Opinion
CASE NO. 1:16-CV-1450 AWI SAB
09-30-2016
HUMANA INSURANCE COMPANY, a Wisconsin Corporation, et al., Plaintiffs v. TENET HEALTH SYSTEM, a Texas Corporation, Defendant
ORDER ON PLAINTIFFS' EX PARTE APPLICATION FOR A TEMPORARY RESTRAINING ORDER
(Doc. No. 4)
Plaintiffs seek an ex parte temporary restraining order that would prevent defendant from cancelling a contractual agreement. Plaintiffs seek injunctive relief while the parties pursue arbitration, which Plaintiffs initiated prior to filing this suit.
Legal Standard
Federal Rule of Civil Procedure 65 governs preliminary injunctions and temporary restraining orders. See Fed. R. Civ. Pro. 65. The substantive standard for granting a temporary restraining order is the same as the standard for entering a preliminary injunction. Majors v. Jeanes, 48 F.Supp.2d 1310, 1312 n.3 (D. Ariz. 2014); Rovio Entm't Ltd. v. Royal Plush Toys, Inc., 907 F.Supp.2d 1086, 1111 (N.D. Cal. 2012); Bryant v. Matvieshen, 904 F.Supp.2d 1034, 1042 (E.D. Cal. 2012); Welker v. Cicerone, 174 F.Supp.2d 1055, 1062 (C.D. Cal. 2001). A plaintiff seeking a preliminary injunction or a restraining order must establish: (1) that he is likely to succeed on the merits, (2) that he is likely to suffer irreparable harm in the absence of preliminary relief, (3) that the balance of equities tips in his favor, and (4) that an injunction is in the public interest. Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 21 (2008); Angelotti Chiropractic v. Baker, 791 F.3d 1075, 1081 (9th Cir. 2015). If a moving party has only shown "serious questions going to the merits," then an injunction may issue if the moving party meets the irreparable harm requirement, meets the public interest requirement, and shows that the balance of hardships "tips sharply" in his favor. Angelotti, 791 F.3d at 1081. However, if a moving party fails to show that he has at least "some chance on the merits," then no injunction will issue. Developmental Servs. Network v. Douglas, 666 F.3d 540, 544 (9th Cir. 2012). "Injunctive relief . . . must be tailored to remedy the specific harm alleged." Park Vill. Apt. Tenants Ass'n v. Mortimer Howard Trust, 636 F.3d 1150, 1160 (9th Cir. 2011). Under Rule 65(b), a court may issue an ex parte temporary restraining order only if: (1) it clearly appears . . . that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party or that party's attorney can be heard in opposition, and (2) the applicant's attorney certifies to the court in writing the efforts, if any, which have been made to give the notice and the reasons supporting the claim that notice should not be required. Fed. R. Civ. Pro. 65(b); Reno Air Racing Ass'n v. McCord, 452 F.3d 1126, 1130 (9th Cir. 2006).
Discussion
The Court will not grant Plaintiffs' motion at this time.
First, Plaintiffs have invoked the Court's diversity jurisdiction, which the Court takes to mean that Plaintiffs are proceeding under state law. The only "count"/cause of action in the Complaint is for injunctive relief, there are no common law or statutory causes of action/authority identified. Under California law, injunctive relief is a remedy, it is not a cause of action. Shamsian v. Atlantic Richfield, Co., 107 Cal.App.4th 967, 984-85 (2003). Without an actual cause of action in the Complaint, Plaintiffs do not adequately demonstrate a probability of success on the merits. Plaintiffs have cited no cases in which a court, without the benefit of any actual cause of action being pled before it, has issued an injunction to maintain the status quo pending resolution of the dispute before an arbitrator.
Second, Plaintiffs acknowledge that they have initiated arbitration proceedings, and have included their "Arbitration Complaint" ("AC"). See Doc. No. 1 at Ex. A. In the AC, Plaintiffs appear to seek very similar injunctive relief from the arbitrator as they do from this Court in this motion. See id. at ¶ 26. There has been no discussion concerning what efforts have been made with the arbitrator to obtain injunctive relief or an explanation of why injunctive relief from the arbitrator cannot be obtained.
Third, it is not clear to the Court that one of the principal irreparable harms identified will result if injunctive is not issued on September 30, 2016. As the Court understands the matter, there is a contractual relationship between the parties that will, at a minimum, run until December 31, 2016, which means that patients will continue to receive medical treatment beyond September 30 from the hospitals in question.
If the Court's understanding is incorrect, this highlights the danger of filing a motion so close to September 30, 2016 (the motion was filed after the close of business on September 29, 2016). See Doc. No. 4.
Finally, although not per se a reason to deny injunctive relief, it is not clear that the Eastern District of California is the appropriate venue. Based on the e-mail string provided, it appears that the contracts at issue may have been negotiated between Torrance, California (which is in the Central District of California) and Atlanta, Georgia. See Doc. No. 6-11. Contrary to the Complaint, it is not clear that any relevant actions took place within the Eastern District of California. See 28 U.S.C. § 1391(b)(2) ("A civil action may be brought in - (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated.").
The Court may raise the issue of improper venue sua sponte. See Costlow v. Weeks, 790 F.2d 1486, 1488 (9th Cir. 1986).
In the e-mail string, Torrance, California is listed as the address for Plaintiffs' representative, and Defendant's representative has a telephone number with an area code of 404, which is the area code for Atlanta, Georgia area. See http://www.allareacodes.com/404.
For these reasons, Plaintiffs' motion will be denied. However, the Court acknowledges that there are significant questions raised in Plaintiffs' motion. Therefore, the Court will give Plaintiffs the opportunity to address the concerns identified in this order. // // //
ORDER
Accordingly, IT IS HEREBY ORDERED that: 1. Plaintiffs' ex parte motion for a temporary restraining order is DENIED without prejudice; 2. Plaintiffs may file an amended motion and/or an amended complaint that addresses the issues raised in this Order, particularly a failure to state a claim and improper venue, no later than 9:30 a.m. on October 4, 2016; 3. If Plaintiffs do not allege facts that demonstrate venue in the Eastern District of California is appropriate, this case will be dismissed; and 4. If Plaintiffs file appropriate amended documents that alleviate the Court's concerns, then the Court will issue further orders at that time. IT IS SO ORDERED. Dated: September 30, 2016
Plaintiffs have identified October 15, 2016 as the commencement date of an open season. Given the significance of this date, the Court finds that a somewhat accelerated briefing schedule is warranted. --------
/s/_________
SENIOR DISTRICT JUDGE