Firm Wants Judge DQ’d Over Son’s Employment Law360, Miami (December 8, 2015, 7:34 PM ET) Actuarial firm Milliman Inc. asked a Florida federal judge Tuesday to disqualify himself from a dispute with BankUnited NA over a $60 million loan to now defunct Universal Health Care Group Inc.
after the judge disclosed that his son worked in the bank’s commercial lending department.
Milliman said U.S. Magistrate Judge Thomas B. McCoun should be disqualified after he said in a Nov. 6 hearing that his son worked at BankUnited’s commercial lending department during the time period relevant in this suit, in which BankUnited claims Milliman improperly performed actuarial services for UHCG and led the bank to believe the healthcare company was in better financial shape than it actually was.
“Milliman’s defense will be critical of the lending practices of plaintiff’s commercial lending department during the time Judge McCoun’s son worked there,” the firm said.
BankUnited’s suit accuses Milliman of improperly certifying projections for UHCG that showed its related companies were solvent and on good financial footing as of 2011. Using that information, BankUnited decided to extend a $60 million loan, according to the complaint.
“Defendant incorrectly certified that the regulated entities had adequate reserves to fund outstanding claims incurred but that were not reported giving UHCG and the regulated entities the appearance of solvency, when, in fact, those reserves were inadequate,” BankUnited said.
More than $30 million of that loan has been left unpaid after UHCG’s messy collapse.
The company, whose affiliates provided Medicare Advantage Health Plans, filed for bankruptcy in February 2013. It was also accused by the state Office of Insurance Regulation of financial irregularities and possible fraud. FBI and U.S. Department of Health and Human Services agents executed search warrants at its St. Petersburg offices that same year.
UHCG was founded in Florida in 2002 by A.K. Desai, a licensed geriatrician and practicing physician, according to company information. It served more than 191,000 members in 19 states.
BankUnited is represented by Brett M. Amron and Jeremy S. Korch of Bast Amron LLP and Frank P. Terzo of GrayRobinson PA. Milliman is represented by Alexander B. Handelsman, David G. Peterson, R. Timothy Muth and Sarah A. Huck of Reinhart Boerner Van Deuren SC and Brett J. Preston and David L. Luikart III of Hill Ward & Henderson PA.
The case is BankUnited NA v. Milliman Inc., case number 8:15cv01357, in the U.S. District Court for the Middle District of Florida.