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University Spine Center v. Aetna, Inc.

United States District Court, D. New Jersey

August 15, 2018

UNIVERSITY SPINE CENTER o/a/o John W., Plaintiff,
AETNA, INC. and JOHN DOE, Defendants.


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

         Plaintiff University Spine Center, on assignment of John W. (“Patient”), brings this action against Defendant Aetna, Inc., alleging violations of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., in connection with Defendant's alleged failure to remit proper payment to Plaintiff under the terms of Patient's medical plan. 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 is GRANTED and Plaintiff's complaint (the “Complaint”) is DISMISSED WITH PREJUDICE.

         I. BACKGROUND

         Plaintiff is a healthcare provider in Passaic County, New Jersey. Compl. ¶ 1, ECF No. 1. Defendant provides health insurance and administrative services for self-funded medical benefits plans in New Jersey and throughout the United States. See Def.'s Mem. of Law in Supp. of Mot. to Dismiss (“Def.'s Mem.”) 3, ECF No. 10-2. At all relevant times, Patient was a member of a health benefits plan (the “Plan”) administered by Defendant. See Decl. of K. Depaepe (“Depaepe Decl.”) ¶ 3, ECF No. 10-3.

         On December 6, 2016, Plaintiff performed an anterior cervical diskectomy and anterior cervical disk replacement on Patient. Compl. ¶ 6-7. Patient transferred all his rights to benefit payments under the Plan to Plaintiff. Id. ¶ 8. Plaintiff subsequently filed a claim with Defendant for $120, 324.00 in reimbursement for services rendered to Patient. Id. ¶ 10. Defendant paid $9, 321.84 of that claim. Id. ¶ 11. On February 28, 2018, Plaintiff filed suit, alleging that Defendant failed to make all payments and provide the summary plan description as required by ERISA and that it breached its fiduciary duty. Id. ¶¶ 19- 41. Plaintiff does not allege that it had a contract with Defendant governing reimbursement. Plaintiff, therefore, was an “out-of-network” provider at the time it performed its services on Patient. See id. ¶¶ 4-18; Def.'s Mem. at 3.

         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 7-10. Alternatively, Defendant argues that the second and third counts of the Complaint fail as a matter of law.[1] See id. at 10-15.

         Plaintiff opposes, arguing that the Plan's anti-assignment clause does not render Patient's assignment of his benefit rights to Plaintiff invalid. See Pl.'s Br. in Opp'n to Def.'s Mot. (“Pl.'s Opp'n”) 4-11, ECF No. 16. Plaintiff further argues that the language of the anti-assignment clause is ambiguous and, therefore, must be construed against Defendant. See id. at 11-14. Defendant filed a reply, reiterating the enforceability of the anti-assignment clause and asserting that the language is clear and unambiguous. See Def.'s Reply Br. in Supp. of Its Mot., ECF No. 17.


         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.


         “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 7-10. The anti-assignment clause in question reads as follows:

Coverage and your rights under this plan may not be assigned. A direction to pay a provider is not an assignment of any right under this plan or of any legal or equitable right to institute any court proceeding.

Depaepe Decl., Ex. 1 75, ECF No. 10-4 (emphasis added).

         The Third Circuit recently determined that anti-assignment clauses in ERISA plans are enforceable. See Am. Orthopedic & Sports Med. v. Independence Blue Cross Blue Shield, 890 F.3d 445, 453 (3d Cir. 2018) (“We now . . . hold that anti-assignment clauses in ERISA-governed health insurance plans as a general matter are enforceable.”). The anti-assignment clause in that case read, “[t]he right of a Member to receive benefit payments under this Program is personal to the Member ...

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