United States District Court, D. New Jersey
MEMORANDUM AND ORDER
G. SHERIDAN, U.S.D.J.
matter comes before the Court on Defendants United Healthcare
Services, Inc. and Atria Senior Living Inc.'s motion
to dismiss Plaintiff Atlantic Shore Surgical Associates'
complaint, (ECF No. 12). This case arises from a dispute over
nonpayment of medical services. Plaintiff Atlantic Shore
Surgical Associates ("Atlantic") is a company that
provides healthcare services in New Jersey. (Compl. at ¶
1; ECF No. 1). On October 28, 2015, Jonathan Yrad, M.D.,
employed by Atlantic, performed extensive surgery on nonparty
P.H. (Id. at ¶¶ 18-19).
received health coverage through a self-insured plan funded
by Defendant Atria Senior Living. (Id. at ¶
15). The plan is administered by Defendant United Healthcare
Services Inc. ("United"). (Id.). Because
Plaintiff was an out of network medical provider, it
contacted United to receive an authorization to render
medical services to P.H. (Id. at ¶ 17).
Plaintiff received an authorization under authorization
number 9041448600 from United. (Id.) Plaintiff then
performed the surgery on P.H. (Id. at ¶ 18).
After completion of the surgery, Plaintiff billed United
$111, 716.08. (Id. at ¶ 23). United paid only
$6, 004.14 toward the charges, leaving a balance of
$105.711.94. (Id. at ¶24).
March 30, 2018, Plaintiff filed this Complaint in New Jersey
Superior Court against Defendants seeking reimbursement for
medical services it provided to P.H. Plaintiff asserts claims
for breach of contract, promissory estoppel, account stated,
and fraudulent inducement. On May 21, 2018, Defendants
removed the case to this Court, based on diversity
jurisdiction. (ECF No. 1). Presently before the Court is
Defendants' motion to dismiss for failure to state a
claim (Fed. R. Civ. P. 12(b)(6)). Defendants additionally
argue that Plaintiffs claims must be dismissed because: (1)
Plaintiff has not sufficiently plead the existence of a
principal/agent relationship between defendant Atria and
defendant UnitedHealthcare/Oxford; and (2) Plaintiffs state
law claims are preempted by ERISA.
motion to dismiss for failure to state a claim pursuant to
Fed.R.Civ.P. 12(b)(6), the Court is required to accept as
true all allegations in the Complaint and all reasonable
inferences that can be drawn therefrom, and to view them in
the light most favorable to the non-moving party. See
Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d
1380, 1384 (3d Cir. 1994). "To survive a motion to
dismiss, a complaint must contain sufficient factual matter,
accepted as true, to 'state a claim to relief that is
plausible on its face."* Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell Atl Corp. v.
Twombly, 550 U.S. 544, 570 (2007)).
court will accept well-pleaded allegations as true for the
purposes of the motion, it will not accept bald assertions,
unsupported conclusions, unwarranted inferences, or sweeping
legal conclusions cast in the form of factual allegations.
Iqbal, 556 U.S. at 678-79; see also Morse v.
Lower Merion School District, 132 F.3d 902, 906 (3d Cir.
1997). A complaint should be dismissed only if the
well-pleaded alleged facts, taken as true, fail to state a
claim. See In re Warfarin Sodium, 214 F.3d 395,
397-98 (3d Cir. 2000). The question is whether the claimant
can prove any set of facts consistent with his or her
allegations that will entitle him or her to relief, not
whether that person will ultimately prevail. Semerenko v.
Cendant Corp., 223 F.3d 165, 173 (3d Cir.), cert,
denied, Forbes v. Semerenko, 531 U.S. 1149 (2001).
argue that, because the plan is an employee welfare benefit
plan, it is governed by ERISA, and as such, Plaintiffs claims
are preempted by ERISA. In response, Plaintiff argues that
its state-law claims arise outside of the plan, and thus are
not preempted by ERISA.
possesses 'extraordinary pre-emptive power.'"
Menkes v. Prudential Ins. Co. of Am., 762 F.3d 285,
293 (3d Cir. 2014) (quoting Metro. Life Ins. Co. v.
Taylor, 481 U.S. 58, 65 (1987)). ERISA provides for two
types of preemption. Under ERISA's civil enforcement
provision, Section 502(a), "state law causes of action
that are within the scope of... § 502(a) are completely
pre-empted." Pascack Valley Hosp., Inc. v. Local
464A UFCW Welfare Reimbursement Plan, 388 F.3d 393, 400
(3d Cir. 2004) (quotation omitted). Section 514(a) states
that ERISA "shall supersede any and all State laws
insofar as they may now or hereafter relate to any employee
benefit plan" as defined under the Act. 29 U.S.C. §
1144(a). "Complete preemption under § 502(a) is a
'jurisdictional concept,' whereas express preemption
under § 514 is a 'substantive concept governing the
applicable law.'" In re U.S. Healthcare,
Inc., 193 F.3d 151, 160 (3d Cir. 1999) (quoting N.J.
Carpenters v. Tishman Constr. Corp., 760 F.3d 297, 302
(3d Cir. 2014)). "Unlike ordinary preemption, which
would only arise as a federal defense to a state-law claim,
complete preemption operates to confer original federal
subject matter jurisdiction notwithstanding the absence of a
federal cause of action on the face of the complaint."
Bauman v. U.S. Healthcare, Inc. (In re US. Healthcare,
Inc., 193 F.3d 151, 160 (3d Cir. 1999). "The
Supreme Court has held that in enacting the civil-enforcement
provisions of section 502(a) of ERISA, Congress intended to
completely preempt state law." Id. In
Baumann, the court explained it was necessary to
distinguish between Sections 502(a) and 514(a), explaining
"State-law claims that are subject to express preemption
are displaced and thus subject to dismissal. . . Claims that
are completely preempted are 'necessarily federal in
character,' and thus are converted into federal
claims." Baumann, 193 F.3d at 160.
Pascack Valley Hosp., Inc and N.J.
Carpenter, the courts, in determining whether a claim
was removable, and thus completely preempted under Section
502(a), explained, "a claim is completely preempted, and
thus removable, under ERISA § 502(a) only if: (1) the
plaintiff could have brought the claim under § 502(a);
and (2) no other independent legal duty supports the
plaintiffs claim." N.J. Carpenters, 760 F.3d at
Court first examines whether Plaintiffs claims are completely
preempted by Section 502(a), ERISA's civil enforcement
provision. For complete preemption to apply, both prongs must
be satisfied. Id. Plaintiff agrees that it lacks
standing to bring an ERISA claim, as it is an out-of-network
provider, and is neither a participant nor a beneficiary
under the plan. (See PI. Br., ECF No. 15, at 7).
Thus, Plaintiff could not bring its claims pursuant to
Section 502(a) of ERISA. Here, Plaintiffs claims are not
completely preempted by Section 502(a) of ERISA, because
Plaintiff does not have standing to bring a claim under
determined that Plaintiff may not bring a claim under Section
502(a) because it lacks standing, the Court now evaluates
whether Plaintiffs state law claims are expressly preempted
under Section 514(a) of ERISA. Section 514(a) states that
ERISA "shall supersede any and all State laws insofar as
they may now or hereafter relate to any employee benefit
plan" as defined under the Act. 29 U.S.C. §
1144(a). ""Relate to'' has always been
given a broad, common-sense meaning, such that a state law
'relates to an employee benefit plan, in the normal sense
of the phrase, if it has a connection with or reference to
such a plan.'" Menkes, 762 F.3d at 293-94
(quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85,
96-97 (1983)). Under ERISA, "[t]he term 'State
law' includes all laws, decisions, rules, regulations, or
other State action having the effect of law, of any
State." 29 U.S.C. § 1144 (c)(1).
common law claims fall within this definition and, therefore,
are subject to ERISA preemption." Nat'l Sec.
Sys. v. Iola,700 F.3d 65, 83 (3d Cir. 2012). Most
recently, the Third Circuit noted that "ERISA preempts
parallel state law remedies . . . [such as]
breach-of-contract claim[s]." McCann v. Unum
Provident, No. 16-2014, 2018 U.S. App. LEXIS 29638, slip
op. at 23 (3d Cir. Oct. 5, 2018); see also Ford v. Unum
Life Ins. Co. of Am.,351 Fed.Appx. 703, 706 (3d Cir.
2009) ("State law claims such as . . . breach of
contract. . . would ordinarily fall within the scope of ERISA
preemption, if the claims relate to an ERISA-governed
benefits plan."); accord Early v. United States Life
Ins. Co.,222 Fed.Appx. 149, 152 (3d Cir. 2007);
Pryzbowski v. U.S. Healthcare, Inc.,245 F.3d 266,
278 (3d Cir. 2001). For example, in Iola, the court
explained that the common law claims were preempted because
the claims '"have a connection with' the ERISA
plans because they are premised ...