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FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022
Michael A. Callinan
Matthew J. Smith
3361 Park Avenue Vanessa H. Hlinka
Suite 104
Frank J. Gissaro
Wantagh, New York 11793
P: (516) 784-5148 / F: (516) 667-1003
Jennifer B. Strong
JENNIFER B. STRONG Steven Daniel Levy
SENIOR COUNSEL Matthew P. Smith
ADMITTED IN N.Y., N.J. & USPTO
jstrong@callinansmith.com
Craig J. Bruno
Stewart C. Fink
Of counsel
April 25, 2022
VIA MODRIA
Master Arbitrator Vic D’Amora, Esq.
MasterAppealTeam@adr.org
Re: Eclipse Medical Imaging PC a/a/o Syreeta Carmona v. Liberty Mutual
Insurance Company
Claim No.: 0411433980001
AAA Case No.: 99-20-1173-5828
C&S File No.: A185-5237E
Dear Master Arbitrator D’Amora:
Please be advised that this office represents the Respondent-Appellee, Liberty Mutual
Insurance Company (hereinafter “Liberty Mutual”) in the above-referenced master arbitration
review. Liberty Mutual respectfully makes the following submission in opposition to Applicant-
Appellant’s appeal.
PROCEDURAL BACKGROUND
This appeal arises from the February 18, 2022 denial of the claim submitted by Applicant-
Appellant Eclipse Medical Imaging PC (hereinafter “Eclipse” or “Applicant-Appellant”) by
Arbitrator Dimitrios Stathopoulos, Esq. See Arbitration Award, attached hereto as Exhibit “1”.
The underlying arbitration arises from three bills submitted by Eclipse to Liberty Mutual seeking
No-Fault reimbursement in the amount of $2,602.27 for allegedly providing MRI services to
Syreeta Carmona (“Insured”) on November 6, 2019, November 24, 2019, and December 1, 2019.
The Insured assigned her No-Fault benefits to Eclipse, and in exchange allegedly received medical
treatment. Based upon the assignment of No-Fault benefits provided to Eclipse, Eclipse submitted
No-Fault billing to Liberty Mutual on the Insured’s behalf.
345 Rt. 17 South 416 Church Street
Suite 43 First Floor
Upper Saddle River, New Jersey 07458 Hawley, Pennsylvania 18428
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Upon receipt of said No-Fault billing, Liberty Mutual initiated an investigation into
Applicant-Appellant Eclipse’s eligibility to bill for and/or to collect New York No-Fault benefits.
James Beadle, an employee with Liberty Mutual Group, was the investigator assigned to
investigate the eligibility of Eclipse to receive No-Fault reimbursements. See, Affidavit of James
Beadle (“Beadle Aff.”), ¶ 3, submitted in opposition to arbitration, and attached hereto as Exhibit
“2”. The investigation revealed that the location from which Eclipse operates is a location that
has been the subject of prior insurance industry investigations and lawsuits regarding the
fraudulent operation and ownership of the MRI facility. Ex. 2, Beadle Aff., ¶ 5.
During itsinvestigation, Liberty Mutual learned that numerous other lawsuits had been
filed by insurance carriers regarding the unlawful operation of health care related corporations by
laypersons, including Robert Maks and Cardenal Management Corp. Copies of the Complaints
from those lawsuits were attached to the Petition underlying the December 16, 2021 Order
referenced in Arbitrator Dimitrios Stathopoulos’s Arbitration Award, attached hereto as Exhibit
“3” (hereinafter “Petition”), collectively as Exhibit “I”. Liberty Mutual also discovered that on or
around January 26, 2021, an action was filed in the United States District Court, Eastern District
of New York by Allstate Insurance Company and its affiliates against various parties, which
included Eclipse Medical Imaging P.C., Jack Baldassare, M.D., Robert Maks and Cardenal
Management Corp. (hereinafter, the “Allstate Suit”). A copy of the Complaint from the Allstate
Suit is annexed to the Petition as Exhibit “J”.
The Complaint filed by Farmers with regard to Kensington Radiology Group, P.C. alleged
the following:
i. Maks and his partners utilized the professional licenses of Stanley
Friedman, M.D., Ronald Schliftman, M.D., and Michael Shapiro,
M.D. to illegally create and operate Kensington Radiology Group,
P.C. for the pecuniary benefit of the layperson defendants, Maks and
his partners. As part of its investigation into Kensington Radiology
Group, P.C., Farmers was able to obtain records from one bank
account which was utilized by Kensington Radiology that evidenced
illegal fee splitting and issues regarding ownership of the P.C. (See
Petition Exhibit “I,”, p. 114, paragraph 131(44)).
ii. According to the bank records, from December 2012 through March
2015, Kensington Radiology had income of approximately Three
Million Four Hundred and Sixty-Five Thousand Dollars
($3,465,000.00). For that same period, Kensington Radiology paid
Kensington Group in excess of Two Million Six Hundred and Sixty
Thousand Dollars ($2,660,000.00). Kensington Group was a non-
professional corporation owned and operated by Robert Maks and
his partners. (See Petition Exhibit “I,”, p. 147, paragraph 122 and
p. 114, paragraph 131(45)).
iii. The bank records indicated that Kensington Group, a non-
professional corporation operated by laypersons Maks and his
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partners, was paid over Seventy-Six Percent (76%) of the income of
Kensington Radiology (See Exhibit “I”, p. 114, paragraph 131(45)).
iv. The monthly payments made by Kensington Radiology to
Kensington Group appeared arbitrary and ranged anywhere from
Sixty Thousand Dollars ($60,000.00) per month to One Hundred
and Fifty Thousand Dollars ($150,000.00) per month (See Petition
Exhibit “I”, p. 115, paragraph 131(47)).
v. In August 2013, a check was issued to Stanley N. Friedman, M.D.,
one of the alleged owners of Kensington Radiology, in the amount
of Five Hundred Eighty Two Dollars and Three Cents ($582.03),
The “Memo” section of the check indicated “Salary of June, July &
August – Direct Deposit was returned by Chase.” (See Petition
Exhibit “I”, p. 115, paragraph 131(48)).
vi. From December 2012 through March 2013, the records do not
indicate that any money was taken out of the account of the P.C. for
payroll. (See Petition Exhibit “I”, p. 115, paragraph 131(49)).
vii. In October 2014, alleged owners, Friedman, Schliftman, and
Shapiro, were each issued a check in the amount of Five Thousand
Dollars ($5,000.00) with the “Memo” section of the check
indicating “Loan Exchange.” All of the checks appeared to be
signed by Friedman. (See Petition Exhibit “I”, p. 115, paragraph
131(50)).
viii. In December 2014, alleged owners Friedman, Schliftman, and
Shapiro were once again each issued a check in the amount of Five
Thousand Dollars ($5,000.00) with the “Memo” section of the check
indicating “Loan Exchange.” Friedman, Schiftman, and Shapiro
were also issued a second check in that month in the amount of One
Thousand Eight Hundred Dollars ($1,800.00) with the “Memo”
section of the check indicating “Loan Exchange.” All of the checks
appeared to be signed by Friedman. (See Petition Exhibit “I”, p. 115,
paragraph 131(51)).
ix. In January 2015, alleged owners Friedman, Schliftman, and Shapiro
were once again each issued a check in the amount of Three
Thousand Dollars ($3,000.00) with the “Memo” section of the check
indicating “Loan Exchange.” All of the checks appear to be signed
by Friedman. (See Petition Exhibit “I”, p. 115, paragraph 131(52)).
A UCC filing demonstrates that the individuals involved in the previously mentioned
fraudulent ownership scheme had a controlling interest in the MRI machinery located at 651 Coney
Island Avenue, Brooklyn, New York – Eclipse’s location. Beadle Aff., ¶ 7. As part of its
investigation and pursuant to its rights under the No-Fault laws, Liberty Mutual sought the
examination under oath (hereinafter, “EUO”) of Eclipse Medical Imaging, P.C., which took place
on August 28, 2019. Id., ¶ 9. The request for the EUO was predicated upon a legitimate, good
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faith basis. Id., ¶ 8. On August 28, 2019, Jack Baldassare, M.D appeared on behalf of Eclipse.
Id., ¶ 9. Dr. Baldassare appeared with his counsel, Raymond Zuppa, Esq.
It is noted that the fraudulently operated Kensington ultimately became Eclipse Medical
Imaging, with the same unlawful layperson control. Dr. Baldassare’s testimony clearly
demonstrated that he was having financial difficulties when he was approached by the layperson
controller of the MRI facility located at 651Coney Island Avenue, Brooklyn, New York 11218.
Id, ¶ 11. This layperson controller, Robert Maks, has been the subject of numerous lawsuits
alleging that he was the unlawful owner of the MRI facility located at 651 Coney Island Avenue,
Brooklyn, New York 11218. Id. Thereafter, Dr. Baldassare assumed a “turnkey” operation at 651
Coney Island Avenue, Brooklyn, New York 11218 and Eclipse Medical Imaging, P.C. was born,
with Robert Maks still intimately involved and presumably running the facility from the shadows.
Id. A full copy of the transcript of the Examination Under Oath of Dr. Jack Baldassare was
included with Liberty Mutual’s arbitration submission as Exhibit “E” to the Beadle Aff., attached
hereto as Exhibit “2”.
Dr. Baldassare’s EUO testimony revealed information that raises legitimate and serious
questions concerning the ownership and eligibility of Eclipse to receive No-Fault reimbursements
pursuant to 11 NCYCRR 65-3.16(a)(12). Id., ¶ 12. Specifically, the testimony revealed the
following:
i. Dr. Baldassare started performing healthcare services at the Coney
Island Avenue location on August 1, 2016, despite the incorporation
of Eclipse Medical Imaging P.C. later in January of 2017 (See Ex.
2, Beadle Aff. Exhibit E, p. 17, lines 17-20, and p. 18, lines 8-15);
ii. Dr. Baldassare suffered substantial financial misfortune in 2014
after an unpaid departure from his partnership with Radiological
Diagnostic Center Medical Association, PA, a reading facility
located in Englewood, New Jersey. (See Ex. 2, Beadle Aff. Exhibit
E, p. 32, line 35 to p. 33, line 22). This misfortune was on top of the
loss of his position as the attending radiologist at Westchester
Square Hospital (See Exhibit E, p. 26, line 10 to p. 27, line 8);
iii. For a short period of time thereafter, Dr. Baldassare began
performing teleradiology for various medical facilities, submitting
billing under his social security number (See Beadle Aff., Exhibit E,
p. 33, line 23 to p. 25, line 3) until he allegedly received a call from
his former partner, Sason Azar, who informed him of a “business”
opportunity (See Ex. 2, Beadle Aff. Exhibit E, p. 39, lines 9-22);
iv. Dr. Azar advised Dr. Baldassare that the owner of a billing
company, Robert Maks, directly contacted him seeking a radiologist
willing to operate an existing radiological facility located at 651
Coney Island Avenue, Brooklyn, New York where Mr. Maks’
billing company had performed all billing services (See Ex. 2,
Beadle Aff. Exhibit E, p. 39, line 23 to p. 40, line 14);
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v. While Dr. Baldassare admitted that he previously performed
services as an independent contractor for Kensington Radiology,
P.C., he denied any knowledge that Kensington Radiology, P.C.
previously operated at the 651 Coney Island Avenue location (See
Exhibit E, p. 40, line 20 to p. 41, line 14; and p. 138, lines 8-12) or
that his former partners, Drs. Stanley Friedman, Michael Shapiro
and Ronald Schliftman, were Kensington Radiology’s “actual”
owners (See Ex. 2, Beadle Aff. Exhibit E, p. 44, line 9 to p. 45, line
19; and p. 53, lines 2-5);
vi. Dr. Baldassare was unaware that his former partners, Drs. Friedman,
Shapiro and Schliftman, as well as Mr. Maks, his billing company,
LAAL Billing, and Kensington Radiology, P.C. are/were the subject
of numerous lawsuits alleging the fraudulent incorporation and
ownership of the radiological facility located at 651 Coney Island
Avenue, Brooklyn, New York, and specifically that Mr. Maks is the
actual owner/operator of the professional corporation in violation of
state law (See Ex. 2, Beadle Aff. Exhibit E, p. 29, line 7 to p. 30,
line 5; and p. 53, line 19 to p. 54, line 6);
vii. Dr. Baldassare then had convincing conversations with Mr. Maks,
the property’s landlord and owner of the MRI machinery,
Kensington Realty or “Steve” (See Exhibit E, p. 47, line 14 to p. 48,
line 3), which led Dr. Baldassare to agree to operate the facility on
the condition he not sign any documentation obligating himself
personally to the payment of rent or the lease of the MRI machinery
for the time being (See Ex. 2, Beadle Aff. Exhibit E, p. 48, line 22
to p. 49, line 2);
viii. According to his testimony, Dr. Baldassare was able to negotiate
three free months of rent for the commercial space and the
machinery’s lease and maintenance (See Ex. 2, Beadle Aff. Exhibit
E, p. 49, line 3 to p. 50, line 5);
ix. Louise Rosenbaum, the prior office manager of Professional Health
Imaging, also had a presence at the 651 Coney Island Avenue
location (See Beadle Aff., Exhibit E, p. 50, line 21 to p. 51, line 10).
She is currently employed by Eclipse Medical Imaging, P.C., is
designated with overseeing the front desk and is paid $50,000.00
(See Beadle Aff., Exhibit E, p. 51, lines 11 through 14; p. 55, lines
6 through 10; and p. 65, lines 20 through 23). Ms. Rosenbaum is
also responsible for hiring technicians (See Beadle Aff., Exhibit E,
p. 67, lines 5 through 12) and assisted in retaining counsel, Victoria
Berez, the attorney who helped incorporate Eclipse Medical
Imaging, P.C. (See Ex. 2, Beadle Aff. Exhibit E, p. 67, lines 5
through 12);
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x. In the summer of 2016, Dr. Baldassare once again became
associated with 651 Coney Island Avenue; however, this time as the
alleged owner of the facility without any actual purchase or
investment made (See Beadle Aff., Exhibit E, p. 54, line 13 through
p. 55, line 5). Robert Maks also continued his association with the
clinic location when LAAL Billing was retained for billing services,
earning between $10,000 to $15,000 per month for the generation of
bills submitted for reimbursement. After the incorporation of
Eclipse Medical Imaging, P.C. in January 2017, Dr. Baldassare
dismissed LAAL Billing because he realized he was overpaying;
however, he then retained Mr. Mak’s wife, Leana Maks, to perform
the same services for an annual salary of $100,000.00, which was
nearly the same amount paid to her husband through his billing
company (See Ex. 2, Beadle Aff. Exhibit E, p. 55, lines 11 through
p. 58, line 13);
xi. In 2018, Dr. Baldassare terminated Mrs. Maks’ employment,
retaining two billing clerks in her stead (See Exhibit E, p. 58, line
17 through p. 59, line 24); however, he then “hired” Mr. Maks as an
office manager paying him an annal salary of $150,000, including
other perks such as payment of his Mercedes Benz car lease and use
of the P.C.’s debit card (See Ex. 2, Beadle Aff. Exhibit E, p. 70, lines
7 through 17; p. 72, lines 7 through 9; p. 78, lines 6 through 24; and
p. 82, lines 19 through 24);
xii. For close to one year, Eclipse Medical Imaging, P.C. “employed”
both Mr. and Mrs. Maks, paying them collectively $250,000 (See
Ex. 2, Beadle Aff. Exhibit E, p. 73, line 21 through p. 74, line 2);
xiii. Mr. Maks is responsible for eliciting patient referrals for Eclipse
Medical Imaging, P.C. as he solely markets the PC by visiting
various medical practices and delivering prescription pads. Dr.
Baldassare was uninformed as to the PC’s actual referral source (See
Ex. 2, Beadle Aff. Exhibit E, p. 80, lines 3 through 25);
xiv. Mr. Maks is entrusted with access to Eclipse Medical Imaging
P.C.’s bank accounts, its general ledger and bank statements. He
also has permission to draw checks for signature or apply a signature
stamp (See Ex. 2, Beadle Aff. Exhibit E, p. 71, line 21 through p.
72, line 2; and p. 72, lines 14 through 25);
xv. Dr. Baldassare recognized the name Gregory Vaunshtyen through
his association with a company called Professional Health Imaging,
but he claimed to be unaware of Mr. Vaunshtyen’s management
companies, including Cardenal Management Corp., and its UCC
filing regarding the actual ownership of the MRI equipment located
at 651 Coney Island Avenue (See Ex. 2, Beadle Aff. Exhibit E, p.
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46, lines 5 through 13; p. 47, lines 11 through 13; and page 117, line
12 to p. 118, line 8);
xvi. Dr. Baldassare testified that he assumed the monthly fee for the MRI
magnet lease in December 2016 paying $5,000 per month until it
was satisfied; however, he does not have a certificate of ownership
or title acknowledging transfer of ownership (See Ex. 2, Beadle Aff.
Exhibit E, p. 60, line 24 to p. 61, line 19; and p. 87, line 24 to p. 88,
line 22);
xvii. All written agreements concerning the use of space at 651 Coney
Island Avenue were executed months after Dr. Baldassare revived
operations and only after the incorporation of Eclipse Medical
Imaging, P.C. (See Ex. 2, Beadle Aff. Exhibit E, p. 62, line 7 to p.
63, line 8);
xviii. According to Dr. Baldassare’s testimony, he mainly reads twenty to
forty reads per day from his New Jersey residence and all
teleradiology reads are dictated over the phone, transcribed in
Pennsylvania, and e-mailed to him for electronic signature. At most,
Dr. Baldassare visits the facility once a week, if necessary, to
converse with Mr. Maks (See Ex. 2, Beadle Aff. Exhibit E, p. 108,
line 23 to p. 112, line 7);
xix. Fifty percent of Eclipse Medical Imaging, P.C.’s practice is No-
Fault and Workers’ Compensation and the remainder is comprised
of major medical, Medicare and Medicaid, whose billing is handled
by Dynasty Billing (See Ex. 2, Beadle Aff. Exhibit E, p. 121, line
18 to p. 122, line 25); and
xx. Mr. Maks, or billing clerk, Oksana, retain collection counsel for the
PC’s collection work, which is split among several different
collection law firms (See Ex. 2, Beadle Aff. Exhibit E, p. 125, line
5 to p. 126, line 11).
This testimony caused Liberty Mutual to grow further suspicious of the practice situated at
651 Coney Island Avenue and the possible continued fraudulent ownership of the location. Beadle
Aff., ¶ 13. Specifically, Dr. Baldassare’s unique introduction to a business opportunity by Dr.
Baldassare’s former partner concerning a space once occupied by Kensington Radiology, P.C., a
PC also connected to Dr. Baldassare’s former partners; Dr. Baldassare’s total adoption of the
former facility’s business operations without any investment or assumption of the property or
equipment lease for several months; Dr. Baldassare’s alleged ignorance of litigation naming
several of his former partners who claimed to be the purported “owners” of the former facility on
behalf of which Dr. Baldassare himself once rendered services was charged as having been
illegally owned and operated by laypersons; the solicitation into the location by Mr. Maks and the
retention of Mr. Maks, his billing company, and Mrs. Maks whom were/are paid generously; and
the degree of control exercised by Mr. Maks in the business affairs of Eclipse Medical Imaging,
P.C., were the driving factors for Liberty Mutual’s determination that continuation of their
investigation is necessary. Id.
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Therefore, Dr. Baldassare’s testimony prompted Liberty Mutual to request additional
verification in correspondence dated August 30, 2019, including:
i. 2017 and 2018 corporate tax returns for Eclipse Medical Imaging,
P.C.;
ii. 2017, 2018 and 2019 general ledger for Eclipse Medical Imaging,
P.C.;
iii. 2018, 2018, and 2019 profit and loss statement for Eclipse Medical
Imaging, P.C.;
iv. A copy of the 2017, 2018 and 2019 bank statements for Eclipse
Medical Imaging, P.C. with J.P. Morgan Chase;
v. Copies of any and all invoices, purchase orders, shipment orders
and/or manifests with regard to the installation and build-out of an
additional MRI unit at Eclipse Medical Imaging, P .C. as testified to
by Dr. Baldassare;
vi. Any written instructions, guidelines and/or protocols issued by
Eclipse Medical Imaging, P.C. to its employees to safeguard HIP
AA materials and records of the patients of Eclipse Medical
Imaging, P.C.;
vii. A copy of the workers' compensation and disability policies of
insurance for Eclipse Medical Imaging, P.C.;
viii. A copy of the car lease and/or proof of payment made by Eclipse
Medical Imaging, P.C. for the vehicle being paid for on behalf of
Robert Maks;
ix. A copy of any and all billing and/or collection agreements entered
into by Eclipse Medical Imaging, P.C.;
x. Copies of the 2017 and 2018 W-2s issued by Eclipse Medical
Imaging, P.C. to its employees (social security numbers can be
redacted);
xi. A copy of the prior billing and collection agreement between Eclipse
Medical Imaging, P.C./Jack Baldassare, M.D. and LAAL/Robert
Maks;
xii. Any and all employment agreements and/or contracts between
Eclipse Medical Imaging, P.C. / Jack Baldassare, M.D. with Robert
Maks and/or Leanna Maks;
xiii. 2019 quarterly tax filings made by Eclipse Medical Imaging, P.C.;
xiv. Copies of cashed checks and/or or proof of payments issued or made
by Eclipse Medical Imaging, P.C. and/or Jack Baldassare, M.D.
with regard to the buildout and installation of an additional MRI unit
as testified to by the witness.
See, Liberty Mutual’s request for additional verification, included in Liberty Mutual’s arbitration
submission enclosed herein as Exhibit “4”. Liberty Mutual advised Eclipse that in accordance
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with 11 NYCRR 65-3.5(o), “[a]n applicant from whom verification is requested shall, within 120
calendar days from the date of the initial request for verification, submit all such verification under
the applicant’s control or possession or written proof providing reasonable justification for the
failure to comply.” Further, Liberty Mutual “advise[d] the applicant in the verification request
that the insurer may deny the claim if the applicant does not provide within 120 calendar days from
the date of the initial request either all such verification under the applicant's control or possession
or written proof providing reasonable justification for the failure to comply.”
Eclipse’s counsel forwarded a response, dated September 20, 2019 (a copy of which is
attached to the Beadle Aff. as Exhibit “E”), which was mailed on September 27, 2019, according
to the postmarked envelope received containing said correspondence, objecting to each post-EUO
demand in bad faith without providing any of the verification demanded. Beadle Aff., ¶ 15. The
limited materials provided by the applicant in the form of redacted W2s did little to quell the
serious questions concerning the continued involvement in Robert Maks at the MRI facility located
at 651 Coney Island Avenue, nor did it extinguish the need for the additional verification to satisfy
Liberty Mutual’s legitimate, and good faith concerns regarding the eligibility of the facility to
receive No-Fault reimbursement. Id., p 16. Liberty Mutual’s counsel forwarded correspondence,
dated October 16, 2019 (attached to the Ex. 2, Beadle Affidavit Exhibit “F”), acknowledging
receipt of counsel's letter on October 3, 2019, and replied to their absolute rejection of Liberty
Mutual’s post-EUO verification demand. Eclipse Medical Imaging, P.C.’s counsel was further
advised that the post-EUO verification was necessary and narrowly tailored to address the issues
of possible fraud concerning the facility and the facility's eligibility to receive No-Fault
reimbursement. Id., ¶ 17
Eclipse failed to respond to narrowly tailored requests to provide additional verification
and has engaged in a pattern of obstruction to frustrate Liberty Mutual’s entitlement to the needed
verification. Beadle Aff., ¶ 18. Accordingly, as a result of Eclipse’s failure to provide the
requested verification within the 120-calendar day period allotted for a response, Liberty Mutual
denied payment of Applicant-Appellant’ bill. Specifically, Liberty Mutual informed Applicant-
Appellant that:
A60: 65-3.5 Claim procedure (o) An applicant from whom
verification is requested shall, within 120 calendar days from the
date of the initial request for verification, submit all such
verification under the applicant's control or possession or written
proof providing reasonable justification for the failure to comply.
The insurer shall advise the applicant in the verification request that
the insurer may deny the claim if the applicant does not provide
within 120 calendar days from the date of the initial request either
all such verification under the applicant's control or possession or
written proof providing reasonable justification for the failure to
comply. This subdivision shall not apply to a prescribed form (NF-
Form) as set forth in Appendix 13 of this Title, medical examination
request, or examination under oath request. This subdivision shall
apply, with respect to claims for medical services, to any treatment
or service rendered on or after April 1, 2013 and with respect to
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claims for lost earnings and reasonable and necessary expenses, to
any accident occurring on or after April 1, 2013.
See NF-10, included in Liberty Mutual’s arbitration submission enclosed herein as Exhibit “4”.
Following denial of the subject bill, Eclipse filed a demand to arbitrate the disputed bill,
along with demands to arbitrate bills related to other assignors that were denied for the same
reason, and Liberty Mutual’s participation in such arbitration proceedings was compulsory.
Despite Applicant-Appellant’s indication that verification was not requested with regard to the bill
that is the subject of this proceeding, the denial was explicitly based on Eclipse’s failure to provide
requested post-EUO verification that was necessary to verify the bill. Accordingly, Applicant-
Appellant’s refusal to provide the requested information prejudiced Defendant-Respondent’s
ability to defend its denial, and therefore, on June 22, 2021, Liberty Mutual filed a petition in
Supreme Court, Nassau County, seeking an order pursuant CPLR §3102(c), for disclosure to
preserve information or to aid in arbitration, ordering Eclipse to fully comply with and respond to
Petitioner’s valid, narrowly tailored August 30, 2019 Post-EUO verification requests1. See Exhibit
“3”.
To further support the need for the EUO of Eclipse and the additional post-EUO
verification sought to verify Eclipse’s eligibility to collect No-Fault benefits, it has since come to
light that fraudulent prescriptions, written on Eclipse prescription pads and purportedly prescribed
by Dr. Arkam Rehman, were utilized to perform diagnostic imaging studies, x-rays, and/or
magnetic resonance imaging. See Rehman Affidavit, attached hereto as Exhibit “5”. Dr. Rehman
set forth in a sworn affidavit that prescriptions presented by Eclipse claiming that Dr. Rehman
ordered diagnostic studies, x-rays, or MRIs are fraudulent in nature, and that he never requested,
prescribed, ordered, or authorized same. Ex. 5, ¶¶ 68-70.
In an effort to foreclose Liberty Mutual’s ability to defend the arbitration and obtain
payment without providing the necessary claim verification, Eclipse filed a motion to dismiss the
petition, and for a protective order to prevent Liberty Mutual from obtaining the verification. In
an Order dated December 16, 2021, the Honorable Christopher G. Quinn denied Eclipse’s motion
to dismiss, and ordered Eclipse to provide the information requested in response to request
numbers 1, 6, 7, and 11-13. See Judge Quinn’s Order, submitted in opposition to arbitration,
attached hereto as Exhibit “6”.
In support of its defense of nonpayment in the underlying arbitration, Liberty Mutual
submitted evidence of the November 6, 2019 and November 24, 2019 bills’ timely denial
predicated upon Eclipse’s failure to provide post-EUO documentation which was requested on
September 3, 2019 and October 3, 2019, and the Affidavit of Danielle Alicea, a litigation specialist
at Liberty Mutual, who reviewed Liberty Mutual’s claim systems and attests that the bill for the
services purportedly rendered on December 1, 2019 was never received. With regard to the
December 1, 2019 bill, Arbitrator Stathopoulos found in favor of Liberty Mutual, noting that
without an affidavit of mail from the applicant or a US postal service date stamp on the postal
form, he could not conclude that the bill was mailed to Liberty Mutual prior to the commencement
1
Additionally, Liberty Mutual sought to enforce subpoenas issues to J.P. Morgan Chase Bank, N.A. to for records
related to accounts held by Eclipse.
FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022
Page 11 - April 25, 2022
of the arbitration. With regard to Eclipse’s failure to respond to Liberty Mutual’s request for
additional verification, Arbitrator Stathopoulos also found in favor of Liberty Mutual, noting that
“it appears that based on Judge Quinn’s order the Respondent is entitled to the items enumerated
as Nos. 1, 6, 7, 11, 12, 13 of the verification requests. Applicant has not submitted any proof that
they fully provided these items. Therefore, there is merit to Respondent’s 120-day denial.”
Accordingly, the bill for the services rendered on December 1, 2019 was dismissed without
prejudice and the bills for the November 6, 2019 and November 24, 2019 services were denied in
their entirety. See Exhibit “1”.
Applicant-Appellant now seeks a vacatur of the lower arbitration award with regard to the
bills for the November 6, 2019 and November 24, 2019 services focusing on Arbitrator
Stathopoulos’s reliance on the Court’s Order, condescendingly arguing that Eclipse’s failure to
provide additional verification should be disregarded because the Court ordered that “only six” of
the categories requested were discoverable. Eclip
Preview
FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Michael A. Callinan Matthew J. Smith 3361 Park Avenue Vanessa H. Hlinka Suite 104 Frank J. Gissaro Wantagh, New York 11793 P: (516) 784-5148 / F: (516) 667-1003 Jennifer B. Strong JENNIFER B. STRONG Steven Daniel Levy SENIOR COUNSEL Matthew P. Smith ADMITTED IN N.Y., N.J. & USPTO jstrong@callinansmith.com Craig J. Bruno Stewart C. Fink Of counsel April 25, 2022 VIA MODRIA Master Arbitrator Vic D’Amora, Esq. MasterAppealTeam@adr.org Re: Eclipse Medical Imaging PC a/a/o Syreeta Carmona v. Liberty Mutual Insurance Company Claim No.: 0411433980001 AAA Case No.: 99-20-1173-5828 C&S File No.: A185-5237E Dear Master Arbitrator D’Amora: Please be advised that this office represents the Respondent-Appellee, Liberty Mutual Insurance Company (hereinafter “Liberty Mutual”) in the above-referenced master arbitration review. Liberty Mutual respectfully makes the following submission in opposition to Applicant- Appellant’s appeal. PROCEDURAL BACKGROUND This appeal arises from the February 18, 2022 denial of the claim submitted by Applicant- Appellant Eclipse Medical Imaging PC (hereinafter “Eclipse” or “Applicant-Appellant”) by Arbitrator Dimitrios Stathopoulos, Esq. See Arbitration Award, attached hereto as Exhibit “1”. The underlying arbitration arises from three bills submitted by Eclipse to Liberty Mutual seeking No-Fault reimbursement in the amount of $2,602.27 for allegedly providing MRI services to Syreeta Carmona (“Insured”) on November 6, 2019, November 24, 2019, and December 1, 2019. The Insured assigned her No-Fault benefits to Eclipse, and in exchange allegedly received medical treatment. Based upon the assignment of No-Fault benefits provided to Eclipse, Eclipse submitted No-Fault billing to Liberty Mutual on the Insured’s behalf. 345 Rt. 17 South 416 Church Street Suite 43 First Floor Upper Saddle River, New Jersey 07458 Hawley, Pennsylvania 18428 FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 2 - April 25, 2022 Upon receipt of said No-Fault billing, Liberty Mutual initiated an investigation into Applicant-Appellant Eclipse’s eligibility to bill for and/or to collect New York No-Fault benefits. James Beadle, an employee with Liberty Mutual Group, was the investigator assigned to investigate the eligibility of Eclipse to receive No-Fault reimbursements. See, Affidavit of James Beadle (“Beadle Aff.”), ¶ 3, submitted in opposition to arbitration, and attached hereto as Exhibit “2”. The investigation revealed that the location from which Eclipse operates is a location that has been the subject of prior insurance industry investigations and lawsuits regarding the fraudulent operation and ownership of the MRI facility. Ex. 2, Beadle Aff., ¶ 5. During itsinvestigation, Liberty Mutual learned that numerous other lawsuits had been filed by insurance carriers regarding the unlawful operation of health care related corporations by laypersons, including Robert Maks and Cardenal Management Corp. Copies of the Complaints from those lawsuits were attached to the Petition underlying the December 16, 2021 Order referenced in Arbitrator Dimitrios Stathopoulos’s Arbitration Award, attached hereto as Exhibit “3” (hereinafter “Petition”), collectively as Exhibit “I”. Liberty Mutual also discovered that on or around January 26, 2021, an action was filed in the United States District Court, Eastern District of New York by Allstate Insurance Company and its affiliates against various parties, which included Eclipse Medical Imaging P.C., Jack Baldassare, M.D., Robert Maks and Cardenal Management Corp. (hereinafter, the “Allstate Suit”). A copy of the Complaint from the Allstate Suit is annexed to the Petition as Exhibit “J”. The Complaint filed by Farmers with regard to Kensington Radiology Group, P.C. alleged the following: i. Maks and his partners utilized the professional licenses of Stanley Friedman, M.D., Ronald Schliftman, M.D., and Michael Shapiro, M.D. to illegally create and operate Kensington Radiology Group, P.C. for the pecuniary benefit of the layperson defendants, Maks and his partners. As part of its investigation into Kensington Radiology Group, P.C., Farmers was able to obtain records from one bank account which was utilized by Kensington Radiology that evidenced illegal fee splitting and issues regarding ownership of the P.C. (See Petition Exhibit “I,”, p. 114, paragraph 131(44)). ii. According to the bank records, from December 2012 through March 2015, Kensington Radiology had income of approximately Three Million Four Hundred and Sixty-Five Thousand Dollars ($3,465,000.00). For that same period, Kensington Radiology paid Kensington Group in excess of Two Million Six Hundred and Sixty Thousand Dollars ($2,660,000.00). Kensington Group was a non- professional corporation owned and operated by Robert Maks and his partners. (See Petition Exhibit “I,”, p. 147, paragraph 122 and p. 114, paragraph 131(45)). iii. The bank records indicated that Kensington Group, a non- professional corporation operated by laypersons Maks and his FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 3 - April 25, 2022 partners, was paid over Seventy-Six Percent (76%) of the income of Kensington Radiology (See Exhibit “I”, p. 114, paragraph 131(45)). iv. The monthly payments made by Kensington Radiology to Kensington Group appeared arbitrary and ranged anywhere from Sixty Thousand Dollars ($60,000.00) per month to One Hundred and Fifty Thousand Dollars ($150,000.00) per month (See Petition Exhibit “I”, p. 115, paragraph 131(47)). v. In August 2013, a check was issued to Stanley N. Friedman, M.D., one of the alleged owners of Kensington Radiology, in the amount of Five Hundred Eighty Two Dollars and Three Cents ($582.03), The “Memo” section of the check indicated “Salary of June, July & August – Direct Deposit was returned by Chase.” (See Petition Exhibit “I”, p. 115, paragraph 131(48)). vi. From December 2012 through March 2013, the records do not indicate that any money was taken out of the account of the P.C. for payroll. (See Petition Exhibit “I”, p. 115, paragraph 131(49)). vii. In October 2014, alleged owners, Friedman, Schliftman, and Shapiro, were each issued a check in the amount of Five Thousand Dollars ($5,000.00) with the “Memo” section of the check indicating “Loan Exchange.” All of the checks appeared to be signed by Friedman. (See Petition Exhibit “I”, p. 115, paragraph 131(50)). viii. In December 2014, alleged owners Friedman, Schliftman, and Shapiro were once again each issued a check in the amount of Five Thousand Dollars ($5,000.00) with the “Memo” section of the check indicating “Loan Exchange.” Friedman, Schiftman, and Shapiro were also issued a second check in that month in the amount of One Thousand Eight Hundred Dollars ($1,800.00) with the “Memo” section of the check indicating “Loan Exchange.” All of the checks appeared to be signed by Friedman. (See Petition Exhibit “I”, p. 115, paragraph 131(51)). ix. In January 2015, alleged owners Friedman, Schliftman, and Shapiro were once again each issued a check in the amount of Three Thousand Dollars ($3,000.00) with the “Memo” section of the check indicating “Loan Exchange.” All of the checks appear to be signed by Friedman. (See Petition Exhibit “I”, p. 115, paragraph 131(52)). A UCC filing demonstrates that the individuals involved in the previously mentioned fraudulent ownership scheme had a controlling interest in the MRI machinery located at 651 Coney Island Avenue, Brooklyn, New York – Eclipse’s location. Beadle Aff., ¶ 7. As part of its investigation and pursuant to its rights under the No-Fault laws, Liberty Mutual sought the examination under oath (hereinafter, “EUO”) of Eclipse Medical Imaging, P.C., which took place on August 28, 2019. Id., ¶ 9. The request for the EUO was predicated upon a legitimate, good FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 4 - April 25, 2022 faith basis. Id., ¶ 8. On August 28, 2019, Jack Baldassare, M.D appeared on behalf of Eclipse. Id., ¶ 9. Dr. Baldassare appeared with his counsel, Raymond Zuppa, Esq. It is noted that the fraudulently operated Kensington ultimately became Eclipse Medical Imaging, with the same unlawful layperson control. Dr. Baldassare’s testimony clearly demonstrated that he was having financial difficulties when he was approached by the layperson controller of the MRI facility located at 651Coney Island Avenue, Brooklyn, New York 11218. Id, ¶ 11. This layperson controller, Robert Maks, has been the subject of numerous lawsuits alleging that he was the unlawful owner of the MRI facility located at 651 Coney Island Avenue, Brooklyn, New York 11218. Id. Thereafter, Dr. Baldassare assumed a “turnkey” operation at 651 Coney Island Avenue, Brooklyn, New York 11218 and Eclipse Medical Imaging, P.C. was born, with Robert Maks still intimately involved and presumably running the facility from the shadows. Id. A full copy of the transcript of the Examination Under Oath of Dr. Jack Baldassare was included with Liberty Mutual’s arbitration submission as Exhibit “E” to the Beadle Aff., attached hereto as Exhibit “2”. Dr. Baldassare’s EUO testimony revealed information that raises legitimate and serious questions concerning the ownership and eligibility of Eclipse to receive No-Fault reimbursements pursuant to 11 NCYCRR 65-3.16(a)(12). Id., ¶ 12. Specifically, the testimony revealed the following: i. Dr. Baldassare started performing healthcare services at the Coney Island Avenue location on August 1, 2016, despite the incorporation of Eclipse Medical Imaging P.C. later in January of 2017 (See Ex. 2, Beadle Aff. Exhibit E, p. 17, lines 17-20, and p. 18, lines 8-15); ii. Dr. Baldassare suffered substantial financial misfortune in 2014 after an unpaid departure from his partnership with Radiological Diagnostic Center Medical Association, PA, a reading facility located in Englewood, New Jersey. (See Ex. 2, Beadle Aff. Exhibit E, p. 32, line 35 to p. 33, line 22). This misfortune was on top of the loss of his position as the attending radiologist at Westchester Square Hospital (See Exhibit E, p. 26, line 10 to p. 27, line 8); iii. For a short period of time thereafter, Dr. Baldassare began performing teleradiology for various medical facilities, submitting billing under his social security number (See Beadle Aff., Exhibit E, p. 33, line 23 to p. 25, line 3) until he allegedly received a call from his former partner, Sason Azar, who informed him of a “business” opportunity (See Ex. 2, Beadle Aff. Exhibit E, p. 39, lines 9-22); iv. Dr. Azar advised Dr. Baldassare that the owner of a billing company, Robert Maks, directly contacted him seeking a radiologist willing to operate an existing radiological facility located at 651 Coney Island Avenue, Brooklyn, New York where Mr. Maks’ billing company had performed all billing services (See Ex. 2, Beadle Aff. Exhibit E, p. 39, line 23 to p. 40, line 14); FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 5 - April 25, 2022 v. While Dr. Baldassare admitted that he previously performed services as an independent contractor for Kensington Radiology, P.C., he denied any knowledge that Kensington Radiology, P.C. previously operated at the 651 Coney Island Avenue location (See Exhibit E, p. 40, line 20 to p. 41, line 14; and p. 138, lines 8-12) or that his former partners, Drs. Stanley Friedman, Michael Shapiro and Ronald Schliftman, were Kensington Radiology’s “actual” owners (See Ex. 2, Beadle Aff. Exhibit E, p. 44, line 9 to p. 45, line 19; and p. 53, lines 2-5); vi. Dr. Baldassare was unaware that his former partners, Drs. Friedman, Shapiro and Schliftman, as well as Mr. Maks, his billing company, LAAL Billing, and Kensington Radiology, P.C. are/were the subject of numerous lawsuits alleging the fraudulent incorporation and ownership of the radiological facility located at 651 Coney Island Avenue, Brooklyn, New York, and specifically that Mr. Maks is the actual owner/operator of the professional corporation in violation of state law (See Ex. 2, Beadle Aff. Exhibit E, p. 29, line 7 to p. 30, line 5; and p. 53, line 19 to p. 54, line 6); vii. Dr. Baldassare then had convincing conversations with Mr. Maks, the property’s landlord and owner of the MRI machinery, Kensington Realty or “Steve” (See Exhibit E, p. 47, line 14 to p. 48, line 3), which led Dr. Baldassare to agree to operate the facility on the condition he not sign any documentation obligating himself personally to the payment of rent or the lease of the MRI machinery for the time being (See Ex. 2, Beadle Aff. Exhibit E, p. 48, line 22 to p. 49, line 2); viii. According to his testimony, Dr. Baldassare was able to negotiate three free months of rent for the commercial space and the machinery’s lease and maintenance (See Ex. 2, Beadle Aff. Exhibit E, p. 49, line 3 to p. 50, line 5); ix. Louise Rosenbaum, the prior office manager of Professional Health Imaging, also had a presence at the 651 Coney Island Avenue location (See Beadle Aff., Exhibit E, p. 50, line 21 to p. 51, line 10). She is currently employed by Eclipse Medical Imaging, P.C., is designated with overseeing the front desk and is paid $50,000.00 (See Beadle Aff., Exhibit E, p. 51, lines 11 through 14; p. 55, lines 6 through 10; and p. 65, lines 20 through 23). Ms. Rosenbaum is also responsible for hiring technicians (See Beadle Aff., Exhibit E, p. 67, lines 5 through 12) and assisted in retaining counsel, Victoria Berez, the attorney who helped incorporate Eclipse Medical Imaging, P.C. (See Ex. 2, Beadle Aff. Exhibit E, p. 67, lines 5 through 12); FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 6 - April 25, 2022 x. In the summer of 2016, Dr. Baldassare once again became associated with 651 Coney Island Avenue; however, this time as the alleged owner of the facility without any actual purchase or investment made (See Beadle Aff., Exhibit E, p. 54, line 13 through p. 55, line 5). Robert Maks also continued his association with the clinic location when LAAL Billing was retained for billing services, earning between $10,000 to $15,000 per month for the generation of bills submitted for reimbursement. After the incorporation of Eclipse Medical Imaging, P.C. in January 2017, Dr. Baldassare dismissed LAAL Billing because he realized he was overpaying; however, he then retained Mr. Mak’s wife, Leana Maks, to perform the same services for an annual salary of $100,000.00, which was nearly the same amount paid to her husband through his billing company (See Ex. 2, Beadle Aff. Exhibit E, p. 55, lines 11 through p. 58, line 13); xi. In 2018, Dr. Baldassare terminated Mrs. Maks’ employment, retaining two billing clerks in her stead (See Exhibit E, p. 58, line 17 through p. 59, line 24); however, he then “hired” Mr. Maks as an office manager paying him an annal salary of $150,000, including other perks such as payment of his Mercedes Benz car lease and use of the P.C.’s debit card (See Ex. 2, Beadle Aff. Exhibit E, p. 70, lines 7 through 17; p. 72, lines 7 through 9; p. 78, lines 6 through 24; and p. 82, lines 19 through 24); xii. For close to one year, Eclipse Medical Imaging, P.C. “employed” both Mr. and Mrs. Maks, paying them collectively $250,000 (See Ex. 2, Beadle Aff. Exhibit E, p. 73, line 21 through p. 74, line 2); xiii. Mr. Maks is responsible for eliciting patient referrals for Eclipse Medical Imaging, P.C. as he solely markets the PC by visiting various medical practices and delivering prescription pads. Dr. Baldassare was uninformed as to the PC’s actual referral source (See Ex. 2, Beadle Aff. Exhibit E, p. 80, lines 3 through 25); xiv. Mr. Maks is entrusted with access to Eclipse Medical Imaging P.C.’s bank accounts, its general ledger and bank statements. He also has permission to draw checks for signature or apply a signature stamp (See Ex. 2, Beadle Aff. Exhibit E, p. 71, line 21 through p. 72, line 2; and p. 72, lines 14 through 25); xv. Dr. Baldassare recognized the name Gregory Vaunshtyen through his association with a company called Professional Health Imaging, but he claimed to be unaware of Mr. Vaunshtyen’s management companies, including Cardenal Management Corp., and its UCC filing regarding the actual ownership of the MRI equipment located at 651 Coney Island Avenue (See Ex. 2, Beadle Aff. Exhibit E, p. FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 7 - April 25, 2022 46, lines 5 through 13; p. 47, lines 11 through 13; and page 117, line 12 to p. 118, line 8); xvi. Dr. Baldassare testified that he assumed the monthly fee for the MRI magnet lease in December 2016 paying $5,000 per month until it was satisfied; however, he does not have a certificate of ownership or title acknowledging transfer of ownership (See Ex. 2, Beadle Aff. Exhibit E, p. 60, line 24 to p. 61, line 19; and p. 87, line 24 to p. 88, line 22); xvii. All written agreements concerning the use of space at 651 Coney Island Avenue were executed months after Dr. Baldassare revived operations and only after the incorporation of Eclipse Medical Imaging, P.C. (See Ex. 2, Beadle Aff. Exhibit E, p. 62, line 7 to p. 63, line 8); xviii. According to Dr. Baldassare’s testimony, he mainly reads twenty to forty reads per day from his New Jersey residence and all teleradiology reads are dictated over the phone, transcribed in Pennsylvania, and e-mailed to him for electronic signature. At most, Dr. Baldassare visits the facility once a week, if necessary, to converse with Mr. Maks (See Ex. 2, Beadle Aff. Exhibit E, p. 108, line 23 to p. 112, line 7); xix. Fifty percent of Eclipse Medical Imaging, P.C.’s practice is No- Fault and Workers’ Compensation and the remainder is comprised of major medical, Medicare and Medicaid, whose billing is handled by Dynasty Billing (See Ex. 2, Beadle Aff. Exhibit E, p. 121, line 18 to p. 122, line 25); and xx. Mr. Maks, or billing clerk, Oksana, retain collection counsel for the PC’s collection work, which is split among several different collection law firms (See Ex. 2, Beadle Aff. Exhibit E, p. 125, line 5 to p. 126, line 11). This testimony caused Liberty Mutual to grow further suspicious of the practice situated at 651 Coney Island Avenue and the possible continued fraudulent ownership of the location. Beadle Aff., ¶ 13. Specifically, Dr. Baldassare’s unique introduction to a business opportunity by Dr. Baldassare’s former partner concerning a space once occupied by Kensington Radiology, P.C., a PC also connected to Dr. Baldassare’s former partners; Dr. Baldassare’s total adoption of the former facility’s business operations without any investment or assumption of the property or equipment lease for several months; Dr. Baldassare’s alleged ignorance of litigation naming several of his former partners who claimed to be the purported “owners” of the former facility on behalf of which Dr. Baldassare himself once rendered services was charged as having been illegally owned and operated by laypersons; the solicitation into the location by Mr. Maks and the retention of Mr. Maks, his billing company, and Mrs. Maks whom were/are paid generously; and the degree of control exercised by Mr. Maks in the business affairs of Eclipse Medical Imaging, P.C., were the driving factors for Liberty Mutual’s determination that continuation of their investigation is necessary. Id. FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 8 - April 25, 2022 Therefore, Dr. Baldassare’s testimony prompted Liberty Mutual to request additional verification in correspondence dated August 30, 2019, including: i. 2017 and 2018 corporate tax returns for Eclipse Medical Imaging, P.C.; ii. 2017, 2018 and 2019 general ledger for Eclipse Medical Imaging, P.C.; iii. 2018, 2018, and 2019 profit and loss statement for Eclipse Medical Imaging, P.C.; iv. A copy of the 2017, 2018 and 2019 bank statements for Eclipse Medical Imaging, P.C. with J.P. Morgan Chase; v. Copies of any and all invoices, purchase orders, shipment orders and/or manifests with regard to the installation and build-out of an additional MRI unit at Eclipse Medical Imaging, P .C. as testified to by Dr. Baldassare; vi. Any written instructions, guidelines and/or protocols issued by Eclipse Medical Imaging, P.C. to its employees to safeguard HIP AA materials and records of the patients of Eclipse Medical Imaging, P.C.; vii. A copy of the workers' compensation and disability policies of insurance for Eclipse Medical Imaging, P.C.; viii. A copy of the car lease and/or proof of payment made by Eclipse Medical Imaging, P.C. for the vehicle being paid for on behalf of Robert Maks; ix. A copy of any and all billing and/or collection agreements entered into by Eclipse Medical Imaging, P.C.; x. Copies of the 2017 and 2018 W-2s issued by Eclipse Medical Imaging, P.C. to its employees (social security numbers can be redacted); xi. A copy of the prior billing and collection agreement between Eclipse Medical Imaging, P.C./Jack Baldassare, M.D. and LAAL/Robert Maks; xii. Any and all employment agreements and/or contracts between Eclipse Medical Imaging, P.C. / Jack Baldassare, M.D. with Robert Maks and/or Leanna Maks; xiii. 2019 quarterly tax filings made by Eclipse Medical Imaging, P.C.; xiv. Copies of cashed checks and/or or proof of payments issued or made by Eclipse Medical Imaging, P.C. and/or Jack Baldassare, M.D. with regard to the buildout and installation of an additional MRI unit as testified to by the witness. See, Liberty Mutual’s request for additional verification, included in Liberty Mutual’s arbitration submission enclosed herein as Exhibit “4”. Liberty Mutual advised Eclipse that in accordance FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 9 - April 25, 2022 with 11 NYCRR 65-3.5(o), “[a]n applicant from whom verification is requested shall, within 120 calendar days from the date of the initial request for verification, submit all such verification under the applicant’s control or possession or written proof providing reasonable justification for the failure to comply.” Further, Liberty Mutual “advise[d] the applicant in the verification request that the insurer may deny the claim if the applicant does not provide within 120 calendar days from the date of the initial request either all such verification under the applicant's control or possession or written proof providing reasonable justification for the failure to comply.” Eclipse’s counsel forwarded a response, dated September 20, 2019 (a copy of which is attached to the Beadle Aff. as Exhibit “E”), which was mailed on September 27, 2019, according to the postmarked envelope received containing said correspondence, objecting to each post-EUO demand in bad faith without providing any of the verification demanded. Beadle Aff., ¶ 15. The limited materials provided by the applicant in the form of redacted W2s did little to quell the serious questions concerning the continued involvement in Robert Maks at the MRI facility located at 651 Coney Island Avenue, nor did it extinguish the need for the additional verification to satisfy Liberty Mutual’s legitimate, and good faith concerns regarding the eligibility of the facility to receive No-Fault reimbursement. Id., p 16. Liberty Mutual’s counsel forwarded correspondence, dated October 16, 2019 (attached to the Ex. 2, Beadle Affidavit Exhibit “F”), acknowledging receipt of counsel's letter on October 3, 2019, and replied to their absolute rejection of Liberty Mutual’s post-EUO verification demand. Eclipse Medical Imaging, P.C.’s counsel was further advised that the post-EUO verification was necessary and narrowly tailored to address the issues of possible fraud concerning the facility and the facility's eligibility to receive No-Fault reimbursement. Id., ¶ 17 Eclipse failed to respond to narrowly tailored requests to provide additional verification and has engaged in a pattern of obstruction to frustrate Liberty Mutual’s entitlement to the needed verification. Beadle Aff., ¶ 18. Accordingly, as a result of Eclipse’s failure to provide the requested verification within the 120-calendar day period allotted for a response, Liberty Mutual denied payment of Applicant-Appellant’ bill. Specifically, Liberty Mutual informed Applicant- Appellant that: A60: 65-3.5 Claim procedure (o) An applicant from whom verification is requested shall, within 120 calendar days from the date of the initial request for verification, submit all such verification under the applicant's control or possession or written proof providing reasonable justification for the failure to comply. The insurer shall advise the applicant in the verification request that the insurer may deny the claim if the applicant does not provide within 120 calendar days from the date of the initial request either all such verification under the applicant's control or possession or written proof providing reasonable justification for the failure to comply. This subdivision shall not apply to a prescribed form (NF- Form) as set forth in Appendix 13 of this Title, medical examination request, or examination under oath request. This subdivision shall apply, with respect to claims for medical services, to any treatment or service rendered on or after April 1, 2013 and with respect to FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 10 - April 25, 2022 claims for lost earnings and reasonable and necessary expenses, to any accident occurring on or after April 1, 2013. See NF-10, included in Liberty Mutual’s arbitration submission enclosed herein as Exhibit “4”. Following denial of the subject bill, Eclipse filed a demand to arbitrate the disputed bill, along with demands to arbitrate bills related to other assignors that were denied for the same reason, and Liberty Mutual’s participation in such arbitration proceedings was compulsory. Despite Applicant-Appellant’s indication that verification was not requested with regard to the bill that is the subject of this proceeding, the denial was explicitly based on Eclipse’s failure to provide requested post-EUO verification that was necessary to verify the bill. Accordingly, Applicant- Appellant’s refusal to provide the requested information prejudiced Defendant-Respondent’s ability to defend its denial, and therefore, on June 22, 2021, Liberty Mutual filed a petition in Supreme Court, Nassau County, seeking an order pursuant CPLR §3102(c), for disclosure to preserve information or to aid in arbitration, ordering Eclipse to fully comply with and respond to Petitioner’s valid, narrowly tailored August 30, 2019 Post-EUO verification requests1. See Exhibit “3”. To further support the need for the EUO of Eclipse and the additional post-EUO verification sought to verify Eclipse’s eligibility to collect No-Fault benefits, it has since come to light that fraudulent prescriptions, written on Eclipse prescription pads and purportedly prescribed by Dr. Arkam Rehman, were utilized to perform diagnostic imaging studies, x-rays, and/or magnetic resonance imaging. See Rehman Affidavit, attached hereto as Exhibit “5”. Dr. Rehman set forth in a sworn affidavit that prescriptions presented by Eclipse claiming that Dr. Rehman ordered diagnostic studies, x-rays, or MRIs are fraudulent in nature, and that he never requested, prescribed, ordered, or authorized same. Ex. 5, ¶¶ 68-70. In an effort to foreclose Liberty Mutual’s ability to defend the arbitration and obtain payment without providing the necessary claim verification, Eclipse filed a motion to dismiss the petition, and for a protective order to prevent Liberty Mutual from obtaining the verification. In an Order dated December 16, 2021, the Honorable Christopher G. Quinn denied Eclipse’s motion to dismiss, and ordered Eclipse to provide the information requested in response to request numbers 1, 6, 7, and 11-13. See Judge Quinn’s Order, submitted in opposition to arbitration, attached hereto as Exhibit “6”. In support of its defense of nonpayment in the underlying arbitration, Liberty Mutual submitted evidence of the November 6, 2019 and November 24, 2019 bills’ timely denial predicated upon Eclipse’s failure to provide post-EUO documentation which was requested on September 3, 2019 and October 3, 2019, and the Affidavit of Danielle Alicea, a litigation specialist at Liberty Mutual, who reviewed Liberty Mutual’s claim systems and attests that the bill for the services purportedly rendered on December 1, 2019 was never received. With regard to the December 1, 2019 bill, Arbitrator Stathopoulos found in favor of Liberty Mutual, noting that without an affidavit of mail from the applicant or a US postal service date stamp on the postal form, he could not conclude that the bill was mailed to Liberty Mutual prior to the commencement 1 Additionally, Liberty Mutual sought to enforce subpoenas issues to J.P. Morgan Chase Bank, N.A. to for records related to accounts held by Eclipse. FILED: NASSAU COUNTY CLERK 08/12/2022 10:35 AM INDEX NO. 610637/2022 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 08/12/2022 Page 11 - April 25, 2022 of the arbitration. With regard to Eclipse’s failure to respond to Liberty Mutual’s request for additional verification, Arbitrator Stathopoulos also found in favor of Liberty Mutual, noting that “it appears that based on Judge Quinn’s order the Respondent is entitled to the items enumerated as Nos. 1, 6, 7, 11, 12, 13 of the verification requests. Applicant has not submitted any proof that they fully provided these items. Therefore, there is merit to Respondent’s 120-day denial.” Accordingly, the bill for the services rendered on December 1, 2019 was dismissed without prejudice and the bills for the November 6, 2019 and November 24, 2019 services were denied in their entirety. See Exhibit “1”. Applicant-Appellant now seeks a vacatur of the lower arbitration award with regard to the bills for the November 6, 2019 and November 24, 2019 services focusing on Arbitrator Stathopoulos’s reliance on the Court’s Order, condescendingly arguing that Eclipse’s failure to provide additional verification should be disregarded because the Court ordered that “only six” of the categories requested were discoverable. Eclip