Spinedex Physical Therapy v. United Healthcare
| Decision Date | 29 April 2009 |
| Docket Number | No. CV-08-457-PHX-ROS.,CV-08-457-PHX-ROS. |
| Citation | 661 F.Supp.2d 1076 |
| Parties | SPINEDEX PHYSICAL THERAPY USA, INC. et al., Plaintiffs, v. UNITED HEALTHCARE OF ARIZONA, INC. et al., Defendants. |
| Court | U.S. District Court — District of Arizona |
Joseph A. Creitz, Law Office of Joseph Creitz, Joseph A. Garofolo, Law Office of Joseph A. Garofolo, San Francisco, CA, for Plaintiffs.
Christopher RJ Pace, Weil Gotshal & Manges LLP, Miami, FL, Jared R. Friedmann, Jeffrey S. Klein, Martin C. Geagan, Jr., Nicholas James Pappas, Salvatore A. Romanello, Weil Gotshal & Manges LLP, New York, NY, John C. West, Jennings Strouss & Salmon PLC, Phoenix, AZ, for Defendants.
On July 9, 2008, Plaintiffs Claude Aragon, Jack Adams, Spinedex Physical Therapy USA, Inc. ("Spinedex") and the Arizona Chiropractic Society ("ACS") filed a Second Amended Complaint, alleging a class action under the Employee Retirement Income Security Act of 1974 ("ERISA") (Doc. 38). Aragon and Adams are participants or beneficiaries in, and thus receive health insurance from, one of the Plans and allege wrongful denial of benefits.1 Spinedex is a medical practice which provided health care services to Aragon, Adams and other Plan participants and beneficiaries (i.e. Spinedex's patients) and alleges wrongful denial of compensation for services. ACS represents the interests of its member physicians who claim wrongful denial of compensation for services provided to Plan participants and beneficiaries. Forty-five employee welfare benefit Plans are named as Defendants ("Plan Defendants") (Doc. 38 at 13-23, 29-34). Six corporations which allegedly are fiduciaries and administrators of the Plans are also named as Defendants ("United Defendants") (Doc. 38 at 8-12, 22-46).
On August 22, 2008, Defendants filed a Motion To Dismiss, pursuant to Federal Rule of Civil Procedure 12(b)(6) (Doc. 103). Prior to filing the Motion, the parties stipulated to and the Court allowed the parties to exceed the length requirements of Local Rule of Civil Procedure 7.2(e) and file a thirty-five-page Motion and Response and a twenty-page Reply (Doc. 57). On September 18, because the Motion violated the memoranda type-set requirements of Local Rule of Civil Procedure 7.1(b)(1), Defendants were ordered to resubmit the Motion in conformance with the Rule (Docs. 107-08). Because the parties stipulated that the revisions required to conform the Motion to the Rule would only be a reduction of approximately four pages, the briefing schedule was not altered, except for granting a one-day extension for the Response (Docs. 108, 111). The revised Motion was filed on September 19, 2008 (Doc. 110). Plaintiffs responded on September 23, 2008 (Doc. 112), and the Reply was filed on October 22, 2008 (Doc. 123).
On the same day as filing the Response, Plaintiffs filed a Motion For Leave To File Separate Statement, Objections, and Motion to Strike as a Separate Motion, which is fully briefed (Docs. 113, 118, 122). Plaintiffs also filed two Requests For Judicial Notice and a Motion For Leave To File A Supplemental Memorandum, the first two of which Defendants did not oppose (Docs. 115, 124-25). The Court's rulings are as follows:
• The Motion For Leave To File Separate Statement, Objections, and Motion to Strike as a Separate Motion will be denied.
• The Request For Judicial Notice will be granted in part.
• The Second Request For Judicial Notice will be granted.
• The Motion For Leave To File A Supplemental Memorandum will be denied.
• The Motion To Dismiss will be granted in part.
Plaintiffs' Motion For Leave To File Separate Statement, Objections, and Motion to Strike as a Separate Motion will be denied (Doc. 113). Local Rule of Civil Procedure 7.2(m) is clear: "An objection to the admission of evidence offered in support or opposition to a motion must be presented in the objecting party's responsive or reply memorandum . . . and not in a separate motion to strike or other separate filing." LRCiv 7.2(m)(2) (emphasis added) ("Rule 7.2(m)"). Plaintiffs request permission to separately file a motion challenging evidence attached to the Motion To Dismiss. According to Plaintiffs, it is "impossible for Plaintiffs to brief the issues and the law relating to their evidentiary objections and their Motion to Strike within the four corners of their [Response]" (Doc. 113 at 3). The Court does not agree. Plaintiffs also argue, because most motions to dismiss do not include voluminous evidentiary submissions, the "spirit of the Local Rules" should allow an exception (Doc. 113 at 3). Again, the Court does not agree. Finally, Plaintiffs infer they were prejudiced when the Court ordered Defendants to resubmit the Motion To Dismiss in conformance with Local Rule 7.1(b) but only granted Plaintiffs one additional day to respond. This argument is without merit. Plaintiffs had three and one-half weeks to respond to the Motion To Dismiss — from August 22 to September 17, 2008 — before the Rule 7.1(b) issue surfaced. Defendants filed the revised motion to dismiss on September 19, 2008 and Plaintiffs had an additional four days to adjust the Response to Defendants' minor revisions. The Motion For Leave To File Separate Statement, Objections, and Motion to Strike as a Separate Motion will thus be denied. None of the evidentiary objections presented in that Motion will be considered.
Given Defendants' failure to respond, Plaintiffs' Request For Judicial Notice will be granted and all documents listed in the Request will be noticed (Doc. 115 at 2-3). See Fed.R.Evid. 201(d) () (emphasis added). The contents of the documents appear to be "not subject to reasonable dispute" and "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned," including court records, public filings, and other government documents. Fed.R.Evid. 201(b) (Docs. 115 at 2-3; Doc. 116 Ex. B-H). It is noted that some documents were attached to but not listed in the body of the Request. These documents will not be considered until properly included in a formal request for judicial notice .
Plaintiffs' Second Request For Judicial Notice (Doc. 124) will be granted and Plaintiffs' Motion For Leave To File Supplemental Memorandum will be denied (Doc. 125). Plaintiffs request judicial notice of an amicus curiae brief filed by the Secretary of the Department of Labor in proceedings before the Ninth Circuit concerning whether a third-party insurer is a proper defendant in a suit for unpaid employee welfare benefit plan benefits pursuant to 29 U.S.C. § 1132(a)(1)(B), ERISA § 502(a)(1)(B) . See infra Section IV.D.4.c. The amicus brief is relevant to an issue currently before the Court, was filed after the Response to the Motion to Dismiss was due, the contents are "not subject to reasonable dispute," the brief itself is "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned" and notice is unopposed. Fed. R.Evid. 201(b). See also Serv. Employees Int'l Union Local 102 v. County of San Diego, 60 F.3d 1346, 1356 n. 3 (9th Cir. 1994) (per curiam) ().
Nevertheless, Plaintiffs will not be allowed to file a supplemental brief to "analyze[] the relevance" of the Secretary's amicus (Doc. 125 at 2). The value of the Secretary's amicus is evident on its face and is not new authority. If this matter involved a question of statutory interpretation that was unsettled in the Ninth Circuit, the Secretary's opinion might carry some authoritative weight. See e.g. U.S. v. Mead Corp., 533 U.S. 218, 121 S.Ct. 2164, 2175, 150 L.Ed.2d 292 (2001) (); see also infra note 9. However, Plaintiffs urge the Court to consider the amicus as authority contrary to Ninth Circuit interpretation of ERISA, arguing a § 1132(a)(1)(B) plaintiff may sue a third-party insurer that is neither an employee welfare benefit plan nor a plan administrator for wrongfully denied benefits. But see Everhart v. Allmerica Fin. Life Ins. Co., 275 F.3d 751, 754 (9th Cir.2001) (). In fact, the Secretary concludes the contrary is Ninth Circuit law (Doc. 124 Ex. A at 5-8). Although judicial deference to executive construction of a statute may be relevant to interpreting ambiguous statutes, the "judiciary is the final authority on issues of statutory construction" and in this case the judiciary has spoken. Chevron U.S.A., Inc. v. Natural Res. Def. Council, 467 U.S. 837, 104 S.Ct. 2778, 2782 n. 9, 81 L.Ed.2d 694 (1984). Thus, the amicus is advisory and no further analysis from the parties is necessary.
Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)") permits challenge of a complaint for "failure to state a claim upon which relief can be granted." A court's inquiry "is limited to the allegations in the complaint, which are accepted as true and construed in the light most favorable to the plaintiff." Lazy Y Ranch Ltd. v. Behrens, 546 F.3d 580, 588 (9th Cir. 2008). However, a court "need not accept as true allegations contradicting documents that are referenced in the complaint or...
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