Florida Health Insurer Alleges Former Employees Orchestrated Racketeering Scheme to Steal Trade Secrets

On Wednesday in the Southern District of Florida, ABS Healthcare Services, Health Option One LLC, and One Stop Quotes Inc. (OSQ) filed a complaint against various individuals and entities over allegations that the defendants operated a scheme to misappropriate the plaintiffs’ confidential business information through racketeering.

The plaintiffs summarized their allegations astutely at the top of their complaint: “This case is about dishonesty, fraud, and greed.” ABS and Health Option One, both doing business as health and life insurer Insurance Care Direct (ICD), along with OSQ, alleged that two of the defendants, Andrew and Corey Shader — both former ICD employees — began and have been directing a group of individuals and organizations to “surreptitiously and illicitly compete with ICD” through stealing trade secrets, proprietary information, and the plaintiffs’ customer base to enrich themselves.

According to the plaintiffs, the defendants executed this scheme through setting up businesses as fronts while “fraudulently concealing” their business intentions and inducing ICD to enter into contracts with them for years. One such front business was formed by the Shaders once they left ICD, National Health Solutions Inc. (NHS), which — predating ICD’s suspicions — entered into a contractual relationship with ICD. Part of the contract included ICD conducting training for NHS, through which the Shaders and other defendants purportedly were able to gain access to confidential information and misappropriate it, the complaint alleged.

“Defendants saw that ICD, a family-owned business, had achieved great success and they sought to profit from ICD’s years of hard work, development, and ingenuity,” the complaint alleged.

Key to the alleged scheme was that the Shaders represented to ICD that their company, and others they purportedly ended up creating, were not in the insurance business; the plaintiffs proffered that the Shaders’ companies actually were in the insurance business and were insidiously competing with ICD.

Apart from the Shaders and NHS, the other defendants allegedly working in concert are Infinix Media LLC, Prodigy Healthy Group LLC, Adam Beeman, Joy Stormont, Alliance Marketing Corporation, Kratos Investments LLC, Health Team One LLC, Richard Ryscik, Scott Offutt, Beeman’s Future Inc., CS Marketing LLC, and C Shader Investments LLC.

The formal causes of action by the plaintiffs are civil violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act and RICO conspiracy, under which they request compensatory, punitive, and treble damages; an enjoinment of the defendants from continuing their alleged conduct; and other relief the court deems germane.

Boies Schiller Flexner LLP represents the plaintiffs.