A new lawsuit claims that a personal injury lawyer from Brooklyn masterminded an extensive scheme to stage car accidents in order to boost insurance payouts, coinciding with Governor Kathy Hochul’s increasing efforts to tackle such frauds.
On Tuesday, FedEx filed a 92-page lawsuit against the Ikilov Law Firm and its founder, attorney Zorik “Eric” Ikilov. The lawsuit accuses the firm of orchestrating a sophisticated operation involving healthcare providers and doctors to defraud FedEx through fabricated claims.
The filing in federal court states, “The staged accident, coordinated medical referrals, and rapid escalation to injections and surgeries all serve the single purpose of creating the necessary statutory preconditions for commencing a personal injury lawsuit.”
According to the complaint, the alleged scheme involved staging or exaggerating vehicle accidents and treating fake victims repeatedly to inflate medical expenses, specifically targeting FedEx due to its significant financial resources.
“Filing these lawsuits is the only path to the substantial recovery the companies seek,” adds the court documents.
This case is being prosecuted under the Racketeer Influenced and Corrupt Organizations Act (RICO Act), which is typically applied in cases concerning gang and mob activities.
This development comes as Hochul continues to advocate for changes to New York’s liability laws, an issue that has become a contentious hurdle in the state’s ongoing budget negotiations.
Tom Stebbins, the executive director of the New York State Litigation Reform Alliance, stated, “To all the legislators who say fraud doesn’t exist, here’s the proof.” He emphasized that this lawsuit should draw attention from Albany, arguing that current liability laws enable and reward malicious attorney-driven activities.
The complaint lists four instances in which the defendants allegedly attempted to exploit FedEx through deceptive claims, including one incident involving a minor collision where a FedEx driver lightly bumped another car at a stoplight.
Photos from the scene validated minimal damage, and emergency services were not called. However, the following days saw the plaintiff consulting a doctor connected to Ikilov’s network, who diagnosed a more severe injury and recommended unnecessary chiropractic treatments.
The complaint alleges that the plaintiff ended up undergoing multiple surgeries as advised by other doctors in the scheme. Notably, he financed these procedures using loans from a law firm linked to Ikilov, suspected of paying kickbacks to various conspirators.
A FedEx spokesperson remarked, “FedEx is committed to protecting our customers and team members from fraud. We filed this lawsuit to address a specific pattern of motor vehicle accidents and medical claims.”
Meanwhile, Ikilov, facing accusations of facilitating unwarranted surgeries, was seen boasting on Instagram about receiving a custom office chair from 1-800-Accident, complete with his initials.
On Wednesday, when contacted via phone, a representative identified as Ikilov responded vaguely and then abruptly disconnected the call.
While Hochul was attending the New York International Auto Show, she announced a new initiative, pairing state financial regulators with state police to identify and combat fraud networks like the one allegedly headed by Ikilov.
Speaking to reporters, Hochul described the situation as a network comprising sophisticated criminal organizations, including drivers, lawyers, and medical professionals who collaborate to stage crashes for substantial payouts.
She proposed redefining “serious injury” to minimize frivolous claims and suggested capping damage amounts for individuals lacking insurance or with a history of impaired driving or felony convictions related to accidents.
However, the state Legislature has remained opposed to these changes, arguing for the necessity of protecting victims, even if they may share fault in an incident.
Assembly Speaker Carl Heastie acknowledged the gravity of the issue, stating, “Accidents happen. People get into accidents, and it’s your fault. If you get seriously injured… you’re not going to go through the pain and suffering.”
Some critics argue that Hochul’s proposals may not effectively lower insurance costs for drivers. Senate Deputy Majority Leader Mike Gianaris expressed concerns over insurance companies benefiting without guaranteeing savings for consumers.
Nevertheless, Hochul maintains that tackling this issue is a cornerstone of her “affordability” agenda. “They’re going to do it. They have to do it,” she mentioned regarding legislative leaders’ resistance.
The New York State Trial Lawyers Association, a significant lobbying entity in the legal field with close ties to legislators, staunchly opposes the proposed changes, reflecting the contentious nature of this debate.
Notably, Uber has also shown interest in this issue, reportedly investing a substantial sum of $8 billion into the initiative.
