Allstate has filed a federal lawsuit against a New York medical supplier, accusing the company of orchestrating a fraud scheme that cost the insurer more than $125,000 and exploited the state’s no-fault auto insurance system.
The case, filed on August 26, 2025, in the US District Court for the Eastern District of New York, names First Supply Inc., its principal Jacob Binyaminov, and several unnamed individuals and entities as defendants.
According to the complaint, between June 2021 and August 2025, the defendants allegedly submitted hundreds of false insurance claims for rental pain management devices known as Sustained Acoustic Medicine (SAM) units and related patches.
Allstate claims the equipment was prescribed under pre-set treatment plans, regardless of whether patients actually needed them. The company says this was part of an arrangement involving kickbacks and financial incentives with certain no-fault medical clinics in the New York area.
Those clinics—though not named as defendants—allegedly directed their doctors and chiropractors to issue formulaic prescriptions for identical medical equipment, making it difficult to verify the legitimacy or necessity of the claims.
The lawsuit states that First Supply routinely billed for rental devices that were never provided, provided in ways that didn’t match the claims, or medically unnecessary because they were prescribed under predetermined plans.
In nearly every case, Allstate alleges, the company sought reimbursement far beyond what New York’s no-fault law allows. The insurer also claims that First Supply paid kickbacks to clinics in exchange for funneling these prescriptions.
Allstate is seeking relief under the Racketeer Influenced and Corrupt Organizations Act (RICO), New York state common law, and the Federal Declaratory Judgment Act.
The insurer is asking for treble damages under RICO, compensatory damages, and a court declaration that it has no obligation to pay any of First Supply’s outstanding no-fault claims tied to the alleged scheme.
Under New York’s no-fault insurance law, insurers must cover reasonable medical expenses for people injured in car accidents. Patients can assign those benefits directly to providers, such as medical suppliers, who then bill insurers for reimbursement.
Allstate argues the defendants exploited this system, using fraudulent prescriptions and inflated claims to generate payments for equipment that was either unnecessary or never delivered.
