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Cases & Deals

September 11, 2019

Precedent Setting Defense Verdict for King & Spalding Client Prime Healthcare

King & Spalding secured a complete defense verdict on behalf of its client Prime Healthcare, a 45-hospital system, and its affiliates against the California Department of Insurance (CDI) and a relator in a major Insurance Frauds Prevention Act (IFPA) trial in Los Angeles County Superior Court. After we successfully brought a motion to strike the jury trial demand, the case was tried as a bench trial before Judge William Fahey. The Court ultimately rejected all of the claims, finding no evidence of fraud under any possible legal standard. This is a precedent setting verdict for healthcare providers whose primary focus is patient care.  It also clarifies the scope of healthcare claims that California’s IFPA law covers in a way that will benefit other healthcare providers.  In its discussion of the types of contracts of insurance that the CDI may use to prosecute alleged claims of fraud, the court determined that “CDI vastly overreached in pursuing a case beyond its limited jurisdiction.” 

A copy of the court’s decision is contained here.