Andrews-Clarke v. Lucent Technologies, Inc.
| Decision Date | 27 July 2001 |
| Docket Number | No. CIV. A.01-10055-PBS.,CIV. A.01-10055-PBS. |
| Citation | 157 F.Supp.2d 93 |
| Parties | Diane ANDREWS-CLARKE, et al., Plaintiffs, v. LUCENT TECHNOLOGIES, INC., et al., Defendants. |
| Court | U.S. District Court — District of Massachusetts |
Richard J. Leonard, Reading, MA, for Plaintiffs.
Thomas E. Shirley, Choate, Hall & Stewart, Gregory C. Keating, Choate, Hall & Stewart, Boston, MA, Arthur N. Lerner, Crowell & Moring, David Florin, Beth M. Kramer, David Florin, Beth M. Kramer, Crowell & Moring LLP, Julie Barnes, Christopher Flynn, King, Pagano & Harrison, Washington, DC, Charles B. Straus, III, Mirick, O'Connell, DeMallie & Lougee, Joan O. Vorster, Mirick, O'Connell, DeMallie & Lougee, LLP, Worcester, MA, for Defendants.
After a review of the objections, I adopt the report and recommendation and order the action to be dismissed.
The plaintiff Diane Andrews-Clarke brings this action individually, as Administratrix of the Estate of her deceased husband Richard J. Clarke, and as next friend of their minor children, seeking to recover damages for her husband's death which allegedly was the result of the defendants' refusal to authorize appropriate medical and psychiatric treatment during Mr. Clarke's repeated hospitalizations for alcoholism in 1994. The defendants are Lucent Technologies (formerly known as AT & T) ("AT & T"); Travelers Insurance Company (formerly known as MetraHealth Insurance and United HealthCare Insurance Company) ("Travelers") and TAO, Inc. (now known as Green Spring Health Services, Inc.) ("TAO").1
Each defendant has moved to dismiss the Complaint pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted. (See Docket Nos. 2, 6, 8). For the reasons detailed below, this court recommends to the district court judge to whom this case is assigned that the motions to dismiss be ALLOWED as this action is barred by the doctrine of res judicata, the claims raised are preempted by the Employee Retirement Income Security Act of 1974, 29 U.S.C.A. § 1001 et seq. ("ERISA"), and the plaintiff has not alleged any viable ERISA claims.
When ruling on a motion to dismiss, the court must accept as true all well-pleaded facts, and the plaintiff is to be given the benefit of all reasonable inferences. See Cooperman v. Individual, Inc., 171 F.3d 43, 46 (1st Cir.1999); Dartmouth Review v. Dartmouth Coll., 889 F.2d 13, 16 (1st Cir. 1989). Applying this standard to the instant case, the relevant facts are as follows:
Diane Andrews-Clarke ("Andrews-Clarke") an employee of AT & T, maintained a health insurance policy with Travelers through her AT & T employee benefit plan. (See Complaint ("Compl.") at ¶¶ 12, 13 and Ex. C).2 TAO, a utilization review company, contracted with AT & T to provide utilization review services for AT & T's employee health benefit plan.3 (Id. at ¶¶ 11, 69). Andrews-Clarke's husband Richard Clarke ("Clarke"), and her children were named beneficiaries of the insurance policy. (Id. at ¶¶ 14, 15).
The allegations in the current complaint arise from the alleged failure of the defendants to authorize adequate medical and psychiatric treatment for Clarke prior to his suicide on November 12, 1994. The plaintiff contends that Clarke was entitled to, and wrongfully denied, in-patient hospital care for detoxification and rehabilitation under the terms of AT & T's employee benefit plan, and that this failure to obtain the necessary treatment resulted in Clarke's tragic death. (Id. at ¶¶ 18, 29, 46, 58, 60-66; Ex. C).
The plaintiff filed her first suit in 1996 in state court against, inter alia, Travelers and TAO.4 The defendants promptly removed the case to federal court, where they filed motions to dismiss on the grounds that the claims were preempted by ERISA. See Andrews-Clarke v. Travelers Ins. Co., 984 F.Supp. 49 (D.Mass. 1997) ("Andrews-Clarke I"). In Andrews-Clarke I, like the instant case, the complaint alleged that Clarke's "death was the direct and foreseeable result of the improper refusal of Traveler's and its agent (TAO) to authorize appropriate medical and psychological treatment during Clarke's repeated hospitalization for alcoholism in 1994." Id. at 52. The factual allegations of the first complaint are virtually identical to the allegations of the present complaint.
After reviewing the factual allegations of the complaint in detail, the District Court (by Young, J.) allowed the motions to dismiss, but clearly was outraged by the ruling. In an eloquent and passionate decision, Judge Young wrote:
This case, thus, becomes yet another illustration of the glaring need for Congress to amend ERISA to account for the changing realities of the modern health care system. Enacted to safeguard the interests of employees and their beneficiaries, ERISA has evolved into a shield of immunity that protects health insurers, utilization review providers, and other managed care entities from potential liability for the consequences of their wrongful denial of health benefits.
Id. at 53. Although clearly loathe to do so, by his decision dated October 30, 1997, Judge Young dismissed all the claims raised against Travelers and TAO in plaintiff's proposed second amended complaint after finding that the state law claims were either preempted by ERISA or did not confer a private right of action. Id. at 53-56. The court also determined that none of the plaintiff's claims stated a cause of action under ERISA. Id. at 55-56. The counts against Travelers and TAO in the proposed second amended complaint included medical malpractice claims for negligent failure to diagnose and failure to administer appropriate treatment; wrongful death; breach of contract for failure to approve medically necessary treatment; loss of spousal and parental consortium; intentional infliction of emotional distress; negligent infliction of emotional distress; violations of Mass. Gen. Laws ch. 175, § 47B; violations of Mass. Gen. Laws ch. 176D, § 3; and violations of Mass. Gen. Laws ch. 93A. Id. at 53-56, n. 22, 23.
The plaintiff had attempted to add AT & T as a defendant in the proposed second amended complaint which formed the basis of Judge Young's ruling.5 She subsequently sought leave to add AT & T in a third amended complaint pursuant to a motion filed in August, 1998, almost a year after Judge Young's decision dismissing the action. The motion to amend was denied, and the plaintiff then moved for reconsideration of that denial. In an Order dated February 9, 1999 the Court (by Saris, J.) found that either the motion to add AT & T had already been denied, or if it had been allowed (as plaintiff claimed it had been), the plaintiff had failed to serve the complaint on AT & T in a timely manner. Thus, the motion for reconsideration was denied. (See Civil Action No. 97-10191-WGY/PBS Docket # 77).
The plaintiff never appealed from any of the decisions rendered in the District Court. Rather, on November 8, 2000, she filed the instant case in state court against Travelers, TAO and AT & T. The defendants removed the case from state court to this court on January 11, 2001. The factual allegations of the instant case mirror those of Andrews-Clarke I. In addition, the plaintiff has realleged many of the same legal claims, this time adding AT & T as one of the defendants.6 Liberally reviewing the complaint to identify "new" causes of action (although they are all based on the same operative facts), it can be found that the complaint adds a count against AT & T for breach of contract based on the alleged failure to provide the contracted for and medically necessary inpatient program (Count I); a count against the defendants for tortious interference with Andrews-Clarke's contract with her employer to provide health benefits and contracts with Clarke's physicians and other health care providers (Count II); a count alleging that the defendants breached their own fiduciary duties, and were vicariously liable for the others breach of the fiduciary duties they owed the plan beneficiaries, by refusing to provide medical treatment and a written explanation or justification for the denial of treatment (Count III); a count under Mass. Gen. L. ch. 176G entitled "Bad Faith" wherein plaintiff alleges the defendants are liable under Mass. Gen. L. ch. 176D, § 3(9) and ch. 175, § 47B for unfair insurance claim settlement practices (Count V); a count under Mass. Gen. Laws ch. 176G, § 8 entitled "Fraud" alleging public dissemination of deceptive or misleading materials (Count VI); and a count entitled "Substandard Quality of Care" (Count VIII). Finally, the complaint seeks actual, compensatory, and punitive damages, treble damages under Mass. Gen. Laws ch. 93 and Mass. Gen. Laws ch. 176G, and "statutory damages in the amount of $100 per day per failure to give written notice of claims denied as accrued since April 22, 1994."
The defendants' motions present four basic arguments. First, the defendants contend that the plaintiff's claims are barred by the doctrine of res judicata. Second, the defendants contend that the plaintiff's claims are preempted by ERISA. Third, the defendants argue that the plaintiff has failed to allege any viable causes of action under ERISA. Finally, according to the defendants, the plaintiff's claims are time-barred. For the reasons detailed below, for the first three of these reasons I recommend that the motions to dismiss be allowed. Factual disputes, however, preclude the dismissal of this case on statute of limitations grounds.
Each defendant has moved to dismiss all counts of the complaint under Fed.R.Civ.P. 12(b)(6) for "failure to state a claim upon which relief can be granted." A motion to dismiss...
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