Healthcare Justice Coalition CA Corp. v. UnitedHealth Group Incorporated et al
Filing
31
MINUTES (IN CHAMBERS) ORDER GRANTING PLAINTIFF'S MOTION TO REMAND 15 by Judge Michael W. Fitzgerald. The Motion is GRANTED, and this action is REMANDED to Los Angeles County Superior Court. MD JS-6. Case Terminated. (iv)
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
JS-6
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
Present: The Honorable MICHAEL W. FITZGERALD, U.S. District Judge
Deputy Clerk:
Rita Sanchez
Court Reporter:
Amy Diaz
Attorneys Present for Plaintiff:
None Present
Attorneys Present for Defendants:
None Present
Proceedings (In Chambers): ORDER GRANTING PLAINTIFF’S MOTION TO
REMAND [15]
Before the Court is Plaintiff Healthcare Justice Coalition CA Corp’s Motion to
Remand (the “Motion”), filed on August 5, 2024. (Docket No. 15). Defendants
UnitedHealth Group, Inc., UnitedHealthcare Benefits Plan of California, Inc., UMR,
Inc., UnitedHealthcare Community Plan of California, Inc., UnitedHealthcare
Insurance Company, and UnitedHealthcare Insurance Company of America
(collectively, “Defendants”) filed an Opposition on September 17, 2024. (Docket No.
18). Plaintiff filed a Reply on October 7, 2024. (Docket No. 20).
On October 15, 2024, Plaintiff filed supplemental authority in support of the
Motion. (Docket No. 22). Defendants filed objections to Plaintiff’s submission of
supplemental authority on October 16, 2024, which are overruled as moot. (Docket
No. 23). The Court would have reached the same conclusion with or without
Plaintiff’s filing.
The Court has read and considered the Motion and held a hearing on October
21, 2024.
For the reasons set forth below, the Motion is GRANTED, and this action
is REMANDED to Los Angeles County Superior Court.
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CIVIL MINUTES—GENERAL
1
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
I.
BACKGROUND
On April 24, 2024, Plaintiff commenced this action in Los Angeles County
Superior Court. (Id. ¶ 3). Plaintiff is the assignee of various emergency medical
groups (the “Providers”) whose physicians rendered emergency care and treatment to
patients in several hospitals in California. (Id. ¶ 4). Plaintiff’s mission is to ensure
emergency medical providers obtain adequate and full payment for services rendered.
(Id. ¶ 3). Defendants are health insurers and/or managed health care companies and
service plans. (Id. ¶ 2). Plaintiff alleges that Defendants underpaid or failed to pay for
emergency medical services that Providers’ physicians rendered to members and
subscribers of Defendants’ healthcare service plans. (Id. ¶ 10).
At the time that the physicians rendered the alleged emergency services, the
Providers did not have contracts with Defendants; rather, the Providers set their own
reasonable rate and charges for the care they provided to Defendants’ members. In
other words, they were “out-of-network” providers. (Id. ¶ 22). Plaintiff alleges that,
pursuant to the Emergency Medical Treatment and Active Labor Act (“EMTALA”),
42 U.S.C. §1395dd, and California Health & Safety Code section 1317, the Providers
had a duty to render emergency services to all patients regardless of their insurance
coverage or ability to pay. (Id. ¶ 40). The relationship between the Providers and
Defendants, however, arose solely out of California statutory and contract law. (Id. ¶
41); (Motion at 7).
California’s Knox-Keene Health Care Service Plan Act of 1975 (“Knox-Keene
Act”) “established required levels of payment for emergency and certain postemergency stabilization care for out-of-network providers.” (Complaint ¶ 9); Cal.
Health & Safety Code §§ 1340 et seq. Plaintiff alleges that, under the Knox-Keene
Act, Defendants are required to pay Plaintiff the “reasonable and customary value of
the emergency services provided by the Providers,” but Defendants failed to do so.
(Complaint ¶ 9–10).
Based on the above allegations, Plaintiff brings the following causes of action:
(1) common law breach of implied contract; (2) common law open book accounting;
and (3) a violation of the Unfair Competition Law (Cal. Bus. & Prof. §§ 17200 et seq.).
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CIVIL MINUTES—GENERAL
2
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
(Complaint ¶¶ 38–60). Plaintiff “explicitly cho[se] not to pursue any rights or causes
of action based on the Employee Retirement Income Security Act of 1974 (ERISA) or
the Medicare Act.” (Complaint ¶ 18). Instead, Plaintiff’s claims “arise out of
interactions” between the Providers and Defendants and “are based upon the rights and
duties of [Defendants], under California law.” (Id. ¶ 19). “Plaintiff does not seek to
enforce the contractual rights of [Defendants’] members or subscribers through their
members’ insurance contracts, policies, certificates of coverage or other written
insurance agreements . . .” (Id.) (emphasis in original).
On June 5, 2024, Defendants removed this action on the following grounds: (1)
the existence of a substantial federal question, (2) ERISA complete preemption, and
(3) federal officer removal. (Notice of Removal (Docket No. 1) ¶¶ 16–56).
Plaintiff seeks to remand this action back to Los Angeles County Superior
Court. (Motion at 10).
II.
LEGAL STANDARD
In general, “any civil action brought in a State court of which the district courts
of the United States have original jurisdiction, may be removed by the defendant or the
defendants, to the district court[.]” 28 U.S.C. § 1441(a). A removing defendant bears
the burden of establishing that removal is proper. See Abrego Abrego v. The Dow
Chem. Co., 443 F.3d 676, 684 (9th Cir. 2006) (per curiam) (noting the “longstanding,
near-canonical rule that the burden on removal rests with the removing defendant”). If
there is any doubt regarding the existence of subject matter jurisdiction, the court must
resolve those doubts in favor of remanding the action to state court. See Gaus v. Miles,
Inc., 980 F.2d 564, 566 (9th Cir. 1992) (“Federal jurisdiction must be rejected if there
is any doubt as to the right of removal in the first instance.”). Indeed, “[i]f at any time
before final judgment it appears that the district court lacks subject matter jurisdiction,
the case shall be remanded.” 28 U.S.C. § 1447(c); see Kelton Arms Condo. Owners
Ass’n, Inc. v. Homestead Ins. Co., 346 F.3d 1190, 1192 (9th Cir. 2003) (“Subject
matter jurisdiction may not be waived, and, indeed, we have held that the district court
must remand if it lacks jurisdiction.”).
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CIVIL MINUTES—GENERAL
3
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
“The general rule, referred to as the ‘well-pleaded complaint rule,’ is that a civil
action arises under federal law for purposes of § 1331 when a federal question appears
on the face of the complaint.” City of Oakland v. BP PLC, 969 F.3d 895, 903 (9th Cir.
2020) (citing Caterpillar, 482 U.S. at 392). However, complete preemption is “an
exception to the well-pleaded complaint rule.” Saldana v. Glenhaven Healthcare LLC,
27 F.4th 679, 686 (9th Cir. 2020) (citing City of Oakland, 969 F.3d at 905). Complete
preemption applies if a well-pleaded complaint establishes a state-law cause of action
but “requires resolution of a substantial question of federal law in dispute between the
parties.” Franchise Tax Bd. of State of Cal. v. Construction Laborers Vacation Trust
for Southern Cal. et al., 463 U.S. 1, 13 (1983); see also Caterpillar Inc. v. Williams,
482 U.S. 386, 393 (1987) (complete preemption is invoked when “the pre-emptive
force of a statute is so ‘extraordinary’ that it ‘converts an ordinary state common-law
complaint into one stating a federal claim for purposes of the well-pleaded complaint
rule’ ”) (citing Metropolitan Life Ins. Co v. Taylor, 481 U.S. at 65).
III.
DISCUSSION
Defendants argue that removal is proper because (1) Plaintiff’s claims are
completely preempted by ERISA; (2) the federal officer removal statute applies; and
(3) the Complaint raises a substantial question of federal law. (Notice of Removal ¶¶
16–56).
A.
ERISA Preemption
Defendants assert that Plaintiff’s claims are completely preempted under ERISA
§ 502(a), 29 U.S.C. § 1131(a). (Notice of Removal ¶¶ 22–36). Complete preemption
under ERISA § 502(a) “confers federal subject matter jurisdiction for claims that
nominally arise under state law.” Fossen v. Blue Cross & Blue Shield of Montana,
Inc., 660 F.3d 1102, 1107 (9th Cir. 2011).
A state law cause of action is preempted by § 502(a) of ERISA if (1) an
individual, at some point in time, could have brought his claim under ERISA §
502(a)(1)(B); and (2) there is no other independent legal duty that is implicated by a
defendant’s actions. Aetna Health Inc. v. Davila, 542 U.S. 200, 210 (2004). The twoprong test is conjunctive; both prongs must be met for there to be complete
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CIVIL MINUTES—GENERAL
4
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
preemption. Marin Gen. Hosp. v. Modesto & Empire Traction Co., 581 F.3d 941, 947
(9th Cir. 2009).
1.
Prong One
As to the first prong, ERISA provides a right of action to participants or
beneficiaries of a plan, the Secretary of Labor, employers of participants, and
employee organizations with an obligation to contribute to a multiemployer plan. 29
U.S.C. § 1132(a). Participants and beneficiaries may also assign their rights to benefits
under an ERISA plan to their healthcare providers, thus giving providers the right to
act in place of the participant or beneficiary. See e.g., S. Coast Specialty Surgery Ctr.,
Inc. v. Blue Cross of California, 90 F.4th 953, 960 (9th Cir. 2024); Misic v. Bldg. Serv.
Emps. Health & Welfare Tr., 789 F.2d 1374, 1377 (9th Cir. 1986).
The parties do not dispute that Plaintiff is not a plan participant, beneficiary, or
healthcare provider. Rather, Defendants contend that, despite Plaintiff’s assertion that
it is not bringing claims pursuant to any assignments from beneficiaries, the Complaint
“demonstrates the likely existence of assignments,” establishing that Plaintiff “can
assert an ERISA claim based on the rights of the participants and/or providers.”
(Notice of Removal ¶ 31); (Opposition at 19). In other words, Defendants argue that
Plaintiff could have brought ERISA claims as a sub-assignee of the Providers.
Plaintiff’s response is twofold. First, Plaintiff disputes that it has derivative authority
as an assignee of a medical provider under Simon v. Value Behav. Health, Inc., 208
F.3d 1073 (9th Cir. 2000). Second, Plaintiff contends that any purported assignments
are irrelevant because “[t]he claims and state law causes of action are based upon
Defendants’ course of conduct with respect to third party emergency providers and
upon acts which were violative of California law, such that the claims and causes of
action asserted by Plaintiff involve duties and rights which are completely independent
of ERISA.” (Reply at 7).
To begin, Defendant is correct that Simon does not outrightly reject derivative
standing for sub-assignees of medical providers, as Plaintiff suggests. See Bristol SL
Holdings, Inc. v. Cigna Health & Life Ins. Co., 22 F.4th 1086, 1092 (9th Cir. 2022)
(extending derivative standing to the sub-assignee and “successor-in-interest through
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CIVIL MINUTES—GENERAL
5
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
bankruptcy” of a medical provider). However, Defendant has failed to demonstrate the
“likely existence of assignments” received by Providers, and thereby Plaintiff, from
beneficiaries. Rather, Defendants submitted evidence that, for a singular claim related
to one patient, a provider noted that they had obtained an assignment. (See Declaration
of Jane Stalinkski, Ex. A (Docket No. 18-1) ¶ 7); (see also Claim Submission Form,
Ex. 4 (Docket No.18-1)). The Court is not persuaded that existence of a possible
assignment for 1 out of the 3,470 disputed claims establishes that Plaintiff could have
brought its claims under ERISA. See Lodi Mem’l Hosp. Ass’n v. Tiger Lines, LLC, CV
15-00319-MCE, 2015 WL 5009093, at *5 (E.D. Cal. Aug. 20, 2015) (finding prong
one of the Davila test was satisfied where Defendants submitted evidence “that for
each claim form submitted by Plaintiff for payment, [Plaintiff] indicated that it had
received an assignment of benefits from the patient.”).
Defendant further argues that the Complaint’s references to “the direct
submission of claims and receipt of payments” indicates an existence of assignments
under ERISA. (Opposition at 19). In its Notice of Removal, Defendant explains that
“[b]ecause the providers could not have submitted direct claims and received direct
payments, absent assignments, the allegation that the providers in fact received such
payments demonstrates the likely existence of assignments.” (Notice of Removal at 9).
However, the Complaint identifies “independent rights to payment,” that do not rely on
the existence of assignments under ERISA, for its claims that Defendant owed the
Providers more than the reimbursement they received. (Complaint ¶ 20) (noting
Plaintiff “seeks payment . . . based upon their own independent rights to payment, by
virtue of their statutory rights to reimbursement under California law and their
entitlement to payment based upon California law.”).
Moreover, as the party seeking to invoke federal jurisdiction, Defendant “bears
the burden of proving that plaintiff’s claim[s] [are] completely preempted” and thereby
“also bears the burden of establishing a valid assignment.” Reiten v. CIGNA Health &
Life Ins. Co., CV 20-2330-FMO (AGRx), 2020 WL 1862462, at *3 (C.D. Cal. Apr. 14,
2020) (cleaned up). Defendants may not merely assume and rely on the “likely
existence of assignments” to establish complete preemption. (Opposition at 19); see
Reiten, 2020 WL 1862462, at *3 (rejecting an insurer’s argument that, absent a written
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CIVIL MINUTES—GENERAL
6
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
contract between the provider and insurer, the existence of assignments should be
assumed).
It appears that at least two district courts have held otherwise. See Sanjiv Goel,
M.D., Inc. v. United Healthcare Servs., Inc., CV 23-10071-HDV (SSCx), 2024 WL
1361800, at *5 (C.D. Cal. Mar. 29, 2024) (finding submission of claims and receipt of
payment is only possible with an assignment of benefits); Lodi Mem’l Hosp. Ass’n v.
Tiger Lines, LLC, No. 2:15-CV-00319-MCE, 2015 WL 5009093 (E.D. Cal. Aug. 20,
2015) (same). Other district courts, however, have maintained that “absent evidence”
of assignments “to establish complete preemption removal over a third-party
provider’s state-law claims, Defendant[s] cannot satisfy the first prong of the Davila
test.” Roohipour v. ILWU-PMA Welfare Plan, 2020 WL 472921, at*4 (C.D. Cal. Jan.
28, 2020); see also Healthcare Just. Coal. CA Corp. v. Aetna, Inc., No. 2:24-CV04681-CBM-RAOX, 2024 WL 4458543, at *4 (C.D. Cal. Oct. 10, 2024) (“Nor have
Defendants submitted evidence establishing that Plaintiff is a double assignee.
Defendants ‘bear[ ] the burden of proving the existence of jurisdictional facts.’”)
(citation omitted).
Given the burden placed on Defendant and the “strong presumption against
removal jurisdiction,” this Court resolves any ambiguity resulting from these divergent
approaches “in favor of remand to state court.” Hunter v. Philip Morris USA, 582 F.3d
1039, 1042 (9th Cir. 2009) (citation omitted); see also Duncan v. Stuetzle, 76 F.3d
1480, 1485 (9th Cir. 1996) (“Because of the Congressional purpose to restrict the
jurisdiction of the federal courts on removal,” statutes conferring jurisdiction are
“strictly construed and federal jurisdiction must be rejected if there is any doubt as to
the right of removal in the first instance.”) (citations and quotations omitted).
Accordingly, the first Davila prong is not satisfied.
2.
Prong Two
Because Defendants fail to meet their burden as to the first prong, the Court need
not reach the second prong of the Davila test. However, for the sake of completion,
the Court analyzes the second prong below.
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CIVIL MINUTES—GENERAL
7
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
“The Ninth Circuit has found that” claims “solely based on the Providers’
independent relationship with Defendants . . . are not preempted by ERISA.”
Healthcare Justice Coalition CA Corp., 2024 WL 4458543, at *3; see e.g., Cath.
Healthcare West-Bay Area v. Seafarers Health & Benefits Plan, 321 F. App’x 563, 564
(9th Cir. 2008) (“Although [plaintiff] could have brought an ERISA claim derivatively
as an assignee, the Complaint does not assert a derivative claim . . . [T]he claims are
based on independent state law, and the dispute involves a contract . . . between a third
party provider and a plan—a relationship that is not governed by ERISA.”); Marin
Gen. Hosp., 581 F.3d at 948 (9th Cir. 2009) (“The mere fact that Providers could have
brought suit against [the defendant] under § 502(a)(1)(B) did not automatically mean
that Providers could not bring some other suit against [the defendant] based on some
other legal obligation.”).
The Complaint expressly states that Plaintiff’s claims arise out of the
interactions between the Providers and Defendants, “which gave rise to quasicontractual, contractual and/or statutory rights to recovery” separate from any ERISA
derivative rights the Providers may have obtained. (Complaint ¶ 20). The Providers
“disclaim and do not seek to assert any derivative claims that could be asserted by a
patient of the Providers, including any claims under ERISA or any claims for recovery
of benefits under the terms of any ERISA Plan . . .” Id. Where a third party brings a
claim “based on contractual obligations arising directly between the provider and the
ERISA plan . . . no ERISA-governed relationship is implicated and the claim is not
preempted.” Cath. Healthcare West-Bay Area, 321 F. App’x at 564; see also
Emsurgcare v. UnitedHealthcare Ins. Co., CV 24-03654-SB (Ex), 2024 WL 2892319,
at *5 (C.D. Cal. June 7, 2024) (“[I]t is Plaintiffs’ prerogative to choose which claims to
pursue. The fact that Plaintiffs could have also asserted the assigned ERISA rights does
not mean that they were required to do so in addition to asserting a separate right to
payment under the Knox–Keene Act.”).
Defendants further argue that some of the statutes Plaintiff relies on to establish
independent legal duties do not actually apply to Defendants. (Opposition at 25–26).
It appears that some district courts have denied remand after deciding a statute did not
give rise to an independent legal duty because it did not apply to a particular defendant.
See e.g., Sagebrush LLC v. Cigna Health & Life Ins. Co., CV 24-00353-CJC, 2024 WL
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CIVIL MINUTES—GENERAL
8
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
2152458, at *3 (C.D. Cal. May 13, 2024) (denying remand after deciding a defendant
was not subject to the Knox-Keene Act); Sanjiv Goel, M.D., Inc., 2024 WL 1361800,
at *5 (same). Other district courts, however, have concluded such analysis is improper.
See e.g., Alta Los Angeles Hosps., Inc. v. Blue Cross of California, CV 17-03611ODW (MRWx), 2017 WL 3671156, at *3 (C.D. Cal. Aug. 24, 2017) (“[T]he viability
(or lack thereof) of Plaintiff’s non-ERISA legal theories does not change the fact that
those theories, as pleaded, do not implicate any duty under ERISA and thus do not give
rise to jurisdiction under complete preemption. . . . The Court’s duty is simply to
analyze the claims as pleaded.”); Emsurgcare v. UnitedHealthcare Ins. Co., CV 2403654-SB (Ex), 2024 WL 2892319, at *6 (C.D. Cal. June 7, 2024) (concluding
determination of the merits of a claim “is not appropriate unless the Court first
determines that it has jurisdiction” and noting a split in district courts regarding this
approach). Again, these divergent approaches, at minimum, “suggest[] uncertainty,
which must be resolved in favor of remand.” Emsurgcare, 2024 WL 2892319, at *6.
Accordingly, Defendants have failed to demonstrate the Plaintiff could have
brought its claim under ERISA.
B.
Federal Officer Removal
Defendants contend that Plaintiff “concedes federal jurisdiction” because, in its
Motion, Plaintiff ignored the fact that Defendants also sought removal based on the
ground of federal officer removal. (Opposition at 10) (emphasis in original). But lack
of subject matter jurisdiction may be raised by the district court sua sponte. Fed. R.
Civ. P. 12(h)(3). Indeed, courts “have an independent obligation to determine whether
subject-matter jurisdiction exists, even in the absence of a challenge from any party.”
Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006). Because there is no complete
preemption under ERISA, the Court must determine whether Defendants’ other
grounds for removal are proper.
Under 28 U.S.C. §1442 (a)(1), “[t]he United States . . . or any officer (or any
person acting under that officer) of the United States or of any agency thereof, in an
official or individual capacity,” may remove any action brought “for or relating to any
act under color of such office.” A party seeking removal under §1442 must
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CIVIL MINUTES—GENERAL
9
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
demonstrate: “(a) it is a ‘person’ within the meaning of the statute; (b) there is a causal
nexus between its actions, taken pursuant to a federal officer’s directions, and
plaintiff’s claims; and (c) it can assert a ‘colorable federal defense.’” Durham v.
Lockheed Martin Corp., 445 F.3d 1247, 1251 (9th Cir. 2006) (internal citation
omitted).
Defendants argue that removal under §1442 is proper because Defendant
UnitedHealthcare Insurance Company (“UHIC”) contracts as a Medicare Advantage
Organization, and 153 of the 3,470 disputed claims in the Complaint are Medicare
Advantage claims. (Opposition at 8, 11). However, Defendants acknowledge that
“Plaintiff’s Complaint did not identify the disputed benefit claims,” and the alleged
identification of 153 claims covered by Medicare Advantage plans was made pursuant
to Defendants’ own analysis using data principally from UHIC’s systems. (Id. at 8);
(Declaration of Jules A. Levenson (Docket No. 18-2) ¶¶ 6–8).
The Complaint expressly contradicts Defendants’ assertion. Plaintiff “does not
seek to pursue any . . . Medicare benefits under any Medicare Advantage plan, and
explicitly disclaims any intent to assert, in this action, any derivative right to benefits
from . . . any Medicare Advantage plan or any delegee of such Medicare Advantage
Plan.” (Complaint ¶ 18). In their Reply, Plaintiff reiterates this point and further states
that “[a]ny inclusion of claims in the spreadsheets provided by Plaintiff to Defendants
were inadvertent and will be removed, as soon as they are identified as Medicare
claims.” (Reply at 19).
Defendants argue that these purported disclaimers are irrelevant because the
removal status is premised on the existence of a colorable federal defense, and thus,
neither the constriction of the Complaint nor Plaintiff’s disclaimers are pertinent to the
analysis. (Opposition at 15). However, the existence of a colorable defense is
necessarily predicated on Plaintiff’s seeking reimbursement from Medicare Advantage
plans. (See id. at 13). Based on the limited evidence provided by Defendants and the
small proportion of claims purportedly related to the Medicare Advantage Plan, the
Court is not persuaded that Plaintiff actually seeks to do so.
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CIVIL MINUTES—GENERAL
10
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
Because Defendants did not establish that Plaintiff is asserting any claims
against them in their capacity as Medicare Advantage Organizations, removal under §
1442 is improper.
C.
Substantial Federal Question
Defendants argue that removal is proper because the Complaint presents
substantial federal questions. (Opposition at 15–18). “A ‘special and small category’
of state law cases may be brought in federal court.” Lake v. Ohana Mil. Communities,
LLC, 14 F.4th 993, 1006 (9th Cir. 2021). Federal jurisdiction over a state law claim is
proper if a federal issue is: “(1) necessarily raised, (2) actually disputed, (3) substantial,
and (4) capable of resolution in federal court without disrupting the federal-state
balance approved by Congress.” Gunn v. Minton, 568 U.S. 251, 258 (2013).
“Jurisdiction is proper where all four of these requirements are met because in such a
case, there is a ‘serious federal interest in claiming the advantages thought to be
inherent in a federal forum.’” Negrete v. City of Oakland, 46 F.4th 811, 818 (9th Cir.
2022) (quoting Gunn, 568 U.S. at 258) (internal quotations and brackets omitted).
The Court concludes that the Complaint does not necessarily raise a substantial
issue of federal law. Defendants argue that Plaintiff’s Complaint raises a question
regarding the scope of obligations under EMTALA. Specifically, Defendants dispute
that EMTALA “has any role in obligating Defendants to reimburse additional plan
benefits,” and the implied contract that Plaintiff claims exists is premised on duties
created by a combination of federal and state law. (Notice of Removal at 6);
(Opposition at 16). However, Plaintiff is merely asserting that the Providers
“themselves had a duty to provide emergency care to patients based upon EMTALA,
not that Defendants had any duty to pay them at all or at any particular rate established
by EMTALA.” (Reply at 19); (see also Complaint ¶ 40). Plaintiff, instead, asserts that
“California common law and Health & Safety Code § 1371.4 impose a reciprocal duty
on health plans . . . and their delegees to accurately pay the Providers and other
physicians for the provision of emergency medical care to their members.” (Complaint
¶ 41).
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CIVIL MINUTES—GENERAL
11
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No. CV 24-04715-MWF (SKx)
Date: January 27, 2025
Title:
Healthcare Justice Coalition CA Corp. v. UnitedHealth Group, Inc. et al.
“The ‘mere presence of a federal issue in a state cause of action does not
automatically confer federal-question jurisdiction.’” Nevada v. Bank of Am. Corp.,
672 F.3d 661, 674 (9th Cir. 2012) (quoting Merrell Dow Pharms., Inc. v. Thompson,
478 U.S. 804, 813). Rather, the federal issues should be “pivotal as opposed to merely
incidental.” Lippitt v. Raymond James Fin. Servs., Inc., 340 F.3d 1033, 1045 (9th Cir.
2003) (internal quotation marks and citation omitted). Defendants have failed to make
that showing here.
Accordingly, the Motion is GRANTED, and this action is REMANDED to Los
Angeles County Superior Court.
IT IS SO ORDERED.
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CIVIL MINUTES—GENERAL
12
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