Welcome to Court Watch #138. Listen, we’re gonna go long this week. Your inbox may clip this issue. There’s too much news. Just embrace it.
In this roundup, Proud Boys miss a mark, Atomwaffen misses a leader, and Chase Matthew misses his royalties. We also have judges in Rolling Stone shirts, lizard people, Dexter and POTUS threats, and no one tell the Twitter cryptobros but the North Korean government has an NFT.
But before we dive into the dockets, our favorite Florida freelancer Gabrielle Russon dives deep into an interesting California healthcare lawsuit.
FTC Tackles ‘ObamaCarePlans’
The Federal Trade Commission reached a $45 million settlement with a company accused of operating websites pretending to sell federal health insurance plans but instead bombarding consumers with marketing calls from telemarketers.
“I have received nearly 80 phone calls after going on your site thinking it was a legitimate health insurance administrator,” one person complained to MediaAlpha in an email, according to court records. “MAKE IT STOP.”
The FTC filed the lawsuit against MediaAlpha this week in the U.S. District Court’s Los Angeles division for the Central District of California. Also in California, the company is currently facing a federal lawsuit seeking class action status filed by a Florida man in June.
People were tricked, thinking they were shopping for real insurance at MediaAlpha-run websites with official-sounding government names such as ObamacarePlans.com, GovernmentHealthInsurance.com, and KentuckyHealthPlans.org, the FTC said.
“Defendants actually sell consumers nothing. Instead, after harvesting consumers’ personal and contact information, Defendants auction it off to telemarketers and other lead generators,” the federal complaint said. “In their advertisements enticing people to visit these sites, Defendants have falsely led consumers to believe that they are affiliated with state or federal government programs and that they offer special access to low-cost, comprehensive insurance plans.”
An order said MediaAlpha was required to transfer to the FTC “all rights, title, and interest, in the following domain names: governmenthealthinsurance.com, biden-care.com, healthexchangequotes.com, affordablecarecalifornia.org, dc-healthcare.org, nvhealthcare.org, obamacare- health-plans.com, obamacare-plans.com, obamacareplans.com, and obamacareusa.org.”
The websites appear to be down already.
The FTC did not respond to a request for comment for this story, but said on its website about the case, “A priority at the FTC is coherently and systematically addressing unlawful lead generation. Businesses should know the FTC will take action when lead generators break the law, engage in unlawful deception, and harm the American people.”
MediaAlpha CEO Steve Yi denied the FTC’s allegations but said the case’s settlement is “a positive step forward and are pleased to have this matter behind us” during the company’s earnings call Wednesday.
“While we strongly disagree with the FTC allegations, we believe resolving this better now is in the best interest of MediaAlpha and our shareholders,” Yi said.
Meanwhile, the Los Angeles-based MediaAlpha reported Wednesday generating about $252 million in revenue for the second quarter — a 41% jump compared to the same time period last year.
Describing itself as the “largest online customer acquisition channel” in the insurance industry, MediaAlpha sold consumers’ personal information, transferred callers to its partners, and sold clicks through third-party advertising, the FTC said.
“During 2024, approximately 119 million leads were sold via Defendants’ platform. Those lead sales amounted to approximately $1.5 billion in gross transaction value and approximately $865 million in revenue to Defendants in 2024 alone,” the complaint said.
That year, Yi was paid nearly $7 million from a compensation package that included a $550,000 base salary and about $6.4 million in stock awards, according to the company’s SEC filing.
MediaAlpha paid millions of dollars for ads to get people’s attention, but the advertisements were deceptive or untrue, the FTC said. One company marketing video featured former President Joe Biden talking about the importance of the Obamacare marketplace. Another showed legendary boxer Floyd Mayweather encouraging people to follow his “health insurance hack” and buy a plan for only $29 a month, the FTC said. “Defendants’ ads have even suggested that Defendants provide access to free health plans and will facilitate direct cash payments to consumers,” the FTC said.
And when one of MediaAlpha’s biggest lead suppliers ran advertisements for “Trumpcare” — which doesn’t exist — MediaAlpha “continued to collect hundreds of thousands of dollars in fees from the sale of that partner’s leads,” the FTC said.
The scam caused real harm to people's lives, the federal government said.
“As a result of this misconduct, people who seek medical treatment learn they have no coverage for the care they need,” the federal complaint said. “Other consumers learn of the deception later when they are faced with substantial unexpected medical cost.”
The websites also undoubtedly created lots of headaches.
MediaAlpha unleashed millions of robocalls since 2018, according to court records. People being asked to keep giving more personal information as they went down the rabbit hole of looking for insurance rates said they began receiving abusive telemarketing calls, the federal complaint said. “I have received 47 calls within one day. At this point, this is harassment,” one person emailed MediaAlpha, according to court records.
The complaint gives a twist.
Once a MediaAlpha employee actually got caught up in the calls too.
“In 2023, a MediaAlpha manager reported to colleagues that ‘the unthinkable happened’ with a sad emoji—she had accidentally entered her real phone number while testing MediaAlpha’s mobile site,” the federal complaint said. “After she relayed the ‘unthinkable’ mistake of providing real contact information in a MediaAlpha mobile form, a senior director responsible for MediaAlpha’s compliance and monitoring joked that the colleague should “get a new number,” a senior manager reacted ‘holy cannoli,’ and a company vice president responded ‘WOW.’”
MediaAlpha did not respond to a request for comment for this story.
The Docket Roundup
We were surprised no one picked it up yet, but in Georgia, a man was charged for threatening multiple victims on TikTok. Victims included someone whose “husband is in the television show Dexter.” A search of his house found weapons and a Kelvar helmet, and his last threat noted that he allegedly stated “I want to be known as the Idaho murderer.”
Thanks to the AP, legal journalists can “blog” in Hawaii’s district courts. We’re glad the courts are catching up to Tumblr era technology.
A forged U.S. Treasury check made a bank lose $1.3 million.
The FBI arrested an Oregon man who allegedly threw rocks at ICE agents during a protest. The criminal complaint in the case indicates that the FBI used facial recognition software to match pictures of the suspect with photos on Reed College’s Instagram account to identify the alleged defendant.
A historic Black church in Washington, DC, which owns the Proud Boys’ trademark and logo after the group failed to pay damages for an incident on January 6th, is now suing a Proud Boys chapter in New York for copyright infringement.
Here comes the Tesla suits.
An Ohio man’s racist tweet led to federal charges. It’s the second time in several months that we can say swords and threats don’t go well together.
Agents with the FBI’s Joint Terrorism Task Force arrested a man for allegedly sending $1,615 to ISIS affiliates and commenting on social media about his aspiration to join the terror group.
Your pro se of the week is a voter suing CBS for election interference over Kamala Harris’s 60 Minutes interview segment.
A shareholder is suing the leadership of the dating conglomerate Match over reports that the company failed to adequately address misconduct and harassment allegations on its apps.
There are some new (redacted) Kash Patel grand jury documents. However, a judge wants DOJ to confirm they followed his order.
Speaking of Patel, his attorneys outlined their defamation case against a former Assistant Director of Counterintelligence at the Bureau in an effort to push back against his attorneys’ motion to dismiss.
A rapper from Kansas was arrested on threat charges after he reportedly harassed several rabbis of synagogues in Atlanta over “white genocide” conspiracy theories.
This threat case is straight-up blasphemous.
The Justice Department responded to two SDNY judges about its plans for the release of the Epstein grand jury testimony.
A group of terror victims is suing the UN’s Relief and Works Agency for Palestine Refugees in the Near East over October 7th.
The popular online gaming site Roblox was hit with another child safety suit.
Here’s something. Building off our music theme last week, the justices of the Minnesota State Supreme Court have started their very own band as a way of blowing off steam. They named the band the “Reasonable Doubts,” and you can catch a quick clip of them playing Chappell Roan’s “Pink Pony Club” here. Our thanks to the Star Tribune for bringing us this joy of seeing a Supreme Court justice in a Stones shirt.
Two Chinese nationals were arrested for allegedly shipping tens of millions of dollars’ worth of microchips that can be used in AI applications to China.
A particularly annoying subset of Twitter was upset with Tiny Desk this week. For our song of the week, we offer the best example of Tiny Desk.
Here’s an interesting order by Judge Trevor McFadden trying to navigate when a counter-protestor has a credible claim for a restraining order against a protestor and they keep showing up to the same protests.
A judge in Massachusetts ordered for a minor who reportedly fled Turkey with his mother after a fatal luxury car accident to be extradited back to face prosecution.
As expected, people who drive a Lamborghini are not trustworthy.
The Justice Department announced the indictment of a thirty-six-year-old man from Ireland for his alleged “sadistic online exploitation of a child.”
A challenge to X/Twitter under the First Amendment and Elon Musk’s now ex role as a government employee fell short.
One pro se litigant appears to be on a quest to see how many districts in the country will deem him a vexatious litigant.
There’s some country music drama.
Honestly, this defense attorney earns a badge for turning a tough case into a likely not guilty verdict with a few pointed questions about lizard people.
Brandon Russell, a violent extremist who recently appeared in our coverage on a case exposing a neo-Nazi network, was sentenced to twenty years in prison after being convicted of a plot to attack Baltimore’s power grid. It was the second time Russell had been sentenced to federal prison in the last decade for activities related to domestic terrorism.
There is a national ring of alleged fraudsters that netted millions of dollars by submitting false unclaimed property claims and familial records for probate accounts.
The man who purportedly killed an Israeli embassy staffer and their romantic partner while they left a Jewish community event in DC was indicted on federal hate crimes charges.
This week, a Pennsylvania man was charged and took a plea deal to threatening President Trump on TikTok.
North Korean-sponsored hackers have infiltrated NFT fan communities on Discord and targeted NFT-inspired companies, stealing at least $1.3 million from one based in New York.
This is the most fascinating story of this week’s issue. If we had all the time in the world, we’d sit down and try to channel our best Patrick Radden Keefe, but alas, we have to pass what would make an undoubtedly riveting long-form piece onto you.
Federal agents investigating a series of break-ins believe the burglars used surveillance cameras planted in neighbors’ bushes to monitor their victims. They’re now asking for a search warrant to access the footage.
Thanks for reading. A final scheduling note, we’ve said this before but we never followed through with it. However, we think we mean it this time. We’ll be taking a break from the roundup next Friday but we’ll be back the following week.