Unreported / Non-Citable
Background
Mercury Insurance Company, Mercury Casualty Insurance Company, and California Automobile Insurance Company alleged that Ramin Aghaei, Jennifer Tu, and two chiropractic corporations prepared fraudulent patient examination reports and bills that induced payment of 543 personal-injury claims between 2016 and 2024. The payments totaled more than $1.9 million. Mercury’s amended complaint asserted fraud, conversion, and unfair-competition claims; the opinion explains that its declaratory and injunctive counts described remedies rather than independent causes of action.
The pleading described patients of different ages and physical statures with identical symptoms, vital signs, and pain levels, including one group whose reports shared the same typographical error. It also alleged that nearly 500 bills used a procedure code for low-complexity decision-making, a 30-to-44-minute visit, and an expanded problem-focused history. Mercury characterized the reported patterns as statistically virtually impossible and alleged that the coding falsely represented evaluation of each patient’s family history.
The chiropractors moved to strike the entire amended complaint under Code of Civil Procedure section 425.16. They argued that the records were prepared for patients’ personal-injury litigation and supplied declarations from Aghaei and attorney Donald Dunham. Those declarations described medical-lien treatment, reports sent to attorneys, and one patient, Alex Wong, whose claim proceeded to a settlement demand, rejection, lawsuit, and eventual settlement. The trial court denied the motion, reasoning that submission of purportedly false insurance claims was not protected petitioning activity.
The Court’s Holding
The Court of Appeal reviewed the order de novo and focused on the moving defendants’ initial burden. It explained that courts must identify the acts supplying the elements and basis for liability in each claim, rather than rely only on a complaint’s principal thrust or gravamen. Because the chiropractors sought to strike the entire amended complaint, any claim for relief not arising from protected activity defeated their step-one showing. The alleged fraudulent records underlying 543 separately submitted claims supplied the wrongdoing and damages elements of Mercury’s claims.
The court held that prelitigation communications receive protection only when related to litigation contemplated in good faith and under serious consideration; a mere possibility of suit is insufficient. Aghaei’s lien agreement allowed compensation through settlement, judgment, or verdict, and he acknowledged that some represented patients resolved claims without court action. Dunham likewise stated that many claims settled before lawsuits were filed. Aghaei’s subjective understanding that attorneys would use his records did not establish seriously contemplated litigation.
Wong’s eventual lawsuit did not fill the evidentiary gap. No suit was pending when Aghaei treated him, Dunham first attempted settlement, and the chiropractors offered no comparable patient-specific evidence for the other 542 claims. They also lacked patient testimony that the bills were intended as litigation damages evidence or attorney testimony that referrals occurred only when litigation was necessary. The court therefore affirmed without reaching whether Mercury’s claims had minimal merit, and awarded Mercury its costs on appeal.
Key Takeaways
- A defendant seeking to strike an entire complaint must address every claim for relief at anti-SLAPP step one, not merely characterize the complaint’s overall gravamen.
- Medical-lien treatment and attorney representation do not by themselves prove that particular reports and bills were prepared for litigation under serious consideration.
- Compensation provisions contemplating settlement as well as judgment or verdict can show that future litigation remained theoretical.
- One documented lawsuit did not establish protected activity for records associated with hundreds of other claims, especially when treatment and billing preceded settlement efforts and suit.
- Because the chiropractors failed their initial burden, the appellate court did not evaluate the probability that Mercury would prevail.
Why It Matters
The decision applies the required act-by-act step-one analysis to a broad anti-SLAPP request targeting an entire insurance-fraud complaint. It shows why generalized descriptions of a medical practice may be inadequate when liability rests on numerous separate transactions and the moving party does not propose narrower allegations to strike. Because review was de novo, the affirmance rests on the appellate court’s own analysis rather than the trial court’s reasoning.
It also distinguishes records connected to genuinely anticipated litigation from materials generated while claims might resolve through negotiation. The unpublished opinion affirms only the denial of the special motion to strike; it does not decide whether Mercury’s fraud allegations are true or resolve the underlying claims.