Going on Offense: Best Strategies to Crush Fraudulent Claims

Transcription

1 Going on Offense: Best Strategies to Crush Fraudulent Claims L. Johnson Sarber III Marks Gray, P.A. Jacksonville How Much Fraud is There? A... study published in 2002 by Mittenberg, Patton, Canyock and Condit, titled Base Rates of Malingering and Symptom Exaggeration, found that malingering is actually quite common in psychological and neuropsychological claims. These authors, in reviewing published studies on fraud and malingering, reported that 41.24% of mild head injury claims were malingered. In fact, they reported the following base rates of malingering: Fibromyalgia and chronic fatigue claims-38.61%; pain and somatoform disorders-33.51%; neurotoxic disorders-29.49%; depressive disorders-16.08%. Mittenberg and his colleagues found that when you looked at malingering and symptom exaggeration by referral type, 30.43% of personal injury claims and 32.73% of disability or worker s compensation, were malingered. The essential fact for the litigator to remember is that about 30% of claims for compensation for psychological and neuropsychological injuries involved fraudulent exaggeration and malingering. David R. Price, Ph.D. How Much Fraud is There? October 7, A 46-year-old man was convicted Friday in a Jacksonville insurance fraud scheme after accidents were staged and victims treated at a licensed massage therapy clinic, according to the State Attorneys Office. A jury convicted David Rodriguez Lopez on charges of schemes to defraud over $50,000, false insurance claims over $100,000 and knowingly participating in an intentional car crash, prosecutors said. By Dan Scanlan Read more at Jacksonville.com: Johnny Sarber, Marks Gray 1

2 The Different Categories of Fraud Accident never happened Injury never happened Injury didn t happen in this accident/preexisting injury Injury happened but magnified Injury happened and not magnified but plaintiff lies about something else (i.e. lost wages) How Fraud is Perpetrated Outright fabrication Exaggeration of scope/duration Omission Witness tampering The Challenge The Challenge Johnny Sarber, Marks Gray 2

3 Defense Offense Time Resources Creativity Duty to Report Rule Candor Toward the Tribunal (Rules Regulating the Florida Bar/Rules of Professional Conduct): A lawyer who... knows that a person intends to engage, is engaging, or has engaged in criminal or fraudulent conduct related to the proceeding shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal. Legal Standard Trial courts inherently possess the authority to dismiss actions as a sanction when the plaintiff has perpetrated a fraud on the court. Perrine v. Henderson, 85 So. 3d 1210, 1211 (Fla. 5th DCA 2012); Long v. Swofford, 805 So. 2d 882, 884 (Fla. 3d DCA 2001) ( Trial court has a duty and an obligation to dismiss a cause of action based upon fraud. ). Johnny Sarber, Marks Gray 3

4 Legal Standard Perpetuation of fraud on the Court warrants dismissal where it can be demonstrated, clearly and convincingly, that a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system s ability to impartially adjudicate a matter by improperly influencing the trier of fact or unfairly hampering the presentation of the opposing party s claim or defense. Cox v. Burke, 706 So. 2d 43, 46 (Fla. 5th DCA 1998). Legal Standard [A] party who has been guilty of fraud or misconduct in the prosecution or defense of a civil proceeding should not be permitted to continue to employ the very institution it has subverted to achieve her ends. Metro. Dade County v. Martinsen, 736 So. 2d 794, 795 (Fla. 3d DCA 1999). Savino v. Florida Drive In Theatre Mgmt., Inc., 697 So. 2d 1011, 1012 (Fla. 4th DCA 1997) - Plaintiff lied about having a master s degree in engineering and also testified that he was unable to work in the future, thereby inflating his damage claim. Johnny Sarber, Marks Gray 4

5 Baker v. Myers Tractor Svs., Inc., 765 So. 2d 149 (Fla. 1st DCA 2000) - Plaintiff repeatedly gave false statements in discovery and stated that he never sustained an injury to his right knee, when in fact, the plaintiff injured his knee in high school while playing football, as well as on the job, and the material non-disclosures concerned facts directly related to a central issue in the action. Trial court stated: Honesty is not a luxury to be invoked at the convenience of the litigant. Brown v. Allstate Ins. Co., 838 So. 2d 1264 (Fla. 5th DCA 2003) - Plaintiff testified during his deposition that he was employed, when in fact, his employer terminated the plaintiff one day before the accident. Issue was central to his claim for lost wages. Distefano v. State Farm Mutual Auto Ins. Co., 846 So. 2d 572 (Fla. 1st DCA 2003) - Plaintiff failed to reveal two prior automobile accidents with injuries and false statements concerning her physical limitations. Johnny Sarber, Marks Gray 5

6 McKnight v. Evancheck, 907 So. 2d 699 (Fla. 4th DCA 2005) and Saenz v. Patco Transport, Inc., 969 So. 2d 1145 (Fla. 5th DCA 2007) Both involved Plaintiffs lying on multiple occasions about prior medical conditions relevant to current claims Wenwei Sun v. Aviles, 53 So. 3d 1075 (Fla. 5th DCA 2010) - Repeated lies about plaintiff s ability to work. The Court rejected idea of poor recollection; plaintiff husband, wife, and son all lied about the husband s ability to work and perform the most basic functions of daily life. They lied on virtually every discovery occasion to their own attorneys and experts, as well as to the appellees, making it virtually impossible for the appellees to defend against the damage claims. Cases Where Dismissal Denied Gautreaux v. Maya, No. 5D12-930, 2013 WL (Fla. 5th DCA May 10, 2013) - Plaintiff s misrepresentation as to her prior headaches did not rise to the level of the the most blatant showing of fraud, pretense, collusion, or other similar wrongdoing where Plaintiff denied prior headaches in first deposition but claimed in second deposition she was confused by question in first deposition and now remembered them. Johnny Sarber, Marks Gray 6

7 Cases Where Dismissal Denied Granados v. Zehr, 979 So. 2d 1155, 1158 (Fla. 5th DCA 2008) - Plaintiff failed to disclose prior back pain and headaches in interrogatory answers, but did disclose the name of her treating physician, whose records revealed prior back pain and headaches, so false statement did not unfairly hamper the preparation of the defense and thus failed to meet Cox standard. Cases Where Dismissal Denied Bologna v. Schlanger, 995 So. 2d 526, 528 (Fla. 5th DCA 2008) Trial court s dismissal for fraud reversed, because an evidentiary hearing should have been conducted since there were many questions... that the court cannot determine without an evidentiary hearing before the ultimate sanction of dismissal be imposed. Appellate court concerned that the defense had the records at the time of the plaintiff s deposition, and plaintiff s answers to interrogatories were adequate for the defense to learn of her treatment for back pain, such that there was a question as to whether there truly existed a scheme to defraud. Cases Where Dismissal Denied Gehrmann v. City of Orlando, 962 So. 2d 1059, 1062 (Fla. 5th DCA 2007) - Plaintiff submitted an affidavit stating that he simply forgot about the two prior back injury incidents during his depositions since they merely involved being checked out by a doctor and did not involve any continuing problems. Johnny Sarber, Marks Gray 7

8 Getting the Information Day of Accident Emergency response/ Go Team Attorney involvement = work product, privilege and proper direction Expert involvement Adjuster involvement Photos Witnesses Law enforcement Video surveillance Getting the Information Right after accident/presuit Social media Index Mastertrace/background Criminal Workers comp Lawsuits Surveillance Getting the Information Case in litigation Social media Interrogatories/Request for Production Subpoena all referenced meds Subpoena unreferenced meds Subpoena all employers, insurers, SS, WC Surveillance Witness/ex-employer/ex-spouse interviews Deposition Johnny Sarber, Marks Gray 8

9 Request for admissions Strategy Motion to dismiss for fraud v. hold for cross? If file motion, ask for evidentiary hearing If motion denied, ask for fees and costs if misleading testimony requires further discovery Timing of mediation? F.S Upon the court's initiative or motion of any party, the court shall award a reasonable attorney's fee to be paid to the prevailing party in equal amounts by the losing party and the losing party's attorney on any claim or defense [if]... the court finds that the losing party or the losing party's attorney knew or should have known that a claim... : Was not supported by the material facts necessary to establish the claim or defense; or Would not be supported by the application of then-existing law to those material facts. F.S Section does not require a finding that the claim or action be frivolous, but only that the claim be unsupported by material facts or then-existing law. Martin County Conservation Alliance v. Martin County, 73 So. 3d 856, 865 (Fla. 1st DCA 2011). Johnny Sarber, Marks Gray 9

10 F.S The Safe Harbor Provision A motion by a party seeking sanctions under this section must be served but may not be filed with or presented to the court unless, within 21 days after service of the motion, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected (4), Fla. Stat. The Result Thank you! L. Johnson Sarber, III Marks Gray, P.A Riverplace Blvd., Suite 800 Jacksonville, FL jsarber@marksgray.com (Phone) (Fax) Johnny Sarber, Marks Gray 10