Newsday: NYC sues Manhattan law firm over alleged personal injury fraud scheme, court document shows

By: Robert Brodsky

New York City has filed a federal racketeering lawsuit against a Manhattan law firm, arguing it orchestrated a personal injury fraud scheme, similar to those linked to several Long Islanders, in which clients falsely blamed injuries sustained in scooter, moped and bicycle accidents on roadway defects, records show.

The RICO suit, filed Sunday in New York's Southern District, cites violations of the state's False Claims Act. It accuses Asher & Associates and its owners, Ryan and Roberta Asher, of filing more than a dozen lawsuits over the past decade, seeking tens of millions of dollars for injuries that were unconnected to the city's roadways or their maintenance.

The suit, which seeks financial penalties against each of the defendants, also names nine "John Does," whom documents identify as unnamed firm lawyers, "runners" who solicit clients and litigation funders who provide money to clients to sue the city.

"Personal injury laws exist to protect actual victims of trauma, not to line the pockets of people looking to make a quick buck off city taxpayers," City Corporation Counsel Steven Banks said in a statement. ... "This firm undermined our civil justice system by operating an illegal scheme to defraud taxpayers and fabricating personal injury claims against the city and others."

The suit is the first filed by the city to combat what critics contend is a rampant scheme involving lawyers, doctors and alleged victims, often newly arrived immigrants, who authorities contend stage accidents on the roads, construction sites or on city sidewalks, fabricating injuries and subjecting themselves to unnecessary surgeries to collect large payouts.

Messages left Monday with Asher & Associates and its principals were not immediately returned.

The city's complaint documents 15 cases filed by the law firm in which clients said they were hurt, predominantly in Brooklyn, by roadway defects.

But the city cites contradictory evidence, provided to paramedics, emergency room personnel or police that linked their injuries to fights, being struck with a lead pipe or an opened car door, skids on wet pavement or motor vehicle collisions.

When the city confronted Asher & Associates about the contradictory statements, the firm discontinued some of the cases without explanation, the RICO suit states.

Many of the lawsuits filed by Asher & Associates also target utility companies and paving contractors whose past roadway work at the incident site was cited as a cause of the alleged roadway defect, city officials said.

The RICO suit contends the 15 cases "are the tip of the proverbial iceberg" as Asher & Associates have filed hundreds of actions alleging injuries from the negligent maintenance of city roadways.

"To remedy the absence of an identifiable negligent actor, the Asher defendants fabricate injury scenarios that falsely allege the city as culpable, and responsible for paying lucrative settlements or judgments," the suit states.

For nearly two years, Newsday has documented the growing legal and political battle over staged motor vehicle crashes, phony falls from construction sites and slip-and-fall injuries on sidewalks. 

The scheme has ensnared several Long Islanders, including some who shared a handful of addresses in Freeport, while state regulators have revoked the ability of at least two local surgeons to treat patients with workers’ compensation claims.

In recent months, RICO suits alleging fraud from stated accident schemes have been filed in New York by insurance providers, Uber Technologies and FedEx. But this is the first time New York City itself has employed the same tactic to combat the alleged schemes.

Tom Stebbins, executive director at the Lawsuit Reform Alliance of New York, said the action is overdue as New York City pays out more in lawsuits than the next 19 largest U.S. cities combined.

"To turn the tide on the rampant fraud plaguing the Big Apple's courtrooms, we need to remove the perverse incentives built into our liability laws," Stebbins said. "We hope Mayor [Zohran] Mamdani takes seriously the flood of racketeering claims against city lawyers — and that he joins us in calling on Albany to fix New York’s out-of-step liability standards that have become a magnet for organized fraud rings, exaggerated claims, and unchecked abuse of our civil justice system."