Morris v. Humana Health Plan, Inc.

• Decision Date: 02 November 2011
• Docket Number: Case No. 11–0542–CV–W–HFS.
• Parties: Jenise MORRIS, Plaintiff, v. HUMANA HEALTH PLAN, INC., Defendant.
• Court: U.S. District Court — Western District of Missouri

829 F.Supp.2d 848

Jenise MORRIS, Plaintiff,

v.HUMANA HEALTH PLAN, INC., Defendant.

Case No. 11–0542–CV–W–HFS.

United States District Court, W.D. Missouri,Western Division.

Nov. 2, 2011.

Blake P. Green, Keith Christopher Lamb, Mitchell L. Burgess, Burgess & Lamb P.C., Ralph K. Phalen, Attorney at Law, Don P. Saxton, Kansas City, MO, for Plaintiff.

Laura U. Hughes, Spencer, Fane, Britt & Browne, LLP, St. Louis, MO, Douglas M. Weems, Spencer Fane Britt & Browne LLP, Kansas City, MO, for Defendant.

MEMORANDUM AND ORDER

HOWARD F. SACHS, District Judge.

Before the court is plaintiff's motion to remand this case pursuant to 28 U.S.C. § 1447. Also, before the court is defendant's motion to dismiss pursuant to Fed. R.Civ.P. 12(b)(1) and 12(b)(6). For the reasons set forth below, the motion to remand will be granted; thereby rendering the motion to dismiss moot.

Factual and Procedural Background

Plaintiff, on behalf of others similarly situated, filed suit against defendant, Humana Health Plan, Inc., in the Circuit Court of Jackson County, Missouri, at Kansas City. Essentially, plaintiff claimed that Humana routinely engaged in a widespread pattern and practice of unlawfully asserting reimbursement rights on healthcare benefits paid to healthplan enrollees by a third-party tortfeasor under provisions of the Federal Employee Health Benefits Act “FEHBA.” Plaintiff asserted claims for unjust enrichment, conversion, and injunctive relief. Pursuant to 28 U.S.C. § 1446(b), Humana timely removed the action to this court and claimed that federal jurisdiction existed under 28 U.S.C. § 1331 (federal question), and under 28 U.S.C. § 1442(a)(1) (the federal officer removal statute).

Applicable Law

A. Federal Question Jurisdiction

“The Federal Employees Health Benefits Act of 1959 (FEHBA), 5 U.S.C. § 8901 et seq. (2000 ed. And Supp. III), establishes a comprehensive program of health insurance for federal employees.” Van Horn v. Arkansas Blue Cross and Blue Shield, 629 F.Supp.2d 905, 907 (E.D.Ark.2007); quoting, Empire Healthchoice v. McVeigh, 547 U.S. 677, 126 S.Ct. 2121, 165 L.Ed.2d 131 (2006). “The Act authorizes the Office of Personnel Management” (OPM) to contract with private carriers to offer federal employees an array of health-care plans.” Id. Humana has such a contract.

Humana claims that this court has federal question jurisdiction because this case is governed by federal common law pursuant to 28 U.S.C. § 1331. Specifically, Humana argues that this case presents a substantial federal question; that is, whether it acted properly under FEHBA in subrogating plaintiff's claim.

Under 28 U.S.C. § 1331, “The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” Manske v. Rocky Mountain Holding Co., 2007 WL 119165 *5 (D.Neb.). A defendant may remove a state court claim to federal court if the claim originally could have been filed in federal court, and the well-pleaded complaint rule provides that a federal question must be presented on the face of the properly pleaded complaint to invoke federal court jurisdiction. Id. Additionally, “federal question jurisdiction will lie over state-law claims that implicate significant federal issues.” Id.; quoting, Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 312, 125 S.Ct. 2363, 162 L.Ed.2d 257 (2005). Therefore, “federal jurisdiction demands not only a contested federal issue, but a substantial one, indicating a serious federal interest in claiming the advantages thought to be inherent in a federal forum.” Id.; quoting, Grable, at 313, 125 S.Ct. 2363.

A defendant is not permitted to inject a federal question into an otherwise state-law claim and thereby transform the action into one arising under federal law. Id. “Congress has long since decided that federal defenses do not provide a basis for removal.” Id. “Thus, a case may not be removed to federal court on the basis of a federal defense, even if the defense is anticipated in the plaintiff's complaint, and even if both parties admit that the defense is the only question truly at issue in the case.” Id. “To permit removal on the basis of a federal defense would deprive the plaintiff of the right to be the master of his cause of action.” Id.; quoting, Caterpillar Inc. v. Williams, 482 U.S. 386, 399, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). In opposing remand, a defendant bears the burden of establishing that federal subject matter jurisdiction exists over the plaintiff's case, and if the defendant proves that any claim within the complaint supports federal question jurisdiction, the entire case may be removed to federal court including any state-law claims arising from the same core of operative facts. Manske, 2007 WL 119165 at, *6. However, all doubts as to the propriety of exercising federal jurisdiction over a removed case must be resolved in favor of remand. Id.

In Manske, the plaintiff filed suit in state court against several defendants alleging that her husband's death in a helicopter crash was the result of a faulty tail rotor system that occurred during an attempted emergency landing. Plaintiff alleged claims for negligence as well as a claim in Count V for failure to preserve, retain and maintain certain records relating to the subject aircraft. Manske, at *6. Removal of an entire case to federal court is permissible if any claim within the complaint supports federal question jurisdiction, including any alleged state-law claims arising from the same core of operative facts. Id. It was upon this basis, the allegation asserted in Count V, that the defendants claimed supported removal; and argued that if there was a duty to maintain the records, it was governed by the Federal Aviation Act. Id. Conversely, the plaintiff contended that the claim was based on breach of a common law duty of care to retain the records. Id.

The defendants in Manske, like Humana at bar, looked to the reasoning expressed in Grable in support of their argument that the complaint in each instance raises a substantial federal question. In Grable, a former landowner brought a quiet title action in state court against a tax sale purchaser, and alleged that the purchaser's record title was invalid because the IRS had failed to provide the plaintiff with proper notice pursuant to federal statute. Manske, at *7; citing, Grable, 545 U.S. at 310, 125 S.Ct. 2363. The Court held that the plaintiff's superior title claim was premised on the IRS's failure to give adequate notice, which made “[t]he meaning of the federal tax provision [ ] an important issue of federal law that sensibly belongs in a federal court.” Id.; citing, Grable, at 315, 125 S.Ct. 2363. Thus, the Manske court held that since the plaintiff's claims were primarily related to the cause of the helicopter crash and any attendant liability, as opposed to federal regulations presented in Grable, any defenses presented by defendants based on federal law would not prevent remand of the case to state court. Id., at *8.¹ The court also found that the application and interpretation of one or two record-keeping regulations did not equate to states supplementing federal safety aviation regulations. Id. Thus, the issue lacked substantial federal interest to justify federal question justification over the plaintiff's state law claims. Id. Similarly, here, Humana claims that a verdict for plaintiff would invalidate a federal government contract program and significantly frustrate OPM's ability to enforce and administer FEHBA contracts. However, sufficient evidence has not been presented which would demonstrate a substantial federal issue, and on the face of the complaint a federal question has not been presented. West Virginia ex rel. McGraw v. CVS Pharmacy, Inc., 748 F.Supp.2d 580, 585–86 (S.D.W.Va.2010) (defendant failed to demonstrate the existence of an “important issue of federal law that sensibly belongs in a federal court.”); see also, Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677, 704, 126 S.Ct. 2121, 165 L.Ed.2d 131 (2006) (few cases can be “squeezed into the slim category Grable exemplifies”).

B. Federal Officer Removal Statute

Humana also claims the presence of federal jurisdiction based on the federal officer removal statute pursuant to 28 U.S.C. § 1442(a)(1). Specifically, Humana contends that in seeking reimbursement it “acted under” the direction of a federal officer, and it has colorable federal defenses, i.e. official immunity, conflict preemption/government-contractor defense, and express preemption. According to Humana, the OPM exercises supervisory authority over it as it administers the Plan for enrollees under a contract negotiated and interpreted by OPM. (Suggestion in Opposition to Remand: Exh. 1, Declaration of Joan Schumer stating that the standard contract requires Humana, under certain circumstances, to assert subrogation rights).

§ 1442 allows removal to a federal forum of any civil or criminal action against “[t]he United States or of any agency thereof or any officer (or any person acting under that officer) of the United States or of any agency thereof, sued in an official or individual capacity for any act under color of such office.” West v. A & S Helicopters, 751 F.Supp.2d 1104, 1109 (W.D.Mo.2010). Four elements are required to be demonstrated: (1) a defendant has acted under the direction of a federal officer, (2) there was a causal connection between its actions and the official authority, (3) the defendant has a colorable federal defense to the plaintiff's claims, and (4) the defendant is a “person” within the meaning of the statute. Id., at 1109. ² “The words ‘acting under’ are broad,” and the Supreme Court “has made clear that the statute must be ‘liberally construed.’ ” Watson v. Philip Morris Cos., Inc., 551 U.S. 142, 147, 127 S.Ct. 2301, 168 L.Ed.2d 42 (2007). “But broad language is not limitless. And a liberal construction...