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Previously Convicted Fresno Healthcare CEO Arrested for $7M Fraud

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The CEO of a Fresno-based home health care company was arrested at San Francisco International Airport while attempting to board a flight to Nigeria. He is charged in a criminal complaint alleging that he fraudulently obtained more than $7 million in payments from the Department of Veterans Affairs for services that were never actually rendered, including care purportedly rendered to veterans weeks after they had died, U.S. Attorney Eric Grant announced.

According to court documents, between December 2019 and July 2024, Cashmir Chinedu Luke, believed to be 66, of Antioch, operated Four Corners Health LLC. That entity provided unskilled in-home nursing and day-to-day care for elderly VA beneficiaries under the Veterans Community Care Program. Four Corners provided services in Fresno, Tulare, Merced, Mariposa, Madera, San Francisco, and Contra Costa Counties.

Luke engaged in a five-year scheme to bill the VA for hours of care that were not actually rendered to veterans. Luke caused Four Corners to submit approximately 10,000 individual false claims of care provided that caused the VA, through its third-party benefits administrator, to reimburse Four Corners $7 million for duplicate claims for care actually provided, claims for days caretakers were not present with veterans, claims for hours of care beyond those actually worked by caretakers, and claims of care for veterans who were actually dead.

Luke served as the sole owner and billing representative for Four Corners and actively deceived the VA’s third-party benefits administrator as it attempted to recover some of the fraudulently paid reimbursements. This allowed the Four Corners billing scheme to continue.

Luke personally profited from the scheme as the sole owner of the bank account that received the reimbursement payments. Luke spent reimbursement payments immediately after being paid by the VA, either by spending lavishly on personal expenses or by promptly transferring the funds across a network of bank accounts throughout Asia and Africa.

This is not Luke’s first encounter with federal law. In 2009, he was convicted in the U.S. District Court for the District of Maryland of conspiracy to commit identification document fraud and aggravated identity theft. His appeal in United States v. Luke, 628 F.3d 114 (4th Cir. 2010), was filed following his October 23, 2009, conviction in the U.S. District Court for the District of Maryland on all four counts of the indictment.

Luke challenged the sufficiency of the evidence supporting his convictions, arguing that his actions did not fall within the scope of the relevant federal statutes. The Fourth Circuit, in a published opinion authored by Judge Allyson K. Duncan, rejected these arguments in a unanimous decision and affirmed the district court’s judgment. The opinion emphasized that the statutes’ broad language clearly encompassed Luke’s fraudulent conduct, and the evidence at trial was more than sufficient to support the jury’s verdict. He served a 27-month prison sentence, followed by three years of supervised release.

Court records from that case indicate Luke, a naturalized U.S. citizen originally from Nigeria, used two identities – his legal name (Cashmir Luke) and birth name (Chinedu Cashmire Osuagwu) – and was found to have committed perjury during his testimony. The 2008 detention order noted his “ties to Nigeria,” which may explain the timing of his attempted departure.

Luke immigrated to the United States from Nigeria in 1982 and became a naturalized citizen in 1984. He initially obtained a U.S. passport and a Virginia driver’s license under his birth name, Chinedu Cashmire Osuagwu. In 1996, he legally changed his name to Cashmir Chinedu Luke but continued to actively maintain both identities for separate purposes, such as professional and personal dealings. At the time of the 2009 offenses, Luke resided in Randallstown, Maryland, and worked as a respiratory therapist at a rehabilitation hospital in Baltimore.

This 2025 case is the product of an investigation by the U.S. Veterans Affairs Office of Inspector General. Assistant U.S. Attorney Calvin Lee is prosecuting the case.

If convicted, Luke faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

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Physician to Serve 2.5 Years For Selling Ketamine to Matthew Perry

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A former physician from Santa Monica was sentenced today to 30 months in federal prison for repeatedly selling vials of ketamine to actor and author Matthew Perry despite knowing Perry’s well-documented history of drug addiction and that Perry’s personal assistant was administering the drug without medical training or supervision.

Salvador Plasencia, 44, a.k.a. “Dr. P,” was sentenced by United States District Judge Sherilyn Peace Garnett, who also fined him $5,600 and ordered him immediately remanded to federal custody.

Plasencia pleaded guilty on July 23 to four counts of distribution of ketamine. He surrendered his California medical license in September 2025.

Plasencia was a physician who owned and operated a Calabasas-based urgent-care clinic called Malibu Canyon Urgent Care LLC. As a medical doctor, Plasencia knew that ketamine was a controlled substance and an anesthetic that is used to treat – without the approval of the United States Food and Drug Administration – depression and other psychiatric conditions.

At all relevant times, Plasencia knew about potential risks associated with ketamine, including sedation, psychiatric events, abuse and misuse by patients, among others. As his treatment notes reflected, Plasencia also believed that patients “should be monitored by [a] physician when undergoing treatment as a safety Measure,” according to court documents.

On September 30, 2023, Plasencia was introduced to Perry by one of his own patients who stated that Perry was a “high profile person” who was seeking ketamine and was willing to pay “cash and lots of thousands” for ketamine treatment, according to Plasencia’s plea agreement.

“Rather than do what was best for Mr. Perry – someone who had struggled with addiction for most of his life – [Plasencia] sought to exploit Perry’s medical vulnerability for profit,” prosecutors argued in a sentencing memorandum. “Indeed, the day [Plasencia] met Perry he made his profit motive known, telling a co-conspirator: ‘I wonder how much this moron will pay’ and ‘let’s find out.’”

The same day Plasencia met Perry, he contacted Mark Chavez, 55, then a licensed San Diego physician. Plasencia that day drove to Costa Mesa and purchased from Chavez $795 in ketamine vials and tablets, syringes, and gloves. Plasencia then drove to Perry’s home in Los Angeles, injected Perry with ketamine, and left at least one vial of ketamine to Kenneth Iwamasa, 60, of Toluca Lake, Perry’s personal assistant. Iwamasa paid Plasencia $4,500.

During the following weeks, Plasencia again purchased ketamine from Chavez and administered the drug to Perry multiple times at Perry’s home and once in a Long Beach parking lot while in the backseat of Perry’s vehicle.

During one ketamine treatment at Perry’s home, Perry’s blood pressure spiked causing him to freeze up. Notwithstanding Perry’s reaction, Plasencia left additional vials of ketamine with Iwamasa, knowing that Iwamasa would inject the ketamine into the victim.

From September 30, 2023, to October 12, 2023, Plasencia distributed 20 vials and multiple tablets of ketamine and syringes to Iwamasa and Perry, knowing that his conduct fell below the proper standard of medical care and that the ketamine transfers were not for a legitimate medical purpose. As prosecutors argued in their sentencing memorandum, Plasencia charged a total of $57,000 for these efforts, even though the going price of ketamine was only approximately $15 per vial.

Plasencia later placed an order for 10 vials of ketamine through a licensed pharmaceutical company using his Drug Enforcement Administration (DEA) license. After receiving the ketamine, on October 27, 2023, he sent the following text message to Iwamasa: “I know you mentioned taking a break. I have been stocking up on the meanwhile. I am not sure when you guys plan to resume but in case its when im out of town this weekend I have left supplies with a nurse of mine …I can always let her know the plan.”

Perry fatally overdosed on ketamine the following day. Plasencia did not provide the ketamine that caused his death.

After Perry’s overdose and in response to a subpoena issued by the DEA to Plasencia, Plasencia falsified purported treatment notes and an invoice for Perry, which prosecutors argued were designed to cover up that he had been illegally selling vials of ketamine to Iwamasa. Among other things, Plasencia provided fraudulent notes that claimed on October 7, 2023, Perry was “scheduled to meet for a treatment session but was not present,” when, in fact, as Plasencia knew, the only person he was schedule to meet on that day was Iwamasa, at midnight, at a public street corner outside of a bar in Santa Monica, to sell Iwamasa vials of ketamine, to be administered to Perry without any health care professional present.

Chavez and Iwamasa pleaded guilty last year to federal drug charges and are scheduled to be sentenced on December 17, 2025, and January 14, 2026, respectively.

Two other defendants charged in connection with Perry’s death – Erik Fleming, 56, of Hawthorne, and Jasveen Sangha, 42, a.k.a. “Ketamine Queen,” of North Hollywood, also pleaded guilty to federal drug charges and await sentencing on January 7, 2026, and February 25, 2026, respectively.

The Los Angeles Police Department, the DEA, and the United States Postal Inspection Service investigated this matter.Assistant United States Attorneys Ian V. Yanniello of the National Security Division and Haoxiaohan H. Cai of the Major Frauds Section prosecuted this case.

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Prop 103 Reform Competing Ballot Measures Declare Armistice

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Proposition 103, passed by California voters in 1988, is a landmark insurance reform measure that rolled back auto and homeowners insurance rates by about 20%, established prior approval requirements for rate increases (giving the elected Insurance Commissioner oversight), and created other consumer protections to prevent excessive pricing and ensure fair practices.

Authored by Harvey Rosenfield of Consumer Watchdog, it has saved Californians billions in premiums over the decades but has come under fire amid the state’s ongoing insurance crisis, driven by wildfires, climate change, and rising claims costs. Critics, including some insurers and brokers, argue it stifles market competition and deters companies from offering policies in high-risk areas, leading to insurer pullbacks and coverage gaps.

The conflict escalated in 2025, prompting competing ballot measures for the November 2026 election. One of them was the California Insurance Market Reform and Consumer Protection Act of 2026. It was filed in August 2025 by Elizabeth Hammack, a Roseville-based insurance broker and owner of Panorama Insurance Associates.

This initiative sought to overhaul Prop 103 by repealing its core rate-regulation provisions, allowing faster rate approvals, reducing regulatory burdens, and aiming to attract more insurers back to the market. Supporters framed it as essential for stabilizing California’s “free-falling” insurance sector, citing recent catastrophic fires like those in Altadena and Pacific Palisades.

This prompted a response. The Insurance Policyholder Bill of Rights. It was filed on September 22, 2025, by Consumer Watchdog leaders Carmen Balber (executive director), Jamie Court, and Harvey Rosenfield. This measure responded directly to Hammack’s filing and proposed strengthening consumer protections. Key provisions included: Guaranteeing homeowners insurance for those meeting state wildfire mitigation standards (or facing a five-year sales ban for non-compliant insurers).

Consumer Watchdog positioned it as a defense of Prop 103’s legacy while addressing modern challenges like the exodus of five major homeowners insurers from parts of California.

On December 2, 2025 leaders from both sides announced a mutual “armistice,” withdrawing their initiatives from the 2026 ballot. This deal preserves Prop 103’s existing reforms intact for now, avoiding a high-stakes voter showdown that could have divided the insurance debate further.

In a joint statement from Consumer Watchdog, Balber, Court, and Rosenfield explained: “This armistice preserves the landmark protections and consumer savings under insurance reform Proposition 103, which was the principal reason we filed the Policyholder Bill of Rights this year. We said if the broker withdrew, we would withdraw. There is still a huge need for many of the other protections in the ballot measure, including the right to be guaranteed an insurance policy if homeowners meet state wildfire mitigation standards and the right to better claims handling policies.”

“We do not have the financial resources to pursue this fight at this time. However, we will spend the next year building support in order to pressure the insurance industry to sell policies in higher risk areas and to treat their customers better. Polling shows 85% of voters want insurance companies to have a mandate to sell homeowners insurance to people who fire-proof their homes. It’s up to the legislature to enact such changes. If they do not, we will work to have the resources to take this popular fight directly to the voters in 2028.”

California’s insurance market remains strained: Recent laws like SB 1107 (effective January 2026) offer temporary relief by speeding up rate approvals for “good faith” filers, but critics call it a “Band-Aid.”

The competing ballot withdrawals avert a costly signature-gathering and campaign fight (ballot measures require ~546,000 valid signatures), but they don’t resolve underlying tensions – insurers continue to limit policies in fire-prone areas, leaving many homeowners uninsured or underinsured. Public sentiment leans pro-consumer, per the polling cited, which could fuel legislative momentum.

This development highlights the ongoing tug-of-war between deregulation (to lure insurers) and consumer safeguards in a wildfire-ravaged state.

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National Company Pays $500K For Unlawful “No Poaching” Agreements

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California’s Unfair Competition Law (UCL), codified in Business and Professions Code Section 17200, prohibits any unlawful, unfair, or fraudulent business act or practice. This broad statute has been applied to challenge “no-poach” provisions – also known as no-hire or non-solicitation agreements between competing companies – where employers agree not to recruit, solicit, or hire each other’s employees, either explicitly or through informal arrangements. Such agreements are viewed as anticompetitive because they restrict employee mobility, suppress wages by limiting competition for talent, and hinder workers’ ability to negotiate better compensation or job terms.

No-poach provisions also may violate California antitrust laws under the Cartwright Act (Business and Professions Code §§ 16720 et seq.), which bars agreements that restrain trade, including those that suppress compensation or limit hiring among competitors. They can also constitute violations of the Unfair Competition Law (UCL – Section 17200) when deemed unlawful or unfair business practices.

PSSI is a national cleaning and sanitation company that contracts with dozens of meatpacking and food processing facilities in California and hundreds across the country. Nationally, PSSI employs over 17,000 workers across approximately 500 worksites. PSSI has had cleaning contracts with over 20 meatpacking and food processing companies in California, including well-known names such as Foster Farms, Harris Ranch, and Pilgrim’s Pride.

DOJ’s investigation revealed that PSSI had implemented a no-poach provision in 22 out of its 24 operative contracts in California, which impacted the rights of approximately 6,000 employees who worked pursuant to those contracts. Today’s judgment, once approved by the court, resolves the allegations stated above.

According to the Attorney General, this business practice, often hidden from employees, can have serious implications including artificially lowering employee compensation, reducing incentives for companies to improve working conditions, and limiting employee career growth.

Last April, the Attorney General filed a lawsuit against PSSI in the Superior Court of the State of California, County of San Diego, Case No. 25CU022640C, entitled The People of the State of California v. Packers Sanitation Services, Inc., LTD., dba Fortrex; Packers Sanitation Services, LTD., LLC, a California corporation; and Does 1 through 20, alleging a cause of action for violations of Business and Professions Code Section 17200 Unfair Competition Law related to the No Hire Provision allegedly contained within Services Agreements So-called no-poach provisions are contractual agreements between employers to not hire each other’s employees.

The People further allege that PSSI’s No Hire Provision had the effect of restraining employee mobility in violation of Business and Professions Code section 16600.

PSSI removed the No Hire Provision from all of its California Services Agreements by February 2024.

This week the California Attorney General announced a settlement against Packers Sanitation Services, Inc. LTD., now doing business as Fortrex (PSSI), a national cleaning and sanitation company, resolving allegations that the company used unlawful “no poach” agreements that restrict competition. As part of the settlement, PSSI will provide notice to employees and customers regarding its discontinued use of the unlawful provision, in addition to paying $500,000 in civil penalties.

According to the Settlement Agreement the Defendants continue to deny all allegations of wrongdoing and liability in connection with this litigation.

There have been several other no-poaching cases filed in California dating back to at least 2011.

2011 – In re High-Tech Employee Antitrust Litigation, Settled in 2015 for $415 million.
2014 – In re Animation Workers Antitrust Litigation, Settled in 2017 for $100 million.
2016 – Frost v. LG Electronics Inc., Dismissed in 2018 for failure to plausibly allege U.S. impact.
2017 – Markson v. CRST International Inc, Ongoing
2018 – Multistate Fast-Food No-Poach Settlements (e.g., Arby’s, Dunkin’, Five Guys, Little Caesars), no monetary penalties but injunctive relief.
2019 – Multistate Fast-Food No-Poach Settlements (e.g., Burger King, Popeyes, Tim Hortons), 2020 settlements prohibited future use nationwide.

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Grounds for County of LA Workplace Violence Restraining Order Affirmed

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Neill Francis Niblett was employed by the County of Los Angeles’s fire department as a senior mechanic. He frequently voiced complaints about management decisions, often raising his voice toward Samuel S. (a nonparty to this case) who was an assistant chief.

On October 5, 2022, Niblett reportedly acted in a verbally abusive manner after Samuel instructed him to pick up parts left on the floor of a department facility. Several days later, on October 11, 2022, Niblett expressed frustration to department secretary Cari Hughes over the transfer of one of his mechanics without his knowledge. During this conversation, Niblett stated, “If they don’t change things in this department, they’re going to have another situation like they had with Tatone.” This alluded to a June 2021 incident in which firefighter Jonathan Tatone fatally shot a colleague at Fire Station 81.

The County filed a petition for a three-year workplace violence restraining order (WVRO) issued pursuant to Code of Civil Procedure section 527.82 that protects nonparty Samuel S.3 from defendant and appellant Neill Francis Niblett on November 18, 2022. It was supported by declarations from Samuel and Hughes. A temporary restraining order was issued shortly thereafter.

Niblett filed a verified response denying the allegations, accompanied by a declaration from union president Luis Del Cid, who described an interaction between Samuel and Niblett but was not a percipient witness. At the January 18, 2023 hearing, Hughes, Samuel, and Del Cid testified; Niblett appeared but did not testify.

The trial court found by clear and convincing evidence that Niblett’s October 11 statement constituted a credible threat of violence under section 527.8, as it was a knowing and willful statement that would place a reasonable person in fear for their safety or that of their immediate family, serving no legitimate purpose.

The WVRO barred Niblett from harassing Samuel, entering his workplace, or possessing firearms or ammunition, and it was set to expire on January 18, 2026. Due to his conduct, Niblett was placed on leave and had not returned to work as of the hearing.

The Court of Appeal affirmed the trial court in the partially published case of County of Los Angeles v. Neill Francis Niblett  -B327744 (November 2025).

On appeal, Niblett challenged the sufficiency of the evidence supporting the credible threat finding, arguing the statement was mere criticism of management rather than a threat. The appellate court rejected this, holding that substantial evidence – viewed in the light most favorable to the County and under the clear and convincing standard – supported the trial court’s determination. The court reasoned that a reasonable person could interpret Niblett’s reference to the Tatone shooting, made amid ongoing frustrations with department decisions, as an implied threat of violence against management if changes were not made. Samuel, as Niblett’s supervisor and a logical target, was appropriately named as the protected party. The court further concluded that great or irreparable harm would likely result without the order, given the reasonable probability of future unlawful violence.

Niblett’s constitutional claims were also unavailing. His First Amendment challenge failed because the statement qualified as a “true threat,” unprotected by the Constitution. The Second Amendment claim regarding the firearm restriction was rejected, as section 527.8’s provisions align with historical traditions of disarming individuals posing credible threats of violence. Additional claims of error, including procedural and evidentiary issues, were deemed forfeited due to inadequate briefing or being raised for the first time in reply.

Notably, the opinion highlighted concerns over Niblett’s appellate counsel’s apparent misuse of artificial intelligence in preparing the opening brief, which included misrepresentations of case holdings and citation to a nonexistent case. Counsel failed to correct these errors despite the County’s identification of them. In a concurrent ruling, the court ordered counsel to show cause why sanctions should not be imposed for undermining the integrity of the appellate process.

The WVRO was affirmed in its entirety.

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Another So.Cal Attorney Sanctioned for an AI Appellate Brief

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In the published case of Shayan v. Shakib -B337559 (December 2025) the Court of Appeal issued a strongly worded published order imposing sanctions on appellant’s counsel, Fahim Farivar, for filing an opening brief riddled with fabricated case quotations and an intentionally misleading citation to a hearing transcript from an unrelated case.

According to his firm’s website “Farivar Law Firm, APC is an AV-rated Los Angeles legal firm which has built a strong reputation for aggressive litigation, outstanding results, and attentive service. We combine the many services of a large legal firm with the personal attentiveness of a sole attorney practice.” Farivar has an office at 18321 Ventura Blvd., Suite 750 in Tarzana California.

The respondent moved to strike the brief and dismiss the consolidated appeals, contending that the numerous fictitious quotations were the product of artificial-intelligence “hallucinations.” Appellant and Farivar denied any use of AI, instead attributing the inaccuracies to a flawed internal drafting process in which non-attorney staff were given vague paraphrased “placeholders” and instructed to locate and insert verbatim language from Westlaw. The court found this explanation immaterial: whether the false quotations originated from generative AI or from Farivar’s delegation of critical citation work to unqualified staff, the signatory attorney remained fully responsible for ensuring the accuracy of everything submitted to the court.

The panel identified three categories of fabrications: (1) real words from cited cases rearranged into sentences that never appeared in the opinions; (2) loose paraphrases presented as direct quotations; and (3) wholly invented statements bearing no relation to the cited authority (including one fabricated quotation about attorney fees in a case that never mentioned the topic). The court rejected Farivar’s characterization of these as mere “clerical citation errors,” noting that the opposition papers themselves continued to misrepresent case holdings.

Relying on recent precedent (People v. Alvarez (2025) 114 Cal.App.5th 1115 and Noland v. Land of the Free, L.P. (2025) 114 Cal.App.5th 426), the court held that submitting briefs containing fabricated legal authority constitutes an unreasonable violation of the California Rules of Court and the Rules of Professional Conduct, regardless of the source of the falsehoods. Farivar’s practice of providing staff with placeholder paraphrases and expecting accurate verbatim insertions carried the same inherent risk of error as uncritical reliance on AI tools.

The court declined to grant respondent’s request to dismiss the appeals, finding that sanction short of dismissal would suffice. Instead, it ordered:

– – Monetary sanctions of $7,500 payable by Farivar personally to the clerk of the court within 30 days of remittitur;
– – The original opening brief stricken in its entirety;
– – Appellant granted leave to file a corrected opening brief (with redline) within 10 days, limited to removing or correcting the fabricated material; and
– – A copy of the order forwarded to the State Bar of California for investigation of Farivar’s apparent violation of Rules of Professional Conduct, rule 3.3(a)(2) (prohibiting knowingly misquoting authority).

Emphasizing the broader threat to judicial integrity, the court warned that inaccurate or hallucinated authorities whether generated by technology or human carelessness can be repeated, believed, and eventually treated as established law. The panel declared there is “no room in our court system for the submission of fake, hallucinated case citations, facts, or law.”

The order underscores that, in the era of both generative AI and increasingly complex delegation practices, the ethical and procedural duty of accuracy remains exclusively on the attorney who signs and files the document.

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November 24, 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: Honda Dealership Prevails in PAGA Wage Hour Dispute. Court Clarifies When a PAGA Settlement Resolves Multiple Lawsuits. Wells Fargo Pays $85M to Settle Fake Diversity Job Interview Class Action. Worker Misclassification Rules Under Public Works Contracts Clarified. CVS Pharmacy Inc. Resolves False Claim Act for $18.3M. Fraudulent Claimants Paid Millions to Indicted VA Claims Examiner. CalChamber Reports 2024 PAGA Reforms are Successful. JOEM Study Shows Asthma Caused by Cannabis Industry Exposures.

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CEO Convicted in $100M Health Care Fraud Scheme

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A federal jury in San Francisco convicted Ruthia He, the founder and CEO of Done, a California-based digital health company, and David Brody, its clinical president, for their roles in a years-long scheme to illegally distribute Adderall over the internet and conspire to commit health care fraud in connection with the submission of false and fraudulent claims for reimbursement for Adderall and other stimulants. Ruthia He was also convicted of conspiring to obstruct justice.

Done Global Inc. was founded in 2019 by Ruthia He, a former Facebook product designer with no medical background. The company capitalized on regulatory changes introduced during the COVID-19 pandemic in 2020, when the Drug Enforcement Administration (DEA) relaxed rules requiring in-person consultations for prescribing controlled substances. This allowed Done to offer online access to ADHD medications, including Adderall, Ritalin, and Vyvanse.

According to court documents and evidence presented at trial, He and Brody conspired with others to build a billion-dollar technology company and raise money from investors by providing easy access to over 40 million pills of Adderall and other stimulants in exchange for payment of a monthly subscription fee. They both spent over $40 million on deceptive advertisements on social media networks that sought to convince Americans challenged by a lack of structure during the COVID-19 pandemic that they were suffering from ADHD. Defendants also paid for targeted keyword search advertisements for drug seekers who wanted to obtain Adderall without a legal prescription.

The evidence at trial showed that He and Brody sought to place “hard limits” on clinical discretion by limiting the length of the initial appointment to less than half the length of a typical psychiatric examination, and seeking to increase profits by refusing to pay for any follow-up treatment. In order to facilitate the illegal prescriptions, He paid nurse practitioners around the country up to $60,000 per month to refill prescriptions without clinical interaction, and enabled an “auto-refill” technology feature where patients could receive prescriptions without clinical interaction for years based on an auto-generated email sent each month requesting additional prescriptions. The auto-refill policy, in some instances, resulted in prescriptions being issued for deceased patients.

He instructed employees that successful technology companies profit off addiction, and offered an expensive luxury electric vehicle to employees who broke the law. Brody told nurses to continue prescribing Adderall, even to patients who were abusing other medications, and to disregard the risk of going to jail. He and Brody also prohibited independent clinical practitioners from discharging patients, and patients were not discharged and continued to receive Adderall even after concerned family members repeatedly notified Done that their children were suffering from bipolar, Adderall-induced psychosis, or other mental health conditions that could be worsened by continued prescriptions.

In order to ensure that members continued paying monthly subscription fees, He, Brody, and others conspired to defraud insurers so that Done members would be able to use insurance to pay for Adderall dispensed at pharmacies. He, Brody, and others submitted false and fraudulent prior authorization requests to insurers, which claimed that Done followed the DSM-5 in diagnosing ADHD, utilized urine drug screens, and falsely claimed that non-stimulants had previously been tried without success. As a result, Medicare, Medicaid, and the commercial insurers paid in excess of approximately $14 million.

In 2022, national media outlets reported that Done was making Adderall too easy to get online. In response to questions from the media, investors, and certain major pharmacy chains, the defendants made deceptive statements about Done’s policies. While internal documents showed that the defendants followed a “customer-first” philosophy where they attempted to obtain customer approval ratings higher than America’s highest-rated retailers, offered second opinions to patients who complained of being denied Adderall, and that He – who had no medical training – ultimately was responsible for approving clinical practices, The defendants falsely denied the existence of these policies and claimed Done was run by independent clinical leadership.

To obstruct the government’s investigation, the evidence at trial showed that He moved operations to China to make personnel and evidence unavailable. He limited her communications on company platforms, used encrypted messaging apps with disappearing messages, and deleted incriminatory documents, such as language encouraging Done providers to provide Adderall even to patients who did not have ADHD. He also transferred over $1 million to a Chinese shell company named Make Believe Asia, conducted internet searches for countries that did not have extradition, and was stopped by law enforcement leaving the country.

He and Brody were both convicted of one count of conspiracy to distribute controlled substances, four counts of distribution of controlled substances, and one count of conspiracy to commit health care fraud. He was also convicted of one count of conspiracy to obstruct justice. He and Brody each face a maximum penalty of 20 years in prison on the conspiracy to distribute controlled substances and distribution of controlled substances counts. Sentencings are set for Feb. 25, 2026. Judge Breyer will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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Four Face Sentencing in Staged Collision Insurance Fraud Case

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Four people have pleaded no-contest to felony insurance fraud and assault charges for their role in staging a collision targeting a rideshare driver. Fifth individual, alleged co-conspirator, Deshawn Perater-Nickson, 26, of Adelanto, faces additional charges of false imprisonment, pimping, and pandering and is due in court January 26, 2026.

Ledontae Pope, 30, of San Bernardino, and Kalil Davis, 27, of Hesperia, were arrested on January 24, 2025 for insurance fraud and assault with a deadly weapon related to a staged collision involving a rideshare vehicle.

Investigators from the Inland Empire Automobile Insurance Fraud Task Force (IEAIFTF) found on November 23, 2024 a collision involving Pope, Davis, John Murillo, 37, of San Bernardino, occurred on the I-215 in San Bernardino. The suspects ordered a rideshare and during that ride, a separate vehicle driven by Murillo, intentionally collided with the rideshare vehicle driven by the victim. Perater-Nickson was the registered owner of the vehicle that Murillo was driving. The suspects intended to file bodily injury claims against the rideshare driver’s insurance and collect the insurance payout.

The incident was originally reported to the California Highway Patrol (CHP) as a hit and run and the suspects traveling in the rideshare vehicle claimed injuries and were transported to the hospital via ambulance. The CHP then reported the collision to the IEAIFTF, after the rideshare driver came forward and suspected they were intentionally hit by the other vehicle.

On January 27, 2025 the San Bernardino County District Attorney’s Office charged Pope, Davis, and Perater-Nickson with assault with a deadly weapon and insurance fraud. At the time of their arrests, two of the three suspects were on probation for previous convictions for narcotics trafficking, assault with a deadly weapon, and felony possession of a firearm.

Additional search warrants were conducted after the arrests of Pope, Davis, and Perater-Nickson which led to the discovery of the identities of two additional suspects. The driver, Murillo and co-conspirator Klydale Moses, 24, of Fontana, were arrested on May 19, 2025 on felony charges of insurance fraud and knowingly cause or participate in a vehicle collision/insurance claim. Moses was not in either vehicle at the time of the collision, but was identified as a co-conspirator and participant of the fraud scheme.

Between September 30, 2025 and October 30, 2025, the following defendants pleaded no contest to felony charges:

– – Pope pleaded no contest to knowingly cause or participate in a vehicle collision/Insurance Claim and Assault by means of force likely to produce great bodily injury. Pope was sentenced to 90 days in county jail and two years felony probation.
– – Davis pleaded no contest to Insurance Fraud and Assault with a deadly weapon. Davis was sentenced to 180 days county jail and two years felony probation.
– – Murillo pleaded no contest to knowingly cause or participate in a vehicular collision/Insurance Claim. Murillo has not been sentenced and remains in custody, but agreed to two years state prison as part of his plea.
– – Moses pleaded no contest to Insurance Fraud. Moses was sentenced to 90 days in county jail and two years felony probation.

Perater-Nickson’s was arrested on January 24, 2025 for insurance fraud and assault with a deadly weapon. His case remains in court. While in custody, on March 13, 2025, he was charged with additional charges related to false imprisonment, pimping, and pandering as a result of evidence discovered during the IEAIFTF investigation.

The IEAIFTF is comprised of peace officers from the California Department of Insurance, the San Bernardino County District Attorney’s Office, Riverside County District Attorney’s Office, and California Highway Patrol. This case is being prosecuted by the San Bernardino District Attorney’s Office.

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Court Clarifies When a PAGA Settlement Resolves Multiple Lawsuits

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In a newly published decision, the California Court of Appeal (Second District, Division Eight) affirmed the dismissal of a representative PAGA action on claim preclusion grounds, holding that a prior global PAGA settlement barred a subsequent plaintiff’s overlapping claims – even though the settling plaintiff had filed an amended complaint only 35 days after submitting an amended Labor & Workforce Development Agency (LWDA) notice for newly added claims and defendants.

In this case Lauren Brown, a former Dave & Buster’s employee, filed a standalone PAGA suit in June 2019 alleging meal and rest-break violations, off-the-clock work, inaccurate wage statements, and unpaid vacation wages under Labor Code § 227.3.

At that time, at least four other PAGA actions were already pending against the same Dave & Buster’s entities. One of those earlier actions – Andrade v. Dave & Buster’s Management Corporation, Inc. (San Diego Superior Court) -ultimately achieved a court-approved global settlement in November 2022 that expressly released all of the claims Brown was asserting, including the § 227.3 vacation claim, and covered all three Dave & Buster’s entities Brown had sued.

Dave & Buster’s successfully moved for judgment on the pleadings in Brown’s case, contending that the Andrade settlement constituted a final judgment on the merits of the same cause of action between parties in privity, thereby precluding Brown’s suit. The trial court agreed and dismissed the action with prejudice.

The Court of Appeal affirmed the dismissal in the published case of Brown v. Dave & Buster’s of California, Inc. -B339729 (November 2025).

On appeal, Brown conceded that the Andrade settlement precluded her non-vacation claims but argued that (1) she retained standing to pursue post-settlement violations (a contention the Court of Appeal swiftly rejected, noting her employment ended in 2018), and (2) Andrade’s failure to wait the full 65 days after her amended LWDA notice meant Andrade was never “deputized” to pursue or settle the newly added vacation-pay claim and additional entities, relying heavily on LaCour v. Marshalls of California, LLC (2023) 94 Cal.App.5th 1172.

The Court of Appeal distinguished LaCour, in which the prior settling plaintiff had never provided LWDA notice of the additional claims at all. Here, Andrade did provide an amended notice that specifically identified the § 227.3 claim and the additional defendants. The court held that the statutory 65-day waiting period does not explicitly apply to amended notices, and even if it did, Andrade substantially complied with PAGA’s administrative exhaustion requirement by giving the LWDA actual notice and an opportunity to act. The LWDA’s subsequent acceptance of the settlement (without objection) rendered the premature filing a harmless technical defect.

Citing federal district court authority and the longstanding doctrine of substantial compliance (historically applied to Government Claims Act notices), the panel concluded that invalidating the settlement on this ground would improperly allow later PAGA plaintiffs to collaterally attack prior approved settlements – an outcome the Supreme Court expressly rejected in Turrieta v. Lyft, Inc. (2024) 16 Cal.5th 664.

Accordingly, the Andrade settlement fully released Brown’s claims against all defendants, satisfying every element of claim preclusion. The judgment dismissing Brown’s action was affirmed, with costs awarded to Dave & Buster’s.

The decision reinforces the finality of approved PAGA settlements and signals that minor procedural deviations in administrative exhaustion will not undermine claim preclusion when the LWDA received actual notice and declined to intervene.

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