Court holds rehab provider cannot collect for No Fault PIP medical services
In Garden City Rehab, LLC v. State Farm, the Court of Appeals ruled that the medical provider could not collect for the services it provided to State Farm's insured. The Court held that the rehab people were bound by the verdict in a case brought by the injured man. The jury had ruled that the insured man had "recovered from his injuries" as of a certain date, and the court in the current case held that the rehab providers could not dispute that holding.
The decision was especially surprising because the Court held that the doctrines of res judicata and collateral estoppel were both applicable, even though the parties were not the same in the two suits--and the medical provider was bound by the outcome of a case in which it did not participate. These limiting doctrines are normally limited to a second action brought by the same parties, where there is "mutuality of estoppel."