Behavioral health treatment company files to have FBI search warrant unsealed

By Eric Heinz

The Dual Diagnosis Treatment Center, Inc., also known as Sovereign Health, filed a motion in federal court on Aug. 15 requesting a judge unseal the search warrant from the Federal Bureau of Investigation (FBI) that allowed agents to conduct a raid on its facilities as well as the home of its CEO, Tonmoy Sharma, on June 13.

Click here to read the motion filed by Sovereign Health

Sovereign Health is claiming the investigations were “induced” by the insurance company Health Net, Inc. (Health Net) in order to gain favor of the insurance provider’s existing lawsuit with Sovereign and other healthcare companies.

“That and other aspects of the warrants suggest that the affidavit likely contains false and misleading information and omits other material information,” the motion stated. “Sovereign and Dr. Sharma thus seek to obtain a copy of the warrant in order to determine whether the searches were lawfully authorized, and to take appropriate action if they were not.”

When inquiring about the reasons behind the FBI raid on the Sovereign facilities, FBI spokesperson Laura Eimiller told the San Clemente Times on two separate occasions—once immediately following the raids and another at the beginning of August—that the warrants are under seal by a federal judge and that the bureau could not disclose the nature of its investigation. The FBI did confirm, however, that it was conducting an investigation at the company’s Southern California locations as well as Vedanta Laboratories where agents were seen carrying out materials and speaking to employees on June 13.

FBI agents raided Sovereign Health, a behavioral health treatment provider based in San Clemente, on Tuesday, June 13. The nature of the investigation has not been revealed by the FBI. Photo: Eric Heinz
FBI agents raided Sovereign Health, a behavioral health treatment provider based in San Clemente, on Tuesday, June 13. The nature of the investigation has not been revealed by the FBI. Photo: Eric Heinz

The lawsuit claims that during the raids, the FBI illegally seized property “outside the scope of the authorized seizures, traumatizing both employees and patients” as well as being responsible for reputable damages to the company. Sovereign is also claiming the investigation pertains to insurance fraud because there is no “genuine concern of evidence destruction or witness intimidation” and therefore, should be unsealed, making the warrant documents public.

Counter to the alleged claims for the raid, Sovereign turns the fraud allegations finger to Health Net, citing their “checkered history of fraud and other unlawful…conduct.” Health Net provided insurance services to Sovereign’s clients, but those provisions soon became prohibitively expensive due to the increased demand and access to services, according to the lawsuit.

“On June 30, 2016, Sovereign filed a complaint against Health Net in the Los

Angeles Superior Court, alleging bad faith, breach of contract and other state law claims resulting from Health Net’s wrongful denial of over $55 million in claims by Sovereign,” the lawsuit stated.

The Aug. 15 lawsuit mentions the insurance provider is currently under investigation by the U.S. Department of Justice for Medicare claims fraud. Sovereign’s legal team said Health Net has provided millions in settlements for other investigations.

Sovereign Health has had a tumultuous relationship with the city of San Clemente for some time. Since at least 2014, residents have staged protests in front of their corporate headquarters or other residential facilities in the city that are owned or operated by the company. Complaints from residents range from continued disruptions to not following ordinances for the reasons behind the various protests against Sovereign Health.

A hearing on the case is requested in the suit for 10 a.m. on Tuesday, Sept. 19, in U.S. District Court in Santa Ana.

This is a developing story. The San Clemente Times will provide more information on this issue once it becomes available.


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comments (1)

  • Well usually someone is working with the FBI in any criminal case it’s not unusual to contact the FBI to report fraud and I’m sure Healthnet had to provide information of said fraud to get the FBI to even be interested, duh! Do dirty things , bad things happen!

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