A San Antonio physician has settled a federal lawsuit brought by two State Farm insurance companies that alleged he performed unnecessary and expensive spinal surgeries and procedures on patients injured in auto accidents to inflate the value of their insurance claims.
While final settlement terms have not been revealed, Dr. Sanjay Misra agreed to pay $314,000 to State Farm Mutual Automobile Insurance Co. and State Farm County Mutual Insurance Co. of Texas under the terms of a preliminary settlement.
Details of that settlement were disclosed during a Sept. 26 court hearing following a successful mediation with U.S. Magistrate Judge Henry Bemporad.
READ MORE: Auto insurers sue San Antonio doctor over hundreds of ‘unnecessary’ medical procedures
A transcript of the hearing outlining the mediated settlement was filed with the court Oct. 2 but was later sealed by U.S. District Judge Jason Pulliam. The request to seal it had been made by Misra’s lawyers, who said the sealing was “necessary to avoid any public conflict from potential minor variations between the Mediation Conference Transcript and the final settlement agreement.”
Misra’s attorneys also said sealing the court transcript was needed to “preserve the confidentiality required” under a federal court rule “covering the parties’ settlement negotiations and terms discussed at the mediation conference which are still being finalized.”
Ricardo Cedillo, one of the lawyers representing Misra and his practice, said his clients were pleased the case is over, particularly given the court found State Farm’s claims on “fabricated patient treatments … totally without merit.”
“Throughout this case, Dr. Misra has maintained his innocence and there has never been a finding of any liability, wrongdoing, misfeasance or malfeasance against Dr. Misra or his practice,” Cedillo said in an email Monday. “He is very happy to put this lawsuit behind him.”
A State Farm representative didn’t respond to a request for comment. In reciting terms of the settlement at the Sept. 26 hearing, Bemporad said “State Farm has no intention to issue a press release of any sort regarding the claims.”
A State Farm lawyer said during the hearing that the companies agreed that they would not say anything other than “there’s been an agreement with no admission of liability.” It also agreed that it would not say anything contrary to Misra’s statement.
During the hearing, Bemporad gave the parties 45 days to work out a final settlement. There apparently were no hiccups because the two sides jointly filed a request to dismiss the case on Friday.
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The court transcript shows Misra preliminarily agreed to make a $23,000 payment at the beginning of 2026, 2027 and 2028, followed by 11 monthly payments of $7,000 in 2026 and 2027, and then 13 monthly payments of $7,000 ending in early 2029.
The parties agreed to release all claims they had against each other, save for some outstanding payments possibly due Misra.
The State Farm companies alleged in their lawsuit that Misra had submitted hundreds of fraudulent bills and supporting documentation. He denied the allegations.
Submitting fraudulent bills through the U.S. mail amounts to a “pattern of racketeering activity” meant to defraud the insurers, the companies said in their complaint. The fraudulent bills and supporting documentation “were at the very least a substantial factor in inducing them to settle bodily injury and uninsured/under-insured motorist claims they otherwise might not have settled,” the insurers said.
They paid more than $6.5 million in connection with legal cases settled or litigated with 335 patients Misra treated for neck and/or back pain, according to a court filing. The companies had sought restitution.
Misra filed a countersuit alleging the State Farm companies wrongly labeled him a criminal, which damaged his professional reputation and caused more than $500,000 in damages to his pain management clinic. Racketeering relates to the Racketeer Influenced and Corrupt Organizations Act, or RICO, which is a federal law often often associated with the prosecution of mob bosses.
Pulliam dismissed Misra’s counterclaims early last year.
During the case, the State Farm companies had subpoenaed the law firms of personal-injury attorneys and television pitchmen Jim Adler and Jeff Davis seeking all communications between them and Misra regarding more than 185 of his patients.
Both law firms filed motions to quash the subpoenas, which were granted in part and denied in part.
State Farm Mutual was Texas’ second-largest auto insurer with a 16.3% market share in 2023, according to the Texas Department of Insurance. Progressive County Mutual Insurance Co. was the largest, with an 18.3% share. State Farm County Mutual ranked 22nd with a 0.89% share.
This article originally published at San Antonio doctor agrees to pay State Farm companies to end litigation.