Tompkins v. United Healthcare of New England

• Decision Date: 05 November 1999
• Docket Number: No. 99-1449,99-1449
• Citation: 203 F.3d 90
• Parties: (1st Cir. 2000) JULIANNE TOMPKINS, KATHLEEN TOMPKINS, and JOHN TOMPKINS, Plaintiffs, Appellants, v. UNITED HEALTHCARE OF NEW ENGLAND, INC., Defendant, Appellee. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 90

203 F.3d 90 (1st Cir. 2000)

JULIANNE TOMPKINS, KATHLEEN TOMPKINS, and JOHN TOMPKINS, Plaintiffs, Appellants, v. UNITED HEALTHCARE OF NEW ENGLAND, INC., Defendant, Appellee.

No. 99-1449.

United States Court of Appeals, for the First Circuit.

Heard Nov. 5, 1999.

Decided February 11, 2000.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS. Hon. Joseph L. Tauro, U.S. District Judge. [Copyrighted Material Omitted]

John R. Mitchell for appellants.

Joan O. Vorster, with whom Mirick, O'Connell, DeMallie & Lougee, LLP, was on brief, for appellee.

Before Stahl, Circuit Judge, Bownes, Senior Circuit Judge, and Lipez, Circuit Judge.

LIPEZ, Circuit Judge.

The plaintiffs, Julianne, Kathleen, and John Tompkins, appeal from the district court's dismissal, pursuant to Fed. R. Civ. P. 12(b)(6), of their claims against United Healthcare of New England, Inc. ("United"), alleging violations of federal and state anti-discrimination statutes, as well as negligent and intentional infliction of emotional distress, misrepresentation, and breach of written, oral, and implied contracts. The district court found that the Employee Retirement Income Security Act of 1974 ("ERISA") as amended, 29 U.S.C. § 1001 et. seq., preempted the state statutory and common law claims of the plaintiffs and that their claims under the Americans with Disabilities Act ("ADA"), 42 U.S.C. §§ 12101-12213, failed to state a cause of action. For reasons somewhat different than those relied upon by the district court, we affirm.

I. BACKGROUND

John and Kathleen Tompkins have a daughter, Julianne Tompkins, who suffers from Trisomy 13, a chromosomal disease that requires regular medical treatment. From 1993 to 1996, Julianne received her treatment at the New England Medical Center ("NEMC").

United is the Tompkinses' health care insurer. Between 1993 and 1996, United pre-approved and paid for Julianne's treatment at NEMC. During that time the Tompkinses received their insurance through Mr. Tompkins's employer, A.B. Dick. In 1996, Mrs. Tompkins returned to work and her employer, New Bedford Harbor Services, Inc. ("New Bedford"), offered her a United insurance policy with lower premiums. After emphasizing the importance of Julianne's continued treatment and receiving assurances from United representatives that changing employer-providers would not alter their coverage, the Tompkinses switched and obtained their insurance through New Bedford.

Less than a week after the switch, however, United began to deny payments for treatment provided to Julianne at NEMC. Shortly thereafter, United notified the Tompkinses that Julianne's therapies at NEMC would no longer be pre-approved or paid for because Julianne was being "transitioned"--i.e., she was to receive future treatment by United-covered physicians at less costly hospitals closer to her home. In the Tompkinses' view, such "transition" meant that Julianne would be unable to visit her regular physicians or to benefit from the high level of expertise and quality available at NEMC.

The Tompkinses appealed United's denial of coverage at NEMC and its decision to transition Julianne to other hospitals for treatment. Ultimately, United's Member Relations Committee heard the appeal and reversed the earlier benefit denial, agreeing to pay back-costs for treatment already received and authorizing Julianne to obtain her future treatments at NEMC.

Despite that victory the Tompkinses initiated this lawsuit, alleging that they suffered emotional distress and physical ailments, and incurred costs and expenses including attorneys' fees, as a result of "their efforts to reverse United's discriminatory denial of Julianne's benefits." In Counts I - IV of the complaint, the Tompkinses sought to recover under Titles I and III of the ADA, the Massachusetts discrimination statute, Mass. Gen. Laws. ch. 151B, and the Massachusetts Equal Rights Act Mass. Gen. Laws. ch. 93 § 103. In Counts V - X, the Tompkinses alleged various common law causes of action, including intentional infliction of emotional distress, misrepresentation, and breach of written, oral, and implied contracts.

United moved to dismiss the Tompkinses' claims on the grounds that, inter alia, (1) ERISA preempted the state statutory and common law claims, and (2) the ADA claims failed to state a cause of action. The district court agreed on both grounds. First, the court held that the Tompkinses' state statutory and common law claims "related to" United's ERISA-regulated health insurance plan within the meaning of ERISA's preemption clause,¹ and consequently, that ERISA preempted all of the Tompkinses' state law claims. Second, the court ruled that the Tompkinses did not state an ADA Title I claim because the allegations of the complaint did not show that United was a "covered entity" under Title I. Lastly, the court concluded that because "Plaintiffs cannot point to any services which United has denied them, they fail to state a claim under Title III."

In affirming the dismissal of the Tompkinses' claims, we rely on somewhat different reasoning than the court below because of the interrelationship between the ADA claims of the plaintiffs and ERISA preemption. On appeal, the plaintiffs do not argue, as they did below, that their state-law claims do not "relate to" the United health care plan within the meaning of ERISA's preemption clause. Instead, relying on the viability of their ADA claims, the Tompkinses assert an alternative argument that they made below--namely, that their Massachusetts statutory claims are exempt from ERISA preemption as a necessary adjunct to the ADA's enforcement scheme.²

We reject the premise of the argument by concluding that both the Title I and the Title III ADA claims were properly dismissed. The only discriminatory conduct alleged in the complaint--United's initial decision to deny payment for Julianne's treatment at NEMC--was fully redressed through United's ERISA-mandated internal review process. Likewise, we find no merit to the contention of the plaintiffs that United waived its right to assert ERISA preemption as an affirmative defense.

II. THE ADA CLAIMS

We review de novo a Rule 12(b)(6) dismissal. See Beddall v. State St. Bank & Trust Co., 137 F.3d 12, 16 (1st Cir. 1998). In reviewing a judgment entered under Rule 12(b)(6), we must take the factual allegations of the complaint as true and draw every reasonable inference in favor of letting the lawsuit proceed. See Langadinos v. American Airlines, Inc., 199 F.3d 68, 69 (1st Cir. Jan. 6, 2000). The complaint will survive as long as it pleads sufficient facts to warrant recovery on any cognizable theory of the case. See Garita Hotel Ltd. Partnership v. Ponce Fed. Bank, F.S.B., 958 F.2d 15, 17 (1st Cir. 1992).

To recover under either Title I or Title III of the ADA, the aggrieved party must be able to show that he or she was denied some benefit on account of a disability or an association with a disabled person. Title I of the ADA provides in relevant part:

No covered entity shall discriminate against a qualified individual with a disability because of the disability of such individual in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.

42 U.S.C. § 12112(a). Title III of the ADA provides in relevant part:

No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.

42 U.S.C. § 12182(a).

Our review of a benefit decision made pursuant to an ERISA-regulated employee benefit plan "must focus . . . on the determinations of the final decision-maker." Terry v. Bayer Corp., 145 F.3d 28, 35-36 (1st Cir. 1998) (emphasizing that "a prerequisite to obtaining judicial review . . . is that the claimant have exhausted the internal administrative remedies available to him."). In the case at hand, the Tompkinses recovered the benefits that they claimed were wrongfully denied on the basis of discrimination by utilizing the internal administrative remedies available to them. In reversing United's initial decision to deny the benefits, United's Member Relations Committee ordered payments of back-costs for treatment already received and authorized Julianne to receive her future treatments at NEMC. Accordingly, the Tompkinses were not denied any "terms, conditions, [or] privileges of employment" under Title I or any "services" under Title III attributable to United's initial decision to deny Julianne benefits based on her disability.³

A close examination of the complaint reveals that the only discriminatory conduct alleged by the Tompkinses was United's initial decision to refuse payments for Julianne's treatment at NEMC. In the count of the complaint asserting a cause of action under Title I, the Tompkinses allege in relevant part:

54. Defendant's establishment of a health benefit plan, which wrongfully discriminates against persons with Trisomy 13 and in particular Julianne Tompkins, and the Plaintiffs constitutes a violation of ADA.

. . . .

56. As a direct and proximate result of these violations of the ADA by Defendant, Plaintiffs have lost and will continue to lose benefits of their employment and contractual relationship with the Defendant.

57. As a direct and proximate result of these violations of the ADA by Defendant, Plaintiffs have experienced and will continue to experience emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life, and other non-pecuniary losses.

The conduct alleged to violate the ADA is the "establishment of a health benefit plan, which wrongfully discriminates against persons with Trisomy 13." As a result, the...