has since struggled to find work in the medical coding field. The False Claims Act allows private citizens to expose fraud and receive a portion of the recovered funds. Whistleblower lawsuits have helped the government recoup over $600 million from Medicare Advantage fraud cases.
Despite audits revealing significant overpayments, CMS has been slow to reclaim funds. In early 2023, the agency announced it would settle for a fraction of the overpayments uncovered in audits dating back to 2011. Future financial penalties on health plans will only be enforced after audits for 2018 payments, leaving the total recoupment amount uncertain.
Conclusion
The $100 million settlement against Independent Health and DxID underscores ongoing efforts to combat Medicare fraud in the Medicare Advantage sector. While this case marks a significant victory for whistleblowers and government regulators, concerns remain about CMS’s ability to fully address widespread fraudulent billing practices. The case highlights the role of data mining in upcoding schemes and the importance of enforcing strict oversight to ensure the integrity of taxpayer-funded healthcare programs.