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Media Exposure

Med Ops Management/Dale Davis arose from circumstances involving denial of Personal Injury Protection benefits to Mr. Mondragon by his Insurance Company following a motor vehicle accident. During the course of litigation in that matter, this office discovered information surrounding the activities of Mr. Dale Davis and his corporate entity known as "Med Ops." It was discovered that Med Ops was essentially involved in insurance fraud by way of arranging medical exams for carriers and thereafter altering medical reports which were generated for insurance companies known as independent medical examinations, or "IMEs." That process involved the insurance company requesting a medical examination pursuant to the terms of the policy, which Davis would arrange in terms of scheduling. He thereafter either directly altered or applied pressure to various medical providers to change the nature of their findings, which were later reported to the insurance company and used as a basis to adjust the claim. Although Mr. Davis denied either coercing doctors to change their reports or outright changing reports himself, employees of the company acknowledged that Davis was responsible for changing medical reports and this consideration was also reported by medical providers as documented by Channel 7. Mr. Davis became the subject of a warrant, and was later arrested for failing to attend a deposition issued by this office to further define his activities.  Channel 7 documented a second story surrounding Mr. Davis's arrest (video).  Eventually, the case settled with the insurer by way of a confidential settlement agreement. Med Ops Management thereafter went out of business and the matter was then reported to the Colorado Division of Insurance for further handling. To date, the Colorado Attorney General's Office has not undertaken any action to prosecute Mr. Davis or Med Ops for criminal conduct arising from this serial insurance crime.

Kay Watts v. State Farm involved a claim of an 80-year-old quadriplegic being summarily denied by State Farm after the claims adjuster working on the case misrepresented the activities of the company's agent who had reviewed and underwritten her homeowners policy shortly before a fire destroyed the residence. Although Ms. Watts had specifically asked her agent to come to the residence to make sure that she had adequate levels of insurance, and the agent, in fact, did come to her home following the request to have the home inspected, this consideration was effectively misrepresented by the State Farm adjuster who handled the claim. The agent ultimately testified that he did come to visit Watts' house, admitted that he made mistakes in underwriting the property and further acknowledged that he had explained all of this to the State Farm adjuster and even requested that the adjuster make payment of the claim. Channel 9's Paula Woodward conducted an investigative report surrounding this case which resulted in a $3.75 million settlement, which is identified in its written form.

The matter of Peressini involved a $3 million record verdict against American Family insurance arising from its denial of a $125,000 claim submitted by Boulder Professor Dominic Peressini. The link documents the Channel 7 investigative story surrounding the company's use of a Colorado State Business Plan which instructed employees to reduce claims payouts by approximately one-third over a four-year period in order to reduce claims payments to levels being made by other companies. The business plan failed to take into account that American Family was basically charging one-third more than those same companies it was attempting to stay in line with, and the business plan also tied in the adjuster's bonuses to denying claims per the business plan. The Channel 7 story also emphasized evidence at trial reflecting that an American Family claims manager had a pink pig with wings on her desk which American Family adjusters referred to in a joking manner when addressing claims, indicating that claims would be paid "when pigs fly."

Hicks v. American Family involved certification of an insurance contract reformation class action wherein American Family was ordered to reform over 17,000 insurance policies to include up to $100,000 in additional benefits for all policies issued between 1992 and 2004. The attached Rocky Mountain News article briefly describes the circumstances wherein American Family supposedly sent "notice letters" to 17,000 consumers under circumstances where American Family was aware that addresses and other identifying information of the policyholders was deficient. The class action forced American Family to reopen its notice procedures and send out notice to all consumers of their entitlement to an additional $100,000 in benefits under court supervision per the class action initiated by this firm. As reported by the Rocky Mountain News, "Judge Morris Sandstead ruled Wednesday that a 'voluntary reformation' process initiated last year by American Family gave inadequate notice to Colorado policyholders. In essence, he ordered American Family to start over a claims and notification process that already had resulted in $3.5 million in additional payments to 535 Colorado policyholders..."

 

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