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University Spine Center v. Blue

United States District Court, D. New Jersey

May 21, 2018



          WILLIAM J. MARTINI, U.S.D.J.

         Plaintiff University Spine Center, on assignment of Edward C. (“Patient”), brings this action against Defendant Anthem Blue Cross Blue Shield, alleging failure to make all payments under Patient's medical plan pursuant to the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1132(a), and breach of fiduciary duty. This matter comes before the Court on Defendant's motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and (b)(6). There was no oral argument. Fed.R.Civ.P. 78(b). For the reasons set forth below, Defendant's motion to dismiss is GRANTED.

         I. BACKGROUND

         Plaintiff is a healthcare provider in the Passaic County, New Jersey. Compl. ¶ 1, ECF No. 1. Defendant administers health insurance plans to individuals in New Jersey, among other states. See id. ¶ 2; Def.'s Mem. of Law in Supp. of Its Mot. to Dismiss (“Def.'s Mem.”) 4-5, ECF No. 6-1. At all relevant times, Patient was a plan participant in the Ascena Retail Group Inc., Benefits Plan (the “Plan”), which Defendant administered. See Def.'s Mem. 5, Ex. A. In addition, at all relevant times, Plaintiff was an out-of-network healthcare provider and did not have a contract with Defendant. See id. at 4.

         On November 17, 2015, Plaintiff provided Patient with medical services, including surgery to remove and fuse cervical disks. See Compl. ¶¶ 5-6. Patient transferred his rights to benefit payments under the Plan to Plaintiff. Id. ¶ 7. Plaintiff subsequently filed a claim with Defendant for $170, 082.00 in reimbursement for services rendered. Id. ¶ 9. Defendant paid $15, 621.95 of that claim. See Pl.'s Br. in Opp'n to Def.'s Mot. (“Pl.'s Opp'n”) 12 n.2, ECF No. 8. On January 26, 2018, Plaintiff filed suit, alleging that Defendant failed to make all payments as required by ERISA and breach of fiduciary duty. See Compl. ¶¶ 17-34.

         Defendant now moves to dismiss, arguing first that Plaintiff lacks standing to assert its ERISA claim because the Plan contains a valid and enforceable anti-assignment clause. See Def.'s Mem. at 8-12. Defendant next argues that Plaintiff's complaint insufficiently describes the alleged assignment. See id. at 12-17. Defendant further argues that Plaintiff failed to state a claim under ERISA for additional benefits, that Plaintiff's breach of fiduciary duty claim is duplicative, and that Plaintiff failed to exhaust its administrative remedies. See id. at 17-25.

         Plaintiff opposes, arguing that the anti-assignment clause does not preclude its standing to sue. See Pl.'s Opp'n at 17-28. Plaintiff further argues that Defendant's reliance on Rule 12(b)(1) is erroneous, that Plaintiff adequately alleged the existence of the assignment, that its breach of fiduciary duty claim is non-duplicative pursuant to Supreme Court precedent, and that Defendant's failure to comply with reasonable claims procedures prevents dismissal based on Plaintiff's failure to exhaust its administrative remedies. See id. at 12-15, 28-34. Defendant filed a reply, largely reiterating its previous arguments, including Plaintiff's lack of standing. See Def.'s Reply Mem. of Law in Further Supp. of Its Mot. to Dismiss, ECF No. 9.


         Federal Rule of Civil Procedure 12(b)(1) provides for the dismissal of a complaint for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). There are two types of challenges to subject-matter jurisdiction: (1) facial attacks, which challenge the allegations of the complaint on their face; and (2) factual attacks, which challenge the existence of subject-matter jurisdiction, quite apart from any pleadings. Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977). In reviewing a factual attack, as Defendant presents here, the court may consider evidence outside the pleadings, and no presumptive truthfulness attaches to the plaintiff's allegations. Gould Elecs. Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000); Gotha v. United States, 115 F.3d 176, 178-79 (3d Cir. 1997). The plaintiff bears the burden of proving that jurisdiction exists. Gould Elecs., 220 F.3d at 178.

         Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint, in whole or in part, if the plaintiff fails to state a claim upon which relief can be granted. The moving party bears the burden of showing that no claim has been stated. Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). In deciding a motion to dismiss under Rule 12(b)(6), a court must take all allegations in the complaint as true and view them in the light most favorable to the plaintiff. See Warth v. Seldin, 422 U.S. 490, 501 (1975); Trump Hotels & Casino Resorts, Inc. v. Mirage Resorts Inc., 140 F.3d 478, 483 (3d Cir. 1998).

         Although a complaint need not contain detailed factual allegations, “a plaintiff's obligation to provide the ‘grounds' of his ‘entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Thus, the factual allegations must be sufficient to raise a plaintiff's right to relief above a speculative level, such that it is “plausible on its face.” See Id. at 570; see also Umland v. PLANCO Fin. Serv., Inc., 542 F.3d 59, 64 (3d Cir. 2008). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556). While “[t]he plausibility standard is not akin to a ‘probability requirement' . . . it asks for more than a sheer possibility.” Id.


         “The requirement that jurisdiction be established as a threshold matter ‘spring[s] from the nature and limits of the judicial power of the United States' and is ‘inflexible and without exception.'” Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94-95 (1998) (quoting Mansfield, C. & L.M.R. Co. v. Swan, 111 U.S. 379, 382 (1884)). Defendant challenges Plaintiff's standing to sue based on the anti-assignment clause located in the Plan documents, restraining Patient from assigning his benefits. See Def.'s Mem. at 9-12. Plaintiff argues that the anti-assignment clause is invalid for multiple reasons. See Pl.'s Opp'n at 17-28. The anti-assignment clause in question reads as follows:

You cannot assign your right to receive payment to anyone else, except as required by a “Qualified Medical Child Support order” as defined by ...

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