It has been nearly a decade since the New York Court of Appeals ruled, in State Farm v. Mallela,1 that a medical corporation was not entitled to be reimbursed by insurance companies under New York’s no-fault law and its implementing regulations2 for medical services rendered by licensed medical practitioners where the medical corporation failed to comply with applicable licensing requirements by virtue of falsely representing that it was owned and controlled by a licensed physician when, in fact, it was owned and controlled by non-physicians. (The author and his firm represented the insurance company plaintiff in Mallela.)
As part of the continuing battle over no-fault insurance fraud,3 one of the issues that recently has arisen since Mallela is whether the ruling should be applied not just to medical corporations licensed under New York’s Business Corporation Law (BCL) and Education Law but to other entities seeking to recover no-fault insurance benefits as assignees of individuals allegedly injured in automobile accidents.
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