Expert MRI, a California diagnostic imaging company, is dealing with two unrelated lawsuits. The first stems from a 2025 data breach that exposed personal and medical information for roughly 209,560 patients and has drawn the attention of law firms investigating a potential class action. The second is an insurance fraud case brought by Allstate, in which a California appeals court ruled in 2023 that the company’s alleged business model amounted to the unlicensed practice of medicine. Both remain unresolved.
The 2025 Data Breach
Expert MRI discovered unauthorized access to its computer systems on September 2, 2025.1California Attorney General. Expert MRI Notice of Data Event A forensic investigation determined that an unknown actor had been inside the network copying files between June 2 and August 24, 2025.2HIPAA Journal. Data Breaches at Expert MRI and McElroy Associates
On September 6, 2025, a ransomware group calling itself “PEAR” claimed responsibility on a dark web forum and said it had stolen 617 gigabytes of data.3ClaimDepot. Expert MRI Data Breach Expert MRI was later removed from the group’s leak site, which one cybersecurity publication said “suggests that the ransom was paid.” Expert MRI has not publicly confirmed or denied a payment.2HIPAA Journal. Data Breaches at Expert MRI and McElroy Associates
What Was Taken
The stolen files contained a mix of identifying and medical data. Categories varied by person and included full names, addresses, dates of birth, driver’s license or state ID numbers, and, for a subset of patients, Social Security numbers. Medical information in the files included admission dates, diagnoses, and treatment details.2HIPAA Journal. Data Breaches at Expert MRI and McElroy Associates
How Many People Are Affected
Expert MRI reported the breach to the U.S. Department of Health and Human Services on October 31, 2025, disclosing approximately 209,560 affected individuals. HHS classified the incident as a “Hacking/IT Incident” involving a network server.4Wicked Local Data. Expert MRI Health Care Data Breach The company reported the breach to the California Attorney General on March 23, 2026.3ClaimDepot. Expert MRI Data Breach
What to Do If You Received a Notification Letter
Expert MRI began mailing notification letters after completing its file review. The letters offer 12 or 24 months of complimentary credit monitoring and identity restoration through Epiq Privacy Solutions, including three-bureau credit monitoring, dark web monitoring, credit freeze assistance, change-of-address monitoring, and access to restoration specialists.1California Attorney General. Expert MRI Notice of Data Event
Enrollment is not automatic. You need to go to privacysolutionsid.com, click “Activate Account,” and enter the unique activation code from your letter. The enrollment deadline stated in the notification letters was January 31, 2026.5Montana Department of Justice. Expert MRI Consumer Notification Letter Expert MRI’s dedicated line for questions about the incident is 855-720-3740, Monday through Friday, 8 a.m. to 8 p.m. CT. Epiq’s enrollment support line is 866-675-2006.1California Attorney General. Expert MRI Notice of Data Event Keep your notification letter and any enrollment paperwork, since those documents may matter if a class action is later filed.
Is There a Class Action Over the Breach?
Not yet. As of mid-2026, no class action related to the breach has been filed, and there is no settlement, no certified class, and no claims process. At least two law firms have publicly said they are investigating potential claims, citing possible violations of HIPAA and the California Confidentiality of Medical Information Act.6Potter Handy LLP. Expert MRI Data Breach Lawsuit Those investigations appear to be in the early client-intake stage.
The Allstate Insurance Fraud Lawsuit
Separate from the breach, Expert MRI has been a defendant since 2020 in two lawsuits filed by Allstate Insurance Company in Los Angeles Superior Court under California’s Insurance Frauds Prevention Act, a statute that lets private parties bring fraud claims on behalf of the state. Codefendants include Discovery Radiology Physicians, OneSource Medical Diagnostics, and Safvi Medical Corporation.7Claims Journal. California Court of Appeal Opinion Makes MRI Brokering Illegal
What Allstate Alleged
Allstate calls the alleged scheme “MRI brokering.” According to the complaints, a non-physician, Sattar Mirtabatabaee (also known as Sattar Mir), created and controlled multiple professional medical corporations, including Expert MRI, that presented themselves as physician-owned radiology practices but actually operated as middlemen.8FindLaw. People ex rel. Allstate Insurance Company v. Discovery Radiology Physicians Allstate says Mir controlled the corporations through his management company, OneSource Medical Diagnostics LLC, and its parent, 1st Source Capital LLC.
The corporations allegedly solicited patients with auto accident or workers’ compensation claims, then referred them to independent MRI facilities and contract radiologists. Allstate says the actual cost per MRI was roughly $200, while the corporations billed insurers close to $2,000 per scan.9Knox Ricksen LLP. Recent California Court Opinion Makes MRI Brokering Business Model Illegal Licensed physicians listed on corporate filings allegedly exercised little real oversight. In Expert MRI’s case, the complaint identified Drs. Adil Mazhar and Sana Khan as nominal owners with “zero oversight, control or review” of the practice.8FindLaw. People ex rel. Allstate Insurance Company v. Discovery Radiology Physicians
The 2023 Appeals Court Ruling
The case nearly ended early. The trial court dismissed the complaints, finding the allegations too vague and Mir’s role administrative. Allstate appealed. On August 15, 2023, a three-justice panel of the California Court of Appeal for the Second District reversed the dismissal in a published opinion, People ex rel. Allstate Ins. Co. v. Discovery Radiology Physicians, P.C., 94 Cal.App.5th 521.8FindLaw. People ex rel. Allstate Insurance Company v. Discovery Radiology Physicians
Writing for the panel, Justice Lee Smalley Edmon held that Allstate had adequately alleged the unlicensed practice of medicine. A non-physician who selects radiology providers, controls billing codes, sets fees, and manages profit distribution is exercising control over medical decision-making that California law reserves for licensed physicians.10vLex. People ex rel. Allstate Ins. Co. v. Discovery Radiology Physicians The court cited California Medical Board guidance that coding, billing, and equipment decisions must be made by licensed doctors rather than management companies. Insurance claims submitted for services rendered in violation of the Medical Practice Act, the court confirmed, can support fraud claims under both the Insurance Frauds Prevention Act and California’s Unfair Competition Law.9Knox Ricksen LLP. Recent California Court Opinion Makes MRI Brokering Business Model Illegal
Where the Fraud Cases Stand
After the appellate court sent the cases back for reinstatement, both suits continued through the trial court. As of June 2024, the Discovery Radiology case (20STCV42672) and the OneSource case (20STCV45151) were pending in Department 36 of the Stanley Mosk Courthouse in Los Angeles.11Rulings.law. People v. Discovery Radiology Physicians, 20STCV42672 Neither case has gone to trial or settled based on available records.