Tradesman RICO Lawsuit: Five Cases, Dismissals, and Fallout

The Tradesman RICO lawsuit is not one case but a series of five federal civil racketeering suits filed in the U.S. District Court for the Eastern District of New York, beginning in March 2024, by Tradesman Program Managers and its Bermuda-based reinsurer Roosevelt Road Re. The suits accuse networks of New York City personal injury law firms, medical clinics, and unlicensed recruiters of staging or exaggerating construction accidents to extract multimillion-dollar settlements under the state’s Scaffold Law. As of mid-2026, courts have dismissed several of the suits, ruling that the plaintiffs sit too far down the insurance chain to bring federal RICO claims, while one case survives on a motion to amend.¹

What the Complaints Allege

Across all five complaints, the plaintiffs describe a repeating pattern. “Runners” recruited vulnerable construction workers, many of them undocumented, and steered them into staged or exaggerated workplace injury claims. The workers were routed to a small set of personal injury firms and to affiliated medical clinics, where, the complaints say, they underwent unnecessary examinations, imaging, injections, and sometimes surgeries. The resulting records were then used to inflate filings before the New York State Workers’ Compensation Board and to support tort suits under New York Labor Law sections 240 and 241.²

Section 240, the Scaffold Law, imposes strict liability on building owners and general contractors for gravity-related injuries, which the plaintiffs say makes the state a uniquely attractive venue for manufactured claims. Injured workers win roughly 90% of those cases, according to Tradesman.³ The complaints estimate that average settlements in the targeted cases ran between $1.5 million and $2 million, with potential exposure of up to $5 million per claim.² Litigation funders are also named as participants, accused of advancing cash to claimants and keeping them financially locked into the litigation.⁴

Tradesman says the pattern predates 2018 and accelerated after 2020. Roosevelt Road Re’s general liability claim adjustment expenses grew from about $14 million in 2018 to more than $142 million in 2022, according to the company.³

Who Is Suing

Tradesman Program Managers is a New York managing general agent founded in 2016 by Daniel Hickey Jr. It underwrites and handles claims for trade contractors and construction firms. It operates under Roosevelt Road Capital Partners, which also owns Roosevelt Road Re, the Bermuda-based reinsurer that carries workers’ compensation and general liability exposure on Tradesman’s book.⁵

Hickey ordered an internal investigation in 2021 after Tradesman noticed a sharp jump in workers’ compensation payouts and tort filings. The company says the investigation ran more than three years, cost roughly $5 million, and used undercover cameras and investigators posing as construction workers.³ Tradesman told the court the alleged fraud had grown severe enough that one of its major carriers, Accredited Surety and Casualty Company, stopped writing general liability policies in New York, making it “impracticable” for Tradesman to keep servicing contracts in the state.⁶

The Five Cases and Their Defendants

The first suit, Roosevelt Road Re v. Hajjar, was filed March 1, 2024, and named 46 defendants. It targeted Dr. John Hajjar and several Surgicare-affiliated ambulatory surgery centers, the personal injury firms Gorayeb & Associates and Fogelgaren Forman & Bergman, and Fanny Guadalupe, whose nonprofits ran Spanish-language OSHA training courses the complaint described as a recruiting pipeline. The complaint also named Francisco Payano, described as an unlicensed investigator for Gorayeb, alleging he openly discussed using the Scaffold Law to generate “windfall” recoveries during a December 2022 class.² Gorayeb & Associates denied wrongdoing, calling the complaint a “gross mischaracterization.”⁷

The second suit, filed July 19, 2024, targeted Herbert S. Subin and Eric D. Subin of Subin Associates along with alleged runner Jorge Arturo Gonzalez Lupi. The complaint said the Subin firm had handled thousands of construction-related lawsuits since 2018.⁸

The third, filed January 17, 2025, targeted Liakas Law P.C., managing partner Dean N. Liakas, and medical entities including Brooklyn Medical Practice, Advanced Orthopedics and Joint Preservation, and Big Apple Pain Management. Ionian Re LLC joined as a co-plaintiff.⁹

The fifth and most recent, a 162-page complaint filed June 16, 2025, named William Schwitzer & Associates P.C., principals William Schwitzer and Giovani Merlino, and more than 30 medical practices spanning orthopedics, radiology, pain management, and acupuncture. Several of those providers operated from a single address at 410 Ditmas Avenue in Brooklyn, which the complaint identified as a referral hub.¹

Why the Courts Keep Dismissing the Cases

The plaintiffs have run into the same wall in case after case: RICO requires a direct relationship between the alleged fraud and the plaintiff’s injury, and judges have found that Roosevelt Road Re and Tradesman sit too far down the chain.

On June 19, 2025, Judge Hector Gonzalez dismissed the amended complaint in the Subin case. He ruled that Roosevelt Road Re’s losses as a reinsurer were “doubly contingent” on harms suffered first by construction employers and then by primary insurers, making the causal chain too attenuated for RICO. As for Tradesman, the court said that because it is paid to investigate claims, it had not shown that the cost of handling fraudulent claims exceeded the profit it earned from processing them.⁸ On September 16, 2025, the court denied leave to amend again, calling further amendment “futile and prejudicial,” and closed the case.¹⁰

The Subin ruling then killed the Schwitzer case. On February 18, 2026, Judge Brian M. Cogan dismissed that suit with prejudice, holding that Roosevelt Road Re’s standing had already been decided in Subin and could not be relitigated under collateral estoppel. The plaintiffs had tried to reframe Roosevelt as a “primary insurer” rather than a reinsurer; the court rejected the recharacterization.¹¹¹²

The Hajjar case is the only Tradesman-filed suit still active. On March 11, 2026, Judge Nina Gershon dismissed the RICO and RICO conspiracy claims from the First Amended Complaint without prejudice, finding “fundamental deficiencies” in the pleading of proximate causation and of a single enterprise linking the defendants. Gorayeb & Associates had argued it shared no common purpose or interpersonal relationships with the medical providers named as co-defendants, and the court agreed the plaintiffs had not shown a unified enterprise.¹³ The plaintiffs filed for leave to submit a Second Amended Complaint in May 2026.¹⁴

Impact on New York Construction Litigation

Even with the dismissals, Tradesman has claimed sweeping practical effects. The company says new claim reporting against its policies fell to a “near standstill” after the first complaint was filed in March 2024.³ Defense-side estimates put the number of cases dropped by plaintiff firms in 2024 at between 500 and 1,000, with one unnamed firm withdrawing from nearly 300 lawsuits.¹⁵ Subin Associates reportedly asked to withdraw from 200 to 300 cases in 2024, citing “ethical concerns” with its referral source.¹⁶ Tradesman says it closed more than 120 New York labor law cases with zero indemnity paid, and its construction underwriting revenues doubled.

Other Insurers Filing Similar Suits

Tradesman’s cases are part of a wider wave of insurer racketeering suits targeting overlapping defendants. Ionian Re, a captive insurer, filed a RICO action in October 2024 against Gorayeb & Associates and associated medical providers, and a November 2024 complaint with three contractors named Subin & Associates, Wingate Russotti Shapiro Moses & Halperin, and William Schwitzer & Associates.¹⁷¹⁸ Union Mutual Fire Insurance filed three RICO suits in spring 2025 against Liakas Law, Subin Associates, and litigation funding companies.¹⁹ Allstate had filed 45 RICO lawsuits in New York by August 2025, and GEICO filed a suit alleging $6.3 million in fraudulent no-fault billings.¹⁶

What Happens Next

Whether Tradesman’s legal strategy can survive the standing problem remains an open question. Courts have twice ruled that a reinsurer’s losses are too indirect to support federal RICO claims, and the Schwitzer dismissal came with prejudice. The Hajjar case, where the plaintiffs are seeking a further chance to amend, is the test of whether Tradesman can rewrite its theory to plead a single enterprise and a direct injury the courts will accept.¹⁴

1
Insurance Journal. Roosevelt Road Specialty and Tradesman Program Managers File Fifth RICO Action
2
GovInfo. Roosevelt Road Re v. Hajjar, Complaint
3
Slipcase. Tradesman RICO Suits a Wake-Up Call to NY Insurers and Defense Bar
4
Roosevelt Road Specialty. Roosevelt Road Re and Tradesman Program Managers File Fifth RICO Action
5
Roosevelt Road Specialty. Daniel Hickey Jr.
6
Reinsurance News. Roosevelt and Tradesman File Lawsuit Over Alleged Fraudulent WC Claims
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ABC7 New York. Construction Workers Fake Falls Injuries
8
GovInfo. Roosevelt Road Re v. Subin, Memorandum and Order
9
OffshoreAlert. Roosevelt Road Re v. Liakas Law, Complaint
10
The Insurer. New York Judge Dismisses Tradesman’s Amended RICO Suit Against Law Firm
11
Justia. Roosevelt Road Re v. William Schwitzer and Associates, Memorandum Decision and Order
12
Ruskin Moscou Faltischek. Federal Court Dismisses Civil RICO Lawsuit With Prejudice
13
Legal Newsline. Another RICO Case Against NYC Injury Lawyers Dismissed
14
PACER Monitor. Roosevelt Road Re v. Hajjar et al
15
WSHB Law. Shining a Light on Corruption: New York Fraudulent Lawsuits Exposed
16
Judicialhellholes.org. New York City
17
Insurance Journal. Bermuda-Based Insurer Files RICO Suit Alleging Staged Construction Accidents
18
Business Insurance. Captive Sues Over Alleged Staged Construction Accidents in New York
19
ICLG News. Vermont Insurer Gunning for Personal Injury Firms