State Farm Mut. Auto. Ins. Co. v. Physicians Grp. Sarasota, L.L.C.
| Citation | 9 F.Supp.3d 1303 |
| Decision Date | 25 March 2014 |
| Docket Number | Case No. 8:13–CIV–1932–17–TGW. |
| Parties | STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY and State Farm Fire & Casualty Company, Plaintiffs, v. PHYSICIANS GROUP OF SARASOTA, L.L.C., Physicians Group, L.L.C. a foreign Delaware corporation, Gary Kompothecras, David Balot, DB Medical Consulting, Inc., W.S. Media, Inc. a foreign Delaware corporation, W.S. Marketing, Inc., and William Sigelakis, Defendants. |
| Court | U.S. District Court — Middle District of Florida |
David I. Spector, Akerman Senterfitt, West Palm Beach, FL, Eric T. Gortner, Ross O. Silverman, Katten Muchin Rosenman, LLP, Chicago, IL, for Plaintiffs.
Bruce S. Rosenberg, Rosenberg Law, PA, Boca Raton, FL, Martin Garcia, Matthews, Eastmoore, Hardy, Crauwels & Garcia, PA, Gregory Anthony Zitani, West Coast Law, PLLC, Sarasota, FL, William P. Cassidy, Jr., Johnson & Cassidy, P.A., Tampa, FL, for Defendants.
ORDER ON DEFENDANT'S MOTION TO DISMISS
THIS CAUSE is before the Court on Defendants', Physicians Group of Sarasota, LLC, Physicians Group, LLC, Gary Kompothecras, David Balot, DB Medical Consulting, Inc., W.S. Media, Inc., W.S. Marketing, Inc., and William Sigelakis (collectively “Defendants”), Motion to Dismiss (Doc. 5) and Plaintiffs', State Farm Mutual Automobile Insurance Company and State Farm Fire & Casualty Company (collectively “State Farm”), response (Doc. 14). The facts set forth here are taken as true from the complaint only for the purpose of resolving the motion.
This dispute arises from State Farm's allegations that Defendants have orchestrated a fraudulent referral scheme to unlawfully collect automobile accident victims' Personal Injury Protection and Medical Payment Coverage benefits for treatment services rendered at Physicians Group clinics throughout Florida.
The elaborate patient referral system revolves around Gary Kompothecras, 1–800–ASK–GARY (“ASK GARY”), and the Physicians Group clinics. According to the complaint, Kompothecras was, and State Farm alleges still is, the Gary behind ASK GARY, as well as the principal interest-holder in Physicians Group; ASK GARY is promoted as an independent medical and legal referral service, when in actuality it refers all patients to Physicians Group clinics.
The other co-Defendants each fill their own role in perpetuating the scheme: there are shell companies, W.S. Marketing and W.S. Media, created to insulate Kompothecras and Physicians Group from ASK GARY; a nominee owner, Sigelakis, to further the appearance of independent control of ASK GARY; an independent contractor, David Balot operating through DB Medical Consulting, to handle the day-to-day operations and coordination with the ASK GARY referral service; all allegedly organized and controlled by Kompothecras. The purpose of the operation is to maintain a high volume of automobile accident victims entering Physicians Group clinics for treatment services.
State Farm alleges that such services were unlawfully rendered, therefore relieving both the patients and State Farm of responsibility for the costs of these services under Florida Statute Section 627.736(5)(b)(1)(b), based on Defendants' alleged violations of the Patient Brokering Act (Fla.Stat. § 817.505 ), the Patient Self–Referral Act (Fla.Stat. § 456.053 ), the Anti–Kickback Statute (Fla.Stat. § 456.054 ), the Deceptive and Unfair Trade Practices Act (Fla. Stat. § 501.201 et seq. ) (“FDUTPA”), the laws concerning grounds for disciplinary action against chiropractors related to advertising and solicitation (Fla.Stat. § 460.413(d), (f), and (l ) ), and administrative rules prohibiting the same (Fla. Admin. C. R. 64B2–15.001(2)(a), (b), and (k)). State Farm's complaint asserts five counts: (I) common law fraud/fraudulent misrepresentation against all Defendants; (II) unjust enrichment against all Defendants; (III) violation of the FDUTPA against all Defendants; (IV) violation of the Patient Self–Referral Act against Physicians Group and Kompothecras; and (V) declaratory relief under 28 U.S.C. Section 2201.
Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” However, the complaint must include more than “labels and conclusions, and a formulaic recitation of the elements of a cause of action.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 577, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). In order to withstand a motion to dismiss, “a complaint must contain sufficient factual material, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955 ). Twombly's plausibility standard requires that the allegations be more than merely conceivable. Twombly, 550 U.S. at 570, 127 S.Ct. 1955. A factually sufficient complaint “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.
The Court must view the complaint in the light most favorable to the plaintiff, accept all factual allegations as true, and limit its consideration to the pleadings and any attached exhibits when determining whether to grant or deny a motion to dismiss. Jackson v. Okaloosa Cnty., Fla., 21 F.3d 1531, 1534 (11th Cir.1994) ; Fed.R.Civ.P. 10(c).
In their motion to dismiss, Defendants ask this Court to exercise its permissive power of abstention and dismiss the complaint in its entirety. Additionally, Defendants claim that the Rooker–Feldman doctrine requires dismissal of Counts I–IV. Finally, Defendants argue that the complaint fails to state a cause of action upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6) for Counts I–V.
In regards to abstention, this Court finds no doctrine that compels dismissal of the complaint and the Rooker–Feldman doctrine is similarly inapplicable. State Farm's complaint meets the Iqbal standard as to the merits of each claim presented. Accordingly, the Defendants' Motion to Dismiss Counts I–V is DENIED.
A District Court may decline to exercise jurisdiction only if the circumstances surrounding a dispute fit within the “extraordinary and narrow exception” of the abstention doctrine. Colo. River Water Conserv. Dist. v. United States, 424 U.S. 800, 813, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976). “Abstention from the exercise of federal jurisdiction is the exception, not the rule[,]” and is justifiable only in “exceptional circumstances.” Id. Courts have recognized a number of abstention doctrines, and the Defendants ask this court to employ the Thibodaux, Wilton/Brillhart, and Colorado River doctrines in finding abstention appropriate here.
Application of the Thibodaux doctrine is appropriate when the District Court is presented with “cases raising issues intimately involved with the States' sovereign prerogative, the proper adjudication of which might be impaired by unsettled questions of state law.” Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 717, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996) (referencing La. Power & Light Co. v. City of Thibodaux, 360 U.S. 25, 28, 79 S.Ct. 1070, 3 L.Ed.2d 1058 (1959) ). The key question on the appropriateness of Thibodaux is whether “the exercise of federal jurisdiction would disrupt states' attempts to establish a coherent policy with respect to a matter of substantial public concern.” Paradigm Ins. Co. v. Carter, 944 F.Supp. 883, 885 (M.D.Fla.1996) (internal quotations omitted); see also Burford v. Sun Oil Co., 319 U.S. 315, 347, 63 S.Ct. 1098, 87 L.Ed. 1424 (1943). Although policy matters of substantial public concern are tangentially related to accusations brought in this complaint, adjudication of this dispute in federal court would not act upon state policy or co-opt state prerogatives.
Defendants argue that ruling on this dispute would infringe upon Florida's, and the Florida Bar's, interests in establishing a coherent policy regarding the regulation of legal and medical referral services. The Florida Bar has recognized that non-lawyer-owned referral services are not regulated by either the Bar or the state. (Doc. 1–3–1–4) But the issues raised in State Farm's complaint do not implicate the regulation of such referral services. Counts I–IV rely on alleged violations of state statutes and rules that govern referral and advertising practices of medical and chiropractic care providers (Fla. Stat. §§ 817.505, 456.053, 456.054, and 460.413(d), (f), and (l ) ); Fla. Admin. C.R. 64B2–15.001(2)(a), (b), and (k) and FDUTPA to trigger a payment exception under Florida's Personal Injury Protection insurance statute, Section 627.736(5)(b)(1)(b). Enforcing existing state policies does not mean disrupting those policies. See State Farm Fire & Casualty Co. v. Silver Star Health & Rehab Inc., 2011 WL 6338496 (M.D.Fla. Dec. 19, 2011) (aff'd sub nom. State Farm Fire & Casualty Co. v. Silver Star Health & Rehab, 739 F.3d 579 (11th Cir.2013) ); Allstate Ins. Co. v. Vizcay, 2011 WL 5870016 (M.D.Fla. Nov. 22, 2011). Accordingly, Defendant's motion for abstention under Thibodaux is DENIED.
Defendants next request this Court to abstain based upon the doctrines defined in Brillhart v. Excess Ins. Co. of America, 316 U.S. 491, 494–495, 62 S.Ct. 1173, 86 L.Ed. 1620 (1942) () and Wilton v. Seven Falls Co., 515 U.S. 277, 289, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995) (...
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