FILED: NEW YORK COUNTY CLERK 03/13/ :08 PM INDEX NO /2016 NYSCEF DOC. NO. 60 RECEIVED NYSCEF: 03/13/2017

Transcription

1 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 1 of 73 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK X Case # MARK SHAPIRO, Plaintiff, -v- DANIEL SACHS GOLDMAN, NICHOLAS MCQUAID, PREET BHARARA, THE OFFICE OF THE UNITED STATES ATTORNEY: SOUTHERN DISTRICT OF NEW YORK, THE FEDERAL BUREAU OF INVESTIGATION, THE UNITED STATES DEPARTMENT OF JUSTICE, THE UNITED STATES OF AMERICA, THE CITY OF NEW YORK, THE OFFICE OF THE DISTRICT ATTORNEY OF NEW YORK COUNTY, THE NEW YORK CITY POLICE DEPARTMENT, THE NATIONAL INSURANCE CRIME BUREAU, ANTHONY TARDALO, RIVKIN RADLER, LLP, BARRY I. LEVY, MICHAEL A. SIRIGNANO, DALLAS REGAN, GOVERNMENT EMPLOYEES INSURANCE COMPANY, GEICO GENERAL INSURANCE COMPANY, GEICO INDEMNITY INSURANCE COMPANY, PROGRESSIVE CASUALTY INSURANCE COMPANY, NATIONWIDE MUTUAL INSURANCE COMPANY, METLIFE INSURANCE COMPANY, METROPOLITAN REINSURANCE COMPANY, METROPOLITAN CASUALTY INSURANCE COMPANY, METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY, METROPOLITAN GENERAL INSURANCE COMPANY, STATE FARM FIRE AND CAUSALTY INSURANCE COMPANY, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, ALLSTATE INSURANCE COMPANY, ALLSTATE PROPERTY AND CASUALTY INSURANCE COMPANY, LIBERTY MUTUAL INSURANCE COMPANY, LIBERTY MUTUAL FIRE INSURANCE COMPANY, TRAVELERS INDEMNITY COMPANY, TRAVELERS HOME AND MARINE INSURANCE COMPANY, REPWEST INSURANCE COMPANY, Page 1 of 73

2 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 2 of 73 21ST CENTURY INSURANCE AND FINANCAL SERVICE, 21ST CENTURY INSURANCE COMPANY, AIG ADVANTAGE INSURANCE COMPANY, TRUCK INSURANCE EXCHANGE, FARMERS INSURANCE COMPANY, and FARMERS NEW CENTURY INSURANCE COMPANY, Defendants X COMPLAINT Plaintiff Mark Shapiro ( Dr. Shapiro and/or Plaintiff ), by and through his attorneys, Davidoff Law Firm, P.L.L.C., complaining of Defendants Daniel Sachs Goldman ( Goldman ), Nicholas McQuaid ( McQuaid ), Preet Bharara, ( Bharara ), the Office of the United States Attorney: Southern District of New York ( SDNY ), the Federal Bureau of Investigation ( FBI ), the United States Department of Justice ( USDOJ ), the United States of America (the "United States"), the City of New York (the City ), the Office of the District Attorney of New York County ( DANY ), the New York City Police Department ( NYPD ) (Goldman, McQuaid, Bharara, SDNY, FBI, USDOJ, the United States, the City, DANY, and NYPD collectively "Government Defendants"), the National Insurance Crime Bureau ( NICB ), Anthony Tardalo, Esq. ("Tardalo"), Dallas Regan ( Regan ), Rivkin Radler, LLP, ( Rivkin Radler ), Barry I. Levy, Esq. ("Levy"), Michael A. Sirignano, Esq. ("Sirignano") (NICB, Tardalo, Regan, Rivkin Radler, Levy, and Sirignano collectively "Ringleaders"), Government Employees Insurance Company ( GEICO ), GEICO General Insurance Company ("GEICO General"), GEICO Indemnity Insurance Company ("GEICO Indemnity") (GEICO, GEICO General, and GEICO Indemnity collectively "GEICO Defendants"), Progressive Casualty Insurance Company ("Progressive"), Nationwide Mutual Insurance Company ("Nationwide"), Page 2 of 73

3 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 3 of 73 MetLife Insurance Company ("MetLife"), Metropolitan Reinsurance Company ("Metropolitan Reinsurance"), Metropolitan Casualty Insurance Company ("Metropolitan Casualty"), Metropolitan Property and Casualty Insurance Company ("Metropolitan Property"), Metropolitan General Insurance Company ("Metropolitan General") (Metropolitan Reinsurance, Metropolitan Casualty, Metropolitan Property, and Metropolitan General collectively "Metropolitan Defendants"), State Farm Fire and Casualty Insurance Company ("State Farm Fire"), State Farm Mutual Automobile Insurance Company ("State Farm Auto")(State Farm Fire and State Farm Auto collectively "State Farm Defendants"), Allstate Insurance Company ("Allstate"), Allstate Property and Casualty Insurance Company ("Allstate Property") (Allstate and Allstate Property collectively "Allstate Defendants"), Liberty Mutual Insurance Company ("Liberty Mutual"), Liberty Mutual Fire Insurance Company ("Liberty Mutual Fire") (Liberty Mutual and Liberty Mutual Fire collectively "Liberty Mutual Defendants"), Travelers Indemnity Company ("Travelers"), Travelers Home and Marine Insurance Company ("Travelers Home") (Travelers and Travelers Home collectively "Travelers Defendants"), Repwest Insurance Company ("Repwest"), 21st Century Insurance and Financial Service ("21st Century Financial"), 21st Century Insurance Company ("21st Century")(21st Century Financial and 21st Century collectively "21st Century Defendants"), AIG Advantage Insurance Company ("AIG"), Truck Insurance Exchange ("Truck Insurance"), Farmers Insurance Company ("Farmers"), and Farmers New Century Insurance Company ("Farmers New Century")(Farmers and Farmers New Century collectively "Farmers Defendants"), (GEICO Defendants, Progressive, Nationwide, MetLife, Metropolitan Defendants, State Farm Defendants, Allstate Defendants, Liberty Mutual Defendants, Travelers Defendants, Repwest, 21st Century Defendants, AIG, Truck Insurance, Page 3 of 73

4 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 4 of 73 and Farmers Defendants collectively the Defendant Insurance Companies ) for conspiring to deprive Dr. Shapiro of his rights associated with the Fourth, Fifth, and Fourteenth amendments to the United States Constitution. Such parties conspired to, and in fact did, deprive Dr. Shapiro of such Constitutional rights through malicious prosecution, abuse of process, tortious interference with business relations and contracts, defamation, and slander per se. 1 The Government Defendants prosecuted Dr. Shapiro for political, greedy, and malicious purposes, which were fabricated by and only benefited the Ringleaders and Defendant Insurance Companies. In short, Dr. Shapiro was the victim of an overzealous and groundless prosecution. JURISDICTION AND VENUE 1. This Court has subject matter jurisdiction over the parties as Plaintiff alleges that each Defendant acted and conspired to deprive Plaintiff of rights granted to him under the Constitution of the United States of America. Pursuant to 28 U.S.C. 1331(a), the Court has jurisdiction over Defendants for any such claims arising under the Constitution of the United States of America. See also, 28 U.S.C. 1343; 28 U.S.C. 1346; 28 U.S.C. 2201; and 28 U.S.C By two letters dated March 6, 2014 and March 7, 2014, the USDOJ informed Dr. Shapiro that it is in receipt of his notice letter, but it failed to further respond to his administrative claims under the Federal Tort Claims Act ( FTCA ), and further respond after advising Dr. Shapiro's counsel it had too many cases. Dr. Shapiro has thus exhausted his 1 Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971). Page 4 of 73

5 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 5 of 73 administrative remedies for purposes of his claims under the FTCA, as more than six (6) months has passed since such letter was sent. See 28 U.S.C. 2675, By letter dated March 13, 2014, the City informed Dr. Shapiro that it is in receipt of his notice of claim. 4. Venue is proper in the Southern District of New York because a substantial portion of the events complained of and giving rise to Plaintiff s claims occurred in this District, including the fact that Plaintiff was maliciously prosecuted in the Southern District of New York. See 28 U.S.C. 1391(b)(2), 1391(e)(1)(B), 1402(b). THE PARTIES 5. Plaintiff, Dr. Mark Shapiro, is an individual who resides in the Town of Lawrence, County of Nassau, and State of New York. 6. Defendant Daniel Sachs Goldman was and is believed to be an Assistant United States Attorney who was assigned to be the lead prosecutor and investigator of Dr. Shapiro s case, United States of America v. Mark Shapiro, et al., 12-cr JPO (SDNY) (the "Case"). Upon information and belief, Goldman, along with his cohort, McQuaid, was responsible for the investigation of Dr. Shapiro s alleged participation in the alleged health care fraud conspiracy, and presented evidence to the grand jury to indict Dr. Shapiro. Dr. Shapiro brings the instant action against Goldman and McQuaid in their individual capacity, as well as in their capacity as an Assistant United States Attorneys at the SDNY. Goldman and McQuaid knew during the investigation that there was no evidence to support any criminal or civil claims against Dr. Shapiro. Page 5 of 73

6 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 6 of Defendant Nicholas McQuaid was an Assistant United States Attorney assigned to Dr. Shapiro s case. McQuaid had the responsibility of investigating and then prosecuting Dr. Shapiro s alleged participation in the alleged health care fraud conspiracy, and upon information and belief, presented evidence to the grand jury to indict Dr. Shapiro. McQuaid was overly vindictive and even threatened Dr. Shapiro with additional charges if he continued working in the medical profession, even though a hearing was conducted and the magistrate judge unequivocally permitted Dr. Shapiro to continue working in his profession and producing affirmations of his findings from his review of MRIs. McQuaid left his position at the SDNY, and, upon information and belief, as compensation for his work on Dr. Shapiro s criminal case, McQuaid was offered (and he accepted) a position as Associate Counsel with the White House under President Barack Obama. It should be noted that under the Barack Obama presidential administration, most of the insurance companies have overall increased in value exponentially as a result of the President s policies, including the approval of prosecutions such as the one brought against Dr. Shapiro. Dr. Shapiro brings the instant action against McQuaid in his individual capacity, as well as in his capacity as an Assistant United States Attorney at the SDNY. 8. Defendant Preet Bharara was and is the United States Attorney for the SDNY and was responsible for the oversight and supervision of all investigations and prosecutions in the SDNY, including Dr. Shapiro s case. Dr. Shapiro brings the instant action against Bharara in his individual capacity, as well as in his capacity as the United States Attorney of the SDNY. Bharara permitted Dr. Shapiro's case to be investigated and then maliciously prosecuted to gain headlines and to pad the Defendant Insurance Companies' wallets. Defendant Bharara issued a Page 6 of 73

7 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 7 of 73 press release (issued jointly by Defendants USDOJ, SDNY, FBI, and NYPD) on February 29, 2012 ("Press Release") that named Dr. Shapiro and further caused Dr. Shapiro both emotional and financial harm and damages. 9. Defendant the SDNY is an agency within the USDOJ, located at 500 Pearl Street, New York, NY 10007, responsible for the investigation and prosecution of criminal cases in the Southern District of New York on behalf of the United States. The SDNY was responsible for, directed and participated in investigating Dr. Shapiro s alleged participation in an alleged health care fraud conspiracy, with assistance from the NICB, the FBI, and the USDOJ, as well as the NYPD, DANY, the individual Defendants named herein and the Defendant Insurance Companies. The SDNY issued the joint Press Release that named Dr. Shapiro and further caused Dr. Shapiro both emotional and financial harm and damages. 10. Defendant the FBI is an agency within the USDOJ that is responsible for investigating and gathering intelligence and information for criminal proceedings, as well as seeking warrants, executing arrests, and administering certain databases that contain and are used to disseminate arrest, detention and other records. The FBI was responsible for investigating Dr. Shapiro s alleged participation in an alleged health care fraud conspiracy, with assistance from the NICB, SDNY, and the USDOJ, as well as the NYPD, DANY, the individual Defendants named herein and the Defendant Insurance Companies. Defendant FBI also issued the joint Press Release that named Dr. Shapiro and further caused Dr. Shapiro both emotional and financial harm and damages. 11. Defendant the USDOJ is a federal agency authorized by federal statute to investigate criminal conduct, make arrests, impose conditions of confinement, and to administer Page 7 of 73

8 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 8 of 73 and maintain various databases that contain and are used to disseminate arrest, detention, and other records. The USDOJ was responsible for investigating Dr. Shapiro s alleged participation in an alleged health care fraud conspiracy, with assistance from the NICB, the FBI, SDNY, as well as the NYPD, DANY, the individual Defendants named herein and the Defendant Insurance Companies. The USDOJ issued the joint Press Release that named Dr. Shapiro and further caused Dr. Shapiro both emotional and financial harm and damages. 12. Defendant the United States is sued under the FTCA, 28 U.S.C. 1346, for tortious acts of its employees committed against Dr. Shapiro. 13. Defendant the City of New York is sued for tortious acts of its employees committed against Dr. Shapiro. 14. Defendant DANY is a municipal agency responsible for prosecuting criminal cases in the County of New York, City of New York, in the State of New York. DANY was also responsible for assisting the NYPD, FBI, SDNY, USDOJ, and the NICB in investigating and prosecuting Dr. Shapiro s alleged participation in an alleged health care fraud scheme. DANY was named in the Press Release as a participant in the investigation that led to the indictment and arrest of Dr. Shapiro. 15. Defendant the NYPD is a municipal agency in the State of New York, City of New York, and was responsible for assisting DANY, FBI, SDNY, USDOJ, and the NICB in investigating and prosecution of Dr. Shapiro s alleged participation in an alleged health care fraud conspiracy. Defendant NYPD also issued the joint Press Release that named Dr. Shapiro and further caused Dr. Shapiro both emotional and financial harm and damages. Page 8 of 73

9 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 9 of Defendant the NICB is a not-for-profit corporation, incorporated under the laws of the State of Illinois. The NICB is made up of members (insurance companies) including the Defendant Insurance Companies. The NICB is tasked with influence law enforcement to maximize the profits of its members and other insurance companies. The NICB was responsible for assisting the SDNY, the USDOJ, the FBI, as well as the NYPD and DANY in the investigation of Dr. Shapiro s alleged participation in an alleged health care fraud scheme. The NICB wrote reports on subjects of investigation, gathered intelligence and materials in aid of the investigation, and otherwise acted in furtherance of its constituents interests during the course of the investigation and prosecution of Dr. Shapiro. 2 The NICB s goal is to maximize profits for its members, at all costs, even at the malicious prosecution of medical providers and other individuals. Upon information and belief, the NICB uses tactics such as claiming to be government entities, claiming to be law enforcement, and using coercive conduct to influence and pressure government entities to bring forth criminal and civil investigations and charges that only benefit the NICB membership and their profits. The NICB was named in the Press Release as a participant in the investigation that led to the indictment and arrest of Dr. Shapiro. 17. Defendant Anthony Tardalo was and is believed to still be an employee of the NICB and, upon information and belief, held the position of Supervisory Special Agent. Upon information and belief, Tardalo was responsible for investigating Dr. Shapiro on behalf of the NICB, and personally assisted in the investigation of Dr. Shapiro by providing reports and other materials to members of the SDNY, FBI, USDOJ, as well as the NYPD and DANY. Upon 2 For a complete list of the NICB s active members, visit Page 9 of 73

10 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 10 of 73 information and belief, Tardalo used coercive conduct to influence the Government Defendants to bring charges against Dr. Shapiro. 18. Defendant Dallas Regan was, upon information and belief, employed by Farmers Insurance as a Senior Special Investigator/Analyst. Upon information and belief, Regan was responsible for assisting the NICB, the Defendant Insurance Companies, the FBI, and members of the SDNY in their investigation of Dr. Shapiro, and Regan's improper conduct led to Dr. Shapiro being maliciously prosecuted. 19. Defendant Rivkin Radler is a Limited Liability Partnership formed under the laws of the State of New York, with its principal executive office/principal place of business at 926 RXR Plaza, Uniondale, New York, On its website ( Rivkin Radler describes itself as "dedicated to fighting healthcare fraud [that] has saved insurers hundreds of millions of dollars, and led to decisions that will continue to benefit clients for years to come." Rivkin Radler represents numerous members of the NICB, and upon information and belief was influential in coercing the Government Defendants to bring the charges against Dr. Shapiro, which caused significant harm to Dr. Shapiro, when Rivkin Radler knew that Dr. Shapiro committed no crimes and was not involved in any fraud or conspiracy to commit fraud. 20. Defendant Barry I. Levy, Esq. is an attorney and member of Rivkin Radler who was responsible for litigating actions against Dr. Shapiro in or about 2010 on behalf of his and Rivkin Radler s clients, including: State Farm, Travelers, and GEICO. Upon information and belief, Levy was involved with the NICB s investigation of Dr. Shapiro 3, and used coercive 3 Levy lists the following case involving Dr. Shapiro as a significant decision on his Rivkin Radler website profile ( "Liberty Mut. Ins. Co. v. Excel Imaging, P.C., 879 F. Supp. 2d 243 (E.D.N.Y. 2012) (denying motion seeking Page 10 of 73

11 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 11 of 73 conduct to influence the Government Defendants to bring forth the malicious criminal case against Dr. Shapiro. 21. Defendant Michael A. Sirignano, Esq. is an attorney and member of Rivkin Radler who was responsible for litigating actions against Dr. Shapiro in or about 2010 on behalf of Rivkin Radler s clients: State Farm, Travelers, and GEICO. Upon information and belief, Defendant Sirignano was involved in the NICB s investigation of Dr. Shapiro, 4 and used coercive conduct to influence the Government Defendants to bring forth the malicious criminal case against Dr. Shapiro. 22. Defendant GEICO is a corporation formed under the laws of Maryland, with its principal executive office/principal place of business at 5260 Western Avenue, Chevy Chase, MD GEICO Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, GEICO Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. GEICO Defendants are alleged to have been a victim dismissal of insurers civil RICO and fraud claims against professional corporation alleged to have operated in violation of state licensing laws and staying the professional corporation s attempts to collect on its pending billing through arbitration)." 4 Sirignano claims on his Rivkin Radler website profile ( ) that his experience includes "acting as lead counsel for insurers in a wide variety of matters, including [supervising] the defense of no fault claims, [counseling] property, automobile and healthcare insurers on fraud prevention, [defending] litigation challenging claims handling practices, and [prosecuting] affirmative recovery litigation in both federal and state court." Sirignano claims to have "headed the investigation into several large scale fraud schemes and has led the successful prosecution of a number of large recovery actions on behalf of insurers." Id. Page 11 of 73

12 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 12 of 73 of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. GEICO Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. GEICO Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 23. Defendant GEICO General Insurance Company is a corporation formed under the laws of Maryland, with its principal office/principal place of business located at 5260 Western Avenue, Chevy Chase, MD GEICO General Insurance Company, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with its claim-avoidance protocol. GEICO Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, GEICO Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. GEICO Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. GEICO Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. GEICO Page 12 of 73

13 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 13 of 73 Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 24. Defendant GEICO Indemnity Insurance Company is a corporation formed under the laws of Maryland, with its principal executive office/principal place of business at 5260 Western Avenue, Chevy Chase, MD GEICO Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, GEICO Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. GEICO Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. GEICO Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. GEICO Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 25. Defendant Progressive Casualty Insurance Company is a corporation formed under the laws of Ohio, with its principal executive office/principal place of business at 6300 Wilson Mills Road, W33, Mayfield Village, OH Progressive is an insurance company that was and is engaged in issuing insurance policies in the State of New York, where it regularly conduct business in, including but not limited to, the no-fault insurance business. Upon Page 13 of 73

14 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 14 of 73 information and belief, Progressive denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Progressive is alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Progressive, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Progressive, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 26. Defendant Nationwide Mutual Insurance Company is a corporation formed under the laws of Ohio, with its principal executive office/principal place of business at One Nationwide Plaza, Columbus, OH Nationwide is an insurance company that was and is engaged in issuing insurance policies in the State of New York, where it regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Nationwide denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Nationwide is alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Nationwide, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages Page 14 of 73

15 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 15 of 73 from Dr. Shapiro. Nationwide, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 27. Defendant Metropolitan Reinsurance Company is a corporation formed under the laws of Delaware, with its principal executive office/principal place of business at 700 Quaker Lane, Warwick, RI Metropolitan Reinsurance Company, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with its claim-avoidance protocol. Metropolitan Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Metropolitan Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Metropolitan Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Metropolitan Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Metropolitan Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. Page 15 of 73

16 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 16 of Defendant Metropolitan Casualty Insurance Company is a corporation formed under the laws of Rhode Island, with its principal executive office/principal place of business at 700 Quaker Lane, Warwick, RI Metropolitan Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Metropolitan Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Metropolitan Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Metropolitan Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Metropolitan Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 29. Defendant Metropolitan Property and Casualty Insurance Company is a corporation formed under the laws of Rhode Island, with its principal executive office/principal place of business at 700 Quaker Lane, Warwick, RI Metropolitan Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Metropolitan Defendants denied claims Page 16 of 73

17 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 17 of 73 submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Metropolitan Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Metropolitan Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Metropolitan Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 30. Defendant Metropolitan General Insurance Company is a corporation formed under the laws of Rhode Island, with its principal executive office/principal place of business at 700 Quaker Lane, Warwick, RI Metropolitan Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Metropolitan Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Metropolitan Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Metropolitan Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking Page 17 of 73

18 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 18 of 73 restitution through the criminal court, including monetary damages from Dr. Shapiro. Metropolitan Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 31. Defendant State Farm Fire and Casualty Insurance Company is a corporation formed under the laws of Illinois, with its principal executive office/principal place of business at One State Farm Plaza, Bloomington, IL State Farm Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, State Farm Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. State Farm Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. State Farm Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. State Farm Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 32. Defendant State Farm Mutual Automobile Insurance Company is a corporation formed under the laws of Illinois, with its principal executive office/principal place of business at One State Farm Plaza, Bloomington, IL State Farm Defendants are insurance companies Page 18 of 73

19 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 19 of 73 that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, State Farm Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. State Farm Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. State Farm Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. State Farm Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 33. Defendant Allstate Insurance Company is a corporation formed under the laws of Illinois, with its principal executive office/principal place of business at 2775 Sanders Road, Northbrook, IL Allstate Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Allstate Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Allstate Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Allstate Defendants, Page 19 of 73

20 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 20 of 73 along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Allstate Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 34. Defendant Allstate Property and Casualty Insurance Company is a corporation formed under the laws of Illinois, with its principal executive office/principal place of business at 3075 Sanders Road, Ste H1A, Northbrook, IL Allstate Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Allstate Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Allstate Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Allstate Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Allstate Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 35. Defendant Liberty Mutual Insurance Company is a corporation formed under the laws of Wisconsin, with its principal executive office/principal place of business at 175 Berkeley Page 20 of 73

21 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 21 of 73 Street, Boston, MA Liberty Mutual Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Liberty Mutual Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Liberty Mutual Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Liberty Mutual Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Liberty Mutual Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 36. Defendant Liberty Mutual Fire Insurance Company is a corporation formed under the laws of Wisconsin, with its principal executive office/principal place of business at 175 Berkeley Street, Boston, MA Liberty Mutual Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Liberty Mutual Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Liberty Mutual Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct Page 21 of 73

22 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 22 of 73 by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Liberty Mutual Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Liberty Mutual Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol Defendant Travelers Indemnity Company is a corporation formed under the laws of Connecticut, with its principal executive office/principal place of business at One Tower Square, Hartford, CT Travelers Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Travelers Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Travelers Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Travelers Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Travelers Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. Page 22 of 73

23 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 23 of Defendant Travelers Home and Marine Insurance Company is a corporation formed under the laws of Connecticut, with its principal executive office/principal place of business at One Tower Square, Hartford, CT Travelers Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Travelers Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Travelers Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Travelers Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Travelers Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 39. Defendant Repwest Insurance Company is a corporation formed under the laws of Arizona, with its principal executive office/principal place of business at 2721 North Central Avenue, Phoenix, AZ Repwest is an insurance company that was and is engaged in issuing insurance policies in the State of New York, where it regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Repwest denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to Page 23 of 73

24 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 24 of 73 concede medical practices and businesses. Repwest is alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Repwest, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Repwest, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 40. Defendant 21st Century Insurance and Financial Service is a corporation formed under the laws of Delaware, with its principal executive office/principal place of business at 3 Beaver Valley Road, Wilmington, DE st Century Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, 21st Century Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. 21st Century Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. 21st Century Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. 21st Century Defendants, together with the NICB, are responsible for flagging, investigating, and Page 24 of 73

25 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 25 of 73 denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 41. Defendant 21st Century Insurance Company is a corporation formed under the laws of Delaware, with its principal executive office/principal place of business at 3 Beaver Valley Road, Wilmington, DE st Century Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, 21st Century Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. 21st Century Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. 21st Century Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. 21st Century Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 42. Defendant AIG Advantage Insurance Company is a corporation formed under the laws of Delaware, with its principal executive office/principal place of business at 3 Beaver Valley Road, Wilmington, DE AIG is an insurance company that was and is engaged in issuing insurance policies in the State of New York, where it regularly conduct business in, Page 25 of 73

26 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 26 of 73 including but not limited to, the no-fault insurance business. Upon information and belief, AIG denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. AIG is alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. AIG, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. AIG, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 43. Defendant Truck Insurance Exchange is a corporation formed under the laws of California, with its principal executive office/principal place of business at 4680 Wilshire Boulevard, Los Angeles, CA Truck Insurance is an insurance company that was and is engaged in issuing insurance policies in the State of New York, where it regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Truck Insurance denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Truck Insurance is alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Truck Insurance, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages Page 26 of 73

27 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 27 of 73 from Dr. Shapiro. Truck Insurance, together with the NICB, is responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 44. Defendant Farmers Insurance Company is a corporation formed under the laws of Kansas, with its principal executive office/principal place of business at West 119th Street, Olathe, KS Farmers Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct business in, including but not limited to, the no-fault insurance business. Upon information and belief, Farmers Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Farmers Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Farmers Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Farmers Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. 45. Defendant Farmers New Century Insurance Company is a corporation formed under the laws of Illinois, with its principal executive office/principal place of business at 2245 Sequoia Drive, Aurora, IL Farmers Defendants are insurance companies that were and are engaged in issuing insurance policies in the State of New York, where they regularly conduct Page 27 of 73

28 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 28 of 73 business in, including but not limited to, the no-fault insurance business. Upon information and belief, Farmers Defendants denied claims submitted by Dr. Shapiro and other medical professionals and entities that were proper claims, all in an attempt to overly burden and persuade medical professionals to concede medical practices and businesses. Farmers Defendants are alleged to have been a victim of Dr. Shapiro s alleged fraudulent conduct by the Government Defendants in the criminal case, which was ultimately nolle prosequi by the Government. Farmers Defendants, along with the other Defendant Insurance Companies, were the alleged victims of Dr. Shapiro s fraud, which they were seeking restitution through the criminal court, including monetary damages from Dr. Shapiro. Farmers Defendants, together with the NICB, are responsible for flagging, investigating, and denying its claimants requests for reimbursement, in accordance with their claim-avoidance protocol. FACTUAL BACKGROUND A. INTRODUCTION 46. The Government Defendants agreed and conspired with the Ringleaders and Defendant Insurance Companies to cooperate and act in concert to deprive Dr. Shapiro of his constitutional right to be free from depravation of liberty and property without due process (Fifth and Fourteenth Amendment), and further deprived Dr. Shapiro of his constitutional right to associate (First Amendment). 47. Specifically, the Government Defendants, Ringleaders, and Defendant Insurance Companies fabricated a claim that Dr. Shapiro participated with and was a member of Russian organized crime involved in a conspiracy to commit healthcare fraud. Page 28 of 73

29 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 29 of The indictment obtained against Dr. Shapiro was based solely on the misrepresentations of the Government Defendants, Ringleaders, and Defendant Insurance Companies. The false allegation asserted against Dr. Shapiro was that he prepared radiology reports finding injuries that were not present in the corresponding radiology films. Such false allegation was concocted by the Government Defendants, Ringleaders, and Defendant Insurance Companies and was not supported by any evidence, and was contradicted by the evidence that the Government Defendants, Ringleaders, and Defendant Insurance Companies did have. 49. The Government Defendants, Ringleaders, and investigative units of the Defendant Insurance Companies investigated third parties, who Dr. Shapiro was indirectly associated with, and in pursuing criminal charges against these third parties, the Government Defendants maliciously prosecuted Dr. Shapiro, which resulted in the Government s dismissal of the indictment against him on December 30, 2013, via the Court entering the nolle prosequi at the Government s request. 50. The complete lack of evidence to support the Government s claim, coupled with the fact that the Government conceded that Dr. Shapiro was not involved in the conspiracy to commit healthcare fraud that was at the center of the indictment, led the Government to dismiss all of the charges against Dr. Shapiro in the face of a pending motion to dismiss, on the eve of trial. The dismissal came after almost two years of the Government Defendants intentionally terrorizing, defaming and slandering Dr. Shapiro in the media, in public records, and in the courtroom without an ounce of evidence to support its allegations. 51. The investigation and prosecution of Dr. Shapiro was conducted by the Government Defendants with the assistance (and pressure and insistence) of the NICB, Tardalo, Page 29 of 73

30 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 30 of 73 and the Defendant Insurance Companies, for the sole purposes of furthering the NICB and several of its members (including the Defendant Insurance Companies) egregious claimavoidance protocol, i.e., to avoid paying valid claims for medical services that had been properly rendered, as well as to further the general business interests of the Defendant Insurance Companies and the NICB. Thus, the conspiracy and collusive effort of the Government Defendants, Ringleaders, and Defendant Insurance Companies led to an investigation driven and tainted by malice. 52. The goal of such conspiracy was to convert and exploit state civil regulations into criminal misconduct so as to further intimidate physicians and other medical professionals in the future. Thus, the arrest and malicious prosecution of Dr. Shapiro was done to appease the NICB and the Defendant Insurance Companies and for purposes of the Government Defendants' own self-aggrandizement. 53. The Government Defendants, upon information and belief, were also influenced and pressured by the law firm Rivkin Radler, who has among their list of clients the largest of the Defendant Insurance Companies and who overzealously pursues the claim-avoidance protocol on behalf of such clients in civil courts in the State of New York, including in the past against Dr. Shapiro. Upon information and belief, Rivkin Radler put undue pressure and threatened to go on a negative public relations campaign against the Government Defendants if they did not prosecute Dr. Shapiro. 54. The Government Defendants, Ringleaders, and Defendant Insurance Companies concocted a theory supported by no evidence and contradicted by exculpatory evidence, and Page 30 of 73

31 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 31 of 73 exaggerated their alleged loss amounts to obtain an indictment against Dr. Shapiro leading to his arrest and prosecution. 55. The meritless claims asserted by the Government required Dr. Shapiro to incur almost a half million dollars to defend his name, reputation, and career. This has placed Dr. Shapiro on the brink of financial ruin as he incurred enormous financial damages, suffered a ruined career, and had his name defamed. Even though the Indictment was ultimately dismissed, the resultant damages incurred by Dr. Shapiro are irreparable. 56. Thus, the Government Defendants, Ringleaders, and Defendant Insurance Companies did act overtly to inflict said constitutional injuries in furtherance of the goals of the conspiracy, and, in fact, damaged Dr. Shapiro. B. THE INDICTMENT AND ARREST OF DR. SHAPIRO, AND THE FOLLOWING PRESS RELEASES BY THE GOVERNMENT DEFENDANTS, INFLICT MAXIMUM DAMAGE UPON DR. SHAPIRO S REPUTATION AND PROFESSIONAL LIVELIHOOD 57. Dr. Shapiro is a board certified radiologist who maintained employment as a radiologist who reviewed radiology films with the same employer since Dr. Shapiro also reviewed MRI films for other radiology facilities throughout the course of his employment with his employer, all with the consent and knowledge of his employer. Dr. Shapiro never visited the other radiology facilities, but merely would review MRI films that were delivered to him, and he would issue a report as to his findings from his review of each MRI. 59. On February 29, 2012, Dr. Shapiro was arrested pursuant to an unsealed Indictment. Dr. Shapiro was handcuffed outside of his residence in Brooklyn, New York, and Page 31 of 73

32 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 32 of 73 was taken into custody by, upon information and belief, members of the SDNY, FBI, NYPD and other law enforcement entities. Dr. Shapiro was in his sleeping attire and was not permitted to dress or put a coat on. Dr. Shapiro was then taken to the Fort Hamilton Veteran's Affairs hospital in Brooklyn where most, if not all of the local arrestees from the unsealed indictment were brought for processing. Goldman and McQuaid were seen wearing jackets labeled FBI while participating in the arrest of Dr. Shapiro and others. 60. Dr. Shapiro was one of thirty-six (36) defendants named in the unsealed Indictment (the Indictment ) issued by the U.S. District Court for the Southern District of New York, which alleged that Dr. Shapiro was a co-conspirator involved in a $279 million scheme to defraud no-fault automobile insurers. 5 Dr. Shapiro was specifically charged with conspiracy to commit healthcare fraud and conspiracy to commit mail fraud. Dr. Shapiro pled not guilty to both charges. 61. The Indictment was void of any specific, or even general, acts that Dr. Shapiro committed in furtherance of the allegations of conspiracy to commit healthcare fraud and mail fraud. 62. The joint Press Release issued by the USDOJ, SDNY, FBI, and NYPD in conjunction with the filing of the Indictment, proudly billed the case as the largest no-fault insurance fraud prosecution in history, and highlighted the arrest of ten doctors connected with the alleged scheme. The joint Press Release, which was subsequently quoted in multiple media outlets (including New York newspapers), provided details of the alleged fraudulent incorporation of multiple medical facilities and alleged the co-conspirators involvement with 5 The case caption is United States v. Michael Zemylansky, et al., 12-cr-171 (JPO). Page 32 of 73

33 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 33 of 73 Russian organized crime. The press release remains on the websites of the USDOJ and FBI as of the filing of this Complaint. 63. As noted in the joint Press Release, Bharara stated the scheme relied on a cadre of corrupt doctors who essentially peddled their medical licenses like a corner fraudster might sell fake ID s, and NYPD Commissioner Ray Kelly commented on the assistance NYPD undercover officers provided in the investigation. Specifically, the joint Press Release congratulated the NYPD and FBI, and further thanked the NICB, DANY, "and the investigative units of the insurance companies that provided invaluable assistance with the investigation." 64. According to the Indictment and the joint Press Release, the Government alleged, without specification to Dr. Shapiro s involvement, a wide-spread conspiracy to commit no-fault insurance fraud. The Indictment alleged that non-physicians were paying physicians to use their names on paperwork filed with the State of New York Secretary of State to establish medical professional corporations ("PCs") and other entities in the greater New York City area (mainly Brooklyn), which specialized in the treatment of patients involved in no-fault automobile accidents. These claims were asserted by the Government, represented by Goldman and McQuaid, at Dr. Shapiro s initial hearing, where the Goldman and McQuaid successfully argued to restrict Dr. Shapiro s freedoms and professional opportunities. Dr. Shapiro posted cash bail in the amount of $15, and was forced to place a $500, lien against his residence. 65. In short, the Government alleged that once the PCs were established under the facially valid cover of the nominal physician-owners, the non-physicians actually owned and operated the companies, and accordingly took the largest share of any profits. Allegedly, to maintain the appearance that the physicians owned the entities, the non-physicians caused the Page 33 of 73

34 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 34 of 73 PCs to contract with management companies (allegedly owned by the non-physicians), providing for the payment of exorbitant fees for routine services. The Government further alleged that these management companies owned other medical facilities (i.e., chiropractor, acupuncture, physical therapy, etc.) and referred the PC s patients to these facilities when such was medically unnecessary, and/or that the PCs billed no-fault insurance providers for treatments that were not actually provided. According to the Indictment, if true owners of the PCs were non-physicians, pursuant to New York Law, 6 insurance companies were not required to reimburse those PCs for the invoiced treatments. In essence, the Government alleged that two components of the conspiracy existed: (1) alleged unlawful billing pursuant to a fraudulent incorporation theory, and (2) alleged improper billing for medical services not rendered and/or services rendered but medically unnecessary. 66. Included among those thirty-six (36) defendants named in the Indictment were physicians, non-physicians who allegedly owned the management companies, and attorneys who the Government alleged provided legal services to physicians and management companies in perpetuation of the fraud. After almost two years of requesting a bill of particulars (specific details of the allegations against Dr. Shapiro) from the Government, or otherwise any explanation of what illegal acts Dr. Shapiro allegedly committed, Goldman stated, in open court 6 See, State Farm Mutual Automobile Insurance Company vs. Mallela, 4 N.Y.3d 313 (2005), in which the New York Court of Appeals held that a violation of a licensing requirement by a medical provider that establishes that the medical provider is not owned and operated by a medical professional renders the medical provider ineligible to be reimbursed by an insurance company for no fault claims that have been assigned to the provider by an individual involved in an automobile accident. Page 34 of 73

35 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 35 of 73 before the Honorable Paul Oetken, that the Government believed Dr. Shapiro, inflated reads. 7 The Government was then alleging that Dr. Shapiro fraudulently stated in his reports that patients sustained injuries when such injuries were not sustained. In fact, Goldman professed in open court that according to the patients MRI films, such patients actually didn t have the injuries; or the patients injuries were actually much less severe than what Dr. Shapiro stated in his reports. The Government essentially asserted that Dr. Shapiro fabricated and exaggerated injuries that were not supported by the MRI films. 67. Dr. Shapiro requested copies of the MRI films, which Goldman agreed to produce by the end of March 2013, however, as of December 2013 Goldman had failed to produce even one MRI film. In fact, after being ordered by the Court to produce the MRI films, the Government produced one CD containing approximately six MRI films. The Government never produced the thousands of MRI films that Goldman and McQuaid claimed to have possession of, nor did the Government ever produce the reports that contradicted Dr. Shapiro s findings, which McQuaid and Goldman claimed to possess. In fact, the Government never indicated one specific case or patient where Dr. Shapiro had allegedly inflated his diagnosis. In essence, Goldman and McQuaid lied to the Court to perpetuate the prosecution and persecution of Dr. Shapiro for their own personal agendas, including but not limited to Goldman s ego and McQuaid s desire to work for the President. 68. Dr. Shapiro was not an owner of any PC named in the Indictment, either on paper or in the fraudulent manner alleged in the Indictment. Rather, Dr. Shapiro was employed as a part-time radiologist by two of the radiology facilities identified in the Indictment, Clearview 7 On December 4, 2013, before Judge Oetken in the SDNY, Goldman stated that Dr. Shapiro inflated reads. Page 35 of 73

36 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 36 of 73 Medical of Brooklyn, P.C. ("Clearview") and KKM Diagnostic, P.C. ("KKM"), to read radiological films (i.e., MRI and X-Ray) and to provide medical reports based upon his findings. The services Dr. Shapiro performed pertained only to interpreting the radiology films provided to him by Clearview and KKM. Dr. Shapiro's work was always done at his full-time employment where the radiological films were delivered to and picked up from. 8 His reports were electronically transmitted to the facilities. Dr. Shapiro never went to any other facilities he performed reads for, as his work was performed in the same manner a tele-radiologist, who provides services without actually having to be at the location of the patient. Dr. Shapiro had done similar work intermittently for the owners of Radiology Today P.C., a MRI clinic that previously occupied the address where Clearview was located, which was unbeknownst to Dr. Shapiro at that time. 69. Because Dr. Shapiro conducted his work for Clearview and KKM at his employer s office, he had no knowledge of the day to day operations of any of the facilities other than Doshi Diagnostic, including those named in the Indictment. Dr. Shapiro had no role in billing any of the insurance companies; as Dr. Shapiro was paid directly by the facilities for the work he performed, which was not contingent upon whether or not the facilities were paid by the insurance companies. 9 Dr. Shapiro never met with or treated any of the Clearview or KKM patients, never solicited or obtained patients, never made any referrals, and had no choice in which images he was given to review. Dr. Shapiro simply reviewed the radiology films, created 8 Dr. Shapiro s employer permitted him to perform radiology reads for other medical facilities at their office. Dr. Shapiro read MRIs for multiple medical facilities, including Clearview and KKM. 9 In fact, Dr. Shapiro's compensation was at or below the industry standard for reading MRI's and issuing reports. Page 36 of 73

37 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 37 of 73 his reports based on his opinions of the films, and electronically transmitted the reports to the medical facilities. 70. The Government Defendants threatened Dr. Shapiro by stating that if he pursued his lawful medical practice while under federal Indictment, the Government would incarcerate Dr. Shapiro with no opportunity for release pending his trial, and use such against Dr. Shapiro, both in the pending criminal case and in an additional Indictment against him. Such was done in the face of a Court order granting Dr. Shapiro the ability to execute affirmations for Clearview and KKM patients. The Government s threats also forced Dr. Shapiro to place a lien against his residence in order to post bail. His arrest had a domino effect upon his professional affairs, including his exclusion from multiple banks, insurance companies, and a suspension by the New York State Worker's Compensation Board and other health care governing bodies. Further Dr. Shapiro s reputation has been damaged to the extent that he is no longer able to find radiology work outside of his employment, costing him hundreds of thousands of dollars each year. Dr. Shapiro s annual income was evenly split between his full time employment, and the extra work he did for other facilities, which now is non-existent. Furthermore, Dr. Shapiro was prohibited from doing any work on no-fault matters during the pendency of his case, which also severely reduced his income. C. THE GOVERNMENT DEFENDANTS AND NICB S INVESTIGATION OF DR. SHAPIRO WAS TAINTED BY MALICE 71. The conspiracy and collusive effort of the Government Defendants, Ringleaders, and Defendant Insurance Companies led to a lengthy covert investigation driven and tainted by malice. The Government Defendants, Ringleaders, and Defendant Insurance Companies Page 37 of 73

38 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 38 of 73 concocted a theory supported by no evidence, and contradicted by exculpatory evidence, to obtain an Indictment against Dr. Shapiro, leading to his arrest and prosecution. The Government Defendants, Ringleaders, and Defendant Insurance Companies exaggerated alleged loss amounts and fabricated a claim that Dr. Shapiro participated with and was a member of Russian organized crime, and further conspired to commit healthcare fraud and mail fraud. 72. Based on recorded conversations from several years of investigation, the Government Defendants, Ringleaders, and the Defendant Insurance Companies were well aware that Dr. Shapiro never owned or purported to own any medical facility named in the Indictment, and that Dr. Shapiro had no role in billing insurance companies. Such information was corroborated by billing records provided by the NICB and numerous insurance companies that cooperated with the investigation, including the Various Insurance Companies named in the instant Complaint. 73. During the course of the lengthy covert investigation, the Government Defendants and the NICB never obtained evidence to indicate any misconduct and/or unlawful acts as alleged against Dr. Shapiro. Most significantly, the Government Defendants failed to obtain any of the radiology films that Dr. Shapiro examined, even though there was ample opportunity to do so and Goldman and McQuaid claimed that the Government possessed them to the Court. These films were an obvious necessity to substantiate any allegation that Dr. Shapiro inflated reads or exaggerated injuries in his reports. 74. Further, during the course of the lengthy covert investigation, the Government Defendants failed to obtain s, other written communications, or any recorded conversations to indicate that Dr. Shapiro inflated reads. Additionally, the Government Defendants did not Page 38 of 73

39 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 39 of 73 obtain any expert opinion or even seek an expert to review Dr. Shapiro s findings in the reports that were claimed to have been fraudulently produced. 75. Importantly, Dr. Shapiro s reports based on MRIs from Clearview and KKM patients were in the possession of the Government Defendants as evidenced by the disclosure provided by the Government during litigation of the case. Upon information and belief, these reports were provided to the Government Defendants by the NICB and/or by numerous insurance companies, including the Defendant Insurance Companies. Such reports plainly show that Dr. Shapiro reported the existence of a significant injury in a approximately 35% of his reports, which is approximately what one may expect to find in a random sample of healthy people who complain of no injuries. The MRIs Dr. Shapiro reviewed were composed of a sample of patients who complained of injuries due to car accidents, in which on one would obviously expect to find a much higher instance of significant injury than a purportedly healthy population. 76. A brief review of Dr. Shapiro s reports would have immediately revealed Dr. Shapiro s non-involvement in the alleged conspiracy, and these reports were in the possession of the alleged victims the Defendant Insurance Companies and others and were obtained by the Government Defendants and the NICB during the investigation. In fact, on or about December 14, 2013, after being recently assigned to Dr. Shapiro s case, Assistant United States Attorney Peter Skinner visited Dr. Shapiro s counsel s office to review the reports, which had been organized by Dr. Shapiro s counsel. After a mere hour of review, Mr. Skinner realized that the allegations against Dr. Shapiro had no merit, and immediately determined that the Indictment should be dismissed against Dr. Shapiro. Page 39 of 73

40 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 40 of Again, these reports were absolutely available to the Government Defendants as these entities were in possession of the bills and claims that were alleged to have been fraudulently submitted to the alleged victims (the Defendants Insurance Companies and others). Such reports regularly accompany bills and claims submitted to insurance companies. Thus, the Government Defendants ignored the exculpatory evidence they possessed during the investigation. Upon information and belief, such was done for the sole purpose of arresting Dr. Shapiro, resulting in extensive benefits to the Government Defendants, the Ringleaders, and the Defendant Insurance Companies (and others). 78. Moreover, Dr. Shapiro issued "So Ordered" (by the Court) subpoenas upon various insurance companies, including some if not all of the Defendant Insurance Companies, and the NICB to produce, among other documents and records, the relevant medical reports at issue in the Case that would have included materials that constituted exculpatory evidence as to the criminal charges brought against Dr. Shapiro. Although the Defendant Insurance Companies and the NICB provided assistance and information, including such exculpatory evidence, to the Government Defendants during the investigation of Dr. Shapiro that lead to his arrest and prosecution, the NICB and many of the Defendant Insurance Companies were unwilling to produce the relevant reports that were requested by Dr. Shapiro pursuant to the subpoenas issued. In fact, the NICB and Tardalo filed an absolutely frivolous motion to quash the subpoenas issued by Dr. Shapiro and So Ordered by the Court in the Case, and improperly and laughably argued that the NICB was a "Government agent" and that Dr. Shapiro was not permitted to obtain their "government documents" from the NICB. Further, the NICB and Tardalo argued that the subpoenas issued by Dr. Shapiro were overly broad and burdensome, but in the same papers Page 40 of 73

41 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 41 of 73 admitted that they obtained materials from its members (insurance companies) and forwarded such materials to the FBI. The NICB and Tardalo's motion was a clear cut attempt to hide the NICB's bad acts and policies. Furthermore, Goldman and McQuaid intentionally hid these material from Dr. Shapiro, even though they possessed them even before they went to the Grand Jury seeking an indictment, all for the improper purpose of gaining their own notoriety, bolstering their own careers and ego, and to gain accolades and friends in the healthcare and insurance industries, all at the cost of Dr. Shapiro and his name and career. 79. Upon information and belief, the investigation of Dr. Shapiro was also perpetuated by Rifkin Radler who had previously represented various defendants in litigation against Dr. Shapiro. Upon information and belief, such was done to put Dr. Shapiro s personal company out of business by not only refusing to compensate Dr. Shapiro s company for services that were properly rendered, but also by influencing a criminal prosecution against him. D. GOVERNMENT PROSECUTES DR. SHAPIRO WITH NO EVIDENCE TO SUPPORT ANY PROBABLE CAUSE OF WRONGDOING 80. Even though the evidence was insufficient to establish probable cause of any wrongdoing by Dr. Shapiro, such was twisted and perverted by the Government Defendants, the Ringleaders, and the Defendant Insurance Companies to support a pre-conceived decision to indict and arrest Dr. Shapiro, in order to cause him maximum damage and to allow the insurance providers to avoid paying out on legitimate claims for medically necessary services performed by Dr. Shapiro and the claimants he had done radiology work for. Further, members of the Government, including Goldman, McQuaid, and Bharara benefitted by expertly utilizing the joint Press Release to appear tough on healthcare fraud (especially on doctors) thus bolstering Page 41 of 73

42 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 42 of 73 their careers, and further benefitted by avoiding the negative publicity threatened by members of Rivkin Radler, the Defendant Insurance Companies, and the NICB. 81. Interestingly, there was no mention of Dr. Shapiro s inflated reads in the Indictment, and presumably there was no supporting evidence presented to the Grand Jury to support this allegation. Further, the Discovery process produced no evidence to support the alleged fraudulent activities conducted by Dr. Shapiro. Rather, the allegations against Dr. Shapiro were concocted by the Government Defendants, Ringleaders, and Defendant Insurance Companies to support including Dr. Shapiro in the Indictment. 82. Such is evidenced by the conduct of Goldman and McQuaid. In his March 2013 opposition to Dr. Shapiro s Omnibus motion and Motion to Dismiss, Goldman, in bad faith, lied to the Court and to Dr. Shapiro s counsel (Jonathan Marc Davidoff, Esq.) by stating that the Government would produce MRI films to Dr. Shapiro s defense team by the end of March As explained supra, these MRI films were necessary to show that Dr. Shapiro made material misrepresentations in his reports, allegedly in furtherance of a conspiracy. A mere five (5) MRI films were produced to Dr. Shapiro s counsel in December, 2013, none of which associated with any of Dr. Shapiro s reports that indicated significant injury. 83. Further, as a condition of Dr. Shapiro s pre-trial release, the Government required Dr. Shapiro to refrain from participating in any medical matters relating to no-fault insurance. McQuaid and Goldman, in furtherance of the conspiracy, harassed and threatened Dr. Shapiro, stating that if he executed affirmations in support of any past no-fault claims relating to any health care facility that he previously worked for, Dr. Shapiro would be in violation of his pretrial release. McQuaid specifically stated that he would have Dr. Shapiro incarcerated with no Page 42 of 73

43 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 43 of 73 opportunity for release pending his trial if he executed any affirmations in support of any litigants cases. Some of the Defendant Insurance Companies were parties to many of these lawsuits, and thus benefitted by keeping Dr. Shapiro from executing affirmations for their adversaries. 84. Even after the magistrate judge ruled that Dr. Shapiro was permitted to execute affirmations for patients from Clearview and KKM (which he had issued radiological medical reports for), McQuaid again threatened Dr. Shapiro by stating that if he executed any affirmations, the Government would use such affirmations against Dr. Shapiro at trial, and would file another Indictment against him charging him with additional criminal conduct. This shows the Government's insistence during Dr. Shapiro s case on protecting the interests of the NICB and the Defendant Insurance Companies, in furtherance of the conspiracy Furthermore, by filing criminal charges against Dr. Shapiro and others, the Government Defendants assisted the Defendant Insurance Companies, who are represented by the NICB, from having to make payments in the personal injury cases (or reducing their exposure) that arose from no-fault insurance claims. Upon information and belief, many legal claims for reimbursement were withdrawn by claimants due to the criminal indictment, saving the Defendant Insurance Companies, and others, millions of dollars. Moreover, for the twentytwo (22) months from the date of his arrest to the date the nolle prosequi was entered, Dr. Shapiro was prevented from billing millions of dollars for legitimate healthcare services that the Defendant Insurance Companies would have been obligated to reimburse. 10 In contrast, the Government permitted Dr. Shapiro to execute affirmations in cases that the Defendant Insurance Companies were not a party to, for example, Medicaid and Medicare cases. Page 43 of 73

44 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 44 of Upon information and belief, members of Rivkin Radler maliciously and nefariously led the drive to include Dr. Shapiro in the Government s Indictment in order to further the interests of the Defendant Insurance Companies, and others, all of which are active members of the NICB and all of which Rivkin Radler regularly represents in civil lawsuits. It is also believed that Rivkin Radler and members of the NICB, including Tardalo, were deeply involved in the investigation that led to the meritless and malicious prosecution of Dr. Shapiro, and continually pressured and influenced the Government throughout the investigation. 87. Upon information and belief, attorneys who worked at Rivkin Radler pressured the Government Defendants to indict Dr. Shapiro by threatening to publically proclaim that the Government refused to prosecute fraudulent healthcare providers that were bilking insurance companies, and that such failures would cause insurance premiums to skyrocket. Sirignano and Levy, in their employment with Rivkin Radler, had previously represented Travelers, State Farm, and GEICO in separate lawsuits against Dr. Shapiro, 11 and egregiously sought a declaration that these insurance companies were not obligated to pay Dr. Shapiro and his company under a theory of fraudulent incorporation. 88. Further, documents provided by the Government demonstrated that the NICB provided the Government with such things as so-called expertise in insurance fraud, which was cited in search warrant applications, documentary evidence gathered from insurance companies, and calculations of the alleged loss and intended loss amounts, which ultimately proved to be astronomical beyond any sense of reality. These amounts are crucial to any prosecution because they drive the projected length of a criminal sentence and, as such, coerce those charged 11 Such lawsuit involved a healthcare entity owned by Dr. Shapiro that was not named in or alleged to be involved in any of the misconduct claimed in the Government s Indictment. Page 44 of 73

45 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 45 of 73 with crimes that involve significant financial loss to take pleas. 12 These pleas were often accompanied with withdrawals of civil claims against the Defendant Insurance Companies. 89. In September 2013, the U.S. District Court for the Southern District of New York held a trial for the first group of defendants. 13 Among those tried in the first wave were two nonphysician owners of management companies who the Government alleged were the masterminds of the conspiracy, as well as three physicians that the Government alleged were paper owners of fraudulently incorporated PCs, which were allegedly truly owned and operated by the masterminds of the conspiracy. The Government requested that Dr. Shapiro be tried by himself at the end of 2013 or the beginning of Included in those who testified at trial were employees of the PCs, patients of the PCs, cooperating witnesses, insurance billing experts, and FBI agents. Among the evidence presented by the Government were several recorded telephone conversations and a voluminous amount of corporate records, bank statements, medical reports, insurance bills, and reimbursement requests. Not one piece of evidence was presented to support the claim that Dr. Shapiro was involved in the fraudulent incorporation of any of the facilities, nor was their one radiology film or report brought into evidence (or even mentioned) to establish that Dr. Shapiro issued one fraudulent finding, or even a negligent or incorrect finding. 91. In November 2013, following seven weeks of trial testimony, the Government and defense rested their cases and the jury began nearly seven days of deliberations, after which the jury delivered a verdict of not-guilty with respect to two of the three physicians. As to the 12 Loss amounts have been called "the tail that wags the dog" when it comes to sentencing. 13 The Court ordered separate trials for groups of defendants based on the Government s selected groupings. Page 45 of 73

46 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 46 of 73 other physician, the jury ended without a verdict, 10-1 for acquittal. As to one of the nonphysicians, the jury acquitted him of all counts except for one, and hung on the last count, 8-3 for acquittal. As for the second non-physician, the jury also hung, 8-3 for an acquittal. 92. The Government s prosecution of Dr. Shapiro continued for more than twentytwo (22) months before the SDNY filed nolle prosequi in the face of a motion to dismiss and a rapidly approaching trial date. During the course of the prosecution, Dr. Shapiro not only attacked the accuracy of the claims and charges made in the Indictment, but also made an innocence proffer, which was supported by positive polygraph results. Further, Dr. Shapiro repeatedly and unceasingly pleaded with the Government to produce one shred of evidence to support its claims, which it never did. 93. The Government s dismissal came after almost two years of publically running Dr. Shapiro s name through the mud, claiming in the media and public records that Dr. Shapiro was engaged in health insurance fraud and involved with Russian organized crime, all of which was not supported by any facts or evidence. The dismissal came after Dr. Shapiro was forced to engage multiple lawyers and spend hundreds of thousands of dollars to defend his name and reputation. The dismissal came after Dr. Shapiro incurred enormous financial damages that resulted in his income being reduced by almost $1,000,000 a year, and which is unlikely to ever be restored to such levels. The dismissal comes after the Government intentionally refused to review the evidence, but rather pushed forward and prohibited Dr. Shapiro from partaking in certain healthcare employment, which resulted Dr. Shapiro s temporary suspension by health care governing bodies. Page 46 of 73

47 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 47 of The Indictment was obtained based solely on the misrepresentations of the Government Defendants, the NICB and the Defendant Insurance Companies. The allegation asserted against Dr. Shapiro that he fraudulently prepared radiology reports by finding injuries that were not present in the corresponding radiology films was concocted by the Government Defendants, Ringleaders, and the Defendant Insurance Companies. Such assertion was not only unsupported by the evidence, but was in fact contradicted by the evidence in possession of the Government Defendants, the NICB and the Defendant Insurance Companies. The arrest and malicious prosecution of Dr. Shapiro was done in accordance with a preconceived motivation to indict Dr. Shapiro, to appease the NICB and the Defendant Insurance Companies, and for purposes of the Government Defendant s own self-aggrandizement. E. CUSTOM, POLICY AND PRACTICE a. Mallela Case Criminalizes an Insurance Regulation 95. The Government Defendants prosecuted Dr. Shapiro not because he committed a crime, but because the Ringleaders and Defendant Insurance Companies pressured the Government Defendants to maliciously investigate and prosecute Dr. Shapiro, along with numerous others, simply to advance their agenda and to provide an opportunity for various insurance companies to avoid having to pay millions of dollars of claims submitted to them. 96. Such is part and parcel of the insurance companies' "claim-avoidance protocol," which simply means engaging in a course of conduct outside the contract (e.g. insurance policies where they have the contractual obligation to pay for medical claims submitted to them) with the intent to defeat the contract and thereby deny the claim. The more claims an insurance company Page 47 of 73

48 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 48 of 73 denies, the higher its profit margins. 14 The Defendant Insurance Companies' egregious claimavoidance protocol, particularly in the area of no-fault insurance claims, is directed at the public against both public policy and in contravention of New York State law. 97. The no-fault insurance law was enacted in 1974 and was designed to ensure prompt compensation for losses incurred by automobile accident victims without regard to fault or negligence. It was enacted to reduce the burden on the courts and to provide substantial premium savings to New York motorists. Insurance companies received a huge benefit because automobile accident victims were severely restricted in their right to recover for injuries sustained in a car accident. 98. In exchange for this windfall to insurers and in response to outrage from consumer advocacy groups, the no-fault law contained provisions obligating insurance companies to only make reasonable requests of its claimants (e.g. healthcare providers and/or insured) and to act in a good faith basis throughout the claims verification process, to assist claimants in the processing of claims, and to not treat claimants as adversaries. Yet, insurance companies, represented by law firms such as Rivkin Radler, continually make bad faith demands 14 Amongst those bedrock principles of insurance company claim avoidance is the phenomena known as Settlement Lag. Under this principle, claims are not paid during the policy period. This lag increases investment value. In determining premium rates, regulators are misled or acquiesce to projections of promised timely payouts on legitimate claims. However, when legitimate claims are delayed by denials and only paid as the result of successful litigation, there is an increase in profit for the insurance company not factored into the premiums that the regulators allow insurance companies to charge. It is a basic fundamental principle of insurance economics that the breach of an insurance contract is profitable. Succinctly a successful breach of contract claim results in the victim of the breach receiving only the benefit that was promised in the original bargained for contract. Meanwhile the victim is forced to expend the time, aggravation and costs of enforcing the contract. At the same time the insurance company is earning investment income from the money it should have paid to the claimant in the first place. This is known as the efficient breach. Page 48 of 73

49 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 49 of 73 of both its insured and healthcare providers of its insured, in order to deny the claims in contravention of no-fault regulations. 99. In the early 1990's, no fault-insurers began lobbying lawmakers to stiffen no-fault regulations under the guise that widespread fraud was endemic in the field of no-fault insurance healthcare providers. At the same time, no fault-insurers began flagrantly ignoring the claims practice principles and started effectuating their claim avoidance protocol In 2002, the New York State Insurance Department Superintendent adopted a regulation that declared that a health care services provider was eligible for reimbursement from a no-fault insurance carrier under Section 5102(a)(1) of the New York Insurance Law only if it met all relevant New York State or local licensing requirements Then, in the year 2005, the New York State Court of Appeals issued a ruling in State Farm v. Mallela holding that insurance companies could withhold payments to healthcare providers if they could prove that the healthcare provider was owned by a non-physician. Specifically, even if the billed-for treatment was medically necessary and provided with the upmost degree of precision, skill and professionalism, the Mallela case held that insurance companies need not pay for the covered treatment if the insurance company could prove that the medical provider was owned by a non-physician However, the Mallela case did not define fraudulent incorporation. As a result, the insurance industry, under the guise of fighting fraud, sought to expand Mallela in ways the New York Court of Appeals never contemplated, including expanding the definition of fraudulent incorporation beyond the events surrounding the incorporation of the healthcare provider. Page 49 of 73

50 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 50 of The Mallela ruling was a boon to insurance companies as it afforded them full discretion to allege fraud on nearly all their claims, in turn using their investigatory privilege into the weapon of choice in the battle to wage their claim-avoidance protocol Soon insurance companies issued blanket denials of claims, and used examinations under oath ("EUO's") conducted as part of the claims arbitration process to inundate healthcare providers with abusive requests for corporate records and financial documents in a perverted fishing expedition, all to avoid paying out claims Physicians and healthcare providers were sacked with costs to defend these arbitrations and left high and dry with no reimbursements as to their expenses, causing them tremendous financial strain. On the other hand, insurance companies saw their profits soar to new heights as a result Dr. Shapiro was a victim of such claim-avoidance protocol long before his Indictment in February, For instance, Dr. Shapiro was named a defendant in lawsuit brought by Defendant Travelers Indemnity (involving a healthcare entity owned by Dr. Shapiro that was not named in or alleged to be involved in any of the misconduct claimed in the Indictment) egregiously seeking a declaration that Travelers Indemnity was not obligated to pay Dr. Shapiro and his company under a theory of fraudulent incorporation Not coincidentally, Travelers Indemnity was represented in such lawsuit by the law firm of Rivkin Radler, which touts itself on its website as having represented many of the nation's largest insurers, including representing State Farm in the Mallela case. Lead counsel for Travelers Indemnity were Levy and Sirignano, members of Rivkin Radler. Page 50 of 73

51 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 51 of Rivkin Radler is named as a defendant in the instant lawsuit, and is included as part of the Ringleaders who pressured the Government Defendants to indict Dr. Shapiro, because, upon information and belief, Rivkin Radler threatened to go public with a proclamation that the Government Defendants refused to prosecute allegedly fraudulent healthcare providers that were bilking insurance companies and causing insurance premiums to skyrocket As such, Rivkin Radler maliciously and nefariously led the drive to include Dr. Shapiro in the Indictment to further the interests of the Defendant Insurance Companies, which it represents in their civil lawsuits Of course, health care providers fought back against the insurance companies' abusive tactics in the civil litigation arena. Yet, when the legal costs of fighting against health care providers ate into their profit margins, insurance companies went even further and took the battle to the criminal arena by lobbying and pressuring the Government to criminally indict physicians and other healthcare providers -- led by none other than the NICB. b. The NICB Infiltrates Law Enforcement to Further the Defendant Insurance Companies Nefarious Claims-Avoidance Protocol 111. As stated, the NICB is a corporation that is fully funded by the insurance industry through insurance companies membership dues that are based upon an assessment of the insurer s market share. The NICB conducts investigations of medical professionals under the guise of it being a part of law enforcement, even though it is not a law enforcement agency or a governmental agency, or even a quasi-governmental agency, although it often claims that it is ceded such power by nefarious means The NICB ostensibly investigates what it believes to be professional misconduct and insurance fraud and reports such conduct to law enforcement with the intent of law Page 51 of 73

52 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 52 of 73 enforcement to prosecute the individuals in an effort to obtain restitution for the NICB members (many of whom are the Defendant Insurance Companies) and for the insurance companies to avoid having to pay otherwise valid claims. In reality, the NICB coerces law enforcement or, in some cases, at least improperly persuades and induces law enforcement into taking action in specific cases that were brought to the NICB from member insurance companies or that were initiated by the NICB The NICB knows that their utility to insurance companies comes primarily from the ability of police action to have a claim killing effect. In other words, if the NICB initiates an investigation, more often than not, all of the claims will be abandoned by the medical professionals who filed them. Thus, if the NICB is able to persuade law enforcement to charge and ultimately prosecute medical professionals, then the insurance companies would benefit from restitution that it could and would recover -- the claims-avoidance protocol The NICB also acts as a representative of insurance companies to law enforcement in order to advocate on behalf of insurance companies to law enforcement in general. The NICB also indoctrinates law enforcement to the benefit of insurance companies by training law enforcement personnel ostensibly to detect insurance fraud, but in reality to utilize a broad set of criteria to guess when insurance fraud is occurring, which criteria when followed leads to a gross number of false detections of insurance fraud, as occurred in Dr. Shapiro s case Furthermore, the NICB initiates a process of guilt by association, and has no concern of making allegations against those who are innocent and happen to be associated with others who may or may not be involved in criminal or fraudulent conduct. Page 52 of 73

53 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 53 of Upon information and belief, the NICB is involved in one form or another in almost every criminal investigation of automobile related insurance fraud that occurs in the New York metropolitan area. This includes investigations conducted by the various police agencies, district attorney s offices, the Attorney General and the FBI. Agents of the NICB are often present for every stage of an investigation including the execution of search warrants, questioning of witnesses and interrogations. Upon information and belief, the NICB agents are never formally deputized, if such could even be done, yet they perform investigations in a manner indistinguishable from law enforcement When attached to an investigation the NICB seeks information unearthed by the investigation, which they pass on to member insurance companies. This information allows the member insurance companies to deny claims based upon fraud with a stated justification. In this regard insurance companies continually used the execution of the search warrant as a justification for denying claims from providers of medical services for whom the billing company or medical professional had submitted bills for payment Often times the NICB leaks information from law enforcement investigations to insurance companies in order to assist insurance companies in denying claims. This includes sensitive wiretap information, which otherwise would not be accessible by the insurance companies. Upon information and belief, the insurance companies use the information for inappropriate purposes to deny claims that far exceed the claims that relate to the investigation For instance, the FBI s investigatory and information sharing relationship with the NICB dates back to at least 1993 according FOIL documents (the NICB was formed in 1992). The NICB, utilizing the fact that many of their so-called agents were former members of law Page 53 of 73

54 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 54 of 73 enforcement NYPD, FBI, district attorney investigators, etc. infiltrates even non-fbi law enforcement investigations. This infiltration goes unchallenged in most quarters and if challenged the NICB implicitly lets it be known that it could hand the case over to the FBI effectively killing local jurisdiction. In fact, the common refrain from NICB agents is that the FBI is going to want to talk to you about this case. The NICB s false pretense law enforcement conduct has been continuous nationwide, and is merely a form of intimidation to get medical providers to abandon their claims for payment from insurance companies The NICB lists in its Key Benefits of NICB Membership an advertisement to insurance companies to join the NICB the following benefit: Law enforcement/insurance industry contacts and relationships. Through its relationships with law enforcement and the insurance industry at all levels, the NICB helps Members obtain reports and information that they otherwise could not receive on their own. The NICB also assists its Members by serving as an outsource solution for their prosecution needs with the ultimate goal of securing restitution. We leverage our law enforcement relationships, so that Members can focus on identifying new questionable claims and develop future cases. NICB working group meetings nationwide cover a broad array of investigative, information and training topics. They are frequently the only opportunities for investigative professionals to share information and discuss local fraud topics. (Italics added) 121. Upon information and belief, the NICB boasts that it provides insurance companies with sensitive law enforcement information. More troublesome is the language: The Page 54 of 73

55 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 55 of 73 NICB also assists its Members by serving as an outsource solution for their prosecution needs 122. Under the law in all states, insurance companies do not have recognizable prosecution needs. No individual or entity of any kind has a recognizable prosecution need. In the State of New York, criminal prosecutions are brought on behalf of the People of the State of New York. In the federal system, criminal prosecutions are brought on behalf of the United States of America. In civil actions, each individual insurance company brings an action in which it has standing to sue under a civil cause of action. The NICB has no standing to bring forth a criminal prosecution or a civil cause of action regarding claims relating to individual insurance companies Most brazen is the NICB boast: We leverage our law enforcement relationships It is illegal and unethical for private industry to leverage law enforcement. Leverage means influence, power, force, control. The only legitimate means to leverage law enforcement into pursuing prosecutions is through the ballot box The NICB is not even a crime victim yet they control police investigations and prosecutions. This is unheard of. Insurance companies have all the above enumerated rights of any crime victim and not one iota more despite their economic status. In no way shape or form does the victim of a crime investigate the crime, participate in questioning of witnesses and suspects, execute search warrants or play any role in decision making Upon information and belief, the NICB works closely with an insurance industry controlled group called the Insurance Services Office Inc., ( ISO ), that provides the NICB access to some of the most sophisticated data-mining technology in the country. ISO, as of Page 55 of 73

56 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 56 of , was 85 percent owned by insurance companies. In 2003 ISO recorded revenues of $485 million dollars The main feature of ISO is a mega-data base that it sells to insurance companies and makes available to law enforcement as administered by the NICB. In fact the ISO website informs members of law enforcement that are having difficulties with the ISO database to contact the NICB and gives an NICB telephone number that should be called Upon information and belief, the ISO database includes hundreds of millions of records of US citizens and residents, including insurance claims, medical records, motor vehicle reports, police records and driver s license numbers. Contained within these documents are the dates of birth, address history, social security numbers, license information, phone numbers, etc., of each individual For a fee, insurance companies have access to this super database thereby limiting the utility of the NICB immensely, and some insurance companies left the NICB as a result of their questionable utility. Consequently, the NICB engaged in the above-described behavior in order to kill claims, which in turn maintained their insurance company membership by furthering the profitable claim-avoidance protocol. c. Operation BORIS: An Illustrative Example in New York State Demonstrating that Government Defendants Were on Notice of, and Deliberately Indifferent to Unconstitutional Customs, Policies and Practices, and in Fact Participated in the Unconstitutional Activity Alleged Herein 129. No case better demonstrates the degree to which the Government Defendants, including policymakers, will participate in the cover-up of unconstitutional activity at the behest of the Defendant Insurance Companies and the NICB such as what occurred in the case at bar then the manner in which Suffolk County (New York) Police Department and especially the Page 56 of 73

57 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 57 of 73 Suffolk County District Attorney s Office acted in Operation BORIS (an offensive acronym for Big Organized Russian Insurance Scam) BORIS was an operation that was funded by the insurance industry, especially State Farm Defendants, through the NICB In and around 2001/2002, State Farm Defendants commenced a link analysis based investigation into what State Farm Defendants would later claim was an immense nofault insurance fraud conspiracy (similar to the facts in the Indictment against Dr. Shapiro and the co-defendants in the Case). State Farm Defendants contacted the NICB with its so-called investigation In and around the early to middle of 2002, State Farm Defendants and the NICB brought the so-called investigation to the Suffolk County District Attorney s Office, who decided to utilize State Farm Defendants' investigation as well as the information and evidence obtained by the State Farm Defendants' investigation primarily the link chart analysis to begin prosecuting individuals and medical provider corporations contained in the State Farm Defendants' "investigation." 133. The link chart analysis was an indecipherable, incomprehensible morass of misinformation Prior to Operation BORIS, the NICB had set up a permanent office and presence in the Suffolk County District Attorney s Office in Hauppauge, New York as part of the Insurance Crimes Unit. This unit consisted of Suffolk County District Attorney s Office prosecutors, Suffolk County Police Department Detectives and NICB Special Agents working side by side. Page 57 of 73

58 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 58 of In Operation BORIS, NICB agents who are corporate employees and nothing else performed investigations in a manner indistinguishable from Suffolk County Police Detectives under full color and authority of the Suffolk County Police Department and the Suffolk County District Attorney s Office. In fact these so called agents and the entire NICB acted illegally because they do not even possess licenses to perform private investigations Meanwhile NICB Special Agents as well as members of insurance company Special Investigative Units were sent out into the field to question witnesses and suspects; perform surveillance; review subpoenaed documents; participate in the execution of search warrants; and participate in arrests The NICB, on behalf of State Farm Defendants and the insurance industry, led the investigation by making key decisions as to who the targets would be, what records would be subpoenaed, who would be indicted and who would be arrested, as well as what locations would be the subject of search warrants The Suffolk County District Attorney s Office /State Farm/NICB matter morphed into an investigation involving what was termed the Suffolk County Task Force (and nicknamed Operation BORIS). This task force was staffed by NICB Special Agents ; investigators from the Suffolk County District Attorney s Office; and a host of insurance company Special Investigative Units employees Members of State Farm Defendants' Special Investigative Units, among other insurance companies, were stationed at the Suffolk County District Attorney s Office. Page 58 of 73

59 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 59 of Operation BORIS ultimately led to approximately 585 indictments. It received accolades in Fortune Magazine 15 and other publications, but it was an investigation without evidence. Simply put, the indictments were legally insufficient Nevertheless, Suffolk County District Attorney Thomas J. Spota was informed by a Judge James C. Hudson of the New York State Supreme Court, Suffolk County, among others, that the indictments were insufficient District Attorney Spota was reluctant to drop the indictments and the investigations because of the positive press that Operation BORIS was giving him personally and to his office. Furthermore, Operation BORIS also resulted in financial rewards for the Suffolk County District Attorney's Office including grant money from New York State, monies from the NICB, and monies bribes from State Farm Defendants through the NICB As a result, the Suffolk County District Attorney refused to immediately drop all the legally insufficient charges and continued the investigation Notably, Discovery Demands sent to the Suffolk County District Attorney s Office by defense attorneys were responded to with the following response: Call State Farm for the documents Out of approximately 585 indictments, well over half simply were never unsealed and eventually expired. Of those that were unsealed, the only convictions were a few pleas taken by low-level perpetrators. Almost everyone else received an ACD Adjournment in Contemplation of Dismissal. Notably, instead of the routine six (6) months for the charges to be 15 Operation BORIS is analyzed in a lengthy piece published in Fortune Magazine on December 8, 2003: Page 59 of 73

60 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 60 of 73 dismissed by way of ACD, some of the ACDs handed out to Operation BORIS defendants were literally 72 hour ACDs in that the cases were dismissed in 72 hours As a result of Operation BORIS, massive numbers of individuals were illegally arrested based upon legally insufficient information and coerced statements Even more nefariously, State Farm Defendants funneled money to the Suffolk County District Attorney s Office during the above-mentioned Operation BORIS investigation via the NICB. Specifically, State Farm Defendants gave a fairly large sum of money the exact amount is solely within the possession of State Farm Defendants, the NICB and the Suffolk County District Attorney's Office to the NICB who then passed it on disguised in the form of grants. Once the money was obtained by the Suffolk County District Attorney's Office, said funds were utilized for the purchase of computer equipment; the payment for cellular phones and the use therein, including personal use; the leasing of vehicles that were used for Suffolk County District Attorney's Office business as well as personal use; the hiring of cronies and personal friends; personal expense accounts; dining out including the purchase of alcoholic beverages; and other questionable uses State Farm Defendants and the NICB engaged in the above conduct in order to influence the Suffolk County District Attorney's Office to investigate, indict, arrest and attempt to obtain convictions so that State Farm Defendants and the insurance industry could deny claims without litigation or successfully deny claims if an arrested medical provider had the temerity to utilize the courts or arbitration to collect on unpaid bills The NICB on behalf of State Farm Defendants and the insurance industry led the investigation by making key decisions as to who the targets would be, what records would be Page 60 of 73

61 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 61 of 73 subpoenaed, who would be indicted and who would be arrested, as well as what locations would be the subject of search warrants. At all times, the NICB had as much information as the Suffolk County District Attorney's Office about Operation BORIS In addition, under color of Operation BORIS, the NICB and insurance company Special Investigation Unit members would show up unannounced at the execution of search warrants by other non-boris law enforcement entities such as the NYPD and Kings County District Attorney s Office The insurance industry and NICB sought to turn every active law enforcement insurance fraud case in lower New York State into a part of Operation BORIS During Operation BORIS and in its aftermath, NICB Special Agents flouted the authority unlawfully given to them by the Suffolk County District Attorney and elsewhere in New York to intimidate, coerce, and through fraud, lie and persuade individuals to sign affidavits that benefited insurance companies Although Operation BORIS resulted in very few convictions (and those that were convicted were merely low-level perpetrators taking pleas to avoid lengthy sentences), the financial benefit to the State Farm Defendants and the insurance industry as a whole - vis-a-vis the claims-avoidance protocol - was tremendous All of the above is illustrative of the Defendant Insurance Companies and NICB s conduct in New York As such, the Government Defendants were on notice of the sham prosecutions backed by faulty evidence stemming from Operation BORIS, and were deliberately indifferent to Page 61 of 73

62 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 62 of 73 and in fact participated in, the unconstitutional customs, policies and practices that took place in the case at bar that irreparably harmed Dr. Shapiro. d. Operation Sudden Impact: An Illustrative Example at the Federal Level Demonstrating that Government Defendants Were on Notice of, and Deliberately Indifferent to Unconstitutional Customs, Policies and Practices, and in Fact Participated in the Unconstitutional Activity Alleged Herein 156. The NICB s involvement with law enforcement investigations, particularly the FBI, is a nationwide phenomenon According to Annual Reports of the NICB, several current and former members of the FBI held positions with the NICB. For example, from 2000 up to and including the present time, the Chief Executive Officer of the NICB is one Robert Bear Bryant. Shortly before coming to the NICB, Bryant was the Deputy Director of the FBI the second highestranking position with FBI wherein Bryant managed the day-to-day operations of the FBI Moreover, the FBI s website contains a section entitled Insurance Fraud: A Basic Overview. The section lists the NICB prominently under Insurance Fraud Resources One example of the pervasive ties between the FBI and NICB is Operation Sudden Impact, a joint FBI/NICB nationwide fraud sting conducted in the 1990s. It targeted physicians, lawyers and business owners allegedly involved in the staging of automobile accidents to collect on insurance policies As part of Operation Sudden Impact, FBI and NICB agents, acting as a team, interrogated suspects, conducted search warrant raids and had access to medical records, as well as access to a massive insurance company database (ISO discussed infra). NICB agents, side by side with FBI agents, actually conducted search warrant raids. That means representatives of insurance companies say State Farm Defendants were permitted to take down doors and Page 62 of 73

63 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 63 of 73 enter into citizens homes and businesses with the FBI in tow. Representatives of insurance companies say State Farm Defendants interrogated suspects/citizens Similar to the Case against Dr. Shapiro, the day of the takedown, May 24, 1995, was designed as a media event that involved FBI headquarters issuing a boiler-plate press release announcing that arrests and indictments were going to be made across the country. FBI field offices were encouraged to customize the press release with input from the NICB The joint "takedown" received a backlash from several politicians, including members of the United States House of Representatives, amongst others, who formally requested an explanation of how the NICB could have been so heavily involved in an FBI investigation/operation, including executing search warrants and arrests. The FBI responded with a formal letter falsely stating that NICB agents are not law enforcement officers and are not authorized to execute arrest or search warrants Directly contradicting the FBI s response to criticism is the fact that in 2005 hundreds of pages of documents requested pursuant to FOIA were finally released. The documents demonstrated that Operation Sudden Impact was initiated upon information brought to the FBI via the NICB. That NICB agents interrogated witnesses and assisted in the execution of search warrants In no way shape of form does the victim of a crime (say insurance companies) investigate the crime, participate in questioning of witnesses and suspects, execute search warrants or play any role in decision making The NICB is not even a crime victim yet they control police investigations and prosecutions. This is unheard of. Page 63 of 73

64 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 64 of As such, the Government Defendants were on notice of the unconstitutional investigations and police actions stemming from Operation Sudden Impact, and were deliberately indifferent to and in fact participated in, the unconstitutional customs, policies and practices that took place in the case at bar that irreparably harmed Dr. Shapiro. herein. CAUSES OF ACTION AS AND FOR A FIRST CAUSE OF ACTION AGAINST ALL DEFENDANTS (Deprivation of Federal Civil Rights Under 42 U.S.C. 1983) 167. Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 168. As and for Dr. Shapiro's claim against all Defendants for deprivation of civil rights, Dr. Shapiro alleges as follows: Defendants, collectively and individually, while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right to be free from depravation of liberty and property without due process Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) All of the aforementioned acts deprived the Plaintiff of the rights, privileges and immunities guaranteed to citizens of the United States by the First, Fourth, Fifth, and Fourteenth Amendments to the Constitution of the United States of America, and in violation of 42 U.S.C All of the Defendants acted with intent in violation of Plaintiffs legal and constitutional rights, and have directly and proximately caused Plaintiffs monetary losses, humiliation, mental pain and suffering. As a direct, legal and proximate result of Defendants violations of Plaintiff's statutory, constitutional and common law rights Plaintiff has been damaged in an amount which Page 64 of 73

65 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 65 of 73 is not yet known. Plaintiffs will seek leave of Court to amend this Complaint when ascertained, or will amend to conform to proof at time of trial. AS AND FOR A SECOND CAUSE OF ACTION AGAINST ALL DEFENDANTS (Malicious Prosecution and Conspiracy to Commit Malicious Prosecution Under 42 U.S.C. 1983) herein Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 172. As and for Dr. Shapiro's claim against all Defendants for malicious prosecution and conspiracy to commit malicious prosecution, Dr. Shapiro alleges as follows: Defendants, collectively and individually, while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right to be free from depravation of liberty and property without due process Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) The malicious prosecution of Dr. Shapiro was conducted by members of the Government Defendants, who were pressured by the NICB, the Defendant Insurance Companies and members of Rivkin Radler, to include Dr. Shapiro in an Indictment before any obtainment of culpatory evidence, or evaluation thereof, and without probable cause. The Government Defendants fabricated, exaggerated, and misrepresented evidence to perpetuate false conclusions in order to support their pre-conceived decision to arrest, indict, and prosecute Dr. Shapiro in furtherance of a conspiracy. The investigation and prosecution was malicious in that it was orchestrated, dictated, and controlled by the NICB, Defendant Insurance Companies, and Page 65 of 73

66 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 66 of 73 members of Rivkin Radler, and in collusion with members of the Government Defendants to further protect and benefit the Defendant Insurance Companies and their business interests, in furtherance of the conspiracy s goals. Furthermore, Dr. Shapiro s case concluded with an order of nolle prosequi. AS AND FOR A THIRD CAUSE OF ACTION AGAINST ALL DEFENDANTS (Abuse of Process and Conspiracy to Commit Abuse of Process Under 42 U.S.C. 1983) herein Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 176. As and for Dr. Shapiro's claim against all Defendants for abuse of process and conspiracy to commit abuse of process, Dr. Shapiro alleges as follows: Defendants, collectively and individually, while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right to be free from depravation of liberty and property without due process Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) The Government Defendants fabricated, exaggerated, and misrepresented evidence to perpetuate false conclusions in order to support their pre-conceived decision to arrest, indict, and prosecute Dr. Shapiro in furtherance of a conspiracy. These acts in furtherance of the conspiracy constitute an abuse of the legal process by the Ringleaders and Defendant Insurance Companies, who conspired with members of the Government Defendants who regularly employ the criminal justice process. Page 66 of 73

67 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 67 of Such was done without justification and through collusion with the NICB, the Defendant Insurance Companies, and members of Rivkin Radler to benefit the Defendant Insurance Companies and the Government Defendants. The Government Defendants continued such abuse in furtherance of the conspiracy s goals throughout the duration of proceedings against Dr. Shapiro. Goldman and McQuaid, under the supervision of Bharara, continued their abuse of the process for the benefit of the other Defendants, as well as for their own benefit, which is evidenced by the press release issued on in connection with the case, as well as McQuaid s new employment opportunity with the President of the United States. By complying with commands of the NICB, the Defendant Insurance Companies, and members of Rivkin Radler, the Government was able to avoid the bad press that was unjustifiably threatened by such Parties, and in turn was able to publicly celebrate adding another doctor to the indictment Further, the NICB, Rivkin Radler and Defendant Insurance Companies profited by the abuse of process and the continued abuse of process as evidenced by Dr. Shapiro s inability to execute affirmations for any Clearview or KKM patients that had personal injury cases pending, as well as the general reduced exposure that arose with regard to no-fault insurance claims, illustrated by multiple global withdrawals of claims, saving the Various Insurance Companies millions of dollars. Also, Dr. Shapiro and those he performed MRI reads for were prevented from billing millions of dollars for legitimate healthcare services that were owed through reimbursement by the Defendant Insurance Companies and other NICB active members. [Remainder of page intentionally left blank.] Page 67 of 73

68 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 68 of 73 AND FOR A FOURTH CAUSE OF ACTION AGAINST ALL DEFENDANTS (Tortious Interference and Conspiracy to Commit Tortious Interference Under 42 U.S.C. 1983) herein Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 182. As and for Dr. Shapiro's claim against all Defendants for tortious interference with business relations and contracts and conspiracy to commit tortious interference, Dr. Shapiro alleges as follows: Defendants, collectively and individually, while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right of freedom of association Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) The Government Defendants investigated, arrested, indicted, and prosecuted Dr. Shapiro without probable cause for the sole purpose of preventing him from continuing his ethical, responsible, and legal medical practice, in direct benefit to the NICB and the Defendant Insurance Companies, and in furtherance of the conspiracy. The Government threatened Dr. Shapiro by stating that if he pursued his lawful medical practice, the Government would incarcerate Dr. Shapiro with no opportunity for release pending his trial, and would file another Indictment against him. Also, the charges interfered with Dr. Shapiro's contract with his employer and others in that due to the malicious prosecution, Dr. Shapiro was no longer able to work on No-Fault matters, which constituted a significant portion of his work with Doshi Diagnostic and other medical facilities. Page 68 of 73

69 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 69 of The Defendants were aware of the existence of Dr. Shapiro s right to profit from his No-Fault employment pursuant to contracts with Doshi Diagnostic and other medical facilities, and the institution of the malicious prosecution rendered Dr. Shapiro unable to perform under such contracts. The Defendants intentional interference with Dr. Shapiro s existing contracts resulted in significant monetary damages to Dr. Shapiro, while simultaneously benefitting the Defendant Insurance Companies, the NICB, and Rivkin Radler. AND FOR A FIFTH CAUSE OF ACTION AGAINST THE SDNY, FBI, USDOJ, THE UNITED STATES AND NYPD (Defamation and Slander Per Se and Conspiracy to Commit Defamation and Slander Per Se Under 42 U.S.C. 1983) herein Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 187. As and for Dr. Shapiro's claim against the SDNY, FBI, USDOJ, the United States, and NYPD for defamation and slander per se and conspiracy to commit defamation and slander per se, Dr. Shapiro alleges as follows: the SDNY, FBI, USDOJ, the United States, and NYPD, while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right of freedom of association Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) The SDNY, FBI, and NYPD issued a joint Press Release in conjunction with the Indictment claiming that Dr. Shapiro was engaged in healthcare insurance fraud and involved with Russian organized crime, all of which was not supported by any facts or evidence, and all of which was known to be false by the SDNY, the FBI, and NYPD with respect to Dr. Shapiro. Page 69 of 73

70 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 70 of Further, these statements resulted in Dr. Shapiro s loss of income and ruined Dr. Shapiro s reputation with respect to his work in radiology. The joint Press Release sullying Dr. Shapiro's name remains uncontroverted, causing further harm to Dr. Shapiro and his reputation, and continues to appear on the FBI s and SNDY s websites to this day. AND FOR A SIXTH CAUSE OF ACTION AGAINST THE BHARARA, SDNY, FBI, USDOJ, THE UNITED STATES, THE CITY, DANY AND NYPD (Federal and Municipal Liability for Deliberate Indifference to Training in Violation of 42 U.S.C. 1983) herein Plaintiff repeats and realleges paragraphs 1 through 166 above as set forth in fully 192. As and for Dr. Shapiro's claim against Bharara, the SDNY, FBI, USDOJ, the United States, the City, DANY and NYPD for federal and municipal liability for deliberate indifference to training, Dr. Shapiro alleges as follows: the Government Defendants while acting under color of state law, conspired and ultimately succeeded in depriving Dr. Shapiro of his constitutional right of freedom of association Accordingly, this action is brought pursuant to 42 U.S.C and Bivins v. Six Unknown Named Agents of Federal Bureau of Narcotics, 91 S.Ct (1971) Government Defendants initiated and continued a criminal investigation of Dr. Shapiro that was loudly broadcast for maximum negative affect as a means to destroy Dr. Shapiro's livelihood and to benefit the private interests of the Defendant Insurance Companies and NICB. Page 70 of 73

71 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 71 of Obviously there was no credible evidence against Dr. Shapiro, but despite all of the above, the investigation was continued with knowledge and malice that said investigation would jeopardize the Plaintiffs liberty, well-being, safety and constitutional rights Bharara, the SDNY, FBI, USDOJ, the United States, the City, DANY and NYPD exhibited a deliberate indifference toward the training and supervision of members of the SDNY, FBI, USDOJ, DANY and NYPD from the upper echelons all the way down to police officers, investigators, and prosecutors, regarding constitutional ethics and morality Specifically, Bharara, the SDNY, FBI, USDOJ, the United States, the City, DANY and NYPD exhibited a deliberate indifference by failing to give police officers, investigators, and prosecutors training on the following subject matters: (1) use and abuse of power; (2) off duty use and abuse of police power; (3) permissible conduct and impermissible conduct toward civilians including the outright maltreatment and exploitation of civilians for monetary profit; (4) the fabrication of alleged criminal conduct, including fabrication of evidence; (5) the harassment and extortion of civilians by members of the Defendant Insurance Companies and NICB; (6) the constitutional duty and moral obligation to investigate, remediate and punish the victimization of civilians by members of the Defendant Insurance Companies and NICB; and (7) the constitutional duty and obligation to refrain from covering up police and prosecutorial misconduct The aforesaid deliberate indifference to the training and supervision of the members of the SDNY, FBI, USDOJ, DANY and NYPD by Bharara, the SDNY, FBI, USDOJ, the United States, the City, DANY and NYPD may be inferred from the fact that the misconduct in this case was not an isolated incident, but rather, occurred on multiple occasions. Page 71 of 73

72 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 72 of In fact the very misconduct perpetrated upon the Plaintiffs as demonstrated by the lengthy contents of the within complaint is part of a custom, pattern, practice and specifically delineated policies that has been ongoing for decades and perpetrated upon the citizens and taxpayers of the State of New York The aforesaid deliberate indifference to the training and supervision of members of the SDNY, FBI, USDOJ, DANY and NYPD by Bharara, the SDNY, FBI, USDOJ, the United States, the City, DANY and NYPD may be further inferred, and outright proven, from the fact that not one of the involved members of the SDNY, FBI, USDOJ, DANY and NYPD who victimized the Plaintiff in this case were punished or disciplined in any way All of the above is including the official written policies as proof of not only constructive acquiescence by the policy makers at the SDNY, FBI, USDOJ, DANY and NYPD of the conduct and practices alleged herein but goes even further to the actual promotion of such misconduct as yet another perk of the job. WHEREFORE, Plaintiff Dr. Shapiro requests that the Court enter judgment in favor of Plaintiff as follows: a. Damages pursuant to violations of 42 U.S.C. Section 1983 in an amount to be proven at trial; b. Damages pursuant to common law malicious prosecution and conspiracy to commit malicious prosecution in an amount to be proven at trial; c. Damages pursuant to common law abuse of process and conspiracy to commit abuse of process in an amount to be proven at trial; Page 72 of 73

73 Case 1:14-cv NRB Document 1 Filed 12/24/14 Page 73 of 73

74 Case 1:14-cv NRB Document 1-1 Filed 12/24/14 Page 1 of 7 EXHIBIT "A"

75 Case 1:14-cv NRB Document 1-1 Filed 12/24/14 Page 2 of 7 UNITED STATES ATTORNEY S OFFICE Southern District of New York U.S. ATTORNEY PREET BHARARA FOR IMMEDIATE RELEASE CONTACT: U.S. ATTORNEY'S OFFICE Wednesday, February 29, 2012 Ellen Davis, Jerika Richardson, Carly Sullivan (212) NYPD FBI Paul J. Browne Tim Flannelly, Jim Margolin (646) (212) MANHATTAN U.S. ATTORNEY ANNOUNCES CHARGES AGAINST 36 INDIVIDUALS FOR PARTICIPATING IN $279 MILLION HEALTH CARE FRAUD SCHEME Largest No-Fault Automobile Insurance Fraud Case Charged-to-Date Includes Ten Doctors and Three Lawyers Charges Also Include Racketeering and Money Laundering Preet Bharara, the United States Attorney for the Southern District of New York, Janice K. Fedarcyk, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation ( FBI ), and Raymond W. Kelly, the Police Commissioner of the City of New York ( NYPD ), announced today the unsealing of charges against 36 defendants involved in a systematic scheme to defraud private insurance companies of more than $279 million under New York s no-fault automobile insurance law. The Indictment includes racketeering charges against eight members and associates of a criminal organization consisting primarily of individuals of Russian descent who were the owners and controllers of fraudulent medical clinics (the No Fault Organization ), as well as 10 licensed doctors and three attorneys. The alleged scheme identified today is the largest single no-fault automobile insurance fraud ever charged, and the first case of its kind to allege violations of the Racketeer Influenced and Corrupt Organizations Act ( RICO ). All of the defendants were arrested this morning in connection with today s charges. Thirty-five were taken into custody in New York and New Jersey and will be presented and arraigned in Manhattan federal court before U.S. Magistrate Judge Theodore H. Katz later this afternoon. One defendant was arrested in Duluth, Minnesota, and will be presented tomorrow in federal court in the District of Minnesota. Manhattan U.S. Attorney Preet Bharara said: Today s charges expose a colossal criminal trifecta, as the fraud s tentacles simultaneously reached into the medical system, the legal system, and the insurance system, pulling out cash to fund the defendants lavish lifestyles. As alleged, the scheme relied on a cadre of corrupt doctors who essentially peddled their medical licenses like a corner fraudster might sell fake ID s, except those medical licenses allowed unlawful entry, not to a club or a bar, but to a multi-billion dollar pool of insurance proceeds.