MINEOLA — Nassau County Court Judge Abbey L. Boklan did not mince words earlier this month when she threw out a larceny conviction due to ineffective counsel rendered to a man charged with insurance fraud. But what remains unresolved are an array of issues surrounding an ailing defendant who claims his insurance company — through video surveillance — bilked him out of deserved benefits and prosecutors who contend he is a lying criminal.
Ruling that attorney Richard Librett provided counsel that did not “rise to level of either effective or meaningful” representation, Judge Boklan in People v. Rachlin, 2102N-98, determined that even though defendant Randolph Rachlin pleaded guilty to fourth-degree grand larceny, he did so without his lawyer having read his client’s occupational disability insurance policy at issue or relevant case law. (NYLJ, Long Island Edition, Jan. 22).
Mr. Librett, in a sworn affirmation, stated that if he had been familiar with the “unique type of policy” that Mr. Rachlin purchased, he would not have recommended a plea. Mr. Rachlin, who suffers from rheumatoid arthritis, now could face a renewed criminal proceeding to determine if he committed fraud when he submitted claim forms.
Mr. Rachlin’s current lawyer, one of our partners, declined to be interviewed for this story, depicts Mr. Rachlin in court papers as an infirm victim of an overzealous district attorney who was unaware of the special legal principles associated with occupational disability insurance.
The prosecution, however, asserts that Mr. Rachlin not only misrepresented the duties of his job on the policy’s application but that he falsified information when he claimed a list of medical problems, despite his ability to work in the same capacity at another business. And it is the alleged misrepresentations on the claims, argue prosecutors, that created the larceny.
The Nassau County District Attorney is in the process of perfecting its appeal, according to Peter Weinstein, chief of the appeal bureau. If the District Attorney wins the appeal, Mr. Rachlin will have his conviction reinstated. If prosecutors lose, the case will be restored to pre-conviction status, he sad.
Case Is Born
As a manager and supervisor for a small furniture store in Queens, Mr. Rachlin purchased an occupational disability policy from Provident Life & Casualty Insurance Co. in 1991. The policy was intended to provide disability payments if Mr. Rachlin became unable to perform the material and substantial duties of his job.
On the application form, according to court papers filed by Nassau County Assistant District Attorney Margaret Mainusch, Mr. Rachlin’s occupation was identified as “store manager” and his duties as “sales and supervision.” Ms. Mainusch argued that if Mr. Rachlin had disclosed the physical nature of his duties, he would not have qualified for occupational disability insurance that Provident issues.
Occupational disability insurance, generally sold to white-collar professionals, does not require policyholders to refrain from working in order to collect. Instead, policyholders receive benefits if they cannot perform the specific tasks associated with the job that they held at the time the policy was issued.
Two years after purchasing the policy, Mr. Rachlin was diagnosed with rheumatoid arthritis, which by 1994 weakened him to a “thin, wasted looking man” who was 6 feet, 1 inch, and weighed 149 pounds, according to an affidavit from the chief clinical professor of rheumatology at Mount Sinai School of Medicine.
In 1994 Mr. Rachlin reported that his condition was exacerbated by a hit-and-run car accident. Two months later, he filed a claim form seeking disability income benefits from his Provident policy.
He stated on the form that he could not stand on the sales floor, could not set up displays, could not lift anything and could not drive for any length of time.
Mr. Rachlin also stated that he spent his days reading, watching television and doing crossroad puzzles. He did not, the prosecution asserted, report that he was working anywhere.
Photographs of Mr. Rachlin were taken last year, which were included in Mr. Quadrino’s motion to vacate, show him in a hospital bed, a gaunt man with enormously swollen joints and shrunken limbs.
After he filed his insurance claim, Mr. Rachlin received $3,080 per month for two years from Provident, which in 1996 launched an investigation into his claims. The probe included visiting Mr. Rachlin at a bedding store in Oceanside, where he informed a Provident claims manager that his wife was the owner and that he was capable only of offering advice in the store.
According to Ms. Mainusch’s opposition to vacate the judgment, Mr. Rachlin also was observed, through undercover videotape surveillance taken on three separate days, driving from his Baldwin home to the Oceanside store and, on one occasion, assisting the undercover Provident investigator — who represented himself as a customer — with the sale of merchandise.
Provident subsequently discontinued benefits on the ground that Mr. Rachlin was performing at least a significant amount of the duties of his occupation. It also referred the matter with videotape to the district attorney’s office which led to Mr. Rachlin being charged with third-degree grand larceny and third-degree insurance fraud.
Mr. Librett, the first defense attorney, stated that he advised his client to plead to a lesser charge because he believed the videotape was incriminating based on the type of policy he mistakenly assumed Mr. Rachlin purchased.
“During the proceedings, the prosecution showed me a videotape of Randolph Rachlin performing a ‘sales pitch’ to a customer at his wife’s store,” he stated. “At that time, it was my belief that an insured could not collect disability benefits while engaged in employment. As such, the videotape and surveillance, on its face, appeared to be incriminating.”
Key to our partner’s argument that his client was wrongly convicted is that the prosecution violated public policy by criminalizing Mr. Rachlin’s conduct in the context of a legitimate property dispute.
Specifically, our partner relies on the State Legislature’s rejection in 1964 of a Model Penal Code provision that allows for the criminal prosecution of a person who has an arguable interest in the property at issue. In applying the Legislature’s intent to this case, Mr. Quadrino contends that Mr. Rachlin should not have been prosecuted for taking the benefits, which were arguably his. Such disputes, he contends, are civil matters.
But Assistant District Attorney Weinstein asserts that Mr. Rachlin’s conduct established larceny without regard to whether he was contractually entitled to the insurance payments. He argues that Mr. Rachlin received benefits by false representation when he stated on his claims forms that he was unable to perform the tasks of the job identified on the application and was videotaped allegedly performing a sales pitch.
“You don’t get to enforce a contractual claim by lies,” Mr. Weinstein said. “A fraudulent statement is not a legitimate self-help remedy.” In addition to the public policy argument, Mr. Quadrino also asserts that prosecutors violated his client’s right to review the surveillance videotapes, which he contends included exculpatory evidence. Asserting a so-called Brady claim, he argues that the tape shows Mr. Rachlin working in a capacity permitted within his occupational disability policy.
Moreover, he contends that the assistant district attorney who originally prosecuted the claim was confused about the type of policy Mr. Rachlin owned. He points to the minutes of Mr. Rachlin’s plea in which Assistant District Attorney Jon Bevilacqua referred to Mr. Rachlin’s policy as “unemployment insurance.”
The prosecution, however, contends that when Mr. Rachlin pleaded guilty, he forfeited his right to review possible exculpatory evidence. Prosecutors also argue that the surveillance tapes are in no way exculpatory and that Mr. Rachlin “cannot seriously claim that he was unaware of his own activities and condition.”
Mr. Rachlin has filed an action in the U.S. District Court for the Souther District against Provident pertaining to his right to receive monthly benefits.
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Evan S. Schwartz
Founder of Schwartz, Conroy & Hack
800-745-1755
ESS@schwartzlawpc.com