BlueCross BlueShield of Tenn. Inc. v. Nicolopoulos, 1:21-CV-271

• Court: United States District Courts. 6th Circuit. Eastern District of Tennessee
• Writing for the Court: J. RONNIE GREER UNITED STATES DISTRICT JUDGE
• Parties: BLUECROSS BLUESHIELD OF TENNESSEE, INC., Plaintiff, v. CHRISTOPHER R. NICOLOPOULOS, in His Official Capacity as Commissioner of the New Hampshire Insurance Department, Defendant.
• Docket Number: 1:21-CV-271
• Decision Date: 30 June 2022

BLUECROSS BLUESHIELD OF TENNESSEE, INC., Plaintiff,
v.
CHRISTOPHER R. NICOLOPOULOS, in His Official Capacity as Commissioner of the New Hampshire Insurance Department, Defendant.

No. 1:21-CV-271

United States District Court, E.D. Tennessee, Chattanooga

June 30, 2022

MEMORANDUM OPINION AND ORDER

J. RONNIE GREER UNITED STATES DISTRICT JUDGE

Federal courts are courts of limited jurisdiction. Generally, a court may hear cases arising under federal law, like the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et. seq. (“ERISA”). Plaintiff filed suit under ERISA. It follows that this Court has jurisdiction to hear this ERISA case. Therefore, Defendant's Motion to Dismiss, [Doc. 29], is DENIED.

I. Background

Plaintiff BlueCross BlueShield of Tennessee, Inc., is a provider of employer group health plans. [Am. Compl, Doc. 20, PageID 453]. Plaintiff is headquartered in Chattanooga, Tennessee. It provides insurance for the employees of PhyNet Dermatology LLC, “an outsourced managed services company for dermatology practices.” [Id. at PageID 453, 455]. PhyNet is a Delaware company with its headquarters in Tennessee. [Id. at PageID 455]. PhyNet's policy does not cover employees' fertility treatments. [Id. at PageID 457].

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One of PhyNet's employees, B.C., lives in New Hampshire. [Id. at PageID 458]. B.C. received fertility treatments and then filed claims for insurance coverage. [Id. at PageID 451, 458]. Plaintiff denied those claims. [See id. at PageID 451].

After Plaintiff denied the claims for fertility treatments, the New Hampshire Insurance Department (“NHID”) received a complaint regarding B.C.'s lack of coverage. [Id. at PageID 458]. In New Hampshire, according to the NHID, insurance carriers must provide coverage for medically necessary fertility treatments. [Id. at PageID 459]. The NHID alleged that Plaintiff violated three laws. [Id. at PageID 460]. According to the Amended Complaint, the NHID alleged that Plaintiff violated:

a. N.H. Rev. Stat. Ann. § 400-A:15, III (which states that “[a]ny person who knowingly violates any statute rule, regulation, or order of the commissioner may, upon hearing . . . be subject to . . . administrative fine not to exceed $2,500 per violation”)

b. N.H. Rev. Stat. Ann. § 417-G:2, II (which states that “health carrier[s]” must cover “medically necessary fertility treatment”); and

c. N.H. Rev. Stat. Ann. § 417:4, I(h) (which prohibits “[m]isrepresentations” in the “offer or sale of any insurance” by “[e]ngaging in any . transaction, practice, or course of business which operates as a fraud or deceit upon the purchaser, insured, or person with policy ownership right”).

[Id. (statute summaries copied from Amended Complaint)].

The NHID tried to enforce the above laws. To do so, it summoned Plaintiff for a hearing and ordered Plaintiff to show why it should not be fined or be forced to stop offering insurance in New Hampshire. [Id. at PagelD 460-61].

Before the date of the hearing, Plaintiff filed this lawsuit against Defendant Nicolopoulos in his official capacity as commissioner of NHID. In its Amended Complaint, Plaintiff brought four claims of relief. First, Plaintiff brought a fiduciary claim to bar interference with plan terms under ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3). [Id. at PageID 462]. Second, Plaintiff brings a

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claim to bar interference with ERISA compliance under ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3). [Id. at PageID 463]. Third, Plaintiff brings a claim to bar actions in violation of ERISA §§ 502 and 514. [Id. at PageID 465]. Last, Plaintiff brings a claim to bar violations of plan terms and federal common law. [Id. at PageID 467]. Plaintiff requested relief in the form of a permanent injunction prohibiting Defendant from interfering with Plaintiff's plan and declaratory judgment declaring the requirements of Plaintiff under ERISA, Tennessee, and New Hampshire law, including whether Plaintiff must appear in New Hampshire for an adjudicatory proceeding and submit to New Hampshire law. [Id. at PagelD 469-71].

In response to the Amended Complaint, Defendant filed a motion to dismiss for lack of subject matter jurisdiction and lack of personal jurisdiction. [Doc. 29]. Plaintiff filed a response, [Doc. 32], and Defendant replied, [Doc. 34]. The motion is now ripe.

II. Standard

Defendant has filed a motion to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. A Rule 12(b)(1) motion comes in two forms, a facial or a factual challenge. United States v. Ritchie, 15 F.3d 592, 598 (6th Cir. 1994). Defendant brought a facial challenge, which “is a challenge to the sufficiency of the pleading itself.” Id. When a challenge is based on the sufficiency of the pleadings, a court accepts the material allegations in the pleadings as true and construes them “in the light most favorable to the nonmoving party.” Id. With a facial attack to subject matter jurisdiction, “the plaintiff has the burden of proving jurisdiction in order to survive the motion.” RMI Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125, 1134 (6th Cir. 1996) (quoting Rogers v. Stratton Indus., 798 F.2d 913, 915 (6th Cir. 1986)).

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Defendant has also filed a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). When a defendant files a motion to dismiss based on lack of personal jurisdiction, the burden is on the plaintiff to show it. Estate of Thomson v. Toyota Motor Corp. Worldwide, 545 F.3d 357, 360 (6th Cir. 2008). When showing personal jurisdiction based on written submissions and affidavits, “the plaintiff's burden is relatively slight.” Id. (internal quotation omitted). Viewing the facts in favor of the plaintiff, “the plaintiff must make only a prima facie showing that personal jurisdiction exists . . . . ” Id. at 360-61. When a Court lacks personal jurisdiction, it may dismiss or transfer the case. Jackson v. L & F Martin Landscape, 421 Fed.Appx. 482, 483-84 (6th Cir. 2009).

III. Discussion

Defendant filed a motion to dismiss for lack of subject matter jurisdiction and lack of personal jurisdiction. While accepting that Plaintiff's claim involves federal law, Defendant argues that Plaintiff's claims are so without merit that the Court will not have to decide...