Hospital Sues Former Maintenance Workers over Alleged Fraud

On Friday a case was filed in the Central District of California by National Union Fire Insurance Company of Pittsburgh, PA as subrogee and assignee of Universal Health Services Inc. and Palmdale Regional Medical Center against former employees Scott Finsten, Richard Yank, and associates.

Palmdale Regional Medical Center is a hospital with attendant maintenance needs. Scott Finstein was employed by the plaintiff as Director of Plant Operations, whose responsibilities including coordinating and overseeing construction and maintenance work performed at the medical center by internal employees and outside contractors.

The plaintiffs accuse the defendants of engaging in a scheme that resulted in extra payments to contractors without work being performed to match the submitted invoices. The scheme is alleged to have occurred from 2009-2018 and includes services such as carpentry, storm drain cleaning, electrical work, valve work, cooling tower work, and other necessary services. The alleged fraud was not discovered until the defendant casually mentioned to a co-worker who was not involved in the scheme that he was going to request that an invoice be resubmitted for under 10,000 so as to not trip the plaintiffs fraud review system.

The plaintiffs are suing for fraud, conversion, breach of duty of loyalty, conspiracy to breach duty of loyalty, and conspiracy to commit fraud. The plaintiffs are represented by Prenovost, Normandin, Dave & Rocha.