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Sportscare of America, P.C v. Multiplan

January 24, 2011

SPORTSCARE OF AMERICA, P.C., PLAINTIFF,
v.
MULTIPLAN, INC., AETNA, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Falk, U.S.M.J.

NOT FOR PUBLICATION

REPORT AND RECOMMENDATION

Before the Court is Plaintiff's motion to remand this case to state court. [CM/ECF No. 14.] The motion is opposed. This Recommendation is made on the papers submitted. Fed. R. Civ. P. 78(b). For the reasons set forth below, it is respectfully recommended that Plaintiff's motion be denied.

BACKGROUND

On July 22, 2010, Plaintiff, Sportscare of America, P.C. ("Plaintiff"), a physical therapy facility, filed the instant complaint in New Jersey Superior Court. The Complaint contains 89 counts and is 65 pages long. Named as defendants are twenty-one insurance providers and one medical claim processing company. The Complaint is couched in terms of fraud, negligence, and interference with contract claims alleged against each insurance plan. However, in reality, the Complaint seeks to recover fees Plaintiff claims it is entitled to as a result of its treatment of individuals insured by the various health plan entities. (Compl. ¶¶ 7-10.) In short, Plaintiff submitted claims to the health insurers and received some payment but at a rate that it claims is improper.*fn1 (Compl. ¶¶ 8, 10.) Plaintiff apparently sues for the difference between what Plaintiff was paid and what it thinks it should have been paid on various insurance claims.

On August 27, 2010, the action was removed to this Court. The Notice of Removal alleges that Plaintiff's claims are actually claims for benefits due under employee benefit plans governed by the Employee Retirement Income Security Act of 1974, ("ERISA"), 29 U.S.C. § 1001, et seq. and are thus preempted. (Notice of Removal ¶ 6.)

On October 27, 2010, Plaintiff filed this motion to remand. Plaintiff argues that it is not a "participant" or "beneficiary" in any ERISA plan, and thus, the claims are not preempted because they could not have been brought under ERISA. Plaintiff also contends "the 'rate of payment' . . . is a non-federal issue [that] is not preempted by ERISA." (Pl.'s Br. 9.)

Defendants opposed the motion on November 22, 2010.*fn2 They contend that the Complaint expressly pleads that Plaintiff is entitled to recover fees pursuant to "assignment of benefits documents," which establish ERISA jurisdiction.*fn3 Defendants assert that the plain language of the Complaint establishes federal jurisdiction. Defendants also argue that there is no independent legal duty that supports Plaintiff's claim beyond ERISA, and thus, no independent legal basis for Plaintiff to bring its claim beyond the federal scheme.

On November 29, 2010, Plaintiff filed a reply brief, arguing -- despite the express allegations in its own Complaint that assignments exist -- that Defendants have failed to establish the existence of valid assignments.

DISCUSSION

A. Legal Standard

Federal courts have original jurisdiction over cases that "arise under" federal law. See 28 U.S.C. § 1331, 1441(a). In this regard, pursuant to the "well-pleaded complaint" rule, a plaintiff is ordinarily entitled to remain in state court so long as its complaint does not allege a federal claim on its face. See Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987); Franchise Tax Bd. of Cal. v. Contr. Laborers Vacation Tr. for S. Ca., 463 U.S. 1, 10 (1983) ("[A] defendant may not remove a case to federal court unless the plaintiff's complaint establishes that the case arises under federal law."). However, the doctrine of complete preemption serves as an exception to the "well-pleaded complaint" rule. See, e.g., Lazorko v. Pa. Hosp., 237 F.3d 242, 248 (3d Cir. 2000) ("One exception to [the well-pleaded complaint rule] is for matters that Congress has so completely preempted that any civil complaint that falls within this category is necessarily federal in character.").

The doctrine of complete preemption "creates removal jurisdiction even though no federal question appears on the face of the plaintiff's complaint." Id. Claims which fall within the scope of ERISA §502(a) have been deemed to be completely preempted. See Pascack Valley Hosp. v. Local 464A UFCW Welfare Reimbursement Plan, 388 F.3d 393, 398 (3d Cir. 2004) ("State law causes of action that are 'within the scope of . . . §502(a) are completely preempted . . . ."); Vaimakis v. United Healthcare/Oxford, No. 07-5184, 2008 WL 3413853, at * 3 (D.N.J. Aug. 8, 2008) ("ERISA's civil enforcement provision falls within the doctrine of complete preemption."). Therefore, such claims are removable to federal court. See, e.g., Pryzbowski v. U.S. Healthcare, Inc., 245 F.3d 266, 271 (3d Cir. 2001) ("Following the decision in Metropolitan Life, there can be no question that 'causes of action within the scope of the civil enforcement provisions of § 502(a) [are] removable to federal court.' ") (quoting Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 62 (1987)).

The Third Circuit has set forth two conditions which must be met for a claim to be completely preempted under §502(a) and, therefore, subject to removal: (1) that the plaintiff could have brought the claim under §502(a); and (2) that "no other legal duty supports" plaintiff's claim. See Pascack, 388 F.3d at 400. Both conditions must be met in order for the claim to be completely preempted. See, e.g., N.J. Spinal Med. & Surgery, PA ...


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