The Regents of The University of California vs. Kaiser Foundation Hospitals

Motion for Leave to Amend

Cal. Super. - 4th Dist.May 19, 2017

O O 0 0 N N O N U n h h W O N = N N N N N N N N N D N N N m o m o m e m p m m k p d p d p m pe a C 0 I O N W n A W N = © V V 0 0 N N O& O v i A W W N D ~ ~ © LAW OFFICES OF STEPHENSON, ACQUISTO & COLMAN,INC. JOY STEPHENSON-LAWS, ESQ. (SBN 113755) BARRY SULLIVAN, ESQ. (SBN 136571) RICHARD A. LOVICH,ESQ. (SBN 113472) SHADI SHAYAN,ESQ. (SBN 265674) 303 N. Glenoaks Blvd., Suite 700 Burbank, CA 91502 Telephone: (818) 559-4477 Facsimile: (818) 559-5484 Attorneys for Plaintiff THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf ofthe University of California, Irvine Medical Center SUPERIOR COURT OF CALIFORNIA FOR THE COUNTY OF ORANGE THE REGENTS OF THE Case No.: 30-2017-00921367 UNIVERSITY OF CALIFORNIA,a Judge: Hon. Sheila Fell public trust corporation, on behalf of the University of California, Irvine Medical |1. NOTICE OF MOTION AND Center, MOTION FOR LEAVE TO FILE oo [PROPOSED] FIRST AMENDED Plaintiff, COMPLAINT; VS. 2. MEMORANDUM OF POINTS KAISER FOUNDATION HOSPITALS, AND AUTHORITIES; a California corporation; KAISER 3. DECLARATION OF SHADI FOUNDATION HEALTH PLAN, a SHAYAN California corporation; SOUTHERN CALIFORNIA PERMANENTE DATE: June 20, 2018 MEDICAL GROUP,a California } } partnership; THE PERMANENTE TIME: 10:00 am MEDICAL GROUP, INC., a California |[DEPT.: C25 corporation; KAISER FOUNDATION } HEALTH PLAN OF GEORGIA, a RESERVATION NO.: 72814445 Georgia corporation; KAISER motion for leave.doc -1- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; © 0 N N O N n n b r WL W N D = = N N N N D N N N N N D N N N N = r m e m p m pe d p m e m e m e m p m 0 N N O N U n B h W I N D = O O 0 0 0 N D R W N D = O o PERMANENTE INSURANCE COMPANY,a California corporation; and DOES 1 THROUGH 25, INCLUSIVE, Defendants. TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE THAT on June 20, 2018, at 10:00 am in Department C25 ofthe Superior Court of the State of California for the County of Orange, located at 700 Civic Center Drive West, Santa Ana, CA 92701, Plaintiff THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf of the University of California, Irvine Medical Center ("UC Irvine Health") will move and hereby does move for an order granting it leave to file its First Amended Complaint, pursuant to Cal. Civ. Proc. Code §§ 473(a)(1), 576, against Defendants KAISER FOUNDATION HOSPITALS, a California corporation; KAISER FOUNDATION HEALTH PLAN,a California corporation; SOUTHERN CALIFORNIA PERMANENTE MEDICAL GROUP, a California partnership; THE PERMANENTE MEDICAL GROUP, a California corporation; KAISER FOUNDATION HEALTH PLAN OF GEORGIA,a Georgia corporation; KAISER PERMANENTE INSURANCE COMPANY,a California corporation (collectively, “Kaiser”). UC Irvine Health brings this motion on the grounds that it through its investigation, it recently discovered errors in its previous complaint concerning the amountin controversy for some of the Patient claims at issue. Moreover, by way ofits First Amended Complaint, UC Irvine Health also hopes to clarify how the motion for leave.doc 2- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 0 9 O N U n b h W W N D = N D N N N N N N N N N N e m r m e m e m p m p m e m p m e m p m 0 0 N I O N W n h h W N = O 0 0 N D N D N A W N = causes of action at issue in this Action are applicable to the claims. UC Irvine Health also requests an order that the attached First Amended Complaint be deemed to be the amended pleading and thatit be deemed filed and served as of the date the motion is granted. This motion is based upon this notice of motion and motion, the attached memorandum ofpoints and authorities, the attached declaration of Shadi Shayan,the attached exhibits, and such other further evidence and argumentas the Court will entertain at the hearing. Dated: 16 May 2018 STEPHENSON, ACQUISTO & COLMAN Jd. SHADI SHAYAN Attorney for THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf of the University of California, Irvine Medical Center motion for leave.doc -3- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 9 O N U n A h W N B N N N N N D N N N N = k m e m e m e m e m e m e m e m e m © N A U n k h W N = O V O 0 d A W N = O MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION AND SUMMARY OF ARGUMENT PlaintiffTHE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a public trust corporation, on behalf of the University of California, Irvine Medical Center (“UC Irvine Health”) broughtthis action for a simple reason: it wants to be fully paid for the medicalcare it rendered. Specifically, UC Irvine Health treated six of Defendants’ members pursuant to the terms of written agreements between UC Irvine Health and Kaiser. UC Irvine Health also treated a seventh Kaiser Member for outpatient infusion therapy. During the course ofUC Irvine Health’s internal investigation ofthe claims at issue in preparation ofits responsesto Kaiser's written discovery requests, it was discovered that the amounts in controversy for the claims at issue are incorrect. Consequently, UC Irvine Health now seeks to amend its operative Complaint to reflect the correct amount in controversy between UC Irvine Health and Kaiser. The Amended Complaint will also clarify which causes of action are applicable to which claims in the Action. These changes will be of no prejudice to any party since a) Kaiser at all times has been aware of exactly how much it paid and did not pay UC Irvine Health for the services underlying these payment disputes; and b) no new theories of recovery are being introduced. Thisis essentially the correction of a scrivener’s error. motion for leave.doc -4- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT;2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 N N O& O V n h h W N N O N N N N D N D N N N N N N m o e m m p m m d m d p d p d p d 0 0 N N O N W n A r WL W N D = O O O V O N R A W = O O IL THE LEGAL STANDARDS FOR ALLOWING AMENDMENTS TO COMPLAINTS UC Irvine Health brings this motion pursuant to California Code of Civil Procedure section 473(a) (1), which states: The court may . in its discretion, after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading or proceeding in other particulars; and may upon like terms allow an answer to be made after the time limited by this code. Similarly, California Code of Civil Procedure section § 576 also provides grounds for this motion: "[a]ny judge, at any time before or after commencementoftrial, in the furtherance ofjustice, and upon such terms as may be proper, may allow the amendment of any pleading . ..." "An application to amend a pleading is addressed to the trial judge's sound discretion." (Thompson Pacific Const., Inc. v. City ofSunnyvale (2007) 155 Cal. App. 4M 525, 544.) Such discretion must be tempered in favor of granting such a request: California courts 'have a policy of great liberality in allowing amendments at any stage of the proceeding so as to dispose of cases upon their substantial merits where the authorization does not prejudice the substantial rights of others.' [citation omitted]. Indeed, 'it is a rare case in which "a court will be justified in motion for leave.doc -5- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 0 9 O N n n A W N N N D N D N N D N D D N N D N D = m o m e m e m e m e m e m e m p m 0 N N O N L r A W N ~~ , O V N O N N D A W N = O refusing a party leave to amend his [or her] pleading so that he [or she] may properly presenthis [or her] case." ‘[citation omitted]. (Board ofTrustees ofLeland Stanford Jr. University v. Superior Court (2007) 149 Cal. App. 4M 1154, 1163.) The proximity of the request to amend to the trial date is immaterial if the plaintiff is the party who seeks to amend and is amenable to a postponement of the trial. (Mesler v. Bragg Management Co. (1985) 39 Cal. 3™ 290, 296-97.) Thus, even if a motion to amend is made on the day oftrial, leavestill should be granted absent prejudice to the other party. (Higgins v. Del. Faro (1981) 123 Cal. App. 3" 558, 564-65 ("Ifplaintiff has a good cause of action, which by accident or mistake he has failed to set out in his complaint, the court, on motion for judgment on the pleadings, should, on his application so to do, permit him to amend.")). Thus, "[w]here no prejudice is shown to the adverse party, the liberal rule of allowance prevails. (Id. at 564.) "Moreover,it is irrelevant that new legal theories are introduced as long as the proposed amendments 'relate to the same general set of facts." (Kittredge Sports Co. v. Super. Ct. (1989) 213 Cal. App. 3™ 1045, 1048). Further,there is a right to amend "to correct inadvertent misstatements of facts or erroneous allegations ofterms." (Berman v. Bromberg (1997) 56 Cal. App. 4" 936, 945). motion for leave.doc -6- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT;2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 0 O N O N L n p A W O N N N N D N D N N N N N = m e m e m e m e m e m e m e m p a © N A L n B h W N = O V W N N N N R A W N m = , III. DEFENDANTS WOULD SUFFER NO PREJUDICE IF UC IRVINE HEALTH WERE ALLOWED TO FILE ITS FIRST AMENDED COMPLAINT It is well-established that "[w]here no prejudice is shown to the adverse party, the liberal rule of allowance prevails. (Higgins, supra, 123 Cal. App. 3" at 564). Here, Defendants would suffer no prejudice if UC Irvine Health were given leave to file its First Amended Complaint because the error UC Irvine Health seeks to correct was the disputed amounts. Atall times, Defendants have been aware ofhow much they should have paid UC Irvine Health, how much they paid and how much they did not pay UC Irvine Health. Moreover, clarification of the claims and the causes of action are helpful to each party. Therefore,this court should applythe liberal rule of allowance and grant leave for UC Irvine Health to amendits pleading. Since amendments to complaints are acceptable even on the day of trial, and this request comes more than three months before trial, and does not disturb in any material way the allegations in the complaint or the discovery exchanged by the parties, the "liberality" rule calls for UC Irvine Health's request for leave to file an amended complaint to be granted. At all times, Defendants have been aware ofhow much they should have paid UC Irvine Health, how much they paid and how much they did not pay UC Irvine Health. motion for leave.doc -7- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 6 0 9 O N n n b h W W N D N N N D N D N D N D N N N N = o m e m e m e a e m e m e m e m p m 0 A A N B R W D D = O O V 0 O N n A W N = o IV. CONCLUSION Based on the foregoing reasons, UC Irvine Health respectfully requests that it be granted leave to file its First Amended Complaint. Dated: 16 May 2018 STEPHENSON, AZQUISTO & COLMAN A ~ SHADI SHAYAN Attorneys for THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf ofthe University of California, Irvine Medical Center motion for leave.doc -8- 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A FIRST AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3.DECLARATION OF SHADI SHAYAN; O O 0 9 O O n n A h W N = N D N N N N N N N N N - e m o m oe m e m e m oe m e m e m e m © N N A U n A W D = O V W N N N R A W N = DECLARATION OF SHADI SHAYAN I, Shadi Shayan, declare: 1. I am over the age of eighteen years and am nota party to this action. I am an attorney at the firm of Stephenson, Acquisto & Colman, attorneys of record for THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf of the University of California, Irvine Medical Center,against defendants KAISER FOUNDATION HOSPITALS, a California corporation; KAISER FOUNDATION HEALTH PLAN,a California corporation; SOUTHERN CALIFORNIA PERMANENTE MEDICAL GROUP,a California partnership; THE PERMANENTE MEDICAL GROUP, a California corporation; KAISER FOUNDATION HEALTH PLAN OF GEORGIA,a Georgia corporation; and KAISER PERMANENTE INSURANCE COMPANY,a California corporation. As such, I am familiar with all the files and pleadings in this matter. If called upon to testify to the facts within this declaration, I could and would competently so testify because such facts come from my own personal knowledge. 2. I'make this declaration in support ofUC Irvine Health's Motion for Leaveto File First Amended Complaint. 3. The First Amended Complaint changes the amounts in controversy between UC Irvine Health and Kaiser and clarifies the causes of action in this Action. 4. Attached hereto as Exhibit 1 is a true and correct copy ofthe First Amended Complaint. -9. L NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A SECOND AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3. DECLARATION OF SHADI SHAYAN O O 0 0 N N O N n i A h W N - N D N N N N N N D N D N D = m m e m oe m e m e m p m e m e m e m © N n b h W I N D =~ , O V O N O DR A W N = O o 5. The correction UC Irvine Health seeks to make does not reveal any new or additional information to the Defendants because at all relevant times, Kaiser was aware ofhow much it should have paid UC Irvine Health for the claim and how much it actually paid for the claims. 6. The First Amended Complaint is necessary and proper to create a record for the Court and all parties involved of the accurate disputed amounts that apply to the claims in issue in this matter. 7. The facts giving rise to the proposed amendment were discovered when I was preparing UC Irvine Health's responses to Defendant Kaiser's discovery. I declare under the penalty ofperjury pursuantto the laws ofthe State of California that the foregoing is true and correct. Executed on May| 2018 in Burbank, California. ae / (SHADI SHAYAN -10 - 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE A SECOND AMENDED COMPLAINT; 2. MEMORANDUM OF POINTS AND AUTHORITIES; 3. DECLARATION OF SHADI SHAYAN Exhibit 1 N O 0 0 9 O N n n A W N N D N D N N N D N N N N = o m oe m e m e m e m e m e m e m p m © N A L A W N = O OV O N O W EA E W N = O o LAW OFFICES OF STEPHENSON, ACQUISTO & COLMAN,INC. JOY STEPHENSON-LAWS, ESQ. (SBN 113755) BARRY SULLIVAN,ESQ. (SBN 136571) RICHARD A. LOVICH, ESQ. (SBN 113472) SHADI SHAYAN, ESQ. (SBN 265674) 303 N. Glenoaks Blvd., Suite 700 Burbank, CA 91502 Telephone: (818) 559-4477 Facsimile: (818) 559-5484 Attorneys for Plaintiff THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a public trust corporation, on behalf ofthe University of California, Irvine Medical Center SUPERIOR COURT OF CALIFORNIA FOR THE COUNTY OF ORANGE UNLIMITED JURISDICTION THE REGENTS OF THE Case No.: 30-2017-00921367 UNIVERSITY OF CALIFORNIA, a public trust corporation, on behalfofthe [Demand Amount Exceeds $25,000] University of California, Irvine Medical Center, FIRST AMENDED COMPLAINT FOR Plaintiff, DAMAGES FOR: v 1. BREACH OF WRITTEN CONTRACT; KAISER FOUNDATION HOSPITALS, a California corporation; KAISER 2. BREACH OF IMPLIED-IN- FOUNDATION HEALTH PLAN, INC. FACT CONTRACT; AND, a California corporation; SOUTHERN CALIFORNIA PERMANENTE 3. QUANTUMMERUIT MEDICAL GROUP,a California partnership; THE PERMANENTE MEDICAL GROUP, INC., a California corporation; KAISER FOUNDATION 17600 - 1 - FIRST AMENDED COMPLAINT FOR DAMAGESFOR: 1. BREACH OF WRITTEN CONTRACT,2.BREACH OF IMPLIED-IN-FACT CONTRACT;AND, 3. QUANTUMMERUIT O O 0 0 N N O N U n h h W W N D N N N D N D N D D N D N N N o m e m e m e m oe m e m e m e m p e 0 N N O N U n A W N = O C V V N O n N RA N W N = o HEALTH PLAN OF GEORGIA, INC., a Georgia corporation; KAISER PERMANENTE INSURANCE COMPANY; and DOES 1 THROUGH 25, INCLUSIVE, Defendants. FIRST AMENDED FIRST AMENDED COMPLAINT FOR DAMAGES PARTIES 1. Plaintiff, The Regents of the University of California (the "Regents"),is a public trust corporation established and recognized pursuant to the Constitution ofthe State of California, Article 9, section 9, with full powers of organization and government. The Regents is authorized to administer various medicalfacilities within the University of California system, including the University of California, Irvine Medical Center ("UC Irvine Health") (Regents and UC Irvine Health shall be collectively referred to as "UC Irvine Health"). UC Irvine Health has its principal place of operation in the City of Orange, County of Orange,State of California. UC Irvine Health provides medical care to patients. 2. Defendant Kaiser Foundation Hospitals (“Kaiser Foundation”) is a corporation organized and existing pursuant to the laws ofthe State of California. Kaiser Foundation has its principal place of business in the City of Oakland, State of California. 3. Defendant Kaiser Foundation Health Plan, Inc. (“Kaiser Health”) is a corporation organized and existing pursuant to the laws ofthe State of 17600 - 2 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT O O 0 0 N N O N U n A h W N N N N D N D N D N D N N N N = o m e m e m e m e m e m e m e m e m 0 N N O N n n B R A W N = O O V W N N O D R A W N = © California. Kaiser Health has its principal place of business in the City of Oakland, State of California. 4. Defendant Southern California Permanente Medical Group (“SoCal Permanente”) is a partnership organized and existing pursuant to the laws of the State of California. SoCal Permanente has its principal place of business in the City of Pasadena, State of California. 5. Defendant The Permanente Medical Group, Inc. (“Permanente”) is a corporation organized and existing pursuant to the laws of the State of California. Permanente has its principal place of business in the City of Oakland, State of California. UC Irvine Health is informed and believes, and thereon allegesthat this Kaiser affiliated entity has an agreement which empowers other Kaiser entities to act as an agentto bind this and other Kaiserentities to hospital services agreements, such as the one at issue in this matter. 6. Defendant Kaiser Foundation Health Plan of Georgia, Inc. (“Kaiser GA”) is a corporation organized and existing pursuantto the laws of the State of Georgia. Kaiser GA hasits principal place of business in the City of Norcross, State of Georgia. UC Irvine Health is informed and believes, and thereon allegesthat this Kaiser affiliated entity has an agreement which empowers other Kaiserentities to act as an agentto bind this and other Kaiserentitiesto hospital services agreements, such as the one at issue in this matter. 7. Defendant Kaiser Permanente Insurance Company (“Kaiser Insurance”) is a corporation organized and existing pursuantto the laws ofthe State of California. Kaiser Insurance has its principalplace of businessin the City of Oakland, State of California. UC Irvine Health is informed and believes, and 17600 - 3 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT O © 0 0 9 O& O W n h b WL W N D = B N N N D N D N N N N N N N o r m p d p m p m p d p d p m e m p e 0 N N O N U n B h W N = © V V O N O I R N A N W N = © thereon alleges that this Kaiseraffiliated entity has an agreement which empowers other Kaiser entities to act as an agent to bind this and other Kaiser entities to hospital services agreements, such as the one at issue in this matter. 8. UC Irvine Health is unaware ofthe true names and capacities, whether corporate, associate, individual, partnership or otherwise of defendants Does 1 through 25, inclusive, and therefore sues such defendants by such fictitious names. UC Irvine Health will seek leave of the Court to amend this complaint to allege their true names and capacities when ascertained. 9. Kaiser Foundation, Kaiser Health, SoCal Permanente, Permanente, Kaiser GA, Kaiser Insurance and Does 1 through 25, inclusive, shall be collectively referred to as “Kaiser.” 10. Defendants, and each of them, at all relevant times, have transacted businessin the State of California. The violations alleged within this complaint have been and are being carried out in the State of California. 11. At all relevant times each of the defendants, including the defendants named "Doe," was and is the agent, employee, employer, joint venturer, representative, alter ego, subsidiary, and/or partner ofone or more ofthe other defendants, and was, in performing the acts complained ofherein, acting within the scope of such agency, employment, joint venture, or partnership authority, and/or is in some other way responsible for the acts of one or more ofthe other defendants. 11 17600 - 4 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUM MERUIT O O 0 NO N O N n n b h W N D N D N N N N N N N o r m e m e m p m e m e m p m p m p e 0 I O N W n b h W N D = O V O 0 0 N D N W N = O COMMON FACTUAL BACKGROUND 12. From 2014 to 2015, Kaiser provided medically necessary treatmentto individualslisted in Exhibit A (collectively, the “Patients”).! 13. UC Irvine Health is informed and believes and thereon alleges that at all relevant times the Patients were beneficiaries of health plans sponsored, administered, and/or funded by Kaiser. 14. At all relevant times, UC Irvine Health had entered into the an Agreement for Health Care Services For Kaiser Permanente Members (“Kaiser Contract”) which covers payment terms and rates for Patient Nos. 1-5 as identified in Exhibit A - Claims Nos.: (1) 002039227273; (2) 002042780193; (3) 009000482613; (4) 009000488057; and, (5) 002036078612. Under the Kaiser Contract, UC Irvine Health agreed to render medically necessary care to the individual enrollees of Kaiser’s health plan; in exchange, Kaiser agreed to pay UC Irvine Health the negotiated rates pursuant to the terms of the Kaiser Contract for that care (“Contract Rates”). In general, the negotiated rates under the Kaiser Contract provided for medically necessary care to be paid at a discount off ofUC Irvine Health’s usual and customary total billed charges. 15. At all relevant times, UC Irvine Health had entered into a Letter ofAgreement (“LOA”) with Kaiser Foundation Health Plan, Inc. for the medically necessary care rendered to Patient No. 6 as identified in Exhibit A - Claim No. 002045729205. Under the LOA, UC Irvine Health agreed to render medically ! In deference to the Patients’ privacy concerns enumerated in Cal. Const. art. I, § 1 as well as the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. §§ 1230d et seq.), the Patients have been identified by initials only. 17600 - 5 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT O O 0 0 N N O N n n b h W N N N O N N D N D N N N N N N m o m e m p d p m p d m d m d e m p e C 0 N N O N W n b h W N = O O V O 0 0 N D BR N W N - = O o necessary care to the individual enrollees of Kaiser’s health plan; in exchange, Kaiser agreed to pay UC Irvine Health the negotiated rates pursuantto the terms of the LOA for that care (“Contract Rates”). In general, the negotiated rates under the LOA provided for medically necessary care to be paid at a discount off ofUC Irvine Health’s usual and customary total billed charges. 16. At all relevant times, Patient No. 7 as identified in Exhibit A - Claim No. 002042845772, was an individual enrollee of Kaiser’s health plan but was not contracted under the Kaiser Contract or the LOA (“Patient No. 7). 17. UC Irvine Health timely and properly submitted the billed charges for all Kaiser Patients to Kaiser, for payment by Kaiser. 18. Kaiserfailed to properly pay UC Irvine Health for the medically necessary services rendered to the Patients, despite demands thereof. 19. UC Irvine Health has now exhausted all available administrative remedies to appeal Kaiser's refusalto pay for the medically necessary care rendered to Patients. FIRST CAUSE OF ACTION (Breach of Written Contract) (Against defendant Kaiser (and/or including Does 1 through 25, inclusive for Patients 1-6 of Exhibit A) 20. UC Irvine Health incorporates by reference and re-alleges paragraphs 1 through 19 here as though set forth in full. 17600 - 6 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUM MERUIT O O 0 0 N N O N w n B h W D D ~ - N O N N N N N D N N N N m oe m e m e m p m e m e m e e e a 0 N N O N W n R A W N = O V O 0 0 N D R A W N D = O 21. As stated above, for Patients Nos. 1-6 which were covered under the Kaiser Contract and the LOA, UC Irvine Health agreed to provide medically necessary services to these Kaiser beneficiaries in exchange for which Kaiser agreed to pay the Contract Rates to UC Irvine Health pursuantto the terms of the Kaiser Contract and the LOA. 22. UC Irvine Health provided medically necessary services to Patient 1-6 listed in Exhibit A and performed all conditions, covenants, and promises required on its part to be performed in accordance with the terms and conditions of the Kaiser Contract and the LOA. 23. UC Irvine Health demanded that Kaiser perform its obligations to properly reimburse UC Irvine Health at the Contract Ratesset for in the Kaiser Contract or the LOA for the medical services, supplies and/or equipment rendered to those Patients. 24. Kaiser breached the Kaiser Contract and the LOA by failing to pay fully, much less to timely pay UC Irvine Health the amount due under the Kaiser Contract and LOA, without excuse. 25. As aresult of the breaches by Kaiser, for Patients Nos. 1-6 as identified in Exhibit A, UC Irvine Health suffered damages in a sum to be proven at trial but not less than $227,883.37, exclusive ofinterest. 17600 - 7] - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT O O 0 0 9 O N U n & W W N D = N O N N D N N N N N N m m m m m e m p m p m p m be m p e 0 N N O N U n B A W N = O O O V 0 N N N N R W N D -~ = O O SECOND CAUSE OF ACTION (Breach of Implied-in-Fact Contract) (Against defendants Kaiser (and/or including Does 1 through 25, inclusive for Patient No. 7 of Exhibit A) 26. UC Irvine Health incorporates by reference and re-alleges paragraphs 1 through 25 here as though set forth in full. 27. As stated above, Patient No. 7, received medically necessary services from UC Irvine Health, and this Patient was an enrollee of Kaiser’s service plan. 28. Once UC Irvine Health was made aware that Kaiser was the proper payor,it contacted Kaiser to notify it of Patient No. 7’s services. Kaiser provided the relevant insurance verification and insurance coverageeligibility concerning Patient No. 7. Under Kaiser’s service plans to UC Irvine Health, Kaiser authorized UC Irvine Health to provide care to Patient No. 7. 29. UC Irvine Health reasonably relied on Kaiser’s promises to pay for Patient No. 7, and it was understood between UC Irvine Health, on one hand, and Kaiser, on the other hand, that Kaiser would pay for such medically necessary services, supplies, and/or equipment in exchange for UC Irvine Health's performance ofsaid medically necessary services at the rate reflecting UC Irvine Health's usual and customary charges for such services. 30. UC Irvine Health's usual and customary total billed charges for rendering the medically necessary care to Patient No. 7 amounted to $260,961. Kaiser made a partial payment of $93,717.75 and there was a patient responsibility 17600 - 8 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT © 6 0 9 O N U n A h W N = N D N D N N N N N N N N m e m e m e m p t l e p e pe d h a 0 0 J O N W n b h W B N = O O 0 0 N N O N N p W N D = O O of $115, leaving a balance of $167,128.25. 31. UC Irvine Health rendered all medically necessary services to Patient No. 7 and performed all conditions, covenants and promises required on its part to be performed in accordance with the terms and conditions of the above- described implied-in-fact contract. 32. However, Kaiser breached the implied-in-fact contract by failing and refusing to fully pay UC Irvine Health the total billed charges associated with providing care to Patient No. 7. 33. Although Kaiser paid $93,717.75 to UC Irvine Health for the medical services provided Patient No. 7, it failed to pay UC Irvine Health the remaining $167,128.25 amount due, despite demands thereof. 34. As a direct and proximate result of Defendants’ breach ofthe implied-in-fact contract, for Patient No. 7, UC Irvine Health has been damaged in amountto be provenat trial but not less than $167,128.25. THIRD CAUSE OF ACTION (Quantum Meruit) (Against defendants Kaiser (and/or including Does 1 through 25, inclusive for Patient No. 7 of Exhibit A) 35. UC Irvine Health incorporates by reference and re-alleges paragraphs 1 through 34 here as though set forth in full. 36. Based upon UC Irvine Health's agent's and/or Kaiser's agent's 17600 - O = FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUM MERUIT O O 6 0 9 & Un i & » V W N D - N O N N N N N N D N N o e m e m e m m E e e e e pe e e e 0 0 N N O N W n BR A W I N D = O O O V 0 0 N S N n h W N D = O assurances and representationsthat Kaiser would pay UC Irvine Health for rendering the medical care as described above to Patient No. 7, representations upon which UC Irvine Health reasonably relied, UC Irvine Health rendered medically necessary care to Patient No. 7. 37. The aforementioned assurances and representations obstructed UC Irvine Health from pursuing other avenues ofreimbursement before rendering treatment to Patient No. 7. 38. UC Irvine Health requested payment from Kaiser forits usual and customary billed charges of $260,961 for rendering medically necessary care to Patient No. 7, but Kaiserfailed to fully pay that amount. 39. Asa direct and proximate result of the aforementioned misrepresentations, UC Irvine Health was induced to render medical care under false pretenses, and has suffered substantial detrimental damagesin the sum of $167,128.25, which sum represents UC Irvine Health's usual and customary total billed charges ($260,961) for such care less the amount paid of $93,717.75 (and $115 patient payment). PRAYER FOR RELIEF WHEREFORE, UC Irvine Health prays for judgmentas follows: For the first cause of action: 1. For an amountto be proven at trial but not less than $227,883.37; 17600 - 10 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUMMERUIT O O 0 0 N N O& O U n H h W W N D N N N N D N N N D N N N N N D m o m e m e m o m p d p m p d p m p e 0 0 N N O N W n h h W N = O 0 0 0 N D N D W N D - = For interest on such principal sum at the rate of fifteen percent (15%) per annum, pursuant to Cal. Health & Safety Code § 1371; or,in the alternative, for interest on such principal sum at the rate often percent (10%) per /, pursuant to Cal. Civ. Code § 3289; For the second and third cause of action: Dated: 16 May 2018 1. For an amountto be proven at trial but not less than $167,128.25; for interest on such principal sum at the rate offifteen percent (15%) per annum, pursuant to Cal. Health & Safety Code § 1371; or,in the alternative, for interest on such principal sum at the rate of ten percent (10%) per /, pursuant to Cal. Civ. Code § 3289; LAW OFFICES OF STEPHENSON, ACQUIST COLMAN,INC. /] SHADISHAYAN Attorneys for THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,a public trust corporation, on behalf of the University of California, Irvine Medical Center 17600 - 11 - FIRST AMENDED COMPLAINT FOR DAMAGES FOR: 1. BREACH OF WRITTEN CONTRACT, 2.BREACH OF IMPLIED-IN-FACT CONTRACT; AND, 3. QUANTUM MERUIT Exhibit A No. [Claim Number Admit Date Discharge Date Patient ID Total Charges Total Paid Underpaid 1]002039227273 9/28/2014 9/30/2014 000019586127 $78,802.00 $52,733.34 $22,976.16 2002042780193 3/4/2015 3/11/2015 000011042611 $107,287.00 $0.00 $102,029.94 3]009000482613 2/13/2015 2/14/2015 541396 $69,934.00 $0.00 $66,507.23 41009000488057 3/7/2015 3/9/2015 21570838 $53,937.00 $45,668.06 $8,410.53 5{002036078612 5/11/2014 5/14/2014 0003405133 $84,942.00 $10,831.21 $2,890.71 6{002045729205 7/1/2015 7/3/2015 9186155 $60,484.00 $35,960.03 $25,068.80 7{002042845772 3/6/2015 7/4/2015 20646486 $260,961.00 $93,717.75 $167,128.25 O O 0 0 N N O N V n b h W N N N N N N D N N N N N N N N = r m e m e m pe d m d m d p m p d p m 0 J O N U n k A W I N D = O O N N N D R R W N D - = PROOF OF SERVICE I am employed in the county ofLos Angeles, State of California. I am over the age of 18 and not a party to the within action; my business address is 303 North| Glenoaks Boulevard, Suite 700, Burbank, California 91502-3226. On 17 May 2018, I served the foregoing document(s) entitled: 1. NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE [PROPOSED] FIRST AMENDED COMPLAINT . MEMORANDUM OF POINTS AND AUTHORITIES . DECLARATION OF SHADI SHAYAN [PROPOSED] ORDER FOR PLAINTIFF’S MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT by placing a true copy thereof enclosed in a sealed envelope addressed per the attached Service List. [] [X] [] [] BY U.S. MAIL: I am "readily familiar" with the firm's practice of collection and processing correspondence for mailing. Underthat practice it would be deposited with the United States Postal Service on that same day with postage thereon fully prepaid at Burbank, Californiain the ordinary course of business. I am aware that on motion ofthe party served, service is presumed invalid if postal cancellation date or postage meter date is more than one dayafter date of deposit for mailing in affidavit. [C.C.P. 1013a(3); F.R.C.P. 5(b)] BY FEDERAL EXPRESS: I caused such envelope(s), with overnight Federal Express Delivery Charges to be paid bythis firm, to be deposited with the Federal Express Corporation at a regularly maintained facility on the aforementioned date. [C.C.P. 1013(c) 1013(d)] BY PERSONAL SERVICE: I caused the above-stated document(s) to be served by personally delivering a true copy thereofto the individuals identified above. [C.C.P. 1011(a); F.R.C.P. 5(b)] BY EXPRESS MAIL: I caused such envelope(s), with postage thereon fully prepaid and addressed to the party(s) shown above,to be deposited in a facility operated by the U.S. Postal Service and regularly maintained for the receipt of Express Mail on the aforementioned date. [C.C.P. 1013(c)] O O 0 9 O N n h W N N N N N N D N D N D N N N e m e m e m e m e m e m e d p e d 0 N N O N n n BR A WL W = O 0 N N N D W N = o [ 1] BY TELECOPIER: Service was effected on all parties at approximately __am/pm by transmitting said document(s) from this firm's facsimile machine (818/559-4477) to the facsimile machine number(s) shown above. Transmission to said numbers was successful as evidenced by a Transmission Report produced by the machine indicating the documents had been transmitted completely and without error. C.R.C. 2008(e), Cal. Civ. Proc. Code § 1013(e). [ X] BY ELECTRONIC SERVICE: By emailing true and correct copies to the persons at the electronic notification address(es) shown on the accompanying service list. The document(s) was/were served electronically and the transmission was reported as complete and without error. [ X] State: I declare under penalty of perjury under the laws ofthe State of California that the above is true and correct. Executed on 17 May 2018 in Burbank, California. ZC STEVE KIM skim@sacfirm.com SERVICE Rey S. Yang, Esq. Sally Hosn, Esq. YANG PROFESSIONAL LAW CORPORATION 80 S. Lake Ave, Suite 820 Pasadena, CA 91101 (626) 921-4300 phone (626) 243-7050 fax an angpc.com shosn@yangpc.com cc: Don DeRush dderush@yangpc.com