WASHINGTON, Oct. 06, 2026 (GLOBE NEWSWIRE) — A new report released today shows a disturbing nationwide trend of organized fraud rings allegedly involving law firms, litigation funders, medical providers and more, leading companies to respond via the Racketeer Influenced and Corrupt Organizations Act — the 1970 statute Congress wrote to dismantle the Mafia.
The American Tort Reform Foundation’s report, released amid Lawsuit Abuse Awareness Week 2026, found that businesses and insurers have filed nearly 300 civil racketeering lawsuits since 2024.
“The fact that court fraud and lawsuit abuse have reached this point — the point at which companies are turning to laws meant to combat organized crime, just to fight back — is incredibly telling about the worst incidences of lawsuit abuse plaguing the civil justice system today,” said Tiger Joyce, president of the American Tort Reform Association. “Companies do not reach for a mob statute because it is convenient. They reach for it because sanctions rules and bar discipline cannot address a widespread scheme spanning hundreds of cases in dozens of courtrooms. Each judge sees one questionable lawsuit. Now, we’re uncovering the whole pattern.”
Each RICO complaint alleges a distinct fraudulent enterprise, but the cases display striking similarities. The fraud allegations outline coordinated relationships among attorneys, medical providers, claim recruiters, litigation funders, and other participants who purportedly transformed marginal claims into substantial settlement demands through fraudulent medical evidence or fabricated litigation.
ATRF’s report analyzes 24 of those cases naming attorneys, law firms or litigation funders as defendants, filed by companies like Uber, FedEx, Ford Motor Co. and 3M. The cases include accusations of:
- Staged automobile accidents and falls;
- Fake or exaggerated injuries; and,
- Unnecessary medical treatment or inflated charges.
The complaints describe a repeating structure:
- Recruiters, or runners, sign up claimants.
- Lawyers steer them to cooperating clinics.
- Litigation funders advance cash for surgeries the complaints allege patients never needed.
- The resulting records turn minor or nonexistent injuries into six- and seven-figure settlement demands.
The RICO filings allege fraud overwhelmingly in states with notorious Judicial Hellholes® like New York, California, Illinois and Pennsylvania.
“In many situations, attorneys are withdrawing from cases without penalty once questions start to arise, ultimately leaving the companies they’ve targeted to shoulder the cost of investigating and defending each case, regardless of the merits,” Joyce said. “Courts should carefully scrutinize repeated voluntary dismissal of claims or requests to withdraw as counsel when the surrounding circumstances suggest a questionable pattern.”
Some courts have begun to see the emerging pattern. In May, U.S. District Judge Mark A. Kearney in Philadelphia refused to dismiss a RICO case Uber and FedEx brought against local firm Simon & Simon, the first such ruling of the current wave. Judge Kearney held that lawyers who allegedly build cases on false evidence are not shielded by the First Amendment: “a lawyer and his experts cannot create false documents under the guise of the Petition Clause and then be immune for their fraud.”
Recent data shows that excessive litigation imposes a tort tax of $1,771 per person and $5,579 per family each year and costs the economy more than 5 million jobs. Fraudulent claims reach consumers as higher insurance premiums, higher delivery costs and higher rent.
“A healthy civil justice system relies on lawyers who tell judges the truth,” Joyce said. “Companies are now spending millions in federal court because too often they no longer believe that is happening. Judges should let well-pleaded RICO cases proceed rather than dismiss them because they arise from litigation.”
The full report examines the recent rise in civil RICO actions alleging litigation-related fraud, explains the legal requirements governing these claims, surveys the principal categories of cases filed in recent years, reviews the emerging judicial response, and considers potential reforms.
The cases are ongoing and whether those allegations and details can satisfy the elevated requirements under the RICO statute remains to be determined. The defendants deny wrongdoing. But while each complaint names different firms and describes a distinct alleged enterprise, the same pattern appears repeatedly across states and types of cases, and ATRF says that repetition warrants close examination.
Turning the Tables? The Growing Use of Civil RICO Actions by Businesses and Insurers to Respond to Suspected Fraudulent Litigation is available at StopCourtFraud.com, where ATRF will update its RICO tracker as cases advance.
Attachments
Bailey Aragon American Tort Reform Association 505-948-0720 baragon@atra.org
Media gallery
