MED-X GLOBAL, LLC v. WORLDWIDE INSURANCE SERVICES, LLC (T/N GEOBLUE) et al

BRIEF in Opposition

D.N.J.March 14, 2019

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY MED-X GLOBAL, LLC, Plaintiff, vs. WORLDWIDE INSURANCE SERVICES, LLC (T/N GEOBLUE), et al. Defendants. Civil Action No.: 3:17-cv-11742-PGS-TJB Hearing Date: April 11, 2019, 11:00 a.m. Before: Hon. Peter G. Sheridan Documents Filed Electronically PLAINTIFF’S OMNIBUS BRIEF IN OPPOSITION TO DEFENDANTS’ MOTIONS TO DISMISS [D.E. 142] AND [D.E. 146] CALLAGY LAW, P.C. Jeffrey L. Greyber, Esq. 1900 N.W. Corporate Blvd., Suite 310W Boca Raton, Florida 33431 561-405-7966 201-549-8753 (Fax) jgreyber@callagylaw.com hcasebolt@callagylaw.com and Michael J. Smikun, Esq. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, New Jersey 07652 201-261-1700 201-261-1775 (Fax) msmikun@callagylaw.com jsisco@callagylaw.com Attorneys for Plaintiff Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 1 of 30 PageID: 922 i Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com TABLE OF CONTENTS TABLE OF AUTHORITIES …………………………………………………………….........ii-iv PRELIMINARY STATEMENT..…………………………………………………………........1-2 FACTUAL BACKGROUND....….………………………….………………………………….2-4 PROCEDURAL HISTORY……….……………………………………………………………4-5 I. ARGUMENT………………………………………………………………………….5-24 A. LEGAL STANDARD…………………………………………………………........5-7 B. COUNT I IS SUFFICIENTLY PLEADED, AND DEFENDANTS’ LEGAL ARGUMENTS AMOUNT TO A THINLY VEILED PRE-DISCOVERY MOTION FOR SUMMARY JUDGMENT (Fed. R. Civ. P. 12(c) And 12(d) …………………………………7-11 C. UNLESS AN ATTORNEY IS A LIAR, DEFENDANTS HAVE HAD MED-X’S ADMINISTRATIVE RECORD REQUEST FOR YEARS … AND, UNLESS DEFENDANTS ARE OSTRICHES WITH HEADS IN SAND, THEY HAVE BEEN ON NOTICE OF THE ADMINISTRATIVE RECORD / CLAIM FILE REQUESTS SINCE THE INCEPTION OF LITIGATION IN 2017 ……………………………………………………………………….11-14 D. NOT KNOWING IF DEFENDANTS ARE PLAN ADMINISTRATORS, CLAIM ADMINISTRATORS, OR BOTH IS DEFENDANTS’ DOING AND DEFENDANTS’ MISCONDUCT VIOLATES FEDERAL CODE (FOR SURE), CONTRACT (LIKELY), AND STATE LAW (LIKELY) …………………………………………………………………….14-15 E. MATTERS SHOULD NOT BE DISMISSED BASED ON FALSEHOODS (LET ALONE GUESSWORK DISCUSSED ABOVE), AND THE MOTIONS TO DISMISS ARE REPLETE WITH SAME …………………………………………………………………….15-18 F. BECKER DEFENDANTS’ [D.E. 142] “GROUP PLEADING” ARGUMENT IS A RED-HERRING ……………………………………………………………………………..18-20 G. BECKER DEFENDANTS’ [D.E. 142] NONSENSE ABOUT MED-X NOT HAVING STANDING BECAUSE SUPPOSEDLY AN ASSIGNEE (SUCH AS A MEDICAL PROVIDER) CANNOT THEN ASSIGN THE OWED BENEFITS TO A DOMESTIC BILLING AGENT (MED-X) IS EXACTLY THAT - NONSENSE … COUNT I IS NOT EVEN ABOUT INSURANCE BENEFITS …………………………………………………………………..20-21 H. UNCLEAN HANDS MILITATES AGAINST THE MOTIONS TO DISMISS (ALONG WITH SEVERAL FORMS OF ESTOPPEL, WAIVER, AND LACHES DISCUSSED ABOVE) ……………………………………………………………………………………..21-23 I. PROCEDURE MILITATES AGAINST THE MOTIONS TO DISMISS ……….23-24 J. LACK OF DISCOVERY MILITATES AGAINST THE MOTION TO DISMISS... 24 K. CONCLUSION ……………………………………………………………………. 24 Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 2 of 30 PageID: 923 ii Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com TABLE OF AUTHORITIES CASES PAGE(S) Am. Orthopedic & Sports Med. v. Indep. Blue Cross Blue Shield, 890 F.3d 445 (3d Cir. 2018) ……………………………………………………………n.13 Belizan v. Hershon, 434 F.3d 579, 369 U.S.App.D.C. 160 (D.C. Cir. 2006)……………………………………7 Caldwell Trucking PRP Group v. Spaulding Composites, Co., Inc., 890 F.Supp. 1247 (D.N.J. 1995)……………………………………………………….......5 Castle v. Cohen, 676 F.Supp. 620 (E.D.Pa. 1987) ..……………………………………………………….22 Cheal v. Life Ins. Co. of North America, 330 F. Supp. 2d 1347 (N.D. Ga. 2004) ...……………………………………………… n. 4 Children’s Seashore House v. Waldman, 197 F.3d 654 (3d Cir. 1999) ...……………………………………………………….........6 Conley v. Gibson, 355 U.S. 41 (1957) ...……………………………………………………………...............6 Conn. State Dental Ass'n v. Anthem Health Plans, Inc., 591 F.3d 1337 (11th Cir.2009) ...……………………………………………………… n.3 D.P. Enter. v. Bucks County Community College, 725 F.2d 943 (3d Cir. 1984) ...………………………………………………………….....6 Emergency Services of Zephyrhills, P.A. v. Coventry Health Care of Florida, Inc., 281 F. Supp. 3d 1339 (S.D. Fla. 2017)…………………………………………………. n.3 Hamilton v. Allen-Bradley Co., Inc., 244 F.3d 819 (11th Cir. 2001) ...……………………………………………….............. n.4 Hishon v. King & Spalding, 467 U.S. 69 (1984) ...……………………………………………………………………...5 Hospital Building Co. v. Trustee of the Rex Hospital, 425 U.S. 738 (1976) ...………………………………………………………………….....6 In re Managed Care Litigation, 150 F. Supp. 2d 1330 (S.D. Fla. 2001) ...……………………………………………….. n.4 In re Rockefeller Center Properties, Inc. Secs. Litigation, 311 F.3d 176 (3rd Cir. 2002) ...………………………………………………………...… Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 3 of 30 PageID: 924 iii Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Jacobs, Visconsi & Jacobs, Co. v. City of Lawrence, 927 F.2d 1111 (10th Cir. 1991) ...………………………………………………………...6 Japhet v. Francis E. Parker Mem. Home, No. 14-1206, 2014 WL 3809173 (D.N.J. 2014) ...…………………………………………………..…20 Law v. Ernst & Young, 956 F.2d 364 (1st Cir. 1992) ...…………………………………………………………..n.4 Maez v. Mountain States Tel., 54 F.3d 1488 (10th Cir. 1995) ...………………………………………………………….5 Maio v. Aetna, Inc., 221 F.3d 472 (3d Cir. 2000) ...…………………………………………………………....6 Malibu Media, LLC v. Lee, 2013 WL 2252650 D.N.J. 2013) ...…………………………………………………….....22 MDS (Canada), Inc. v. Rad Source Technologies, Inc., 720 F.3d 833 (11th Cir. 2013)……....…………………………………………………..n.10 Melo-Sonics v. Cropp, 342 F.2d 856 (3d Cir. 1965) ...………………………………………………………….....6 MHA, LLC v. UnitedHealth Group, Inc., et al., No. 13-6130 (WJM), 2014 WL 223176 (D.N.J. Jan. 2014)……………………………..n.3 Nishibayashi v. England, 360 F.Supp.2d 1095 (D. Haw. 2005). ...…………………………………………………..5 North Jersey Brain & Spine Center v. Aetna, Inc., 801 F.3d 369 (3d Cir. 2015) ...………………………………………………………….n.13 Oakwood Labs., LLC v. Thanoo, No. 17-CV-05090(PGS), 2017 WL 5762393 (D.N.J. Nov. 28, 2017) ...…………………………………………....18 Panek v. Bogucz, 718 F.Supp. 1228 (D.N.J. 1987). ...……………………………………………………….5 Pension Ben. Guar. Corp. v. White Consol. Ind., 998 F.2d 1192 (3d Cir. 1993)….…………………………………………………………..6 Pryor v. National Collegiate Athletic Ass’n, 288 F.3d 548 (3d Cir. 2002) ...………………………………………………………….....6 REVA, Inc. v. Healthkeepers, Inc., et al., No. 17-24158-CIV-MORENO, 2018 WL 3323817 Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 4 of 30 PageID: 925 iv Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com (S.D. Fla. July 6, 2018) ……………………………………………….………………………………n.3 Rosen v. TRW, Inc., 979 F.2d 191 (11th Cir. 1992) ...………………………………………………………...n.4 Semeranko v. Cendant Corp., 223 F.3d 165 (3d Cir. 2000) ...…………………………………………………………….5 White v. Aetna Life Ins. Co., 2009 WL 909272 (M.D. Fla. 2009) ...………………………………………………….n.4 Statutes: 29 U.S.C. § 1024(b) ...……………………………………………………………….......3-4, 22-23 29 U.S.C. § 1132(a)(1)(b) …………………………………………………………………………4 29 U.S.C. § 1132(c)(1) ...……………………………………………………………………3-4, n.4 Other Authorities: 29 C.F.R. § 2575.502c-1...………………………………………………………………….....6, 12 Black’s Law Dictionary (2d Pocket Ed.) ...………………………………………........n.7, n.9, n.11 ERISA - Analysis, § 67:53 Relationship to other laws - Preemption at 11 (citing Connecticut State Dental Ass’n v. Anthem Health Plans, Inc., 591 F.3d 1337, 1350 (11th Cir. 2009), Lone Star OB/GYN Associates v. Aetna Health, Inc., 579 F.3d 525, 530 (5th Cir. 2009), and Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 324-235 (2d Cir. 2011)) …………………………..n.3 Fed. R. Civ. P. 8(a)(2) ...…………………………………………………………………………18 Fed. R. Civ. P. 12(b)(6) ...………………………………………………………………5-7, 10-11 Fed. R. Civ. P. 12(c) ……………………………………………………………………....7, 10-11 Fed. R. Civ. P. 12(d) ………………………………………………………………………7, 10-11 Fed R. Civ. P. 56...……………………………………………………………………………..6-7 5B Wright & Miller, Federal Practice and Procedure 3d §1356...……………………………… Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 5 of 30 PageID: 926 1 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com PRELIMINARY STATEMENT Plaintiff, Med-X Global, LLC (hereinafter “Med-X” or “Plaintiff”) submits this omnibus memorandum of law in opposition to the two motions to dismiss [D.E. 142] and [D.E. 146] filed by certain Defendants seeking to dismiss the Med-X’s Second Amended Complaint.1 The Defendants, working together, have filed these motions in a coordinated effort to beguile the Court into dismissing Med-X’s claims (namely Count I), which such claims seek to hold the Defendants (just the remaining Defendants referenced in footnote 1) to their legally prescribed obligations and duties under Employee Retirement Income Security Act of 1974 (“ERISA”), federal code, insurance contract, and / or state statute.2 The Defendants’ continued outright refusal to cooperate with Med-X in the resolution of the scores of claims for medical benefits at issue is only highlighted by the [D.E. 142] and [D.E. 146] motions to dismiss. For reasons discussed in greater detail below, that the Court should deny the [D.E. 142] and [D.E. 146] motions to dismiss. 1 The [D.E. 142] motion to dismiss involves the following Defendants: (a) Horizon Blue Cross Blue Shield of New Jersey (“Horizon”), (b) CareFirst of Maryland, Inc., (c) Regence BlueShield of Idaho, Inc., (d) Blue Cross and Blue Shield of Massachusetts, (e) Blue Cross Blue Shield of North Carolina, (f) Premera Blue Cross (“Premera”), and (g) Excellus Health Plan, Inc. Settlements were achieved (and appropriate dismissal stipulations filed) as to all of these Defendants, see [D.E. 160], [D.E. 161], [D.E. 162], [D.E. 165], [D.E. 172], other than Horizon and Premera. Accordingly, the [D.E. 142] motion to dismiss is due to be denied as moot as to all Defendants not named Horizon or Premera in the above list and, so, this brief only addresses [D.E. 142] as to Horizon and Premera. The [D.E. 146] motion to dismiss involves the following Defendants: (a) Blue Cross Blue Shield of Illinois (“BCBSIL”), (b) Blue Cross Blue Shield of Texas (“BCBSTX”), (c) Highmark, Inc., (d) Blue Cross Blue Shield Delaware, Inc. Settlements were achieved (and appropriate dismissal stipulations filed) as to all of these Defendants, see [D.E. 163], other than BCBSIL and BCBSTX. Accordingly, the [D.E. 146] motion to dismiss is due to be denied as moot as to all Defendants not named BCBSIL or BCBSTX in the above list and, so, this brief only addresses [D.E. 146] as to BCBSIL and BCBSTX. There was also another motion to dismiss [D.E. 152] involving Blue Cross Blue Shield of Michigan. But settlement was achieved with this Defendant and an appropriate dismissal stipulation has been filed, see [D.E. 171]. Accordingly, the [D.E. 152] motion to dismiss is due to be denied as moot and, so, this brief does not address [D.E. 152]. Moreover, and worth noting, settlements have been achieved with several other Defendants captioned above (e.g.¸ Worldwide Insurance Services, LLC (t/n GeoBlue), see [D.E. 169]). For purposes of this brief, all remaining Defendants subject to the [D.E. 142] and [D.E. 146] motions to dismiss will be referred to collectively as “Defendants” unless otherwise specified. 2 Count II of the Second Amended Complaint is not at issue in the subject briefing because that count pertained to GeoBlue and a settlement in principle has been achieved with GeoBlue as noted in the preceding footnote. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 6 of 30 PageID: 927 2 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com FACTUAL BACKGROUND Med-X is a third-party billing agent that represents foreign medical providers who provide medical services and treatment to American citizens while traveling abroad. Its principle business is processing medical insurance claims and receiving payment on behalf of international medical providers who provide medical care to citizens of the United States while traveling abroad. The majority of Med-X’s clients are Mexican healthcare providers that are part of Consorcio Mexicano de Hospitales. Consorcio Mexicano de Hospitales is a consortium of Mexican medical facilities that provide medical services to, among others, American citizens traveling in Mexico. As set forth in Second Amended Complaint [D.E. 134] and the exhibits thereto, prior to American billing agents servicing foreign medical providers, those providers frequently required huge cash deposits before treating Americans as there was no guaranty of payment as those providers had little experience (and / or success) in billing American health insurance carriers ultimately leading to denied or underpaid insurance claims. Since Med-X and other companies offering similar services have begun operations, foreign medical providers have now developed a comfort level in treating American patients with the promise of payment from the medical insurance carriers that cover those patients. The result was that the patients received the medical care they needed, the insurance carriers were provided with the necessary information for the insurance claims by Med-X or other similar billing agents, and the medical providers received payment for their services. Essentially, while not without its minor hiccups, the system worked. That is until October 18, 2017 when GeoBlue, without explanation or justification, advised Med-X and / or Med-X’s clients that they would no longer communicate or make payments for medical services to Med-X or any other American based billing agents for services provided by foreign medical providers. The net effect of this action is to put Med-X and an entire industry - American based billing agents for foreign providers - out of business and force Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 7 of 30 PageID: 928 3 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com foreign medical providers to either require up-front cash payments from patients or gamble that the U.S. based insurance carriers will pay without having a U.S. based biller to assist them. But, again, thankfully, these kinds of issues are in the process of being quelled via the aforementioned settlement efforts with GeoBlue. Because of the irreparable harm that would be visited upon Med-X, its industry and most importantly to American patients of foreign medical providers, Med-X filed the underlying action in this regard. But, with settlement logistics being ironed out with GeoBlue (which would put Count II of the Second Amended Complaint to rest), there remains the issue of Count I and the local / home carriers at issue, see footnote 1, supra. As to Count I, the biggest problem remaining with the local / home carriers at issue is their continued refusal to satisfy administrative record (claim file) repeated (and very old) requests legally required of them under Title 29, United States Code, Sec. 1024(B), Title 29, United States Code, Sec. 1132(c)(1), and Title 29 Code of Federal Regulations Sec. 2575.502c-1, the subject insurance contracts, and / or state statutes. Defendants’ failures in this regard continue to hold the remaining health insurance claims (some dating back to 2016 / 2017 dates of service at this point) in no man’s land, and subjecting Defendants to a $110.00 / day penalty for their administrative record production failures for claims subject to ERISA (which are likely most, if not all, of the subject claims) and bad faith exposure for any claims not subject to ERISA. Without the administrative records / claim files required by federal code, insurance contract, and / or statute, Med-X simply cannot move the outstanding health insurance claims forward - the claims just sit in some Defendant-created gray zone. For examples, without the administrative records / claim files, Med-X cannot (a) assess subject plan documents / insurance policies for coverage ins-and- outs, (b) assess the subject plan documents / insurance policies for “pre-suit” administrative appeal and / or external review rights, and carry such processes out, (c) assess the subject plan document Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 8 of 30 PageID: 929 4 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com / insurance policies (or related manuals, guidelines, protocol, fee schedules, re-pricing formulas) as to indemnification amounts owed (whether there is any UCR-related re-pricing to endure, what patient responsibilities such as co-pay, co-insurance, deductible subject to annual out-of-pocket maximum are), and (d) et cetera. These kinds of things are the reasons why Title 29, United States Code, Sec. 1024(B), Title 29, United States Code, Sec. 1132(c)(1), and Title 29 Code of Federal Regulations Sec. 2575.502c-1 were put on the legal books, why most insurance contracts track same, and why many states have statutes on the books to this effect. This is the law, Defendants cannot be allowed to shirk same - the motions to dismiss are due to be denied on these grounds alone, administrative records are due to be compelled post haste, and the $110.00 / day penalty is due to be enforced on any and all eligible claims. Then, equipped with the legally prescribed administrative records / claim files, Med-X reserves the right to amend the Second Amended Complaint as to the Defendants listed in footnote 1 to craft a standard breach of contract action (under state law, if applicable) or a count for recovery of benefits under ERISA, Title 29, United States Code, Sec. 1132(a)(1)(b) concerning the remaining owed health insurance benefits. See, e.g., [D.E. 134] at n. 2. PROCEDURAL HISTORY Plaintiff filed suit against the Defendants on November 16, 2017 in the United States District Court for the District of New Jersey. [D.E. 1]. After much back-and-forth (delay-oriented at Defendants’ druthers, we submit), the operative complaint has arrived at the Second Amended Complaint [D.E. 134], filed on November 1, 2018. The Defendants referenced in footnote 1 have moved to dismiss [D.E. 142] and [D.E. 146] the Second Amended Complaint. Defendants’ reply deadline is March 28, 2019, and the subject motion practice is set for hearing on April 11, 2019. See [D.E. 159]. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 9 of 30 PageID: 930 5 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com ARGUMENT A. Legal Standard Federal Rule of Civil Procedure 12(b) provides, in pertinent part, that “…a party may assert the following defenses by motion: … (6) failure to state a claim upon which relief can be granted … .” Id. The purpose of a motion under Federal Rule of Civil Procedure 12(b)(6) is to test the formal sufficiency of the statement of the claim for relief; the motion is not a procedure for resolving a contest between the parties about the facts or the substantive merits of the claimant’s case. In re Rockefeller Center Properties, Inc. Secs. Litigation, 311 F.3d 176 (3d Cir. 2002), see also 5B Wright & Miller, Federal Practice and Procedure 3d §1356, at 354. Thus, the issue on a motion to dismiss for failure to state a claim is not whether a claimant will ultimately prevail, but whether the claimant is entitled to offer evidence to support his claims. Semeranko v. Cendant Corp., 223 F.3d 165 (3d Cir. 2000). On a motion to dismiss for failure to state a claim, a claim may be dismissed as a matter of law for two reasons: (a) lack of a cognizable legal theory, or (b) insufficient facts alleged under a cognizable legal theory. Nishibayashi v. England, 360 F. Supp. 2d 1095 (D. Haw. 2005). When considering motions such as that now before the court it is important to keep in mind that the Federal Rules of Civil Procedure have routinely been interpreted as having erected a powerful presumption against rejecting pleadings for failure to state a claim. See, e.g., Maez v. Mountain States Tel., 54 F.3d 1488 (10th Cir. 1995). That is partly why it is the stated policy of this District that motions to dismiss for failure to state a claim are disfavored and rarely granted. See, e.g., Caldwell Trucking PRP Group v. Spaulding Composites, Co., Inc., 890 F.Supp. 1247 (D.N.J. 1995); Panek v. Bogucz, 718 F.Supp. 1228 (D.N.J. 1987). In analyzing motions made pursuant to Federal Rule of Civil Procedure 12(b)(6), a claim will be dismissed on the pleadings only if it appears beyond doubt that the claimant can prove no Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 10 of 30 PageID: 931 6 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com set of facts consistent with the allegations of the claim that would entitle him to relief. See, e.g., Hishon v. King & Spalding, 467 U.S. 69 (1984); Conley v. Gibson, 355 U.S. 41, 45-46 (1957); Jacobs, Visconsi & Jacobs, Co. v. City of Lawrence, 927 F.2d 1111, 1115 (10th Cir. 1991). This is, obviously, a difficult standard to meet. It is much more difficult than establishing that, based upon the evidence submitted, there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law under Federal Rule of Civil Procedure 56. In this case, the court looks at whether the claimant’s pleading sets forth a claim upon which relief can be granted based upon any set of facts supported by the pleadings. In the case of a Federal Rule of Civil Procedure 56 motion, the court decides upon the actual facts, based upon admissible evidence presented to the court. In deciding a motion to dismiss, the court must assume that all the factual allegations set forth in the pleading are true and it must draw all reasonable inferences in favor of the non-moving party. See, e.g., Hospital Building Co. v. Trustee of the Rex Hospital, 425 U.S. 738 (1976), Melo- Sonics v. Cropp, 342 F.2d 856, 858 (3d Cir. 1965); D.P. Enter. V. Bucks County Community College, 725 F.2d 943, 944 (3d Cir. 1984). Additionally, this Court generally considers only the allegations contained in the pleading, exhibits attached thereto, matters of public record and undisputedly authentic documents. See, e.g., Pension Ben. Guar. Corp. v. White Consol. Ind., 998 F.2d 1192 (3d Cir. 1993) (court can consider undisputedly authentic documents); Pryor v. National Collegiate Athletic Ass’n, 288 F.3d 548 (3d Cir. 2002) (documents attached to movant’s pleadings may be considered only if they are referred to in the claimant’s pleading and are central to the claim); Children’s Seashore House v. Waldman, 197 F.3d 654, (3d Cir. 1999), cert. denied 530 U.S. 1275 (2000) (court can consider matters of public record). Courts may also consider statements made by counsel at oral argument to clarify allegations in the complaint that were unclear on review of dismissal for failure to state a claim. Maio v. Aetna, Inc., 221 F.3d 472 (3d Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 11 of 30 PageID: 932 7 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Cir. 2000). Even if a court were inclined to dismiss a claim for failure to state a claim such a dismissal should be made without prejudice. Belizan v. Hershon, 434 F.3d 579, 369 U.S.App.D.C. 160 (D.C. Cir. 2006). It is for these reasons, and the reasons discussed below, that Defendants’ motions to dismiss should be denied. B. Count I Is Sufficiently Pleaded, And Defendants’ Legal Arguments Amount To A Thinly Veiled Pre-Discovery Motion For Summary Judgment (Fed. R. Civ. P. 12(c) And 12(d)) The subject motions to dismiss deviate significantly (if not entirely) from what a Rule 12(b)(6) analysis is supposed to be about - they are not Rule 12(b)(6) motions, they are cloaked Rule 12(c) motions. Federal Rules of Civil Procedure 12(c) and 12(d) provide as follows: (c) Motion for Judgment on the Pleadings. After the pleadings are closed - but early enough not to delay trial - a party may move for judgment on the pleadings. (d) Result of Presenting Matters Outside the Pleadings. If, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56. All parties must be given a reasonable opportunity to present all the material that is pertinent to the motion. Id. As now discussed, the real procedural underpinning of the subject motions to dismiss is Rule 12(c), which brings Rule 12(d) into play. As for Rule 12(b)(6), the Second Amended Complaint says quite enough about the subject Defendants’ failures leading to several health insurance claims lingering for years. Because Defendants’ arguments are “matter[s] outside the pleadings,” the Court should “exclude[ ]” the arguments or treat the arguments “as one[s] for summary judgment under Rule 56 [and allow] [a]ll parties … a reasonable opportunity [i.e., discovery] to present all material that is pertinent to the motion [for summary judgment].” Fed. R. Civ. P. 12(d). Here, Defendants’ motions to dismiss say that the subject outstanding health insurance claims are outside ERISA because there is a “chance” that the subject health insurance plans / policies are not subject to ERISA (“perhaps” privately obtained or “perhaps” exempt from ERISA Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 12 of 30 PageID: 933 8 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com by way of a government body plan). First, that is pure conjecture (conjecture entirely created by Defendants due to their legally repugnant refusal to supply administrative records / claim files, including, inter alia, the SPD, which everybody with functioning dendrites in the industry knows to be the insurance policy / plan document). Second, whether or not the subject insurance plans / policies underlying the subject outstanding health insurance claims are ERISA-governed or not has nothing to do with Count I of the Second Amended Complaint. The Second Amended Complaint makes abundantly clear that when Defendants are finally made to disclose germane claim materials (legally required), some of the subsequent claim recovery actions may be subject to state or federal court action outside of ERISA and some might be subject to federal action inside ERISA and many (if not all) such claim recovery actions could (or should) remain part of the instant action by way of amendment … once Defendants finally turn over the subject SPD and / or plan / policies. Then, once Defendants are made (under Count I) to satisfy their legal obligations (pursuant to federal code, insurance contract, and / or state statute) to turn over germane claim documentation (other examples include vital documents such as Explanations of Benefits, “EOB,” telling us why Defendants denied, underpaid, or have not decided the subject outstanding health insurance claims and re-pricing formulas telling us why a certain amount was paid on a claim if it is even a claim where a partial payment has even been made), we will all be in a position to assess Defendants’ motion to dismiss hypotheses as to whether the claims will succeed on their merits under ERISA or state law. Then, once Defendants are made (under Count I) to satisfy their legal obligations (pursuant to federal code, insurance contract, and / or state statute) to turn over germane claim documentation (such as the SPD), we will all know who the plan administrator is and who the claim administrator is. Then, once Defendants are made (under Count I) to satisfy their legal obligations (pursuant to Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 13 of 30 PageID: 934 9 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com federal code, insurance contract, and / or state statute) to turn over germane claim documentation (such as Third Party Administrator Agreements, “TPA Agreements”), we will all know what duties / responsibilities (such whether the plan administrator or claim administrator or both are required to turn over the germane claim documentation long ago requested by Med-X). The list could go on as to why Count I exists and why the predicate United States Code and Code of Federal Regulations (or insurance contract language or state statutes) exists - nobody can make heads-or-tails of the (im)propriety of claim decision-making otherwise. That is why lawmakers underscored the importance of what Defendants have refused to do for years by putting some teeth behind the law - a $110.00 / day penalty, at least with respect to the claims subject to ERISA. Defendants’ pure guesswork (“What if a particular claim is not under an ERISA-governed plan because maybe, just maybe, the insurance policy was privately procured or a governmental plan exempt from ERISA?”3 “What if Defendants had no obligation to provide the requested germane documentation anyway?” “What if the Third Circuit does not endorse a de facto 3 No kidding that that is a “What If,” but the “What If” is Defendants’ doing. Plainly not every insurance program in the world is subject to ERISA, though a huge percentage are. But this is why the Second Amended Complaint [D.E. 134] included footnotes 1 and 2, for examples. The documentation / information that Count I seeks is needed to tell everybody what kind of insurance program we are dealing with, among other things. It would be the epitome of unjust to dismiss a plaintiff’s lawsuit for confusion / problems created by the defendant at the threshold. Moreover, even if some of the subject insurance plans / policies are not subject to ERISA, the related claims would not go away - this Court would have pendent jurisdiction over the eventual state law breach of contract actions relating to the claim denials / underpayments / non-decisions relating to any plans / policies not governed by ERISA. And, for that matter, even plans / policies governed by ERISA at first blush can still be subject to state law under “right of payment” versus “rate of payment” authority. More specifically, whenever Defendants are finally made to produce the documentation / information they are legally required to produce (which will include EOBs and UCR-related re-pricing formulas, as examples), we will be able to determine if a particular claim was denied on coverage levels (“right of payment” claim) or covered but underpaid (“rate of payment” claim), with the latter still being housed in this Court under diversity and / or pendent jurisdiction, but subject to state law because federal authority makes clear that “rate of payment” claims are state law driven not ERISA driven. See, e.g., REVA, Inc. v. Healthkeepers, Inc., et al., No. 17-24158-CIV- MORENO, 2018 WL 3323817 (S.D. Fla. July 6, 2018); Emergency Services of Zephyrhills, P.A. v. Coventry Health Care of Florida, Inc., 281 F. Supp. 3d 1339 (S.D. Fla. 2017); MHA, LLC v. UnitedHealth Group, Inc., et al., No. 13- 6130 (WJM), 2014 WL 223176 (D.N.J. Jan. 2014); ERISA - Analysis, § 67:53 Relationship to other laws - Preemption at 11 (citing Connecticut State Dental Ass’n v. Anthem Health Plans, Inc., 591 F.3d 1337, 1350 (11th Cir. 2009), Lone Star OB/GYN Associates v. Aetna Health, Inc., 579 F.3d 525, 530 (5th Cir. 2009), and Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 324-235 (2d Cir. 2011)). Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 14 of 30 PageID: 935 10 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com administrator concept like other federal circuit courts have?”4 “What if outstanding insurance claims do not even exist [because Plaintiff has supposedly not advised Defendants of such]?” “What if Med-X does not have valid assignments or authorizations?” Et cetera) is absolutely not Rule 12(b)(6) fodder, it is Rule 12(c) and Rule 12(d) fodder after (as Rule 12(d) makes clear) “[a]ll parties [are] given a reasonable opportunity to present all the material that is pertinent to the motion.”5 First, a motion to dismiss predicated entirely on speculation (as here) should not be granted ... guesswork simply is not good enough to throw a case out.6 Second, per the Rules, the Court should treat the motions to dismiss for what they are (premature motions for summary judgment) 4 For what it is worth, the Third Circuit should embrace the well-reasoned de facto administrator argument if, regrettably, that issue needs to be explored in that court someday. The better, most realistic de facto approach given how things actually work in the insurance world is that which the Eleventh and First circuits have embraced, for examples. See, e.g., Law v. Ernst & Young, 956 F.2d 364 (1st Cir. 1992) (“If, to all appearances, Arthur Young acted as plan administrator in respect to dissemination of information concerning plan benefits, it may properly be treated as such for purposes of liability provided under § 1132(c)… This conclusion is consistent with the intent of Congress that employees have a remedy when they are denied timely information about their ERISA benefits. To hold that an entity not named as administrator in the plan documents may not be held liable under § 1132(c), even though it actually controls the dissemination of plan information, would cut off the remedy Congress intended to create”); Rosen v. TRW, Inc., 979 F.2d 191 (11th Cir. 1992); Hamilton v. Allen-Bradley Co., Inc., 244 F.3d 819, 824 (11th Cir. 2001); In re Managed Care Litigation, 150 F. Supp. 2d 1330, 1354 (S.D. Fla. 2001); White v. Aetna Life Ins. Co., 2009 WL 909272 at *2 (M.D. Fla. Apr. 1, 2009); Cheal v. Life Ins. Co. of North America, 330 F. Supp. 2d 1347, 1357 (N.D. Ga. 2004). But, again, as for Count I, there are umpteen different reasons articulated in this brief for Count I to continue onward that do not even involve the de facto administrator argument. If the Court wants to go down the de facto road for some reason, it should not do so now. Determining whether an individual / entity is a de facto ERISA plan administrator “‘requires an analysis of the facts surrounding the administration of the plan,’ Hamilton, 244 F.3d at 824, and therefore cannot be resolved upon a motion to dismiss.” In re Managed Care Litigation at 1355 (emphasis added); see also Rosen at 194 (“we note that dismissal of Rosen’s claim at this point in the litigation would deprive him of any remedy in the event that the company ultimately was found liable for assuming control of the plan’s administration. Congress intended to provide a remedy for ERISA violations”); White at *3 (in holding that Aetna’s motion to dismiss was premature, the court noted that issues concerning the true identity of an ERISA plan administrator are more appropriately resolved at the summary judgment stage of litigation, because (a) “[t]he Court must ... accept Plaintiff’s factual allegations as true” when resolving a motion to dismiss; and, (b) a party seeking an administrative penalty “is entitled to conduct discovery in an attempt to prove her allegations”). 5 It is quite telling that Defendants have not attached any documentation supporting their myriad “What Ifs” and / or sought leave to do so and / or filed a motion for judicial notice. 6 And as to the pot calling the kettle black, the motions to dismiss absurdly state that the Second Amended Complaint has the Defendants and the Court guessing as to what Count I is about or what Defendants did wrong. “Absurdly” because the Second Amended Complaint is more than adequately pleaded (even under Twombly) and the only guessing at hand was / is the sole doing of Defendants’ legally repugnant secreting of germane claim documentation / information. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 15 of 30 PageID: 936 11 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com and allow for adequate discovery to dispel all the “What ifs” upon which Defendants seek to deprive Med-X of its deserved day in Court and / or not allow Defendants to get away with a $0.00 windfall on thousands of dollars of outstanding claims deserving of indemnification. Third, and in an abundance of caution, if the Court is somehow not inclined to deny the purported Rule 12(b)(6) motions to dismiss revolving entirely around “What ifs” or dispose of (or convert) the purported Rule 12(b)(6) motions to dismiss pursuant to Rules 12(c) and 12(d), we will below demonstrate that all the purported “What ifs” are addressed in the Second Amended Complaint and / or have been undeniably addressed for Defendants pre-suit and / or post-suit. C. Unless An Attorney Is A Liar, Defendants Have Had Med-X’s Administrative Record Requests For Years … And, Unless Defendants Are Ostriches With Heads In The Sand, They Have Been On Notice Of The Administrative Record / Claim File Requests Since The Inception Of This Litigation In 2017 The motions to dismiss misrepresent that Med-X did not make any particular request of the Defendants. See, e.g., [D.E. 142 at 2]. Wrong, see the Second Amended Complaint at Paragraph 28, footnote 4, Paragraphs 30-32, and Paragraphs 35-38. GeoBlue (who attorney Kevin G. Fitzgerald was representing at the time of the hundreds of documentation / information letters that went out in June 2017) was / is an agent of the Defendants, invoking respondeat superior (at the very least) as to the Defendants.7 That agent decision was not Med-X’s fault or choice, that was Defendants’ fault or choice. So, unless Defendants are calling Mr. Fitzgerald a liar, Defendants received hundreds of June 2017 letters requesting germane documentation / information.8 7 The hornbook definition of respondeat superior is as follows: “The doctrine holding an employer or principal liable for the employee’s or agent’s wrongful acts committed within the scope of the employment or agency.” Garner, Bryan A., Black’s Law Dictionary, 609 (2d Pocket Ed., 2001). 8 If Mr. Fitzgerald did not do what he said (in writing) he was going to do such that the local / home carriers did not receive the June 2017 documentation / information request letters, perhaps Defendants should consider cross-claiming against Mr. Fitzgerald. But by no means should Med-X lose its day in Court if Defendants’ agent’s legal counsel did not do what he said he would do under some nonsensical notion that it was Med-X who is to blame for local / home carriers not receiving the subject letters. But, again, we think the notion of local / home carriers not receiving the letters is a figment of imagination, otherwise Defendants would have by now argued as much or tried to prove as much. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 16 of 30 PageID: 937 12 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Thereafter, now over a year, there was not one peep from the local / home carrier Defendants to whom Mr. Fitzgerald provided the letters along these lines: “Hey there, we received your documentation / information request letter from Mr. Fitzgerald. We are not the right source to oblige your request, please send your request to the insured’s employer.” Defendants have to live with the actions of their agents (respondeat superior, at the very least), even if just under ordinary estoppel principles because Med-X (and undersigned counsel) most certainly relied on Mr. Fitzgerald’s written representations and would suffer great detriment if this matter was dismissed because of Defendants’ seeming argument that we had no right to rely on the representations of their agent’s legal counsel (an officer of the court),9 or even under waiver principles.10 Moreover, Defendants’ attempted backtracking from the representations of their agent’s legal counsel is barred by laches and / or estoppel by silence - if there was any merit to the “Hey there, Mr. Fitzgerald lied to you” argument set forth in (or embodied by) the motions to dismiss, Defendants should have said so years ago.11 And, again, barred by respondeat superior. 9 The hornbook definition of equitable estoppel is as follows: “A defensive doctrine preventing one party from taking unfair advantage of another when, through false language or conduct, the person to be estopped has induced another person to act in a certain way, with the result that the other person has been injured in some way.” Garner, Bryan A., Black’s Law Dictionary, 247 (2d Pocket Ed., 2001). The hornbook definition of promissory estoppel is as follows: “The principle that a promise made without consideration may nonetheless be enforced to prevent injustice if the promisor should have reasonably expected the promisee to rely on the promise and if the promisee did actually rely on the promise to his or her detriment.” Id. The hornbook definition of quasi estoppel is as follows: “An equitable doctrine preventing one from repudiating an act or assertion if it would harm another who reasonably relied on the act or omission.” Id. 10 “Waiver is commonly defined as the intentional or voluntary relinquishment of a known right.” MDS (Canada), Inc. v. Rad Source Technologies, Inc., 720 F.3d 833, 852 (11th Cir. 2013). Assuming arguendo GeoBlue was not bound by some piece of paper (perhaps by some yet discovered TPA agreement with the local / home carriers because, again, the administrative record has not yet been produced) to oblige the “any information” requests set forth in the various administrative record requests, GeoBlue (as Defendants’ agent) relinquished such lack of written responsibility by undertaking the “any information” production. 11 The hornbook definition of laches is as follows: “The equitable doctrine by which a court denies relief to a [party] who has unreasonably delayed or been negligent in asserting the claim, when that delay or negligence has prejudiced the party against whom relief is sought.” Garner, Bryan A., Black’s Law Dictionary, 396 (2d Pocket Ed., 2001). The hornbook definition of estoppel by laches is as follows: “The equitable doctrine by which some courts deny relief to a [party] who has unreasonably delayed or been negligent in asserting a claim.” Id. at 247. The hornbook definition of estoppel by silence is as follows: “Estoppel that arises when a party is under a duty to speak but fails to do so.” Id. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 17 of 30 PageID: 938 13 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Similarly, since the commencement of this litigation in November 2017, Defendants have engaged in no effort to obtain and provide Med-X with the imperative documentation / information or advised undersigned counsel along these lines: “Hey there, here is a copy of the SPD, which shows your records request should have been directed to an employer. And here is a copy of the TPA agreement showing we have no agreement with the insured’s employer. So, can you please dismiss us out of your lawsuit now that we have shown you that and direct your efforts to the insured’s employer?” These would have been realistic and sensible possibilities; but, alas, as evidenced by the pending motions to dismiss, commonsense is not in Defendants’ playbook, litigiousness is. And, again, Defendants’ contentions as to the supposed misplacement of our germane documentation requests (and, thus, their supposedly not having to oblige the record requests and endure the $110.00 / day penalty because of their inordinate delay) is barred by laches - if there was any merit to the “Hey there, we’re not the right folks” argument set forth in (or embodied by) the motions to dismiss, Defendants should have said so years ago. To allow Defendants to get away with throwing Mr. Fitzgerald under the proverbial bus and / or having not spoken up many moons ago about where record requests supposedly should have gone and pointed the figure in that direction would be equitably (estoppel, laches) inappropriate. The motions to dismiss are due to be denied. D. Not Knowing If Defendants Are Plan Administrators, Claim Administrators, Or Both Is Defendants’ Doing And Defendants’ Misconduct Violates Federal Code (For Sure), Contract (Likely), and State Law (Likely) Quite enough has been said already (in this brief and the in the Second Amended Complaint) about why nobody knows whether Defendants are plan administrators, claim administrators, or both - because of Defendants’ legally (and likely contractually and perhaps also statutorily) repugnant secreting of the very documents that will tell us that - the SPD / policy, the TPA agreement, and / or et cetera. Not only is Defendants’ documentation / information Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 18 of 30 PageID: 939 14 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com production gamesmanship violative of the above-cited United States Code and Code of Federal Regulations (and, thus, not subject to endorsement by this Court by way of the dismissal Defendants desire), but also more than likely violative of the subject insurance contracts (whether called an insurance policy, SPD, benefits booklet, certificate of coverage, master plan document) Defendants have wrongly withheld. Just about every insurance contract that undersigned counsel has ever read (hundreds of all varieties spanning over a dozen years) has a rights and responsibilities section wherein the kinds of documents requested by Med-X here (see [D.E. 134] at ¶ 28 for a listing of such kinds of documents) are available as a matter of contract following an adverse benefits determination, irrespective of United States Code and Code of Federal Regulations. Meaning, in all likelihood, Defendants’ secreting of the germane claim documentation / information needed to advance very old stagnant claims is not only violative of federal code, but also more than likely in breach of contract. Then, there are even statutes in many states requiring the production of the germane documentation / information Med-X has requested and Defendants’ have wrongly withheld here. See, e.g., Unfair Claim Settlement Practices, Fla. Stat. § 626.9541(1)(i)3.c (“[f]ailing to acknowledge and act promptly upon communications with respect to claims”); Fla. Stat. § 626.9541(1)(i)3.e (“[f]ailing to affirm or deny full or partial coverage of claims, and, as to partial coverage, the dollar amount or extent of coverage, or failing to provide a written statement that the claim is being investigated, upon the request …”); Fla. Stat. § 626.9541(1)(i)3.f (“[f]ailing to provide a reasonable explanation in writing to the insured of the basis in the insurance policy, in relation to the facts or applicable law, for denial of a claim of for the offer of a compromise settlement); Fla. Stat. § 626.9541(1)(i)3.g (“[f]ailing to promptly notify the insured of any additional information and the reasons why such information is necessary”). Florida tracks the National Association of Insurance Commissioners model code, as do many other states. Meaning, Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 19 of 30 PageID: 940 15 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com in all likelihood, Defendants’ secreting of the germane claim documentation / information needed to advance very old stagnant claims is not only violative of federal code and in breach of contract, but also in all likelihood violative of state law. To allow Defendants to get away with their record production refusals would be to throw federal code (for sure), contract (likely), and / or statute (likely) by the wayside. The motions to dismiss are due to be denied. E. Matters Should Not Be Dismissed Based On Falsehoods (Let Alone Guesswork Discussed Above), And The Motions To Dismiss Are Replete With Same Given there are two motions to dismiss, perhaps a chart is best: Defendants’ Statement The Truth or Proper Context “[T]he SAC alleges in Count One that all Defendants … committed disclosure violations under … ERISA, for which Plaintiff seeks statutory penalties.” [D.E. 142] at 1. “[Plaintiff] demands administrative penalties of ‘many thousands’ of dollars… .” Id. at 2. These statements are actually true, but quite intentionally omissive. Count I of the Second Amended Complaint, see [D.E. 134] at 15-16, is not just about recovery of legally prescribed administrative penalty, it is also about getting the germane claim documentation / information that Defendants have wrongly withheld so that claims that have sat in limbo for years can move forward. While the Court absolutely should uphold the law and award administrative penalty, even if the Court is somehow not inclined to uphold the law, Count I must survive at the very least so that the outstanding documentation / information needed to move old claims totaling thousands of dollars can be rectified. Without the legally required documentation / information, there is absolutely nothing that can be done about the claims Defendants have wrongly held up for years. “The SAC … does not mention any particular request made of a Becker Defendant or identify any particular Becker Defendant plan or member.” Id.; see also [D.E. 146] at 5-6 (“there are no allegations of any disputed claims or records requests related to any particular Non-GeoBlue Wrong. See Section C, supra, and two more rows down. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 20 of 30 PageID: 941 16 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Defendant, and there are no allegations that any written request was made to a plan administrator…”). “[A]ssumes, without showing, that ERISA in fact applies to each and every claim…” Id.; see also [D.E. 146] at 5 (“a claim has not been stated because there are no allegations that any Non-GeoBlue Defendants’ members for whom claims were billed through Med-X are ERISA participants or beneficiaries”). Out-of-context and misleading. See Sections B and D, supra. The reason we cannot yet show that every outstanding claim is subject to ERISA (although the odds suggest that most, if not all, are) is because Defendants have wrongly withheld legally required documentation / information; hence, Count I. “The SAC admits that Plaintiff never sent any such request directly to any non- GeoBlue defendant.” Id. at 4. Out-of-context and misleading. The hundreds of record request letters that were sent in June 2017 (June 28, 2017, and June 29, 2017, to be precise, see [D.E. 134 at ¶ 28) were replete with this kind of language (and all the letters, including those that were for the Defendants said the same thing: (a) “to assess and deal with the (im)propriety of the local carrier’s / GeoBlue’s claims(s) denial, underpayment, or delayed non-decision,” (b) “we trust that any and all applicable pre-suit administrative appeal deadlines will be tolled pending the local carrier’s / GeoBlue’s production of the germane documentation / information set forth below … if we err in that trust, we expect the local carrier / GeoBlue to immediately say so,” (c) “please remain cognizant of the $110.00 / day penalty … for any local carrier / GeoBlue failure to timely oblige the below documentation / information requests,” (d) “we think it very sensible (for all involved) for us to sit down for an early resolution meeting … say, towards the end of July 2017; i.e., before the local carrier / GeoBlue incurs hundreds of thousands of dollars complying with the below legally required documentation / information requests …,” and (e) “Regarding our assessment of the local carrier’s / GeoBlue’s claim(s) denial, underpayment, or delayed non-decision, please promptly provide us with a copy of … .” [D.E. 134] at ¶ 28 (emphasis added). Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 21 of 30 PageID: 942 17 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com “The SAC does not specify what any particular Becker Defendant actually did; does not recite any particular documents requested of any particular Becker Defendant (or the date of any particular request); and does not mention any particular insured member of any one Becker Defendant.” Id. at 6; see also [D.E. 146] at 3 (“The Second Amended Complaint contains no allegations of conduct undertaken by any particular Non- GeoBlue Defendant”) and at 5-6 (“no allegations that … any plan administrator failed to respond to such request with respect to a claim involving a Non- GeoBlue member”). Complete nonsense. The Defendants did just as every other local / home carrier did - completely ignore the documentation / information letters and engage in a game plan of complete radio silence. See, e.g., [D.E. 134] at n. 1, n. 2, ¶ 31. Moreover, the documentation / information requested of the Defendants was the same as requested of all other local / home carriers. See id. at ¶ 28 and n. 3. Moreover, each of the letters that the Defendants received, again, lest the Defendants are accusing Mr. Fitzgerald of being a liar or the Defendants have done nothing since November 2017 to get the letters from Mr. Fitzgerald if, in fact, Mr. Fitzgerald lied and did not provide the Defendants with same, captioned all of the following: (a) insured name, (b) date of service, (c) policy / plan number, and (d) insured’s date of birth. We would be happy to show the Court the letters upon request, but, again, the precise documentation / information requested of Defendants is spelled out (quoted, in fact) in the Second Amended Complaint. See [D.E. 134] at ¶ 28. And since that time, undersigned counsel has repeatedly shown Defendants’ counsel the list of outstanding claims with all needed claim identifying information (even though, again, all needed identifying claim information was included on each letter sent in June 2017). To be clear, and without violating PHI, as of the date of this filing there are, as to the Defendants involved with [D.E. 142] and [D.E. 146], merely five outstanding claims concerning Horizon, one outstanding claim concerning Premera (which such claim Premera already paid, but wrongly paid to a Med-X competitor and for who knows what reason refuses to re-issue payment to the proper party - Med-X), eleven outstanding claims concerning BCBSIL (the most sizeable of which BCBSIL already paid to the patient / insured, but the check was not cashed by the now deceased patient / insured, and the Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 22 of 30 PageID: 943 18 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com deceased’s representative has authorized reissuance of such payment to Med-X), and two outstanding claims concerning BCBSTX. “Plaintiff is obligated to, at bare minimum, proffer a basis from which to infer that ERISA applies in the first place by at least identifying the claims in question.” Id. at 10. Ok, assuming arguendo that is true (and again keeping in mind that it is Defendants who have secreted the very germane materials upon which the “is this an ERISA-governed plan?” assessment could unfold), we have identified the subject claims more than once over many years. See the row above in this chart. F. Becker Defendants’ [D.E. 142] “Group Pleading” Argument Is A Red-Herring Federal Rule of Civil Procedure 8(a)(2) provides that Med-X’s Second Amended Complaint must include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Id. The Defendants correctly point out that a plaintiff must “provide sufficient information to put Defendants on notice of the nature of the claim and to support the claim itself.” Oakwood Labs., LLC v. Thanoo, No. 17-CV-05090(PGS), 2017 WL 5762393, at *4 (D.N.J. Nov. 28, 2017). That is exactly what has been accomplished in the Second Amended Complaint. If the supposed problem with group pleading is as the authority cited in the [D.E. 142] motion to dismiss says it is (“force[d] both the Defendants and the Courts to guess who did what to whom when”), id. at 6, well, then there is no problem. The Second Amended Complaint is plain as day as to what the problem is, it is disingenuous (at best) and / or misrepresentative (at worst) for Defendants to claim they and the Court are left guessing as to something. As to “who did what,” “to whom,” and “when,” the Second Amended Complaint clearly contains allegations to this effect. See above chart, Section E. The grouping of the Defendants in the Count I vein is not at all confusing or somehow leaves anybody guessing because Count I is about all of those defendants doing the exact same thing; i.e., there is nothing different to say about Horizon, Premera, BCBSTX, or BCBSIL … insertion of proper nouns (as the [D.E. 142] and [D.E. 146] Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 23 of 30 PageID: 944 19 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com motions to dismiss seemingly urge) would be an exercise in futility. The Second Amended Complaint’s allegations plainly satisfy the legal standard set forth in Section A above. When boiled down to its simplest terms, the Second Amended Complaint alleges as to each Defendant as follows: (a) That the Defendant insures one or more patients that were provided medical services by international medical providers represented by Med-X, (b) Med-X submitted medical insurance claims to the Defendants for the aforementioned medical services, (c) The Defendants failed to pay the insurance claims once submitted, (d) Thereafter Med-X sent requests (the hundreds of June 2017 letters with crystal clear claim identifying information in each letter) for germane documentation / information to which Med-X was / is entitled under federal code, insurance contract, and / or statute on each claim to each Defendant through their agent, GeoBlue, (e) Counsel for GeoBlue responded and promised to assist Med-X by passing the requests along to the Defendants (local / home carriers), and (f) No documents or information were ever sent by any of the Defendants and Med-X has been left with no information whatsoever on any of the outstanding claims. The Becker Defendants [D.E. 142] argue that that the Second Amended Complaint is an impermissible group pleading in violation of Federal Rule of Civil Procedure 8, because it “forc[es] both the Defendants and the Court to guess who did what to whom when.” Japhet v. Francis E. Parker Mem. Home, No. 14-1206, 2014 WL 3809173, at *2 (D.N.J. July 31, 2014). Again, here, there is zero guesswork as to the bases for the claims against the Defendants - failure to produce legally (federal code, contract, and / or statute) documentation / information relating to claim decision-making. There is no question as to what is alleged against each Defendant and the Defendants have cited no authority to suggest that anything further would be required. The motions to dismiss are due to be denied. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 24 of 30 PageID: 945 20 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com G. Becker Defendants’ [D.E. 142] Nonsense About Med-X Not Having Standing Because Supposedly An Assignee (Such As A Medical Provider) Cannot Then Assign The Owed Benefits To A Domestic Billing Agent (Med-X) Is Exactly That - Nonsense … Count I Is Not Even About Insurance Benefits Notably, the [D.E. 142] motion to dismiss cites only 9th Circuit authority for the proposition that (applied, here) a foreign medical provider cannot delegate or assign the insurance benefits recovery task to a domestic billing agent. The [D.E. 142] motion to dismiss argues that an assignment of an assignment is impermissible in the 9th Circuit and bootstraps that into an argument that Med-X somehow does not have standing for Count I of this lawsuit. Preliminarily, this is a red-herring. Reason being, Count I does not pertain to Med-X’s recovery of insurance benefits under an assignment of an assignment or otherwise.12 Count I sounds in Med-X’s right (as a hired domestic billing agent by foreign entities) to process claims and exchange / receive germane claim documentation / information (the subject of Count I) so as to be able to do its job for its clientele. This right has nothing to do with assignment of insurance benefits. If Med-X was deprived of this right (which undersigned is unaware of any law that would justify such deprivation), the billing agency industry would become extinct. It is no secret that Med-X receives a commission from the recovered insurance benefits. See, e.g., [D.E. 134] at ¶¶ 40-41 (making clear Med-X’s financial stake). But Med-X’s commission is between it and its contracting medical provider clients. When this matter gets to the point of recovering insurance benefits (which, again, simply cannot happen until the wrongs complained of in Count I are rectified), well, then perhaps there can be a standing debate. But that 12 See, e.g., [D.E. 134] at ¶ 29 (“But, as stated above, that will be for the breach of contract / recovery of benefits count likely to be added to this Second Amended Complaint once Blue is made to honor its legally-prescribed administrative record production obligations …”). Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 25 of 30 PageID: 946 21 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com time is not now and the [D.E. 142] motion to dismiss 9th Circuit chatter is entirely inapposite to the instant motion practice.13 The motions to dismiss are due to be denied. H. Unclean Hands Militates Against The Motions To Dismiss (Along With Several Forms of Estoppel, Waiver, and Laches Discussed Above) Despite hundreds of requests for documentation / information to locals / GeoBlue (again, then passed onto the local / home Defendants lest Mr. Fitzgerald is a liar), whether GeoBlue or any of the other individually named Defendants are plan administrators, claim administrators, or both (under either insuring agreements such as an SPD or TPA agreements or both) remains a mystery because of Defendants’ malfeasance and Defendants’ malfeasance only. It is this game of three-card monte, in which the Defendants have deliberately refused to provide Med-X with the documentation / information they are rightfully entitled to. By each Defendant claiming they are not the plan administrator, and in turn refusing to provide documentation which would ultimately identify who the plan administrator actually is (despite having told Med-X, at least through Mr. Fitzgerald, well over a year ago that they would handle the administrative record requests), they 13 Looking ahead, there are three basic requirements to confer standing: (1) Injury-in-fact: The plaintiff must have suffered or imminently will suffer injury - an invasion of a legally protected interest that is (a) concrete and particularized, and (b) actual or imminent (that is, neither conjectural nor hypothetical; not abstract). The injury can be either economic, non-economic, or both. (2) Causation: There must be a causal connection between the injury and the conduct complained of, so that the injury is fairly traceable to the challenged action of the defendant and not the result of the independent action of some third party who is not before the court. (3) Redressability: It must be likely, as opposed to merely speculative, that a favorable court decision will redress the injury. See, e.g., Sprint Commc’ns Co. v. APCC Servs., Inc., 554 U.S. 269, 273-274 (2008). When the time comes, Med-X will easily satisfy those prongs even if it is just from a commission perspective (a real injury), which such commission (between Med-X and medical provider clientele) would have nothing to do with assignment of insurance benefits (between medical provider clientele and patient). And, when the time comes for pursuing owed insurance benefits (after Count I is resolved), there are plenty of arrows in the Med-X argument quiver that an assignment of an assignment (or an authorization or other vested legal authority, as the case may be) is fine anyway. See, e.g., Am. Orthopedic & Sports Med. v. Indep. Blue Cross Blue Shield, 890 F.3d 445 (3d Cir. 2018); North Jersey Brain & Spine Center v. Aetna, Inc., 801 F.3d 369, 372 (3d Cir. 2015) (along with myriad internal citations). But, again, the time to assess Med-X’s ability to pursue recovery of owed insurance benefits as named Plaintiff is not now despite the [D.E. 142] motion to dismiss’ effort to confuse the instant issues. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 26 of 30 PageID: 947 22 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com are benefiting from their own unclean hands by asking this Court to dismiss the Second Amended Complaint pursuant to the problems they have created. The unclean hands doctrine is normally seen as an affirmative defense, but can be utilized by any party and is, “applicable when 1) a party seeking affirmative relief 2) is guilty of conduct involving fraud, deceit, unconscionability, or bad faith 3) directly related to the matter in issue 4) that injures the other party 5) and affects the balance of equities between the litigants.” Castle v. Cohen, 676 F.Supp. 620, 626 (E.D.Pa. 1987) (additional citations omitted). In Malibu Media, LLC, this Court reviewed the unclean hands doctrine and stated as follows, “[i]n considering the permissibility of an unclean hands [claim], this Court is not ‘bound by formula or restrained by any limitation that tends to trammel the free and just exercise of discretion.’ [] However, in exercising such discretion, ‘the primary principle guiding application of the unclean hands doctrine is that the alleged inequitable conduct must be connected, i.e. have a relationship, to the matters before the court for resolution.’” Malibu Media, LLC v. Lee, No. 12-03900, 2013 WL 2252650 at 8 (D.N.J. May 22, 2013) (internal citations omitted). First, the Defendants in this matter are seeking relief from the Court by asking that the Second Amended Complaint be dismissed with prejudice. Second, if the Defendants are in fact the “plan administrators,” their conduct in purposefully withholding documentation, required to be produced pursuant to U.S.C. § 1024(b)(4), from Med-X is unconscionable and in bad faith. In the alternative, in the event that none of the Defendants are the named “plan administrators,” per their claims in each of their respective motions, their willful refusal to provide the identifying information of the “plan administrators,” to which they are the only parties with the requisite knowledge, is also unconscionable and in bad faith. Third, these actions are directly related to the underlying action in Count I of the Second Amended Complaint concerning the production of records pursuant to U.S.C. § 1024(b)(4). Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 27 of 30 PageID: 948 23 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Fourth, both the refusal to provide the requested documentation in violation of ERISA guidelines, and / or the refusal to identify the names “plan administrators,” harm Med-X by prohibiting their ability to challenge claim determinations and denials. By refusing to provide the information or supply the party with whom Med-X should be requesting the information, the Defendants are effectively barring Med-X from pursing claim payments and remedies (e.g., pre- suit appeals and / or external reviews of claims denials or underpayments) specifically provided to them through ERISA-governed plans (or even many kinds of private policies, for that matter). Fifth, if the Defendants are permitted to hide the ball, the balance of equities tips so far in their favor as to not only dismiss the Second Amended Complaint, but to effectively prohibit any and all future challenges, from any insured or policyholder, of a claim denial or underpayment where the definitive identification of the “plan administrator” is unknown. This type of gamesmanship is precisely what Med-X is attempting to overcome with the filing of the Second Amended Complaint. The motions to dismiss are due to be denied. I. Procedure Militates Against The Motions To Dismiss From a legal sufficiency standpoint, which is all that is supposed to be tested at the dismissal stage of litigation there is nothing inadequate about the averments included in Count I of the Complaint. Count I of the Complaint adequately alleges the Defendants’ administrative failures. If Count I someday fails on the merits (e.g., it is someday proven that the Defendants did not drop the administrative ball as alleged in Count I), well, then so be it. But that time (i.e., the summary judgment stage) is not now. Again, all that is to be tested at this early stage of litigation is the legal sufficiency of Count I. The Motion to Dismiss improperly (at this early juncture) quarrels with the merits of Count I. The motions to dismiss are due to be denied. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 28 of 30 PageID: 949 24 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com J. Lack Of Discovery Militates Against The Motion To Dismiss Again, there presumably exists some paperwork between GeoBlue and the various local / home carriers (Defendants in the instant motion practice) that sets forth the administrative roles and duties of both, but, again, the documentation / information required by federal code (for sure), insurance contract (likely), and / or statute (likely) has not yet been produced. It would be premature to adjudicate Count I (let alone in Defendants’ favor) without such paperwork in hand. The motions to dismiss are due to be denied. K. CONCLUSION As is demonstrated in the foregoing arguments, Med-X’s Second Amended Complaint states prima facia claims in Count I. For all the foregoing reasons (legal, equitable, otherwise) it is respectfully submitted that this Court should deny the Defendants’ Motions to Dismiss [D.E. 142] and [D.E. 146] in their entirety. WHEREFORE, Plaintiff, Med-X Global, LLC, respectfully requests entry of an order (a) denying Defendants’ motions to dismiss [D.E. 142] and [D.E. 146], (b) requiring Defendants to immediately answer the Second Amended Complaint, (c) compelling Defendants immediate production of the documentation / information at issue in Count I, (d) awarding the legally- prescribed administrative penalty ($110.00 / day) for Defendants’ documentation / information production failures on any ERISA-related claims (which will be most, if not all, of the subject claims), and (e) awarding any other relief that the Court deems equitable, just, or proper. Dated: March 14, 2019 Respectfully submitted, CALLAGY LAW, P.C. /s/ Jeffrey L. Greyber Jeffrey L. Greyber, Esq. 1900 N.W. Corporate Blvd., Suite 310W Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 29 of 30 PageID: 950 25 Callagy Law, P.C. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, NJ 07652 And 1900 N.W. Corporate Blvd. Suite 310W Boca Raton, FL 33431 www.callagylaw.com Boca Raton, Florida 33431 561-405-7966 201-549-8753 (Fax) jgreyber@callagylaw.com hcasebolt@callagylaw.com and Michael J. Smikun, Esq. Mack-Cali Centre II 650 From Rd., Suite 565 Paramus, New Jersey 07652 201-261-1700 201-261-1775 (Fax) msmikun@callagylaw.com jsisco@callagylaw.com Attorneys for Plaintiff CERTIFICATE OF SERVICE I HEREBY CERTIFY that on March 14, 2019, I electronically filed the foregoing documents with the Clerk of the Court by using CM / ECF. I also certify that the foregoing document is being served this day on all counsel of record via Notices of Electronic Filing generated by CM / ECF to defense counsel of record. /s/ Jeffrey L. Greyber Jeffrey L. Greyber, Esq. Case 3:17-cv-11742-PGS-TJB Document 173 Filed 03/14/19 Page 30 of 30 PageID: 951