Mayer Eisenstein files for bankruptcy…again

22 Jan

Mayer Eisenstein is a go-to person in the vaccines-cause-autism community. He heads a large practice in the Chicago area and claims that his unvaccinated children do not have autism. He also was or is a part of the “Lupron Franchise”—a group of practitioners who took on the Geier idea that shutting down sex hormone production in autistics could be a treatment. It was a profoundly bad idea.

Mayer Eisenstein was the subject of an article in the Chicago Tribune: Autism doctor: Troubling record trails doctor treating autism. From that article:

Yet his suburban Chicago practice, currently known as Homefirst, garnered an alarming record: It was on the losing side of one of the largest U.S. jury verdicts — $30 million — ever awarded to the family of a newborn in a wrongful-death suit.

In court records dating back three decades, the families of dead and brain-damaged children repeatedly alleged that doctors who work for Eisenstein made harmful mistakes — sometimes the same error more than once. His practice also has been dogged by accusations in court records that its offshore malpractice policy was phony.

After the $30M verdict, Mayer Eisenstein filed bankruptcy. Which was not permitted. Again from the article above:

With bankruptcy off the table, a Cook County judge acknowledged the practice’s claim of insolvency, consolidated the $30 million verdict, five remaining malpractice cases and two civil fraud cases and ordered mediation.

Last July, the judge approved a $1.275 million settlement that Homefirst must divide among six families over seven years. Eisenstein’s practice made the first $100,000 payment last September, four months before he opened the autism clinic.

It appears that the $1.275M settlement noted above is the topic of a battle ongoing in the current bankruptcy filing by Dr. Eisenstein. Per the complaint:

The aggregate Settlement Amount of $1,275,000 represents a small fraction of the total of claims by the Personal Injury Plaintiffs, some of which had reached verdict and judgment.

In other words, it appears Mayer Eisenstein wasn’t allowed to avoid payment by filing bankruptcy, but he did reduce the payments dramatically. The settlement also included a payment schedule. The families claim that four annual payments for a total of $430,000 were made, then the payments stopped after 2011. They claimed (as of August 2013):

Installments to Be Paid on or Before: Amount

September 22, 2012 (not paid when due). . . . . . . . . . . . $ 140,000.00

September 22, 2013 (not yet due). . . . . . . . . . . . . . . . . . $ 150,000.00

September 22, 2014 (not yet due). . . . . . . . . . . . . . . . . . $ 160,000.00

September 22, 2015 (not yet due). . . . . . . . . . . . . . . . . . $ 395,000.00

Total due and unpaid and to become due $ 845,000.00

Per the docket, the case was scheduled to go to hearing last month.

In short, it appears that a multiple families were injured by Mayer Eisenstein and/or member of his practice. They sought and were granted damages, only to have Dr. Eisenstein negotiate those down in a 2004 bankruptcy filing. Dr. Eisenstein made some payments, but then stopped. And he now appears to be trying to avoid further payments as part of his new bankruptcy filing, which the families are fighting. Again.

Why, one might ask, didn’t the families get some secutity pledged to cover the settlement should Dr. Eisenstien stop payments? Seems a reasonable thing to do. The answer is they did. It appears that the property he pledged as security was not under Mayer Eisenstien’s control. In other words, when the families sought to get the property in lieu of the payments, they found that Dr. Eisenstein (who holds a law degree in addition to his medical credentials) couldn’t directly hand it over.

The records of the Office of the Recorder of Deeds of Cook County, Illinois disclose the following transactions for the property at 1101 Dodge, Evanston, Illinois, PIN 10-24-

208-032-0000:

(a) Karen Eisenstein (Mayer Eisenstein, M.D.’s spouse) took title by a deed recorded on April 29, 2002 as document number 0020384408.

(b) Karen Eisenstein transferred title to North Star Trust Co. Tr. # 36189 by a deed in trust recorded on June 11, 2003 as document number 0316239026.

25. Paragraph 6 of the Circuit Court order of July 12, 2008 further provides:

“6. Plaintiffs are to have secured creditor status in the event of an applicable bankruptcy filing.”

So, it would appear that Mayer Eisenstein pledged a property as security for the settlement—a property which he had transferred to his wife in 2002 and which she had transferred to a trust company, in 2003. In other words, to this layman, it appears that at the time he put the property up, it was effectively shielded from actually being used as security.

Another question that one would reasonably ask is why weren’t these claims paid by malpractice insurance? That gets very convoluted, but the original settlement agreement included the statment

“I. Defendants in this matter affirm that they do not have any liability insurance coverage for any of the claims of the remaining plaintiffs.”


Defendants would be Mayer Eisenstein and his practice. And here is where it gets convoluted. The current complaint states

45. At one of the meetings pursuant to Section 341 of the Bankruptcy Code, Mayer Eisenstein, M.D. stated that from time to time he has malpractice insurance to allow him to be on staff at an area hospital.

46. At that same meeting, Mayer Eisenstein, M.D. stated that he did not submit any of the claims to that malpractice insurance carrier, because, as he claimed, if he had the insurance would have been cancelled, and he could no longer use the hospital

47. If Mayer Eisenstein, M.D. had medical malpractice insurance coverage in place at a time when the claims or one or more of the Personal Injury Plaintiffs cases arose, then the
statement was false.

Maybe he didn’t have insurance. Maybe he did and didn’t submit the claims.

Let’s take a look back at the Chicago Tribune article. In addition to discussing the Lupron clinic Dr. Eisenstein set up, it also discusses his history with insurance:

He also dabbled in group health plan sales to Illinois families but tangled with state insurance regulators in the mid- to late 1990s. Regulators warned consumers in a newsletter that Eisenstein “continued to illegally market” the Homefirst Health Plan, based in the British Virgin Islands, even after they told him the plan was ineligible. Despite this, he continued selling the plan, records show, and they ordered him to “cease and desist.”

In an interview, Eisenstein said he was offering a “fraternal health plan,” not traditional health insurance, so he said he didn’t have to listen to regulators. He no longer sells health plans.

And, later:

After Nathan Howey’s death, Weiss Hospital sued Homefirst, Rosi and Eisenstein for fraud, alleging they misrepresented their Caribbean-based malpractice policy. Eisenstein testified that he was in St. Kitts helping one of his daughters, a veterinary student there, buy a condo when the lawyer who helped arrange the sale told Eisenstein he also sold malpractice insurance.
“I was tickled pink to get insurance,” he said under oath.

A Cook County judge called it an “improperly underwritten insurance plan.” Eisenstein, who says the policy is legitimate, agreed to pay Weiss $50,000 after mediation.

Yes, “tickled pink” to get insurance. From a Caribbean island real estate/insurance salesman.

For those interested, here are some of the documents from the case discussed above.

Case 13-01050, lawsuit

Exhibit A

Exhibit B


By Matt Carey

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10 Responses to “Mayer Eisenstein files for bankruptcy…again”

  1. reissd January 22, 2014 at 21:14 #

    I have listened to several broadcasts of Attorney Alan Phillips and Dr. Eisenstein on their “Know your Rights” hour. I was very disturbed when Dr. Eisenstein encouraged and affirmed parents in not telling doctors in hospitals and emergency rooms that their children were unvaccinated.

    • Saraquill January 24, 2014 at 14:18 #

      How that man can call himself a doctor, and play an accessory into possibly introducing an outbreak into a hospital, I don’t understand.

  2. lilady January 22, 2014 at 23:57 #

    It’s hard to believe that Mayer Eisenstein with all his shady dealings, has a clean record with the Illinois State Lawyer Licensing Board:

    http://www.iardc.org/ldetail.asp?id=986022080

    • reissd January 23, 2014 at 00:00 #

      If he’s not practicing as a lawyer – which I don’t know – there won’t be legal malpractice.

    • lilady January 23, 2014 at 00:02 #

      Ooops, try this link and key in “Eisenstein” in the “Lawyer Search” field in the left column:

      http://www.iardc.org/

  3. Anne January 23, 2014 at 02:46 #

    To continue the story, you can read Eisenstein’s answer to the complaint here:

    http://bit.ly/1aKu5d6

    To boil it down, Eisenstein is saying that he never agreed to the settlement and never agreed to pledge the property as security because he didn’t own it and couldn’t pledge it. His lawyers done it, and it’s not his fault, he says.

    Eisenstein says there never was a settlement, though he admits that he made the first four settlement payments “on advice of counsel.” Re the medical malpractice insurance, he says he had a policy, but it wouldn’t have covered the plaintiffs’ claims so he didn’t submit them to his carrier.

    What appears to have happened is that there were a bunch of state court cases against Eisenstein that were consolidated and ultimately, according to the plaintiffs, settled. This had nothing to do with the earlier bankruptcy proceeding.

    After the settlement, Eisenstein made some of the payments and then filed the 2013 bankruptcy proceeding. Because the plaintiffs’ claims existed before the 2013 bankruptcy was filed, those claims would ordinarily be discharged, meaning that the plaintiffs could not pursue them and would have to take whatever they could get from the bankruptcy, sharing with other creditors. But there’s an exception to discharge for claims that resulted from fraud. So the plaintiffs filed this Adversary Proceeding in the bankruptcy court – that’s what this lawsuit is – to get their claims under the settlement agreement declared nondischargeable due to Eisenstein’s alleged fraud in entering into the settlement agreement. If they win this, they would then be able to pursue their claims against Eisenstein for breach of the settlement agreement regardless of the bankruptcy. The purpose of the Adversary Proceeding is to try to prevent Eisenstein from using his bankruptcy to avoid his full liability to the plaintiffs for the remaining settlement amounts.

    The case is still pending and, as far as I can tell, hasn’t yet been set for trial.

    Now I wonder whether Eisenstein will let his lawyers testify about whether he authorized them to say he would pledge the property as security, or whether he will invoke the attorney-client privilege on that subject.

    • reissd January 23, 2014 at 02:48 #

      He’s the client. If they acted without his authorization, he should act against them. I, too, am interested to see if he invokes privilege – which would be excellent reason to dismiss that claim. thanks for the info.

    • Julian Frost January 25, 2014 at 21:51 #

      Eisenstein is saying that he never agreed to the settlement and never agreed to pledge the property as security because he didn’t own it and couldn’t pledge it. His lawyers done it, and it’s not his fault, he says.

      While there are bad lawyers (every job has bad apples), I don’t buy this for a second. I can’t believe that the lawyers would have put this up as surety without the title deed, unless Eisenstein claimed he owned it. I’m convinced he’s lying, but that would be par for the course from someone who encourages others to lie.

  4. michael February 28, 2014 at 13:30 #

    anyone notice that there are no details as to what this suit is against Eisenstein? what exactly is the charge?

    • Chris February 28, 2014 at 16:05 #

      Which one? there are several mentioned in the Chicago Tribune article. Also, the links contain the legal documents to the bankruptcy.

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