In a landmark ruling, U.S. District Court Judge Nancy L. Maldonado allowed the majority of
claims in the RICO lawsuit against Centene Corporation to proceed,
asserting that the plaintiffs provided sufficient evidence of a
multi-billion-dollar scheme to defraud consumers through Ambetter
health insurance plans. The ruling marks a significant step forward
for the plaintiffs represented by Wexler
Boley & Elgersma LLP
CHICAGO, May 6, 2024
/PRNewswire-PRWeb/ -- U.S. District Court Judge Nancy L. Maldonado ruled that Plaintiffs in
Havrilla v. Centene Corp. (N.D. Ill.) could proceed on the majority
of their claims against Centene Corporation and two of its
subsidiaries, Centene Management Company, LLC, and Celtic Insurance
Company.
"No company should be allowed to abuse the
healthcare system and take advantage of consumers in the way that
we believe Centene has."
Plaintiffs allege in their complaint that Centene
Corporation—the largest provider of health-insurance plans sold on
the online exchanges established by the Affordable Care Act
(ACA)—and its subsidiaries engaged in a multi-billion-dollar scheme
to defraud consumers, taxpayers, and government entities across 26
states through the company's "Ambetter" brand health-insurance
plans in violation of the Racketeer Influenced and Corrupt
Organizations Act (RICO) and numerous state laws. They also seek to
certify the lawsuit as a class action.
As noted in the judge's opinion, the core of the lawsuit is
Plaintiffs' allegation "that Defendants mislead consumers by
publishing provider directories that are not up to date and
misrepresent the benefits that members will receive when they
purchase the insurance plan." This means that those (primarily low
income) consumers who purchase Ambetter health insurance "run into
difficulty finding healthcare providers who actually accept the
insurance—including providers that are listed on the Ambetter
plans' websites and provider directories."
Defendants had moved to dismiss the complaint on grounds of lack
of subject-matter jurisdiction and failure to state a claim. Judge
Maldonado rejected the bulk of Defendants' arguments,
concluding:
"Plaintiffs have pled sufficient facts to allege a
RICO conspiracy to commit mail and wire fraud and have
adequately established standing to bring claims on behalf of
putative class members who reside in states where no named
Plaintiff resides. Further, Plaintiffs have stated a claim for
relief under each of the state consumer protection acts
alleged in the Complaint apart from Nebraska."
Relying in part on the Seventh Circuit's decision in Fitzgerald
v. Chrysler Corp., 116 F.3d 225 (7th Cir. 1997), Judge Maldonado
found that "Plaintiffs' allegations are close to the 'prototypical
RICO case' outlined by the Seventh Circuit" because "Plaintiffs
have alleged that Centene Corp. has used the
'resources, contacts, facilities, and appearance of legitimacy' of
its subsidiaries to perpetrate a fraud in a manner it
could not have done without channeling its activities through the
[RICO] enterprise."
Judge Maldonado also rejected Defendants' argument that
Plaintiffs' allegations lacked the "particularity and specificity"
required to plead the predicate acts of mail and wire
fraud. Defendants' argument failed, the judge
explained, because "Plaintiffs identify the 'who' of the
alleged fraud—Defendants and at least 26
other Centene Corp. subsidiaries—and outline each Defendants' role
in the Ambetter enterprise."
The only two claims dismissed by the judge were Plaintiffs'
claim of unjust enrichment and their claim under the Nebraska
Consumer Protection Act.
"This opinion is a significant step forward in our effort to
obtain relief for our clients and a large number of vulnerable
constituents," said WBE Partner Justin N. Boley. "No company should
be allowed to abuse the healthcare system and take advantage of
consumers in the way that we believe Centene has. We look forward
to pushing ahead in the case."
With the remainder of Defendants' motion to dismiss having been
denied, Plaintiffs can now move forward on their federal RICO claim
as well as their claims under 17 states' consumer-protection
statutes.
About Wexler Boley & Elgersma
LLP: WBE is nationally recognized as a leading law firm in complex
class-action and antitrust litigation, from investigation to trial
and appeals. We are dedicated to protecting the rights and
interests of all and, in this pursuit, represent investors, health
and welfare plans, consumers, pension plans, businesses,
governments, and organizations from all over the United States
Contact Information:
[Brian Lynch] [Head of Marketing]
[bl@wbe-llp.com] [Wexler Boley &
Elgersma LLP] [https://wbe-llp.com] [311 S. Wacker Drive Suite 5450
Chicago, IL 60606]
Media Contact
Justin N. Boley, Wexler Boley & Elgersma LLP, 1 312.346.2222,
jnb@wbe-llp.com, https://wbe-llp.com/
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content:https://www.prweb.com/releases/landmark-ruling-in-rico-lawsuit-against-centene-corporation-alleging-the-company-defrauds-consumers-through-sale-of-its-ambetter-health-insurance-plans-302136329.html
SOURCE Wexler Boley &
Elgersma LLP