Allstate Wins Medical Fraud Lawsuit - Quick Facts

(RTTNews) - Allstate Insurance Company said that in its first medical fraud lawsuit in the state, it received a judgment of more than $7 million, following a Racketeering Influenced in Corrupt Organizations or RICO investigation nearly 10 years in the making.

The company said that the RICO complaint was filed in 2008 in the Las Vegas Federal District Court against chiropractor Obteen Nassiri, D.C., and his businesses: Advanced Accident Chiropractic Care, ONN Management, Digital Imaging Services and Digital X-Ray. Since the suit was filed, the Chiropractic Physicians' Board of Nevada revoked Obteen Nassiri's license.

The company's lawsuit alleged Nassiri began defrauding Allstate in 2003 by exaggerating clinical findings, submitting improbable diagnoses, charging for treatment he did not provide, providing unnecessary and excessive treatment, grossly misrepresenting billing, making inappropriate referrals, and exhibiting a general pattern of illegal and fraudulent conduct.

The jury in the case also found Nassiri's spouse, Jennifer Nassiri, liable for negligent misrepresentation in the overall fraudulent scheme to harm Allstate.

The case accused Obteen Nassiri of running a practice that referred patients to his clinics for unnecessary medical consultations and expensive diagnostic studies in an effort to generate more revenue and profit. A favorable verdict sided with Allstate in June and the final judgment and award was made September 10.

The company noted that the total judgment against the defendants included an award to Allstate for $3.59 million in compensatory damages, $2.51 million in punitive damages and $1 million in pre-judgment interest. The company noted that it is also pursuing more than a million dollars in attorney's fees and costs.

The monetary award means Allstate will recover money for the settlement of more than 150 auto accident claims that involved fraudulent costs, the company noted.