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FILED: NASSAU COUNTY CLERK 01/22/2024 11:55 AM INDEX NO. 614817/2023
NYSCEF DOC. NO. 9 RECEIVED NYSCEF: 01/22/2024
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NASSAU
------------------------------------------------------------------x
PROGRESSIVE CASUALTY INSURANCE
COMPANY,
Plaintiff/Petitioner,
- against - Index No.614817/2023
JUAN D. DELACRUZ MD
Defendant/Respondent.
------------------------------------------------------------------x
NOTICE OF ELECTRONIC FILING
(Consensual Case)
(Uniform Rule § 202.5-b)
You have received this Notice because:
1) The Plaintiff/Petitioner, whose name is listed above, has filed this case using the
New York State Courts E-filing system (“NYSCEF”), and
2) You are a Defendant/Respondent (a party) in this case.
! If you are represented by an attorney:
Give this Notice to your attorney. (Attorneys: see “Information for Attorneys” pg. 2).
! If you are not represented by an attorney:
You will be served with all documents in paper and you must serve and file your
documents in paper, unless you choose to participate in e-filing.
If you choose to participate in e-filing, you must have access to a computer and a
scanner or other device to convert documents into electronic format, a connection
to the internet, and an e-mail address to receive service of documents.
The benefits of participating in e-filing include:
! serving and filing your documents electronically
! free access to view and print your e-filed documents
! limiting your number of trips to the courthouse
! paying any court fees on-line (credit card needed)
To register for e-filing or for more information about how e-filing works:
! visit: www.nycourts.gov/efile-unrepresented or
! contact the Clerk’s Office or Help Center at the court where the case was filed. Court
contact information can be found at www.nycourts.gov
Page 1 of 2 EF-3
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To find legal information to help you represent yourself visit www.nycourthelp.gov
Information for Attorneys
An attorney representing a party who is served with this notice must either consent or
decline consent to electronic filing and service through NYSCEF for this case.
Attorneys registered with NYSCEF may record their consent electronically in the manner
provided at the NYSCEF site. Attorneys not registered with NYSCEF but intending to
participate in e-filing must first create a NYSCEF account and obtain a user ID and
password prior to recording their consent by going to www.nycourts.gov/efile
Attorneys declining to consent must file with the court and serve on all parties of record a
declination of consent.
For additional information about electronic filing and to create a NYSCEF account, visit the
NYSCEF website at www.nycourts.gov/efile or contact the NYSCEF Resource Center
(phone: 646-386-3033; e-mail: nyscef@nycourts.gov).
Dated: 9/14/23
KEVIN A. MATTEI, ESQ.
_______________________________ 1035 STEWART AVE.
________________________________
Name
MCCORMACK, MATTEI & HOLLER
GARDEN CITY, NY 11530
______________________________ ________________________________
Firm Name Address
516-505-0600
_______________________________
Phone
E-Mail
To:
2/24/20
Index # Page 2 of 2 EF-3
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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NASSAU
---------------------------------------------------------------X SUMMONS
PROGRESSIVE CASUALTY INSURANCE COMPANY,
DRIVE NEW JERSEY INSURANCE COMPANY,
PROGRESSIVE ADVANCED INSURANCE COMPANY,
PROGRESSIVE GARDEN STATE INSURANCE COMPANY,
PROGRESSIVE MAX INSURANCE COMPANY, Index:
PROGRESSIVE SPECIALTY INSURANCE COMPANY AND
UNITED FINANCIAL CASUALTY COMPANY,
Plaintiff(s),
-against-
JUAN D. DELACRUZ MD,
Defendant(s).
------------------------------------------------------------X
TO THE ABOVE-NAMED DEFENDANTS:
YOU ARE HEREBY SUMMONED to Answer the Complaint in this action and to serve
a copy of your answer or, if the Complaint is not served with this Summons, to serve a Notice of
Appearance, on the Plaintiff's Attorney(s) within twenty (20) days after the service of this
Summons, exclusive of the day of service (or within thirty 30 days after the service is complete if
this Summons is not personally delivered to you within the State of New York); and in case of
your failure to appear, or Answer, judgment will be taken against you by default for the relief
demanded in this Complaint.
Dated: Garden City, New York
September 13, 2023 Yours 9t
McCO , MATTEI & HOLLER
By:
NICO I B. HOLLER, ESQ.
Attorneys for Plaintiff
2nd 3rd
1035 Stewart Avenue, & PlOOrS
Garden City, New York 11530
(516) 505-0600 x 224
File No.: Y-3007.dj
TO2
JUAN D. DELACRUZ MD
C/O D. DARVISH LAW
505 NORTHERN BOULEVARD #210
GREAT NECK, NEW YORK 11021
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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NASSAU
-------------------------------------X VERIFIED COMPLAINT
PROGRESSIVE CASUALTY INSURANCE COMPANY,
DRIVE NEW JERSEY INSURANCE COMPANY,
PROGRESSIVE ADVANCED INSURANCE COMPANY,
PROGRESSIVE GARDEN STATE INSURANCE COMPANY,
PROGRESSIVE MAX INSURANCE COMPANY, Index:
PROGRESSIVE SPECIALTY INSURANCE COMPANY AND
UNITED FINANCIAL CASUALTY COMPANY,
Plaintiff(s),
-against-
JUAN D. DELACRUZ MD,
Defendant(s).
____________________..-----------------X
PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSY=EY
INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY,
PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESIVE MAX
INSURANCE COMPANY, PROGRESSIVE SPECIALTY INSURANCE COMPANY AND
"Plaintiff"
UNITED FINANCIAL CASUALTY COMPANY, (hereinafter collectively or
"PROGRESSIVE"), by and through their attorneys, McCORMACK, MATTEI & HOLLER,
for their Verified Cornplaint in this action, hereby alleges as follows:
1. PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSY=EY
INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY,
PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESIVE MAX INSURANCE
COMPANY, PROGRESSIVE SPECIALTY INSURANCE COMPANY AND UNITED FINANCIAL
CASUALTY COMPANY, are foreign corporations authorized to engage in the business of insurance in
the State of New York, maintaining offices in the County of Nassau, State of New York and has
transacted business in the State of New York.
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2. Upon information and belief, Defendant UAN D. DELACRUZ MD, is
purportedly an individual which is transacting or has transacted business in the State of New York.
3. Pursuant to Section 503(a) of the C.P.L.R., venue is appropriate in Nassau County
based upon the residence of the Plaintiffs who maintain an office within the county.
AS AND FOR A FIRST CAUSE OF ACTION
4. This action seeks a declaration that Plaintiff is under no obligation to reimburse
Defendant for services purportedly rendered and billed to Progressive pursuant to the no-fault laws
and regulations and the Insurance Law of the State of New York, based upon the Defendant's
failure to satisfy conditions precedent to coverage or to verify their claims as required by law, and
that Defendant may not collect against any patient-assignors personally and that any liens between
the Defendant and the patients are null and void.
5. Defendant purports to provide medical services to persons who claim to be involved
in motor vehicle losses in New York State.
6. Defendant purports to have obtained assignments of benefits from those persons
who claim to be involved in motor vehicle losses in New York State, and based upon those
assignments, Defendant submits billing to no-fault insurers for reimbursement for these medical
supplies.
7. The State of New York requires, pursuant to Article 51, §5108 of the Insurance
Law, that insurers provide no-fault insurance benefits to persons injured in automobile accidents
regardless of fault. These benefits include medical services.
8. Plaintiff issues automobile insurance policies in the State of New York, which
include No-Fault benefits. Under the No-Fault Laws, insureds can assign their rights to benefits to
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providers of medically necessary treatment and tests. Pursuant to validly executed assignments,
insurers are obligated to pay an insured's No-Fault benefits directly to the health care providers.
9. New York State Department of Insurance regulations provide that to be
compensated under No-Fault, professional health services must be provided by a licensed provider
within the scope of his or her license. 11 N.Y.C.R.R. & 11 N.Y.C.R.R. §65-
§65.15(0)(1)(vi)
3.16(6).
10. Insurance Law §5102 et seq. requires no-fault insurers to reimburse patients for
basic economic loss. Unlicensed or fraudulently licensed providers are ineligible for
reimbursement under the authority of 11 NYCRR 65-3.16(a)(12) which provides that "A provider
of health care services is not eligible for reimbursement under §5102 (a)(1) of the Insurance Law
."
if the provider fails to meet any applicable New York State or local licensing requirement. .
N.Y.3"1
11. The New York Court of Appeals in State Farm v. Mallela, 4 313, 827
N.E.2d 758, 794 N.Y.S.2d 700 (2005), confirmed that insurance carriers may withhold payment
for medical services provided by fraudulently incorporated enterprises to which their patients have
"doc-in-the-box"
assigned their claims. This scheme occurs when a physician essentially sells his
license to an unlicensed person or entity which truly owns and controls the medical facility. The
profits do not go to the nominal physician-owner, but rather to the unlicensed lay persons. In
Mallela, the Court of Appeals upheld 11 NYCRR 65-3.16(a)(12), which excludes from the
loss"
meaning of "basic economic payments made to unlicensed providers, thus rendering them
ineligible for reimbursement. The Court of Appeals noted that the Superintendent of the Insurance
Department's brief asserted that he promulgated this regulation to combat rapidly growing
incidences of fraud in the no-fault regime, fraud that he has identified as correlative with the
corporate practice of medicine by non-physicians. The Mallela Court rejected the argument that
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the medical services ought to be reimbursed if they were actually provided by licensed medical
professionals, despite the improper ownership and control of the facility by unlicensed lay persons.
12. The State of New York regulates the practice of medicine and other healthcare
professions. It restricts the ownership of professional corporations to professionals licensed in the
practice that the professional corporations are authorized to operate. The State does so in order to
protect consumers and the public health. After incorporation, a professional corporation is subject
to disciplinary proceedings and penalties in the same manner that a licensed owner is pursuant to
BCL §1503.
"physician"
13. The use of the title by one who is not a physician is prohibited by New
York Education Law §6513. The practice of medicine by one who is not a physician is a felony
pursuant to New York Education Law §6512. The sale of a medical license is also a felony under
New York Education Law § 6512. Only doctors of medicine and of osteopathy are permitted to
use the title of physician and are included in New York's Education Law authorizing the practice
of medicine. N.Y. Education Law §§6522, 6524.
14. The practice of any profession in which a license is a prerequisite by persons not
authorized is prohibited by New York Education Law § 6512. This statutory framework is
designed to protect the public and to ensure that medical services are provided by licensed
physicians.
15. Pursuant to Section 1504(a) of the New York State Business Corporation Law and
regulations promulgated by the New York State Department of Health, professional service
corporations may only render professional services through individuals authorized by law to render
such professional services as individuals. Section 1507 of the Business Corporation Law of the
State of New York prohibits a professional service corporation from issuing shares to individuals
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corporation."
unless they are "engaged in the practice of such profession in such It also prohibits
such shareholder(s) from entering into any agreement with, granting proxies to or transferring
control to individuals who are not authorized by law to practice the profession for which the
professional corporation is authorized to practice. "All shares issued, agreements made, or proxies
void."
granted in violation of this section are
16. Pursuant to Section 1503(b) of the Business Corporation Law of the State of New
York, a professional corporation is required to state the name and resident addresses of all
individuals who are to be the original shareholders, directors and officers. Section 1503(a) of the
Business Corporation Law allows only "individuals duly authorized by law to render the same
service"
professional to organize a professional service corporation for pecuniary profit.
17. New York's Insurance Department Regulations require that a health care provider
submit certain information in order to be paid for a no-fault claim. This infonnation includes the
name of the provider and the type of service provided. In addition, pursuant to the Department of
Insurance Regulations, 11 N.Y.C.R.R. §65-3.16(6) health services must be provided by a licensed
provider within the scope of his or her license in order to be compensated under the no-fault laws.
18. Progressive initiated an investigation into JUAN D. DELACRUZ MD after receipt
of the submitted billing and attempted to verify ownership of the entity, corporate status and the
rendering of services to PROGRESSIVE'S various insureds.
19. Progressive's investigation revealed that JUAN D. DELACRUZ MD has billing
submitted by The Darvish Law Firm, with a billing address of 505 Northern Blvd Ste 210 Great
Neck NY and service addresses at 1849 Utica Ave Brooklyn NY 11234 and 611 East 76 St
Brooklyn NY 11236.
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20. Progressive's investigation uncovered that this doctor is billing for shockwave
therapy, (0101T) to the exclusion of any other service with billing being submitted by the Darvish
Law Firm. Progressive recently obtained an affidavit from Inna Leytsenko NP in which she stated
that she was recruited by Nicole Hidalgo to perform shockwave therapy. In fact, All Pro Billing
'Vadim'
Solutions was submitting billing for Ms. Leytsenko, and she was introduced to a who was
Inc,"
associated to a company called "Citiwide NY Funding Group who was paying her $1,500.00
a day to perform shockwave therapy. Vadim requested that she sign documents to enable bills to
be submitted to insurance companies. At Vadim's directions, she did sign an escrow agreement
with David Darvish PC, directing insurance payments for her services be paid to Citiwide, an
escrow agreement with The Darvish Law Finn directing they pay All Pro's fees from the firm's
IOLA Account and a retainer with The Darvish Law Firm. While it is unclear who is preparing
these bills, the commonality of the exclusive service being rendered being shockwave therapy
combined with the involvement of The Darvish Law Firm concerns Progressive that the same
scheme set forth in the affidavit is being followed by this doctor.
21. Progressive found the W-9 being submitted for this Provider is dated 02/02/2023
which is after this MD began billing on 01/10/2023. It contains the lawyer's address, not an
address associated to this MD, and the attomey's address is on the AOBs being submitted to
Progressive, instead of an address for this doctor.
22. Progressive also discovered that Dr. De La Cruz was sanctioned in the state of New
Jersey in October of 2010 for quality-of-care issues, dishonorable, unethical, unprofessional
conduct, however, the NYS OPMC has no record of this disciplinary action. This calls into
question whether Dr. De La Cruz has failed to comply with reciprocity laws. Fathennore, at the
time of the investigation, Dr. De La Cruz was 84 years of age and prior to billing under his own
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name for ESWT, he never billed Progressive. He also has licenses in NY, GA, FL, and Puerto Rico
and filed a chapter 13 bankruptcy on 09/09/2020 that was discharged on 01/29/2021.
23. Progressive's investigation found the use of a signature stamp on billing submitted.
See below:
On Bill # 70298641 the following signature were observed on the AOB AND ESWT notes that
appears to be identical.
AOB:
(Signature of Provider)
ESWT Report:
Bill # 70317532 contains the same signatures:
AOB
(Signature of Proylder)
ESWT notes:
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If a signature stamp or pre-signed copied documents are being utilized, Progressive questions who
has the authority to use it. Progressive further questions how they can determine whether or not
Shin Mijung rendered any of the care.
24. Progressive's investigation discovered that this practice is receiving
Preview
FILED: NASSAU COUNTY CLERK 01/22/2024 11:55 AM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 RECEIVED NYSCEF: 01/22/2024 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NASSAU ------------------------------------------------------------------x PROGRESSIVE CASUALTY INSURANCE COMPANY, Plaintiff/Petitioner, - against - Index No.614817/2023 JUAN D. DELACRUZ MD Defendant/Respondent. ------------------------------------------------------------------x NOTICE OF ELECTRONIC FILING (Consensual Case) (Uniform Rule § 202.5-b) You have received this Notice because: 1) The Plaintiff/Petitioner, whose name is listed above, has filed this case using the New York State Courts E-filing system (“NYSCEF”), and 2) You are a Defendant/Respondent (a party) in this case. ! If you are represented by an attorney: Give this Notice to your attorney. (Attorneys: see “Information for Attorneys” pg. 2). ! If you are not represented by an attorney: You will be served with all documents in paper and you must serve and file your documents in paper, unless you choose to participate in e-filing. If you choose to participate in e-filing, you must have access to a computer and a scanner or other device to convert documents into electronic format, a connection to the internet, and an e-mail address to receive service of documents. The benefits of participating in e-filing include: ! serving and filing your documents electronically ! free access to view and print your e-filed documents ! limiting your number of trips to the courthouse ! paying any court fees on-line (credit card needed) To register for e-filing or for more information about how e-filing works: ! visit: www.nycourts.gov/efile-unrepresented or ! contact the Clerk’s Office or Help Center at the court where the case was filed. Court contact information can be found at www.nycourts.gov Page 1 of 2 EF-3 FILED: NASSAU COUNTY CLERK 01/22/2024 11:55 AM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 RECEIVED NYSCEF: 01/22/2024 To find legal information to help you represent yourself visit www.nycourthelp.gov Information for Attorneys An attorney representing a party who is served with this notice must either consent or decline consent to electronic filing and service through NYSCEF for this case. Attorneys registered with NYSCEF may record their consent electronically in the manner provided at the NYSCEF site. Attorneys not registered with NYSCEF but intending to participate in e-filing must first create a NYSCEF account and obtain a user ID and password prior to recording their consent by going to www.nycourts.gov/efile Attorneys declining to consent must file with the court and serve on all parties of record a declination of consent. For additional information about electronic filing and to create a NYSCEF account, visit the NYSCEF website at www.nycourts.gov/efile or contact the NYSCEF Resource Center (phone: 646-386-3033; e-mail: nyscef@nycourts.gov). Dated: 9/14/23 KEVIN A. MATTEI, ESQ. _______________________________ 1035 STEWART AVE. ________________________________ Name MCCORMACK, MATTEI & HOLLER GARDEN CITY, NY 11530 ______________________________ ________________________________ Firm Name Address 516-505-0600 _______________________________ Phone E-Mail To: 2/24/20 Index # Page 2 of 2 EF-3 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NASSAU ---------------------------------------------------------------X SUMMONS PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSEY INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY, PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESSIVE MAX INSURANCE COMPANY, Index: PROGRESSIVE SPECIALTY INSURANCE COMPANY AND UNITED FINANCIAL CASUALTY COMPANY, Plaintiff(s), -against- JUAN D. DELACRUZ MD, Defendant(s). ------------------------------------------------------------X TO THE ABOVE-NAMED DEFENDANTS: YOU ARE HEREBY SUMMONED to Answer the Complaint in this action and to serve a copy of your answer or, if the Complaint is not served with this Summons, to serve a Notice of Appearance, on the Plaintiff's Attorney(s) within twenty (20) days after the service of this Summons, exclusive of the day of service (or within thirty 30 days after the service is complete if this Summons is not personally delivered to you within the State of New York); and in case of your failure to appear, or Answer, judgment will be taken against you by default for the relief demanded in this Complaint. Dated: Garden City, New York September 13, 2023 Yours 9t McCO , MATTEI & HOLLER By: NICO I B. HOLLER, ESQ. Attorneys for Plaintiff 2nd 3rd 1035 Stewart Avenue, & PlOOrS Garden City, New York 11530 (516) 505-0600 x 224 File No.: Y-3007.dj TO2 JUAN D. DELACRUZ MD C/O D. DARVISH LAW 505 NORTHERN BOULEVARD #210 GREAT NECK, NEW YORK 11021 1 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NASSAU -------------------------------------X VERIFIED COMPLAINT PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSEY INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY, PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESSIVE MAX INSURANCE COMPANY, Index: PROGRESSIVE SPECIALTY INSURANCE COMPANY AND UNITED FINANCIAL CASUALTY COMPANY, Plaintiff(s), -against- JUAN D. DELACRUZ MD, Defendant(s). ____________________..-----------------X PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSY=EY INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY, PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESIVE MAX INSURANCE COMPANY, PROGRESSIVE SPECIALTY INSURANCE COMPANY AND "Plaintiff" UNITED FINANCIAL CASUALTY COMPANY, (hereinafter collectively or "PROGRESSIVE"), by and through their attorneys, McCORMACK, MATTEI & HOLLER, for their Verified Cornplaint in this action, hereby alleges as follows: 1. PROGRESSIVE CASUALTY INSURANCE COMPANY, DRIVE NEW JERSY=EY INSURANCE COMPANY, PROGRESSIVE ADVANCED INSURANCE COMPANY, PROGRESSIVE GARDEN STATE INSURANCE COMPANY, PROGRESIVE MAX INSURANCE COMPANY, PROGRESSIVE SPECIALTY INSURANCE COMPANY AND UNITED FINANCIAL CASUALTY COMPANY, are foreign corporations authorized to engage in the business of insurance in the State of New York, maintaining offices in the County of Nassau, State of New York and has transacted business in the State of New York. 2 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 2. Upon information and belief, Defendant UAN D. DELACRUZ MD, is purportedly an individual which is transacting or has transacted business in the State of New York. 3. Pursuant to Section 503(a) of the C.P.L.R., venue is appropriate in Nassau County based upon the residence of the Plaintiffs who maintain an office within the county. AS AND FOR A FIRST CAUSE OF ACTION 4. This action seeks a declaration that Plaintiff is under no obligation to reimburse Defendant for services purportedly rendered and billed to Progressive pursuant to the no-fault laws and regulations and the Insurance Law of the State of New York, based upon the Defendant's failure to satisfy conditions precedent to coverage or to verify their claims as required by law, and that Defendant may not collect against any patient-assignors personally and that any liens between the Defendant and the patients are null and void. 5. Defendant purports to provide medical services to persons who claim to be involved in motor vehicle losses in New York State. 6. Defendant purports to have obtained assignments of benefits from those persons who claim to be involved in motor vehicle losses in New York State, and based upon those assignments, Defendant submits billing to no-fault insurers for reimbursement for these medical supplies. 7. The State of New York requires, pursuant to Article 51, §5108 of the Insurance Law, that insurers provide no-fault insurance benefits to persons injured in automobile accidents regardless of fault. These benefits include medical services. 8. Plaintiff issues automobile insurance policies in the State of New York, which include No-Fault benefits. Under the No-Fault Laws, insureds can assign their rights to benefits to 3 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 providers of medically necessary treatment and tests. Pursuant to validly executed assignments, insurers are obligated to pay an insured's No-Fault benefits directly to the health care providers. 9. New York State Department of Insurance regulations provide that to be compensated under No-Fault, professional health services must be provided by a licensed provider within the scope of his or her license. 11 N.Y.C.R.R. & 11 N.Y.C.R.R. §65- §65.15(0)(1)(vi) 3.16(6). 10. Insurance Law §5102 et seq. requires no-fault insurers to reimburse patients for basic economic loss. Unlicensed or fraudulently licensed providers are ineligible for reimbursement under the authority of 11 NYCRR 65-3.16(a)(12) which provides that "A provider of health care services is not eligible for reimbursement under §5102 (a)(1) of the Insurance Law ." if the provider fails to meet any applicable New York State or local licensing requirement. . N.Y.3"1 11. The New York Court of Appeals in State Farm v. Mallela, 4 313, 827 N.E.2d 758, 794 N.Y.S.2d 700 (2005), confirmed that insurance carriers may withhold payment for medical services provided by fraudulently incorporated enterprises to which their patients have "doc-in-the-box" assigned their claims. This scheme occurs when a physician essentially sells his license to an unlicensed person or entity which truly owns and controls the medical facility. The profits do not go to the nominal physician-owner, but rather to the unlicensed lay persons. In Mallela, the Court of Appeals upheld 11 NYCRR 65-3.16(a)(12), which excludes from the loss" meaning of "basic economic payments made to unlicensed providers, thus rendering them ineligible for reimbursement. The Court of Appeals noted that the Superintendent of the Insurance Department's brief asserted that he promulgated this regulation to combat rapidly growing incidences of fraud in the no-fault regime, fraud that he has identified as correlative with the corporate practice of medicine by non-physicians. The Mallela Court rejected the argument that 4 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 the medical services ought to be reimbursed if they were actually provided by licensed medical professionals, despite the improper ownership and control of the facility by unlicensed lay persons. 12. The State of New York regulates the practice of medicine and other healthcare professions. It restricts the ownership of professional corporations to professionals licensed in the practice that the professional corporations are authorized to operate. The State does so in order to protect consumers and the public health. After incorporation, a professional corporation is subject to disciplinary proceedings and penalties in the same manner that a licensed owner is pursuant to BCL §1503. "physician" 13. The use of the title by one who is not a physician is prohibited by New York Education Law §6513. The practice of medicine by one who is not a physician is a felony pursuant to New York Education Law §6512. The sale of a medical license is also a felony under New York Education Law § 6512. Only doctors of medicine and of osteopathy are permitted to use the title of physician and are included in New York's Education Law authorizing the practice of medicine. N.Y. Education Law §§6522, 6524. 14. The practice of any profession in which a license is a prerequisite by persons not authorized is prohibited by New York Education Law § 6512. This statutory framework is designed to protect the public and to ensure that medical services are provided by licensed physicians. 15. Pursuant to Section 1504(a) of the New York State Business Corporation Law and regulations promulgated by the New York State Department of Health, professional service corporations may only render professional services through individuals authorized by law to render such professional services as individuals. Section 1507 of the Business Corporation Law of the State of New York prohibits a professional service corporation from issuing shares to individuals 5 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 corporation." unless they are "engaged in the practice of such profession in such It also prohibits such shareholder(s) from entering into any agreement with, granting proxies to or transferring control to individuals who are not authorized by law to practice the profession for which the professional corporation is authorized to practice. "All shares issued, agreements made, or proxies void." granted in violation of this section are 16. Pursuant to Section 1503(b) of the Business Corporation Law of the State of New York, a professional corporation is required to state the name and resident addresses of all individuals who are to be the original shareholders, directors and officers. Section 1503(a) of the Business Corporation Law allows only "individuals duly authorized by law to render the same service" professional to organize a professional service corporation for pecuniary profit. 17. New York's Insurance Department Regulations require that a health care provider submit certain information in order to be paid for a no-fault claim. This infonnation includes the name of the provider and the type of service provided. In addition, pursuant to the Department of Insurance Regulations, 11 N.Y.C.R.R. §65-3.16(6) health services must be provided by a licensed provider within the scope of his or her license in order to be compensated under the no-fault laws. 18. Progressive initiated an investigation into JUAN D. DELACRUZ MD after receipt of the submitted billing and attempted to verify ownership of the entity, corporate status and the rendering of services to PROGRESSIVE'S various insureds. 19. Progressive's investigation revealed that JUAN D. DELACRUZ MD has billing submitted by The Darvish Law Firm, with a billing address of 505 Northern Blvd Ste 210 Great Neck NY and service addresses at 1849 Utica Ave Brooklyn NY 11234 and 611 East 76 St Brooklyn NY 11236. 6 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 20. Progressive's investigation uncovered that this doctor is billing for shockwave therapy, (0101T) to the exclusion of any other service with billing being submitted by the Darvish Law Firm. Progressive recently obtained an affidavit from Inna Leytsenko NP in which she stated that she was recruited by Nicole Hidalgo to perform shockwave therapy. In fact, All Pro Billing 'Vadim' Solutions was submitting billing for Ms. Leytsenko, and she was introduced to a who was Inc," associated to a company called "Citiwide NY Funding Group who was paying her $1,500.00 a day to perform shockwave therapy. Vadim requested that she sign documents to enable bills to be submitted to insurance companies. At Vadim's directions, she did sign an escrow agreement with David Darvish PC, directing insurance payments for her services be paid to Citiwide, an escrow agreement with The Darvish Law Finn directing they pay All Pro's fees from the firm's IOLA Account and a retainer with The Darvish Law Firm. While it is unclear who is preparing these bills, the commonality of the exclusive service being rendered being shockwave therapy combined with the involvement of The Darvish Law Firm concerns Progressive that the same scheme set forth in the affidavit is being followed by this doctor. 21. Progressive found the W-9 being submitted for this Provider is dated 02/02/2023 which is after this MD began billing on 01/10/2023. It contains the lawyer's address, not an address associated to this MD, and the attomey's address is on the AOBs being submitted to Progressive, instead of an address for this doctor. 22. Progressive also discovered that Dr. De La Cruz was sanctioned in the state of New Jersey in October of 2010 for quality-of-care issues, dishonorable, unethical, unprofessional conduct, however, the NYS OPMC has no record of this disciplinary action. This calls into question whether Dr. De La Cruz has failed to comply with reciprocity laws. Fathennore, at the time of the investigation, Dr. De La Cruz was 84 years of age and prior to billing under his own 7 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 name for ESWT, he never billed Progressive. He also has licenses in NY, GA, FL, and Puerto Rico and filed a chapter 13 bankruptcy on 09/09/2020 that was discharged on 01/29/2021. 23. Progressive's investigation found the use of a signature stamp on billing submitted. See below: On Bill # 70298641 the following signature were observed on the AOB AND ESWT notes that appears to be identical. AOB: (Signature of Provider) ESWT Report: Bill # 70317532 contains the same signatures: AOB (Signature of Proylder) ESWT notes: 8 of 20 FILED: NASSAU COUNTY CLERK 01/22/2024 09/13/2023 11:55 01:57 AM PM INDEX NO. 614817/2023 NYSCEF DOC. NO. 9 1 RECEIVED NYSCEF: 01/22/2024 09/13/2023 If a signature stamp or pre-signed copied documents are being utilized, Progressive questions who has the authority to use it. Progressive further questions how they can determine whether or not Shin Mijung rendered any of the care. 24. Progressive's investigation discovered that this practice is receiving