Arthur Ave. Med. Servs., PC v. GEICO Ins. Co.

72 Misc.3d 342

148 N.Y.S.3d 356

ARTHUR AVENUE MEDICAL SERVICES, PC a/a/o Zuri Adams, Plaintiff,

v.GEICO INSURANCE COMPANY, Defendant.

CV-711242-17/KI

Civil Court, City of New York, Kings County.

Decided on April 20, 2021

Attorney for Plaintiff: Jaime Koo, Esq., Law Office of Melissa Betancourt, P.C., 2761 Bath Avenue, Suite B1 & B2, Brooklyn, NY 11214

Attorney for Defendant: Donald Kernisant Jr., Esq., Rivkin Radler, LLP, 926 RXR Plaza, Uniondale, NY 11556

Consuelo Mallafre Melendez, J.

In this first party No-Fault action, Defendant moves pursuant to CPLR 2221 to re-argue that portion of this court's February 28, 2019 decision which reserved the reasonableness of the content of Defendant's request for post-EUO additional verification as an issue of fact for trial. Defendant contends its request is not subject to judicial review and is valid under the No-Fault rules as a matter of law. Defendant claims the court misapprehended the law when it reserved for trial the question of the reasonableness of these additional verification requests. Plaintiff claims Defendant failed to establish its outstanding verification defense and, that under the circumstances of this case, the substance of the additional requests was improper and an abuse of the verification process. Plaintiff maintains that Defendant's demand for this type of additional verification placed an improper onus on the provider to supply documents outside the scope of the claim verification process. They claim that Defendant's denial was improper as it was based on a claimed failure to provide some or all of these impermissible requests. Plaintiff further argued that Defendant had acquired sufficient information to determine whether to verify or deny the claim from the provider's EUO and Defendant's own related investigation. The court notes that defendant interposed a Mallela defense in its Answer and that similar demands were made in Combined Demands served upon Plaintiff.

The decision of whether to grant reargument is within the sound discretion of the motion court (see Matter of Anthony J. Carter, DDS, P.C. v. Carter , 81 A.D.3d 819, 820, 916 N.Y.S.2d 821 [2d Dept. 2011] ; Degraw Constr. Group, Inc. v. McGowan Bldrs., Inc. , 178 A.D.3d 772, 773, 111 N.Y.S.3d 898 [2d Dept. 2019] ; Barnett v. Smith , 64 A.D.3d 669 [883 N.Y.S.2d 573, 2d Dept. 2009] ). A motion for reargument " ‘is not designed to provide an unsuccessful party with successive opportunities to reargue issues previously decided, or to present arguments different from those originally presented’ " ( Matter of Anthony J. Carter, DDS, P.C. v. Carter , 81 A.D.3d 819 at 820, 916 N.Y.S.2d 821, quoting McGill v. Goldman , 261 A.D.2d 593, 594, 691 N.Y.S.2d 75 [2d Dept. 1999] ; Jaspar Holdings, LLC v. Gotham Trading Partners No. 1, LLC , 186 A.D.3d 582, 130 N.Y.S.3d 19 [2d Dept. 2020] ). The movant must make an effort to demonstrate in what manner the court, in rendering the original determination, overlooked or misapprehended the relevant facts or law (see Nicolia v. Nicolia , 84 A.D.3d 1327, 924 N.Y.S.2d 509 [2d Dept. 2011] ; Matter of Anthony J. Carter, DDS, P.C. v. Carter , 81 A.D.3d at 820, 916 N.Y.S.2d 821 ). "Once the court reviews the merits of the movant's arguments, the court, by doing so, has granted reargument, and must determine whether to adhere to the original determination, or alter the original determination. If the movant has alleged that the original determination overlooked or misapprehended the relevant facts or law, and the court disagrees, it will adhere to the original determination" ( Ahmed v. Pannone , 116 A.D.3d 802, 811, 984 N.Y.S.2d 104 [2d Dept. 2014, Hinds-Radix, J., dissenting] [internal citation omitted]).

Upon review of the parties’ submissions, Defendant's motion for leave to re-argue is granted, and upon re-argument, Defendant's motion is denied. Defendant failed to demonstrate that the court overlooked or misapprehended relevant facts or misapplied governing principles of law (see, McGill v. Goldman , 261 A.D.2d 593, 691 N.Y.S.2d 75 [2d Dept. 1999] ). Accordingly, the court adheres to its original decision wherein it ruled that the reasonableness of Defendant's post-EUO request for additional verification remained an issue of fact for trial.

As an initial matter, this court notes that Defendant's post EUO request for additional verification is the matter at issue herein. The court emphasizes this because in the instant motion, paragraph three of Defendant's affirmation and much of its supporting legal authority pertain to the issue of an EUO no-show, a matter that at no point was in dispute or an issue in the underlying motion. Conversely, at the outset of Defendant's affirmation in support of the underlying summary judgment motion, Defendant argued for dismissal of the complaint "because Plaintiff failed to provide GEICO with post examination under oath ("EUO") verification that was timely requested pursuant to 11 NYCRR. 65-3.5" (emphasis added). Further, the affidavits in support of Defendant's underlying motion also relate to the issue of outstanding additional verification.

Likewise, the arguments in Plaintiff's opposition to both the underlying and instant motion applies to outstanding additional verification requests. No other issue is properly before the court for reargument. It is also noted that reargument is not sought as to that portion of the decision wherein the court granted each party summary judgment to the extent that they established their prima facie case. Therefore, the court's ensuing decision and analysis will discuss the issue of the outstanding post-EUO verification request only.

Defendant commenced an investigation into Arthur Avenue Medical Services because it claimed that it identified several facts and circumstances that called into question the provider's eligibility to collect No-Fault benefits. Defendant specifically investigated whether Arthur Avenue was truly owned and controlled by Jaime G. Gutierrez, M.D., or was actually owned and controlled by laypersons. The investigation included but was not limited to a review and analysis of claims files, public records, previous investigations into other entities that operate out of the same location, previous investigations into other entities where Dr. Gutierrez rendered services and billing submissions submitted to the carrier for reimbursement. Submitted with Defendant's original motion is the affidavit of Glenn Simmons, an investigator with GEICO's Special Investigations Unit, which sets forth the extent of the investigation and conclusions arrived, namely that: patients treated at Arthur Avenue were referred to that provider by Dr. Gutierrez (who operates at the same location); Dr. Gutierrez provided services on behalf of Jamie G. Gutierrez, M.D. then referred the same patients to Arthur Avenue for additional medical treatment; various doctors performed services, yet the billing submissions name Dr. Gutierrez as the only service provider; improper performance of nerve testing including omissions of necessary steps in the administration of the tests; absence of variation in the pattern of treatment and use of predetermined treatment protocol, etc. Mr. Simmons states that the investigation uncovered indications that laypersons were improperly influencing the manner and method of treatment provided to claimants, that Arthur Avenue was rendering services pursuant to a pre-determined treatment protocol designed to maximize profit and that Arthur Avenue's charges may be the result of improper self-referrals.

In addition to the investigation, it is undisputed that on March 9, 2017, Jaime Gutierrez, M.D. appeared on behalf of Arthur Avenue in full compliance with Defendant's EUO request. The court's review of the EUO transcript annexed to the underlying motion reveals that the EUO took place over the course of five hours with questioning involving medical treatment as well as the provider's licensing and corporate structure. Dr. Gutierrez's testimony lent further support to the concerns over fraud previously investigated by Defendant, including whether Arthur avenue was a party to unlawful financial relationships with unlicensed individual and entities, whether laypersons were improperly influencing the manner and methods of treatment provided to GEICO's insureds and whether Arthur Avenue is truly owned and controlled by Dr. Gutierrez or by laypersons all in contravention to New York Law. Defendant claims that its request for additional verification was based on the information obtained during the EUO and that the EUO raised questions regarding improper corporate structure and fee sharing. Thus, by letter dated March 20, 2017, Defendant requested that Plaintiff provide the following additional verification:

A complete copy of the lease agreements, if any, entered into by Arthur Medical, including any accompanying Schedules, Documents, Floor Plans or Riders, regarding the following premises:

764 Elmont Road, Elmont

293 East 53rd Street, Brooklyn

2363 Ralph Avenue, Brooklyn

9004 Merrick Boulevard, Jamaica

2625 Atlantic Avenue, Brooklyn All article of incorporation, including but not limited to any By-Laws for Arthur Medical;

A complete copy of the billing agreement entered between Arthur Medical and Collection Services, Inc./Inna Lyubronestkaya;

All invoices between Collection Services, Inc./Inna Lyubronestkaya and Arthur Medical;

All W-2, 1099, and/or K-1 forms from Arthur Medical, including, but not limited to, any documentation regarding the employee status or relationship between Arthur Medical and any person rendering services on behalf of Arthur Medical;

All quarterly payroll and tax returns (IRS Form 941 and NYS Form 45-MN) filed from 2016 to present by or on behalf of Arthur Medical; Opening/signatory authorization documents for the Arthur Medical Chase bank account;

Copies of all bank statements and cancelled checks for Arthur Medical from 2016 to present;

These include, but is not to be

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