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“You’re in Good Hands When You Help Out Your Good Neighbor” ought to be the motto for the recent team effort between State Farm Insurance Company and Allstate Insurance Company.
The companies joined forces to file a RICO suit against an auto accident fraud ring that hit Allstate with 44 claims and State Farm with 23 claims. In October a federal court awarded the insurance carriers almost $11 million (in mostly treble damages) from the group of defendants. Ronald Rivera, a chiropractor who owned three medical groups, a health center and a clinic, was ordered to pay $3 million. Five lawyers named in the suit were ordered to pay $1 million each in treble damages. Each of the other defendants was ordered to pay $200,000 in treble damages.
This was the first award of its kind and may prove to be a catalyst for other companies willing to fight back.
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