LAS VEGAS (CN) - A woman who managed an endoscopy clinic at the center of the 2007 hepatitis C outbreak sued five insurance companies for not defending her from multiple lawsuits stemming from the scandal.
Tonya Rushing filed the lawsuit in Clark County Court against Nevada Mutual Insurance, St. Paul Fire & Marine Insurance, US Fidelity and Guaranty Co., Travelers Indemnity Co. of America; and Evanston Insurance.
Rushing claims the insurers issued liability or professional liability policies to the Endoscopy of Southern Nevada LLC and the Gastroenterology Center of Nevada. She says the policies obligated the insurers to defend various employees of the Endoscopy Center, and that one specifically identified her as an insured.
Travelers and Nevada Mutual were advised of numerous lawsuits against the Endoscopy Center and Rushing in April 2009, according to the complaint. Rushing says Evanston Mutual was advised of the lawsuits in February 2010.
She claims that each insurance company denied coverage, "claiming a lack of basis for establishing coverage."
"In the various complaints," the lawsuit states, Rushing "was alleged to have committed acts, which if proven, would have resulted in finding of liability that was covered under each and every, and/or any one, of the various insurance policies identified above."
Dr. Dipak Desai and Rushing pleaded not guilty to federal charges of overbilling insurance companies. They are charged with conspiracy and 25 counts of health care fraud, according to the Las Vegas Review-Journal.
The indictment claims the two stretched out the length of medical procedures and overbilled insurance companies from January 2005 through February 2008. Trial has been is set for May.
Desai and two of his nurse anesthetists, Keith Mathahs, 76, and Ronald Lakeman, 65, face felony charges: health officials say seven people were infected with hepatitis C at Desai's clinics, according to The Associated Press.
Prosecutors say Desai required his staff to use leftover anesthesia from used vials and to reuse colonoscopy scopes and bite plates.
Desai, Mathahs and Lakeman pleaded not guilty to murder charges and 28 other felony charges after prosecutors claimed that Rodolfo Meana, 77, died from hepatitis C that was genetically traced to a Sept. 21, 2007 procedure at Desai's Endoscopy Center of Southern Nevada. Trial on that matter is set for April 22.
Mathahs took a plea deal in exchange for testimony against Desai and Lakeman. Mathahs pleaded guilty to criminal neglect of patients, insurance fraud and other charges, according to The Associated Press.
Since the scandal broke, Desai has suffered strokes, declared bankruptcy and surrendered his medical license. Prosecutors claimed he's faking his illness to avoid prosecution, and physicians determined last year that he was competent to stand trial.
The legal issues were prompted by the Southern Nevada Health District's February 2008 notification to more than 50,000 patients to be tested for the disease.
Rushing seeks damages and attorneys fees for contract and bad faith.
She is represented by Justin L. Wilson with Jones Wilson.
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