Cristantielli v. Kaiser Foundation Health Plan
| Decision Date | 01 August 2000 |
| Docket Number | No. CIV. A. 4:99-CV-0516-P.,CIV. A. 4:99-CV-0516-P. |
| Citation | 113 F.Supp.2d 1055 |
| Parties | Benny E. CRISTANTIELLI and Sandra Cristantielli, Plaintiffs, v. KAISER FOUNDATION HEALTH PLAN OF TEXAS, et al.; Defendants. |
| Court | U.S. District Court — Northern District of Texas |
E.L. Atkins, Law Offices of E.L. Atkins, Arlington, TX, for plaintiffs.
John Anthony Scully, Cooper & Scully, Dallas, TX, M. Steve Nagle, Gwinn and Roby, Dallas, TX, for defendants.
The Court now considers the following:
1. Plaintiffs' Motion to Remand, filed July 23, 1999; Defendant Kaiser Foundation Health Plan of Texas' Response, filed August 12, 1999; Plaintiffs' Reply, filed April 5, 2000;
2. Defendant's Motion to Strike Reply, filed April 13, 2000;
3. Defendant's Motion for Leave to File Sur-Reply, filed April 13, 2000;
4. Plaintiffs' Motion for Leave to File First Amended Motion to Remand, filed May 2, 2000; Defendant's Response, filed May 22, 2000;
5. Plaintiffs' Motion for Leave to File Affidavit, filed June 15, 2000.
For the reasons set forth below, the Court GRANTS Plaintiffs' Motion for Leave to File First Amended Motion to Remand. The Court DENIES Plaintiffs' Amended Motion to Remand; DENIES Defendant's Motion to Strike Reply; and DENIES Defendant's Motion for Leave to File Sur-Reply. Finally, the Court DENIES Plaintiffs' Motion for Leave to File Affidavit.
On or about June 1, 1996, Benny and Sandra Cristantielli ("Plaintiffs" or "Cristantiellis") enrolled in a medical insurance plan with Kaiser Foundation Health Plan of Texas ("Defendant" or "Kaiser") serving as the health maintenance organization ("HMO"). In the spring of 1997, Mrs. Cristantielli requested Defendant's advice regarding appropriate testing and diagnostic procedures for the early detection of prostate cancer. Mr. Cristantielli was not knowingly suffering from any prostate disorder at the time of his wife's initial inquiry. Mrs. Cristantielli's inquiry seemed to have developed strictly as a means of screening and early detection of this disease. In response to Mrs. Cristantielli's inquiry, a physician with Kaiser allegedly told her, "Kaiser does not do that—PSA is not accurate." (Pl's Compl. at 4). Mr. Cristantielli turned fifty years old on August 31, 1997.
On December 4, 1997, Mr. Cristantielli contacted Defendant to report back pain. (See Pl's Compl. at 4). He requested a PSA because he knew that back pain could indicate a possible prostate problem. Muhammed A. Khan, M.D., a physician employed by Defendant, examined Mr. Cristantielli and reported a normal lumbar spine. He did not, however, perform either a PSA or a digital rectal examination. In April 1998, a Kaiser physician finally ordered a PSA test. (Pl's Compl. at 5). The initial PSA test, as confirmed by a second test, indicated prostate cancer. X-ray reports revealed "diffuse osseous metastases," meaning that the cancer had spread from Mr. Cristantielli's prostate. (Id.) Mr. Cristantielli alleges he will probably not survive the spreading cancer. (Id.)
The Cristantiellis now sue Dr. Mark Capistrano for negligence in failing to provide timely and proper medical care to Mr. Cristantielli.1 Furthermore, the Cristantiellis seek to recover from Defendant for negligence as an HMO in handling and providing medical care, breach of the duty of good faith and fair dealing, violations of the Texas Insurance Code and the Texas DTPA, and breach of contract all in connection with the HMO's failure to perform the PSA test when Ms. Cristantielli first requested it and again when Mr. Cristantielli turned fifty.2 Kaiser filed a notice of removal on June 25, 1999. Kaiser alleges this court has original jurisdiction over this action because one or all of the Cristantiellis' claims arise under the Employee Retirement Income Security Act (ERISA) of 1974, 29 U.S.C. § 1001, et seq. (1999). As such, Defendant alleges ERISA preempts and displaces Plaintiffs' claims and provides this Court with subject matter jurisdiction. The Cristantiellis filed a Motion to Remand on July 23, 1999, and Motion for Leave to File Plaintiffs' First Amended Motion to Remand on May 2, 2000.
The Cristantiellis' original Motion to Remand rested in whole upon the argument that the claims were too tenuous to "relate to" the ERISA plan. Months after filing the original Motion to Remand, Plaintiffs filed a Reply to that motion, which added an argument challenging ERISA's application to the Cristantiellis' health plan. Specifically, they raised the new argument that the health plan at issue fell beyond the statutory definition of employee benefit plan. Therefore, the Cristantiellis sought remand due to this Court's lack of subject matter jurisdiction over the claims. Kaiser filed a motion to strike the Reply as untimely and requested, in the alternative, the opportunity to file a sur-response addressing Plaintiffs' new arguments. Later, Plaintiffs filed the Motion for Leave to File Plaintiffs' First Amended Motion to Remand, which addressed both arguments for remand. Kaiser filed a Response to the Motion for Leave that addressed the Plaintiffs' new argument.
A motion to remand based upon lack of subject matter jurisdiction may be made at any time prior to final judgment. See 28 U.S.C. § 1447(c). Plaintiffs' most recent challenge to the applicability of ERISA directly attacks this Court's subject matter jurisdiction. Accordingly, Plaintiffs' new arguments should be considered before determining the propriety of Kaiser's removal. Kaiser's Motion to Strike Plaintiffs' Reply is DENIED. As requested in Kaiser's Motion to Strike, Kaiser should be afforded the opportunity to address Plaintiffs' additional argument. While ordinarily this might require an extension of time or leave to file a sur-reply, Kaiser presented a thorough opposition to Plaintiffs' argument in its Response to Plaintiffs' Motion for Leave. Several transfers of this case have delayed the resolution of these motions and issues. Because both sides have presented adequate briefing on the issue, the Court will not create any further delay by allowing additional briefing. For these reasons, the Court DENIES Kaiser's Motion for Leave to File a Sur-Reply and GRANTS Plaintiffs' Motion for Leave to File Plaintiffs' First Amended Motion to Remand.
Removal of a state law action to federal court is proper when the complaint falls within the original jurisdiction of the federal district court. See 28 U.S.C. § 1331. Where, as here, there is no diversity of citizenship between the parties, the propriety of removal depends upon the existence of a federal question, i.e., whether any of plaintiffs' claims "arise under" federal law. See 28 U.S.C. § 1331. An action arises under federal law when the face of the "well pleaded complaint" raises a federal issue. Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 9-12, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983). The well-pleaded complaint rule is qualified, however, by the complete preemption doctrine. As the Supreme Court stated in Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 62-63, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987), "Congress may so completely pre-empt a particular area that any civil complaint raising this select group of claims is necessarily federal in character." The Supreme Court ruled that ERISA is such an area, and that state law claims are preempted by ERISA provided that they "relate to" an ERISA plan. Id.
Defendant Kaiser removed this action alleging ERISA preempts the Cristantiellis' various state law claims, thereby conferring this court with original jurisdiction over the action. The Cristantiellis raise two separate arguments in their motions to remand for improper removal: (1) the health plan at issue is not subject to ERISA; and (2) the claims do not "relate to" an ERISA plan so as to invoke the doctrine of complete preemption. The court will address each of these arguments in turn.
Mr. Cristantielli is the sole shareholder of his individually formed Texas Corporation, CIC, Inc. Individually and through this wholly-owned corporation, Mr. Cristantielli owns, operates, and manages a restaurant in Fort Worth, Texas, on which Mr. Cristantielli holds a franchise agreement with International House of Pancakes ("IHOP"). The name of Mr. Cristantielli's restaurant is "IHOP # 1318."
In May 1996, Mr. Cristantielli applied for a group health insurance plan from Kaiser. Mr. Cristantielli offered this health insurance plan to all of his full-time employees. As discussed more fully infra, it appears that the full-time employees consisted of Mr. Cristantielli and his wife Sandra, their twenty-four-year-old son, Benny Jr., and their twenty-six-year-old daughter, Erika. No other employees of CIC, Inc. were offered the insurance coverage. Therefore, the group plan covered only the immediate family of Mr. Cristantielli.
Mr. Cristantielli now argues that these policies are individual health insurance plans purchased for his family from personal funds and do not meet ERISA's statutory definition of an employee benefit plan. Kaiser argues that regardless of the particular individuals covered by the plan, Mr. Cristantielli purchased and organized it through CIC, Inc., which employed all of the individuals covered. Kaiser therefore contends the plan falls squarely within the definition of an employee benefit plan.
ERISA applies only to employee benefit plans as defined by the statute. See 29 U.S.C. § 1003(a) (1999). The statute defines an "employee benefit plan" as "any plan, fund, or program which was ... established or maintained by an employer ... for the purpose of providing for its participants or their beneficiaries ..." certain hospital or medical benefits. 29 U.S.C. § 1002(1) (1999). The Fifth Circuit has established...
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