International Medical Group v. American Arbit.
| Decision Date | 25 May 2001 |
| Docket Number | No. IP00-1020-C-B/S.,IP00-1020-C-B/S. |
| Citation | 149 F.Supp.2d 615 |
| Court | U.S. District Court — Southern District of Indiana |
| Parties | INTERNATIONAL MEDICAL GROUP, INC., An Indiana Corporation, Sirius International Insurance Corporation (publ), a Foreign Corporation, Plaintiffs, v. AMERICAN ARBITRATION ASSOCIATION, Janella Brown, John Germani, Juan J. Rodriguez, Hilda Piloto, Rodriguez & Machado Pa, Ogdon, Michael, Defendants. |
F. Jonathan Zusy, Indianapolis, IN, for plaintiffs.
Geoffrey Slaughter, Sommer & Barnard, Indianapolis, IN, William P. Wooden, Wooden & McLaughlin, Indianapolis, IN, for defendants.
ENTRY GRANTING DEFENDANTS' MOTION TO DISMISS
Plaintiffs, International Medical Group, Inc. ("IMG") and Sirius International Insurance Corporation ("Sirius"), filed suit in Indiana state court requesting that the court issue an ex parte temporary restraining order ("TRO") with regard to an arbitration proceeding entitled Michael D. Ogdon, Claimant v. International Medical Group, Inc., Respondent; American Arbitration Association Case No. 32-193-00084-00 (the "Arbitration Proceeding"). Plaintiffs sought preliminary and permanent injunctive relief to prevent the Defendants, American Arbitration Association ("AAA"), Janella Brown ("Brown"), John Germani ("Germani") (collectively the "AAA Defendants"), Juan J. Rodriguez ("Rodriguez"), Hilda Piloto ("Piloto"), Rodriguez & Machado, P.A. ("R & M"), and Michael Ogdon ("Ogdon") (collectively the "Non-AAA Defendants"), from proceeding with the Arbitration Proceeding, requested declaratory relief with respect to the Arbitration Proceeding and the insurance policy at issue herein, and alleged abuse of process, malicious prosecution and bad faith arbitration. After the state court granted Plaintiffs' requests for preliminary injunctive relief, the action was removed to federal court.1
We now consider the AAA Defendants' motion to dismiss the complaint, pursuant to Federal Rule of Civil Procedure 12(b)(2) and 12(b)(6), for lack of personal jurisdiction and for failure to state a claim upon which relief may be granted.2 Specifically, the Defendants allege that there is no personal jurisdiction over Brown and Germani and that jurisdiction is lacking over the AAA because it is an unnecessary defendant, whose presence is tangential to plaintiffs' claims for relief. Furthermore they contend that the AAA Defendants enjoy arbitral immunity against the claims raised in the complaint, but that even if such immunity does not exist, the complaint lacks the factual basis necessary to support the three substantive claims asserted. For the reasons explicated below, we GRANT the AAA Defendants' motion to dismiss in its entirety.
Defendant, Michael Ogdon ("Ogdon") (a citizen of Great Britain and an alien admitted to the United States for permanent residence, residing in Florida), purchased a global health insurance policy on or about November 14, 1998, issued by Plaintiff, Sirius (a Swedish Corporation, with offices in Stockholm, Sweden, and London, England), and designating Plaintiff, IMG (an Indiana corporation, with offices in Indianapolis), as the policy administrator and general underwriter. See Compl. in Int'l Med. Group, Inc. v. American Arbitration Ass'n, No. 49D02-0005-CP-736, Marion County, Indiana Superior Court ("State Complaint") ¶¶ 13, 14; id., Exs. A, Global Medical Insurance contract, signed by Michael Ogdon, and dated Sept. 4, 1998 ("Ins.Policy"), and B, Declaration of Insurance for Michael D. Ogdon, effective Nov. 4, 1998, Certificate No. 1B98-70484 ("Ins. Dec.") at 1, ¶ A. The policy provides coverage for all services, supplies, treatments or conditions resulting from an illness or injury, except that it excluded from coverage any pre-existing medical conditions for the first two years and limited coverage of such conditions thereafter. Ins. Policy at 3; Ins. Dec. ¶ K(1); State Complaint ¶¶ 16, 17.
With respect to legal proceedings concerning the policy, it provides that:
(6) SERVICE OF SUIT—It is agreed that in the event of the failure of the Company3 to pay any amount claimed to be due hereunder, the Company, at the request of the Insured Person, will submit to the jurisdiction of a Court of competent jurisdiction with the United States. Nothing in this clause constitutes or should be understood to constitute a waiver of the Company's rights to commence an action in any Court of competent jurisdiction in the United States, to remove an action to a United States District Court, or to seek a transfer of a case to another Court as permitted by the laws of the United States or of any state in the United States. In any suit instituted against the Company upon this agreement, the Company will abide by the final decision of such Court or of any Appellate Court in the event of an appeal.
. . . . .
(16) If any dispute shall arise as to the amount to be paid under this insurance (liability being otherwise admitted), such dispute shall be referred to arbitration in accordance with procedures of the American Arbitration Association. Where any dispute is by this provision referred to arbitration, the making of an award shall be a condition precedent to any right of action against the Company.
Ins. Dec. ¶¶ B(6), (16).
On or about January 18, 1999, Ogdon allegedly received "emergency medical treatment" at a Florida hospital and, pursuant to the terms of his policy, submitted bills approximating $10,000 to Sirius, through IMG as plan administrator, requesting payment. State Compl. ¶¶ 18-19. After conducting an investigation and examining Ogdon's medical bills, IMG, for and on behalf of Sirius, denied the claim and refused to issue any payment, contending that all bills related to his treatment resulted from a pre-existing condition. Id. ¶ 20.
On or about January 31, 1999, Ogdon, by his attorneys (Defendants, R & M, through Rodriguez and Piloto), filed a complaint with the Indiana Department of Insurance, Consumer Services Division, in Indianapolis, alleging in relevant part that the January 1999, illness was not a pre-existing condition at the time of entering into the Insurance Policy contract, and further that Plaintiffs' denial of said claim was improper, pretextual, and in bad faith. State Compl. ¶ 21, Ex. C. IMG replied to this charge on February 17, 2000, denying it in full. Id. ¶ 23. Neither Sirius nor IMG ever admitted any liability under the Insurance Policy for these claims. Id. ¶ 20.
On February 25, 2000, Ogdon requested both verbally and in writing that IMG cancel the Insurance Policy and that the prorated premium be refunded. Id. ¶ 25, Ex. D. The policy provided that cancellation occurred at the option of IMG; IMG exercised this option on March 12, 2000, effective February 25, 2000, credited Ogdon's credit card account in the amount of $602.57, and informed Ogdon in writing that "[a]ll rights under this Certificate have been forfeited." Id. ¶ 26, Exs. E, F.
After notifying Plaintiffs of his desire to cancel the policy, but before Plaintiffs consented to its cancellation, on or about March 6, 2000, Ogdon's attorneys prepared a Statement of Claim and a Demand for Arbitration which were filed with Defendant, the American Arbitration Association ("AAA"). State Compl. ¶ 27, Ex. G. Ogdon and his attorneys contended that this claim and demand were authorized by the arbitration provision contained in Section B(16) of the Insurance Declaration.
Upon receiving Ogdon's claim, the AAA assigned Defendant Brown as the case manager and on March 17, 2000, Brown notified Thomas Dawson of the law firm of LeBoeuf, Lamb Greene & MacRae, L.L.P. (whom paragraph B(6) of the Insurance Policy designated as Sirius' agent for purposes of service) of the request for arbitration which had been filed and laid out preliminary procedural matters. State Compl., Ex. H. On March 29, 2000, F. Jonathan Zusy, Vice President and General Counsel for IMG, responded to Brown's letter denying that the arbitration was authorized by the Insurance Policy and disputing the AAA's authority to proceed with the arbitration; IMG specifically objected to the arbitration proceedings and requested notification that the proposed arbitration had been withdrawn. State Compl., Ex. I. The next day, Brown, on behalf of the AAA, sent another letter to Dawson acknowledging the receipt of IMG's letter and placing Ogdon on notice that any response to IMG's letter was to be received on or before April 4, 2000. State Compl., Ex. J.
Once again, Dawson forwarded Brown's letter to IMG and Zusy responded, instructing Brown to direct further communications to him and reiterating IMG's position that the arbitration was unauthorized and non-consensual. State Compl., Ex. K. Thereafter, Brown directed correspondence to Zusy (in Indiana).
On April 7, 2000, Brown notified Ogdon (through his attorney) and IMG (through Zusy) that:
The Association has carefully reviewed the positions and contentions of the parties as set forth in their correspondence. The claimant has met the filing requirements of the rules by filing a demand for arbitration providing for administration by the American Arbitration Association under its rules.
Accordingly, in the absence of an agreement by the parties or under a court order staying this matter, the Association will proceed with further administration. The parties may wish to raise this issue with the arbitrator at or prior to the hearing.
State Compl., Ex. L. Zusy responded five days later requesting that Brown: (1) forward to him all "comments" received by AAA from Ogdon; (2) provide the names and title of all AAA employees who had reviewed Ogdon's claim and the comments received by AAA; (3) provide the names and titles of all employees who participated in the AAA's conclusion that Ogdon had...
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