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Westminster Seeks $600K in Civil Fraud Case Against Former Cop

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A former Westminster police officer, 39 year old Nicole Brown who lives in Riverside, has been charged with nine felony counts of making a fraudulent statement to obtain compensation, six felony counts of making a fraudulent insurance benefit claim, and one felony enhancement of committing an aggravated while collar crime over $100,000. She faces a maximum sentence of 22 years in state prison if convicted on all counts.

Brown’s stepfather, 57 year old Peter Gregory Schuman who lives in Buena Park, has been charged with one felony count of making a fraudulent insurance benefit claim and one felony count of assisting, abetting, conspiring with and soliciting a person in unlawful act. He faces a maximum sentence of eight years in state prison if convicted on all counts. As an attorney licensed by the State of California, he may also suffer discipline by the State Bar of California.

While out on Total Temporary Disability, Brown cost the city of Westminster more than $600,000, which included Brown’s full salary – tax-free – and her medical expenses.

During her time on TTD Brown’s ongoing complaints were headaches, dizziness, sensitivity to light and noise, problems processing thoughts and words, and an inability to work on the computer or do any screentime.

Despite her representations to doctors and the City of Westminster regarding her inability to work as a police officer due to her injury, on April 29, 2023, Brown was seen by several people who knew she was off work on total disability as she was dancing and drinking at the Stagecoach Music Festival, with more than 75,000 people in attendance with loud music and bright lights everywhere and temperatures in excess of 100 degrees.

In addition to facing the 15 felony charges, the City of Westminster has now filed a civil lawsuit against  the former police officer after the Westminster City Council voted unanimously to seek to recover all of the funds – over $600,000 – as well as hold the officer accountable for this breech of public trust. The City of Westminster filed the lawsuit on July 8, 2025, naming Nicole Brown of Riverside.

The lawsuit seeks repayment of all disability and medical payments, benefits, and other funds unlawfully obtained by Brown; and seeks to recover costs associated with investigation and prosecution of the lawsuit.

“This former police officer has betrayed the public trust. We owe it to our residents and to the honest, hard-working officers in our police department to seek to recover these funds,” said Mayor Chi Charlie Nguyen. “Our residents count on us to protect their taxpayer dollars and ensure that employees who are actually injured receive the support they need to recover. Fraud will not be tolerated in Westminster.”

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June 30, 2025 – News Podcast

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Rene Thomas Folse, JD, Ph.D. is the host for this edition which reports on the following news stories: Plaintiff Must Hold or Desire Job at Time of ADA Discrimination. Class Action Against Employer Can be Decertified at Any Time. Case Dismissal Affirmed for PI Attorney Misconduct During Trial. Public Officials Face Arson and Insurance Fraud Charges. Ontrak CEO Sentenced to Over 3 Years in Prison. WCRI Study Explores Promises and Challenges of AI for WorkComp. NSC Grant Recipients Tackle Most Common Workplace Injuries. AG Claims Skilled Nursing Facility Chain Puts Patients at Risk.

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Proposed Bipartisan Law Limits Small Business Predatory ADA Claims

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California Senate Bill 84 if past by the California legislature “prohibits a construction-related accessibility claim for statutory damages from being initiated in a legal proceeding against a defendant unless the defendant has: 1) been served with a letter specifying each alleged violation of a construction-related accessibility standard; and 2) the alleged violations have not been corrected within 120 days of service.

This bill also provides that a defendant is not liable for statutory damages, costs, or plaintiff’s attorney’s fees for an alleged violation that is corrected within 120 days of service of a letter. The provisions of this bill apply to a defendant who employs 50 or fewer individuals as of the date of the receipt of the letter or for any period over the past three years from the date of the receipt of the letter.”

According to the authors of  SB 84 since “the pandemic there has been a surge in ADA lawsuits filed across California, typically by very few repeat plaintiffs. Two plaintiffs filed more than 1,000 combined ADA lawsuits across California from 2020-2021 and are some of the most frequent filers in Northern California, according to an NBC Bay area analysis. In 2021, California had more disability access lawsuits filed than the remaining 49 states, combined.”

“Across the state, businesses are being targeted for failing to be in compliance with disability access guidelines, resulting in lawsuits that cost the business thousands, and put money in the pockets of serial plaintiffs without ever actually improving accessibility to people with disabilities.

Amongst the suits filed are those for a bathroom mirror being one and a half inches too high, the handicap sign on a restroom being the wrong shape, and the color of the handicap parking space sign not being the specified shade of blue.”

“Because California law provides that the plaintiff is entitled to a minimum damages that can start as high as $4,000 per violation, triple the damages, and may be awarded attorney’s fees, mom-and-pop businesses are finding themselves fixing a $10 mirror, but owing tens of thousands of dollars to the plaintiff’s attorneys for their fees.”

“The average settlement can be as much as $14,000, but the cost of litigating will easily cost hundreds of thousands of dollars in legal fees. This leads to businesses settling out of court for far more than what it would cost to repair the violation. As such, this problem is putting many small businesses out-of-business, and its further adding to the stigma that California is a bad place to open a business and create jobs. Balance must be struck to protect both our disabled population, as well as business owners being targeted from untoward use of the law. SB 84 strikes this balance by placing the emphasis on increased access through curing an alleged violation.”

This bill is author sponsored and supported by the Civil Justice Association of California and other business organizations. The bill is opposed by Disability Rights California and other organizations that support the civil rights of disabled people.

According to a report on the proposed law by Courthouse News, Senator Roger Niello, a Fair Oaks Republican and coauthor of the bill said “The predatory law firms have accelerated their abuse all over the state.” Senators from both sides of the aisle have joined Niello as coauthors.

The report goes on to say “Democrats stood by Niello’s side, signing onto his bill and urging its passage. State Senator Aisha Wahab, a Silicon Valley Democrat, said she had discussions about the bipartisan effort last fall, working on the best way to correct the problem. Wahab wants to ensure those with disabilities have proper access while helping small business owners.”

“I do hope to see that move all the way to the governor’s desk,” she added.

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Physicians Owned Malpractice Insurer Buys NYSE Listed Comp Carrier

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The Doctors Company, the nation’s largest physician-owned medical malpractice insurer, and ProAssurance Corporation (NYSE: PRA), an industry-leading specialty insurer with extensive expertise in medical liability, products liability for medical technology and life sciences, and workers’ compensation insurance, announced earlier this year that they have entered into a definitive agreement under which ProAssurance will be acquired by The Doctors Company.

The Doctors Company is part of TDC Group (tdcg.com), the nation’s largest physician- owned provider of insurance and risk management solutions. TDC Group serves the full continuum of care, from individual clinicians to academic medical systems—with over 110,000 healthcare professionals and organizations nationwide – with annual revenue of $1.5 billion and more than $8 billion in assets.

Under the terms of the agreement, ProAssurance stockholders will receive $25.00 in cash per share, representing an approximately 60% premium to the closing price per share of ProAssurance common stock on March 18, 2025, the last trading day prior to today’s announcement, with a transaction value of approximately $1.3 billion. The combined company will have assets of approximately $12 billion.

The transaction has not yet closed. However, on June 24, 2025, ProAssurance announced that its stockholders overwhelmingly approved the acquisition, with over 99% of votes cast in favor.

On July 2, 2025, the U.S. Federal Trade Commission granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, satisfying a key condition for the merger. However, the transaction still requires additional regulatory approvals, including from insurance regulators in the states where ProAssurance’s insurance subsidiaries are domiciled.

Currently the acquisition is expected to close in the first half of 2026, subject to remaining regulatory approvals and other customary closing conditions. The deal is not subject to a financing condition. Upon completion, ProAssurance will become a wholly owned subsidiary of The Doctors Company and will be delisted from the New York Stock Exchange.

Both companies continue to operate independently until the transaction is finalized.

The deal has been noted for its strategic benefits, combining the second- and fourth-largest medical professional liability insurers in the U.S., but some analysts have raised concerns about ProAssurance’s valuation. Raymond James downgraded ProAssurance’s stock rating to “Underperform” and Citizens JMP to “Market Perform,” citing a high 2025 estimated earnings per share multiple compared to industry peers.

AM Best has maintained the Financial Strength Rating of A (Excellent) for both ProAssurance and The Doctors Company, with no immediate changes expected due to the acquisition. Both entities will be monitored independently during the transaction period.

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DME Supplier Paid $227K in Kickbacks in $5.9M Fraud Case

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Jacobo Melcer, a Bonita resident and businessowner, pleaded guilty in federal court admitting that he conspired with others to defraud Medicare of millions of dollars and to pay unlawful kickbacks for patient referrals.

According to his plea agreement, Melcer submitted more than $5.88 million in false and fraudulent claims to Medicare through his ownership and operation of two durable medical equipment (DME) companies, which sold orthotics – including back, wrist, and knee braces – to Medicare beneficiaries.

Melcer admitted that in operating the DME companies, he paid unlawful kickback payments to multiple companies for the referral of Medicare beneficiaries and prescriptions for DME, knowing that the prescriptions were signed by physicians who had no legitimate doctor-patient relationship with the beneficiary and had not conducted a legitimate medical evaluation of the beneficiary.

In total, Melcer admitted that he paid more than $227,000 in kickbacks, and fraudulently billed Medicare $5,885,382 and was paid $3,479,303. As part of his guilty plea, Melcer agreed to forfeit and pay restitution in the amount of $3,479,303.

Melcer further admitted that he created and sold two DME companies to a co-conspirator for the sole purpose of putting the ownership under a nominee owner to conceal the true ownership from Medicare due to Medicare suspending the co-conspirator as a Medicare provider and the co-conspirator’s inability to continue to submit claims to Medicare.

Melcer’s sentencing is scheduled for October 10, 2025. The case is being prosecuted by Assistant U.S. Attorney Blanca Quintero of the Southern District of California.

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Northridge Insurance Broker Sentenced for $3.7M Policy Scams

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A woman was sentenced to 50 months in federal prison for defrauding a lender out of $3.7 million by submitting bogus applications for fine art insurance policies for commercial clients, but instead using the money for herself.

Tonja Van Roy, 59, of Las Vegas, but who formerly operated a Northridge-based insurance agency, was sentenced by United States District Judge Stephen V. Wilson, who also ordered her to pay $1,880,237 in restitution.

Van Roy pleaded guilty on January 6 to one count of wire fraud.

According to court documents, Van Roy owned and ran Pegasus Insurance, a Northridge company that specialized in insurance policies covering art collections. From January 2021 to December 2023, Van Roy created and submitted dozens of fraudulent finance agreements to AFCO Credit Corp., a Lake Forest, Illinois-based provider of insurance premium finance, purportedly to finance insurance policies she claimed to have sold to art galleries.

Van Roy made up the insurance policy numbers she used and forged the electronic signatures for fictitious insureds. She used the borrowed money to fund her lifestyle, which included payments on dozens of credit cards. When the loans from AFCO came due, Van Roy submitted additional fraudulent finance agreements to AFCO, and used the proceeds from the new loans to make it appear as though the old loans had been repaid.

“[Van Roy] embarked on a sophisticated, multiyear scheme to borrow fraudulently over $3.7 million dollars using her insider’s knowledge of the insurance industry,” prosecutors argued in a sentencing memorandum. “[She] has more than 25 years of experience working as an insurance agent, during which time she sold countless insurance policies and worked for many different insurance agencies before founding her own; she had an expert’s understanding of the industry, which allowed her to manipulate her victims and avoid detection for years.”

Homeland Security Investigations and the California Department of Insurance investigated this matter.

Assistant United States Attorney Andrew Brown of the Major Frauds Section prosecuted this case.  

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WCAB Denies Reconsideration of Psyche Claim Take Nothing

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Framee Jones while employed during the period November 7, 2023, through January 26, 2024, as an Occupational Therapy Assistant by Vista Knoll Specialized Care, claimed to have sustained injury arising out of and in the course of employment to her psyche.

This matter proceeded to trial over four days, concluding on March 6, 2025. Multiple employer witnesses testified about the incidents in which applicant alleged had caused her an industrial psychiatric injury. Multiple employer witnesses all agreed that Jones was good at her job as an Occupational Therapy Assistant (OTA). However, the witnesses also stated to the Court that her moods were unpredictable, she created an environment in which everyone would “walk on eggshells”, she was more excitable than average, and she could be snappy. On the last day of trial, the matter was submitted.

The WCJ found applicant had not met her burden of proof establishing an industrial injury and  issued an Order that applicant take nothing.

The WCAB denied reconsideration of the take nothing in the panel decision of Jones v Vista Knoll Specialized Care – ADJ19555636 (June 2025).

Labor code § 3208.3 states that in order to establish industrial causation of a psychiatric injury, an injured worker must show by a preponderance of the evidence that actual events of employment predominantly caused the psychological injury. (Lab. Code, § 3208.3(b)(1).

The WCJ relied on the analysis of Verga v. WCAB, (2008) 159 Cal.App.4th 174, 73 CCC 63 in deciding this case. In Verga, the court of appeal agreed with the WCAB in concluding that the disdainful reactions of a supervisor and co-workers to an employee’s mistreatment of them do not constitute “actual events of employment” for which the employee can obtain worker’s compensation benefits for the psychological stress that the employee experiences because of those disdainful reactions to her inappropriate conduct.

Jones attempts to distinguish that the worker in Verga received across the board negative reviews regarding her attitude and performance, while in the current matter every employer witness had nice things to say about her.

The WCJ noted that however “what Petitioner fails to acknowledge is that the standard in Verga establishes that in order to prevail, the worker needs to show ‘objective evidence of harassment, persecution, or other basis for the alleged psychiatric injury.’ “

The WCAB panel denied reconsideration, stating that it has “given the WCJ’s credibility determinations great weight because the WCJ had the opportunity to observe the demeanor of the witnesses. (Garza v. Workmen’s Comp. Appeals Bd. (1970) 3 Cal.3d 312, 318-319 [35 Cal.Comp.Cases 500].) Furthermore, we conclude there is no evidence of considerable substantiality that would warrant rejecting the WCJ’s credibility determinations. (Id.) Thus, we do not disturb the WCJ’s conclusions.”

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Healthline.com Resolves Website Tracking Violations for $1.55M

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The California Attorney General announced a settlement with website publisher Healthline Media LLC, resolving allegations that its use of online tracking technology on its health information website, Healthline.com, violated the California Consumer Privacy Act (CCPA).

An investigation by the California Department of Justice (DOJ) found that Healthline failed to allow consumers to opt out of targeted advertising and shared data with third parties without CCPA-mandated privacy protections – including data suggesting that a person may have a serious health condition.

The proposed settlement, pending final approval from the court, includes $1.55 million in civil penalties and strong injunctive terms, including a novel term that prohibits Healthline from sharing article titles that reveal that a consumer may have already been diagnosed with a medical condition – banning the company from engaging in these types of data transmissions.

Healthline.com is a health and wellness information website that is one of the top 40 most visited websites in the world. Healthline generates revenue by showing ads – some of which are personally targeted at the reader. To maximize ad revenue, Healthline allows online trackers, like cookies and pixels, to communicate data about readers to advertisers and other third parties.

Healthline shared data that could uniquely identify the consumer, in addition to the title of the article they were reading. Some titles indicated that the reader may have already been diagnosed with a serious illness, such as “You’ve Been Newly Diagnosed with MS. What’s Next?” And because these online trackers run invisibly in the background in the first milliseconds when a webpage loads, consumers often have no idea how many online trackers might be running. In Healthline’s case, dozens of trackers were sharing consumer data with numerous third parties.

The complaint alleges Healthline violated the CCPA and the Unfair Competition Law by:

– – Failing to opt consumers out of the sharing of their personal information for targeted advertising. The CCPA gives consumers the right to opt-out of the sale or sharing of their personal information for certain targeted advertising. Businesses and website publishers must honor these requests, including requests submitted through the Global Privacy Control. Healthline continued to share data with some third parties involved in advertising, even for consumer who exercised their right to opt -out.  

– – Violating the Purpose Limitation Principle. Under the CCPA, a business’s use of personal information is limited to the purposes for which the personal information was collected or processed or another disclosed, compatible purpose. Healthline violated this principle by sharing article titles suggesting a consumer may have already been diagnosed with a specific medical condition to target advertising at the consumer.  

– – Failing to maintain CCPA-required contracts. Healthline had not ensured its advertising contracts contain privacy protections for readers’ data required by the CCPA. Instead, Healthline had assumed, but not verified, that the third parties had agreed to abide by an industry contractual framework.

– – Deceiving consumers about privacy practices. The Unfair Competition Law prohibits deceptive business practices. Healthline.com featured a “consent banner” that did not disable tracking cookies, despite purporting to do so if a consumer unchecked a box.  

Under the settlement Healthline is required to ensure that its opt-out mechanisms work correctly; must stop disclosing information that can link a specific consumer to a specific article title that suggests that consumers have been diagnosed with a disease; must maintain a CCPA compliance program that, among other things, mandates that Healthline audits its contracts for specific, required privacy terms or confirm that third parties have signed an industry contractual framework that includes those terms; and maintain accurate online disclosures and privacy policy.

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June 23, 2025 – News Podcast

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Rene Thomas Folse, JD, Ph.D. is the host for this edition which reports on the following news stories: WCAB Decides When and How Subrosa Can Be Sent to QME. Employer Sues Injured Worker’s Firm for Malicious Prosecution. Two Employment Contracts Must Be Read Together For Adhesion. NVIDIA Fraud Expert Charged in Health Plan Fraud scheme. Fugitive Physician Sentenced in $1.5M Health Care Fraud Scheme. Physician Pleads Guilty for Ketamine Sales to Actor Matthew Perry. DOI Launches Investigation of State Farm Fire Claim Handling. Kaiser School of Medicine adds Pepperdine MD/MBA Program.

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Convicted SoCal Comp Fraudster Charged in New $270M Fraud Sweep

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The Justice Department announced the results of its 2025 National Health Care Fraud Takedown, which resulted in criminal charges against 324 defendants, including 96 doctors, nurse practitioners, pharmacists, and other licensed medical professionals, in 50 federal districts and 12 State Attorneys General’s Offices across the United States, for their alleged participation in various health care fraud schemes involving over $14.6 billion in intended loss.

And reaching across the country, the U.S. Attorneys office for the Central District of California announced that an Orange County man, who’s name might have a familiar ring to the worker’s compensation community, has just been charged via federal criminal complaint with submitting nearly $270 million in fraudulent claims to Medi-Cal, over an 11-month span, for expensive prescription drugs containing generic ingredients that were not medically necessary and, in many instances, not provided to the purported recipients.

66 year old Paul Richard Randall is now charged with health care fraud, a felony that carries a statutory maximum penalty of 10 years in federal prison.Randall made his initial appearance in United States District Court in Los Angeles on Friday and was ordered jailed without bond. His arraignment is scheduled for July 17.

Randall has a long criminal history as he reportedly began his career as a hospital marketer in the mid-1990s after serving a stint in federal prison for racketeering. He was convicted of the felony in 1993 for deals that involved buying wooden shipping pallets on credit and reselling them without paying the original vendors, and was sentenced to a 21-month term. After serving time in the Terminal Island federal correctional facility in Long Beach harbor, Mr. Randall went into business with Michael D. Drobot, the owner of Pacific Hospital of Long Beach.

Drobot pleaded guilty to criminal charges related to paying more than $20 million in kickbacks and bribing California state Sen. Ron Calderon to preserve a loophole in state law that enabled him to charge insurers sky-high prices for spinal hardware used at the Pacific Hospital of Long Beach. The FBI has said the kickbacks-for-surgeries scam is believed to be the largest in California history.

After a business dispute between the two men, Randall moved to Tri-City Regional Medical Center in Hawaiian Gardens in 2008, a hospital eight miles away that then focused on bariatric surgery. Tri-City, which is a nonprofit institution, paid Mr. Randall more than $3.2 million between 2008 and July 2011 as a business-development consultant. Mr. Randall recruited some of the same spine surgeons to Tri-City that he earlier introduced to Mr. Drobot at Pacific Hospital.

By August 2011, Mr. Randall said, he was back to doing spine-surgery marketing work for Mr. Drobot at Pacific Hospital of Long Beach. Randall reportedly said he signed a $100,000-a-month marketing agreement with Mr. Drobot – technically between Mr. Drobot’s spinal-implant distributorship and a Randall marketing firm – under which Mr. Randall was to provide services such as “recruiting surgeons to the medical staff of hospitals that use” implants Mr. Drobot distributes. Drobot disputed signing such an agreement.

Randall pleaded guilty on April 16, 2012 to conspiracy to commit mail fraud. Randall admitted recruiting chiropractors and doctors to refer patients to Tri-City in exchange for kickbacks. Randall’s guilty plea in 2012 and agreement to cooperate in “Operation Spinal Cap” suggest he provided information to federal investigators, potentially implicating others in the Pacific Hospital and Tri-City schemes.

However, his 2017 arrest for violating pre-sentencing release terms in the Tri-City case and subsequent fraud allegations indicate continued criminal activity. A judge denied bail on October 23, 2017, ordering Randall to remain in custody at the Santa Ana city jail until sentencing. His sentencing was advanced to November 17, 2017, from December 22, 2017. Prosecutors sought a sentence of 37 to 46 months in prison, plus restitution.

Randall incorporated a company, Pharma Pro Solutions, in 2016, which was implicated in a scheme to defraud the University of California’s Student Health Insurance Plan (UC SHIP). The scheme allegedly stole student health plan ID numbers to bill $12 million for compound drugs over six months starting in October 2016. The Regents of the University of California amended a civil complaint in July 2017, filed in Los Angeles County Superior Court, alleging Randall’s involvement. The scheme involved recruiting students to apply for positions selling topical creams, requiring them to provide UC SHIP numbers and fill out health history forms, or offering payments for participating in “clinical trials” of pain creams.

Also, in what may be characterized as a federal lawsuit pieced together from evidence that exists across existing criminal and civil litigation, 14 AIG insurance related companies sought restitution from nearly 30 named defendants who it claims fraudulently or illegally made claims for payment for providing worker’s compensation treatment on cases where AIG entities provided coverage. The 22 page federal lawsuit filed on October 31, 2017 listed Paul Richard Randall as one of the named defendants.

According to an affidavit filed with the newest complaint, Randall, Kyrollos Mekail, 37, of Moreno Valley, and Patricia Anderson, 57, of West Hills, took advantage of Medi-Cal’s suspension of its requirement that health care providers obtain prior authorization before providing certain health care services or medications as a condition of reimbursement. The suspension of the prior authorization requirements was part of an ongoing transition of Medi-Cal’s prescription drug program to a new payment system.

Through a business called Monte Vista Pharmacy, Randall and his co-schemers allegedly exploited Medi-Cal’s prior authorization suspension by billing Medi-Cal tens of millions of dollars per month for dispensing high-reimbursement, non-contracted, generic drugs through Monte Vista Pharmacy. Some prescription medications purportedly were to treat pain and included Folite tablets, a vitamin available over the counter.

Normally, these high-cost reimbursement medications would have required prior authorization under Medi-Cal’s old payment system. Medication involved in this scheme was medically unnecessary, frequently was not dispensed to patients, and procured by kickbacks.

From May 2022 to April 2023, Monte Vista billed Medi-Cal more than $269 million and was paid more than $178 million for 19 expensive, non-contracted drugs containing low-cost, generic ingredients that were not medically necessary, not provided, or both.

Randall and others then allegedly laundered their illicit proceeds by transferring the proceeds of the Medi-Cal fraud scheme to a third party to pay kickbacks to Anderson, to promote the fraud scheme and to conceal and disguise the transfers from detection by law enforcement.

Relatedly, Anderson was charged in a two-count information charging her with health care fraud for her role in the scheme which was unsealed last week. Mekail pleaded guilty to criminal charges in August 2024 and awaits sentencing.

As a result of the national takedown, the government seized more than $245 million in cash, luxury vehicles, cryptocurrency, and other assets as part of the coordinated enforcement efforts. As part of the whole-of-government approach to combating health care fraud announced today, the Centers for Medicare and Medicaid Services (CMS) also announced that it successfully prevented more than $4 billion from being paid in response to false and fraudulent claims and that it suspended or revoked the billing privileges of 205 providers in the months leading up to the Takedown.

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