Michigan Ambulatory Surgical Center, LLC v. State Farm Mutual Automobile Insurance Company

Filing 35

OPINION AND ORDER granting 30 Motion for Summary Judgment. Signed by District Judge Paul D. Borman. (DTof)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
MICHIGAN AMBULATORY
SURGICAL CENTER, LLC,
Case No. 16-cv-14507
Plaintiff,
Paul D. Borman
United States District Judge

v.
STATE FARM MUTUAL
AUTOMOBILE INSURANCE
COMPANY,
Defendant.
______________________________/

OPINION AND ORDER GRANTING DEFENDANT’S
MOTION FOR SUMMARY JUDGMENT (ECF NO. 30)
This case involves Plaintiff Michigan Ambulatory Surgical Center, LLC’s
(“Michigan Ambulatory”) claim for the payment of no-fault insurance benefits for
treatment provided on February 9, 2016, to Defendant State Farm Mutual Automobile
Insurance Company’s (“State Farm”) insured, Tamika R. Burrell, in connection with
injuries allegedly suffered by Ms. Burrell in an August 19, 2014 motor vehicle
accident. Michigan Ambulatory relies on two different assignments from Ms. Burrell
in making its claim for payment from State Farm.
State Farm filed a motion for summary judgment (ECF No. 30) and Plaintiff

1

filed a response (ECF No. 31). The Court held a hearing on June 28, 2018, and
received supplemental briefing from the Plaintiff on July 4, 2018 (ECF No. 34). For
the reasons that follow, the Court GRANTS State Farm’s motion for summary
judgment.
I.

BACKGROUND
Ms. Burrell was involved in an automobile accident on August 19, 2014, while

merging onto Northbound I-75 from EB I-696, when she was unable to stop and
crashed into the back of the vehicle in front of her. (ECF No. 30, Def.’s Mot. Summ.
J. Ex. B, State of Michigan Crash Report PgID 776.) At the time, Ms. Burrell was
insured with State Farm under a no-fault insurance policy. Responding officers
categorized the extent of damage to both vehicles as a category “1,” noting that neither
vehicle’s airbags deployed. (Id.) The Royal Oak Fire Department responded, noting
that Ms. Burrell was alert and oriented, complaining of pain in multiple areas, but had
no visible sign of injury. Royal Oak responders noted that there was “very little
damage to her vehicle,” and her “airbag did not deploy.” (Id. Ex. C, Royal Oak Fire
Department Patient Care Record PgID 780.) Despite the minimal damage to the
vehicles, both of which were driveable, Ms. Burrell was taken by ambulance to
Southfield Providence Hospital. (Id. at PgID 781.) Ms. Burrell was informed at the
Emergency Department that her exam did not show any sign of serious injury from
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the car accident. She was given prescriptions for Ibuprofen, Darvocet, and Eye Drops
and was released that same day with no restrictions. (Def.’ Mot. Summ. J. Ex. D,
Providence Hospital ED Notes, PgID 784-788.) Ms. Burrell continued to treat with
various providers over the next several months, and State Farm paid benefits of nearly
$31,000.00, until March 13, 2015, when State Farm discontinued benefits based on
a provider’s report that Ms. Burrell had reached maximum improvement as a result
of her 2014 car accident and based upon surveillance video of Ms. Burrell
demonstrating her improved physical abilities. (Id. Exs. E-G.) According to State
Farm, subsequent examinations of Ms. Burrell ordered by State Farm demonstrated
that any injuries she had sustained as a result of the August 2014 automobile accident
had resolved and none of her accident-related injuries necessitated surgery.
On February 9, 2016, Ms. Burrell did undergo surgery at Michigan Ambulatory
for injuries Michigan Ambulatory alleges are related to her August 19, 2014
automobile accident. The total cost of the services provided by Michigan Ambulatory
was $123,467.00. (ECF No. 31, Pl.’s Resp. to Mot. Summ. J. Ex. B.)1 In its original
Complaint in this action, Michigan Ambulatory sought to recover no-fault benefits
1

Plaintiff’s physical condition, and the necessity (or not) for the surgical procedure
at Michigan Ambulatory on February 9, 2016, are not at issue in this action. As a
point of note, Plaintiff does not dispute any of this factual background, which was
provided by State Farm, and proceeds directly to the subject of the assignments, which
are at the heart of this case.
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directly from State Farm under Michigan’s No-Fault statute for unpaid medical
expenses for surgical services provided to Ms. Burrell on February 9, 2016, for
injuries allegedly related to the August 19, 2014 accident. As a result of the Michigan
Supreme Court’s May 25, 2017 decision in Covenant Medical Center, Inc. v. State
Farm Mut. Auto. Ins. Co., 500 Mich. 191 (2017), which established that medical
providers such as Michigan Ambulatory do not have a statutory claim under the
Michigan No-Fault Act to recover personal protection insurance benefits directly from
no-fault insurers, Michigan Ambulatory now seeks to rely instead on two separate
assignments, one executed by Ms. Burrell on the day of her February 9, 2016 surgery
and one executed by her on June 12, 2017, after the Covenant decision was issued and
after Ms. Burrell had settled with State Farm her claim for no-fault benefits allegedly
related to her August 19, 2014 accident through case evaluation in another case before
this Court. That case evaluation resulted in a dismissal with prejudice of Ms. Burrell’s
claims for no-fault benefits from State Farm related to her August 19, 2014
automobile accident.2 ZMC Pharmacy, LLC v. State Farm Mutual Auto. Ins. Co., 307
2

In an Opinion and Order issued on March 30, 2018, this Court denied State Farm’s
motion to dismiss this action because State Farm relied on matters outside the
pleadings. But the Court granted Plaintiff’s motion to amend the Complaint to rely
on the assignments that are now challenged by State Farm in this motion for summary
judgment. Michigan Ambulatory Surgical Center, LLC v. State Farm Mutual
Automobile Insurance Co., No. 16-14507, 2018 WL 1570332 (E.D. Mich. March 30,
2018). In that Opinion and Order, the Court expressly held that State Farm was not
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F. Supp. 3d 661 (E.D. Mich. 2018).
A.

Ms. Burrell’s Lawsuit Against State Farm

On September 3, 2015, Ms. Burrell filed an action in Wayne County Circuit
Court against State Farm. On February 11, 2016, State Farm removed the case to this
Court based upon diversity jurisdiction when Ms. Burrell amended her complaint and
added a claim for uninsured motorist benefits up to the policy limits of $50,000.00,
increasing the amount in controversy above $75,000.00.3 (Burrell v. State Farm Mut.
Auto. Ins. Co., No. 16-cv-10508 (E.D. Mich. 2016) (ECF No. 1, Notice of Removal)).
ZMC Pharmacy, LLC (“ZMC”) and MMT Integrative Services, Inc. (“MMT”)
intervened in the Burrell action seeking to recover for medical services provided to
Ms. Burrell allegedly in connection with her August 2014 motor vehicle accident. As
relevant here, the parties in the Burrell lawsuit stipulated to submit the case to state
court case evaluation in February, 2017, pursuant to Mich. Ct. R. 2.403. (Burrell, 16-

precluded from making the arguments it presents here regarding the effectiveness of
the assignments executed by Ms. Burrell on a more developed record. The parties
have agreed that the record before the Court is sufficient to enable the Court to resolve
State Farm’s summary judgment motion and have requested that the Court resolve the
motion for summary judgment before further discovery or case evaluation.
3

Further detail regarding Ms. Burrell’s lawsuit against State Farm, not all of which
is relevant here, can be found in this Court’s March 29, 2018 Opinion and Order, ZMC
Pharmacy, LLC v. State Farm Automobile Ins. Co., 307 F. Supp. 3d 661 (E.D. Mich.
2018).
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cv-10508, ECF No. 20, Stipulation to Submit Matter to State Court Evaluation.) The
parties appeared for state court case evaluation on May 9, 2017, and Plaintiff’s case
evaluation summary included the bills of several providers, including the $123,467.00
bill from Michigan Ambulatory that Michigan Ambulatory seeks to recover now in
this lawsuit from State Farm. (Def.’s Mot. Summ. J., Ex. J, [Ms. Burrell’s] Case
Evaluation Summary, PgID 863.) The parties were required to accept or reject case
evaluation on or before June 6, 2017, as required under Mich. Ct. R. 2.403. Both Ms.
Burrell and State Farm, as well as Intervening Plaintiff MMT, accepted the case
evaluation awards and on July 19, 2017, this Court entered a Stipulated of Order of
Dismissal dismissing all of Ms. Burrell’s claims against State Farm arising out of her
August 19, 2014 motor vehicle accident. (ECF No. 22, Stipulation and Order
Dismissing With Prejudice Plaintiff Burrell’s Claims Against State Farm.) MMT also
dismissed its claims against State Farm. (ECF No. 23, Stipulation and Order
Dismissing With Prejudice Plaintiff MMT’s Claims Against State Farm.) Intervening
Plaintiff ZMC did not accept the case evaluation award but its claims against State
Farm were dismissed on summary judgment, and the Burrell case closed, in the
Opinion and Order issued by this Court on March 29, 2017. ZMC Pharmacy, LLC v.
State Farm Mutual Automobile Ins. Co., 307 F. Supp. 3d 661 (E.D. Mich. 2018). In
that Opinion and Order, the Court concluded that ZMC could not rely on an
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assignment executed by Ms. Burrell in favor of ZMC on June 12, 2017, because at
that time Ms. Burrell had accepted her case evaluation award, settled her claims
against State Farm for all no-fault benefits related to her August 19, 2014 motor
vehicle accident, and thus had no remaining rights to collect no-fault benefits from
State Farm and therefore had no such rights to assign to ZMC. Id. at *10. As
discussed infra, because Covenant determined that a provider’s rights to recover nofault benefits were entirely derivative of the insured’s and ZMC therefore had no
independent cause of action against State Farm, and because Ms. Burrell, who settled
her claims against State Farm for all no-fault benefits due her as a result of the August,
2014 automobile accident had no such rights to assign to ZMC on June 12, 2017, the
Court granted State Farm’s motion to dismiss ZMC. ZMC did not appeal that ruling.
B.

The February 9, 2016 Assignment

On February 9, 2016, at 8:26 a.m. the morning of her surgery at Michigan
Ambulatory while she was in the pre-operative stages of her procedure, Ms. Burrell
executed an “Assignment of Rights and Guarantee,” which states that Ms. Burrell was
then “experiencing injuries arising from an accident that occurred on ^Date^ [sic].”4
The Assignment states:

4

Specialty Surgical Center and Michigan Ambulatory are the same legal entity, as
this Court concluded in its prior Opinion and Order. 2018 WL 1570332, at *5 n. 3.
7

Assignment of Rights
I hereby assign to Specialty Surgical Center (the “Center”) my right to
collect no-fault insurance from my auto insurer for my care at the Center.
I understand that this assignment does not include my right to any other
no-fault benefits to which I may be entitled, nor benefits for my care by
any provider other than the Center.
I understand and agree that should I pursue a lawsuit against my auto
insurer, my attorney shall have authority to collect on behalf of the
Center any bills owed the Center for my care. Further, I agree to notify
the Center immediately to pursue its rights to expenses owed for my care
under a lawsuit.
I understand and agree that this assignment of rights simply allows the
Center to collect bills for my care at the Center directly from my auto
carrier; it does not relieve me of my obligation for payment of any
medical bills for my care at the Center.
Guarantee
I guarantee payment of my medical expenses at the Center out of
settlement of my claim related to the above-identified accident or
episode.
Should a judge or jury determine my injuries are not related to a motor
vehicle accident, this assignment of rights shall be voided, and I will be
obligated to pay the full amount owed to the Center.
(Def.’s Mot. Ex. I, 2/9/16 Assignment of Rights).5
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In its prior Opinion and Order in this case denying State Farm’s motion to dismiss
and granting Michigan Ambulatory leave to amend, this Court determined that
Plaintiff had pleaded facts plausibly suggesting that the 2/9/16 Assignment, which was
signed by Ms. Burrell in the pre-operative phase of her surgical procedure, assigned
Ms. Burrell’s present (and not future) rights to payment as they became due because
it used present tense language to presently transfer “the thing” to the assignee. 2018
8

C.

Ms. Burrell’s Post-Case Evaluation Assignment to Michigan
Ambulatory

As noted supra, on June 12, 2017, after Ms. Burrell had accepted the May 9,
2017 case evaluation award in the Burrell case, and settled her claims against State
Farm for no-fault benefits related to her August 2014 motor vehicle accident, Ms.
Burrell executed an Assignment of rights to Michigan Ambulatory, as she had done
in favor of ZMC on that same date. The June 12, 2017 Assignment to Michigan
Ambulatory purported to assign to Michigan Ambulatory Ms. Burrell’s “no-fault
benefits presently due or past due incurred as a result of” Ms. Burrell’s August 19,
2014 motor vehicle accident. (Def.’s Mot. Summ. J. Ex. L, Assignment of No-Fault
Claim and Release of Medical and Insurance Information.) That June 12, 2017
Assignment provided:
I assign to Michigan Ambulatory Surgical Center, d/b/a Specialty
Surgical Center all no-fault benefits presently due or past due incurred
as a result of my automobile accident(s) and relating to the
reimbursement of medical billings by Michigan Ambulatory Surgical

WL 1570332, at *6 (citing Estate of Grimmett v. Encompass Indemnity Co., No. 14cv-14646, 2017 WL 5592897, at *4 (E.D. Mich. Nov. 21, 2017) (quoting Aetna Ins.
Co. v. Starkey, 116 Mich. App. 640 (1982)). In its March 30, 2018 Opinion and
Order, the Court examined the issue raised by State Farm of whether the Complaint
plausibly pleaded the purported assignment of present (as distinct from future) rights
to payment in the 2/9/16 Assignment. The Court was not called upon to, and did not,
interpret any other language of that Assignment or express any opinion on the validity
of any other aspect of the 2/9/16 Assignment in its March 30, 2018 Opinion and
Order.
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Center, d/b/a Specialty Surgical. I assign my right to recover no-fault
interest and attorney’s fees as it relates to the reimbursement of these
medical billings. I am not assigning any future benefits.
I understand that Michigan Ambulatory Surgical Center d/b/a Specialty
Surgical may pursue collection on its own behalf against my insurance
company. I grant Michigan Ambulatory Surgical Center d/b/a Specialty
Surgical and/or its attorneys permission to receive all personal or
medical information including, but not limited to , insurance claim files,
insurance policies, and all medical records.
(Def.’s Mot. Summ. J. Ex. L, 6/12/17 Assignment of No-Fault Claim and Release of
Medical and Insurance Information.)
In this Court’s March 30, 2018 Opinion and Order dismissing ZMC, the Court
declined to dismiss Michigan Ambulatory because Michigan Ambulatory was not a
named party to the Burrell lawsuit and because State Farm’s claim that Michigan
Ambulatory’s bill nonetheless was included by Ms. Burrell in her state court case
evaluation relied on matters outside the pleadings that the Court could not properly
consider on State Farm’s motion to dismiss under Fed. R. Civ. P. 12(b)(6). State Farm
now presents undisputed evidence that Ms. Burrell did expressly “blackboard”
Michigan Ambulatory’s bill in her state court case evaluation, that Michigan
Ambulatory had notice that its bill was included the case evaluation process, and that
Michigan Ambulatory elected not to intervene in Burrell or otherwise participate in
the case evaluation process.

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Michigan Ambulatory now purports to rely on these two Assignments in
pursuing its claim for no-fault benefits against State Farm for its February 9, 2016
treatment of Ms. Burrell. But because Ms. Burrell, the assignor and sole possessor of
the statutory right to obtain no-fault benefits under the Michigan no-fault act, filed a
lawsuit against State Farm and settled in full her claim against State Farm for no-fault
benefits due her as a result of her August 19, 2014 motor vehicle accident, Michigan
Ambulatory must look to Ms. Burrell, not to State Farm, for payment of its charges
for Ms. Burrell’s February 9, 2016 surgery.
II.

STANDARD OF REVIEW
Pursuant to Federal Rule of Civil Procedure 56, a party against whom a claim,

counterclaim, or cross-claim is asserted may file a motion for summary judgment “at
any time until 30 days after the close of all discovery,” unless a different time is set
by local rule or court order. Fed. R. Civ. P. 56(b). Summary judgment is appropriate
where the moving party demonstrates that there is no genuine dispute as to any
material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Fed. R. Civ. P.
56(a). “Of course, [the moving party] always bears the initial responsibility of
informing the district court of the basis for its motion, and identifying those portions
of ‘the pleadings, depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any,’ which it believes demonstrate the absence of a
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genuine issue of material fact.” Celotex, 477 U.S. at 323.
A fact is “material” for purposes of a motion for summary judgment where
proof of that fact “would have [the] effect of establishing or refuting one of the
essential elements of a cause of action or defense asserted by the parties.” Kendall v.
Hoover Co., 751 F.2d 171, 174 (6th Cir. 1984) (quoting Black’s Law Dictionary 881
(6th ed. 1979)) (citations omitted). A dispute over a material fact is genuine “if the
evidence is such that a reasonable jury could return a verdict for the nonmoving
party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Conversely,
where a reasonable jury could not find for the nonmoving party, there is no genuine
issue of material fact for trial and summary judgment is appropriate. Feliciano v. City
of Cleveland, 988 F.2d 649, 654 (6th Cir. 1993). “The evidence and all reasonable
inferences which may be drawn therefrom must be viewed in the light most favorable
to the party opposing the summary judgment motion.” Bender v. Southland Corp., 749
F.2d 1205, 1210-11 (6th Cir. 1984). “‘The central issue is whether the evidence
presents a sufficient disagreement to require submission to a jury or whether it is so
one-sided that one party must prevail as a matter of law.’” Binay v. Bettendorf, 601
F.3d 640, 646 (6th Cir. 2010) (quoting In re Calumet Farm, Inc., 398 F.3d 555, 558
(6th Cir. 2005)).
If this burden is met by the moving party, the non-moving party’s failure to
12

make a showing that is “sufficient to establish the existence of an element essential
to that party’s case, and on which that party will bear the burden of proof at trial,” will
mandate the entry of summary judgment. Celotex, 477 U.S. at 322-23. “[A] complete
failure of proof concerning an essential element of the nonmoving party’s case
necessarily renders all other facts immaterial.” Id. at 324. “The test is whether the
party bearing the burden of proof has presented a jury question as to each element in
the case. The plaintiff must present more than a mere scintilla of the evidence. To
support his or her position, he or she must present evidence on which the trier of fact
could find for the plaintiff.” Davis v. McCourt, 226 F.3d 506, 511 (6th Cir. 2000)
(internal quotation marks and citations omitted). In doing so, the non-moving party
may not rest upon the mere allegations or denials of his pleadings, but the response,
by affidavits or as otherwise provided in Rule 56, must set forth specific facts which
demonstrate that there is a genuine issue for trial. Fed. R. Civ. P. 56(e). The rule
requires the non-moving party to introduce “evidence of evidentiary quality”
demonstrating the existence of a material fact. Bailey v. Floyd County Bd. of Educ.,
106 F.3d 135, 145 (6th Cir. 1997); see Anderson, 477 U.S. at 252 (holding that the
non-moving party must produce more than a scintilla of evidence to survive summary
judgment). “A party asserting that a fact . . . is genuinely disputed must support the
assertion by . . . citing to particular parts of materials in the record.” Fed. R. Civ. P.
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56(c)(1)(A).
III.

ANALYSIS
There is no dispute, after the Michigan Supreme Court’s decision in Covenant,

that medical providers such as Michigan Ambulatory do not have an independent
statutory cause of action under the Michigan No-Fault Act to recover personal
protection insurance (“PIP”) benefits from no-fault insurers. Further, the Michigan
Court of Appeals decision in Foote Memorial Hosp. v. Michigan Assigned Claims
Plan, 321 Mich. App. 159, 196 (2017), establishes that Covenant applies retroactively.
The Michigan Court of Appeals has reiterated that Covenant applies retroactively:
“This Court has already held in two recent published decisions that Covenant applies
retroactively.” Jawad A. Shah, M.D. v. State Farm Mutual Auto. Ins. Co., No.
340370, 2018 WL 2121787, at *4 (Mich. Ct. App. May 8, 2018) (citing Foote and
VHS Huron Valley Sinai Hosp. v. Sentinel Ins. Co., 322 Mich. App. 707 (2018)).
Likewise, there is no dispute that Michigan Ambulatory’s claims are derivative of Ms.
Burrell’s claims as the insured is the only person entitled to claim PIP benefits under
the Michigan No-Fault statute. Foote, 321 Mich. App. at 174 (“the right to bring a
personal protection insurance action . . . belongs to the injured party”) (quoting
Hatcher v. State Farm Mut. Ins. Co., 269 Mich. App. 596, 600 (2005)). Covenant
thus dictates that at the time Ms. Burrell executed the February 9, 2016 Assignment,
14

Michigan Ambulatory did not have an independent statutory right to commence a
lawsuit against State Farm to recover no-fault PIP benefits that were due and owing
to Ms. Burrell.
It is also understood following Covenant, which expressly declined to alter the
rights of an insured to assign rights to a medical provider, that a provider is not
precluded from presenting claims based on a valid contractual assignment from the
insured for presently or past due benefits. “[O]ur conclusion today is not intended to
alter an insured’s ability to assign his or her right to past or presently due benefits to
a healthcare provider.” Covenant, 500 Mich. at 217 n. 40. Plaintiff purports to rely
on two separate assignments here: the one executed on February 9, 2016, the day of
her surgery at Michigan Ambulatory, and one executed on June 12, 2017, after Ms.
Burrell had settled her lawsuit with State Farm for no-fault PIP benefits she alleged
were due and payable as a result of her August 2014 motor vehicle accident.
The parties agree that Michigan substantive law governs the issues presented
in State Farm’s motion and they do not dispute the generally applicable principles of
the law of assignments. It is axiomatic that “‘[a]n assignee stands in the position of
the assignor, possessing the same rights and being subject to the same defenses.’”
Jawad A. Shah, 2018 WL 2121787, at *8 (quoting Burkhardt v. Bailey, 260 Mich.
App. 636, 653 (2004)). Michigan courts apply the following principles in analyzing
15

the validity of an assignment:
In Weston v. Dowty, 163 Mich.App. 238, 242, 414 N.W.2d 165 (1987),
this Court opined “there must be a perfected transaction between the
parties which is intended to vest in the assignee a present right in the
thing assigned.” Further, Michigan’s version of the statute of frauds
requires that an assignment of “things in action” be “in writing and
signed with an authorized signature by the party to be charged with the
agreement, contract, or promise....” M.C.L. § 566.132(1)(f) . Thus, under
Michigan law, a written instrument, even if poorly drafted, creates an
assignment if it clearly reflects the intent of the assignor to presently
transfer “the thing” to the assignee. Hovey v. Grand Trunk W. R. Co.,
135 Mich. 147, 149, 97 N.W. 398 (1903).
Foreign jurisdictions have also held generally that an assignment
requires an assignor’s intent to presently assign be clearly manifested.
“No ‘particular form of words is required for an assignment, but the
assignor must manifest an intent to transfer and must not retain any
control or any power of revocation.’” Travertine Corp. v.
Lexington–Silverwood, 670 N.W.2d 444, 447 (Minn. App., 2003),
quoting Minnesota Mut. Life Ins. Co. v. Anderson, 504 N.W.2d 284, 286
(Minn.App., 1993). See, also, E & L Rental Equip., Inc. v. Gifford, 744
N.E.2d 1007, 1011 (Ind. App., 2001), quoting Brown v. Indiana Nat'l
Bank, 476 N.E.2d 888, 894 (Ind. App., 1985) : “‘In determining whether
an assignment has been made, the question is one of intent. A written
agreement assigning a subject matter must manifest the assignor's intent
to transfer the subject matter clearly and unconditionally to the
assignee.’” (Citations omitted.)
Burkhardt, 260 Mich. App. at 654-55 (emphasis added). Finally, while “the general
rule [is] that a third party cannot challenge an assignment,” a third party may
challenge an assignment where the challenge would “‘render[] the assignment
absolutely invalid or ineffective, or void.’” Keyes v. Deutsche Bank Nat. Trust Co.,

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921 F. Supp. 2d 749, 756 (E.D. Mich. 2013) (quoting Livonia Props. v. 12840–12976
Farmington Road Holdings, LLC, 399 F. App’x 97, 102 (6th Cir. 2010)).
A.

The February 9, 2016 Assignment

Ms. Burrell did not “unconditionally” assign to Michigan Ambulatory her right
to collect no-fault PIP benefits from State Farm in the February 9, 2016 Assignment.
In fact, by the clear and unambiguous language of that Assignment, Ms. Burrell
expressly “retained control” over her right to sue State Farm to collect no-fault PIP
benefits, including those benefits due for the services provided by Michigan
Ambulatory on February 9, 2016. Burkhardt, 260 Mich. App. at 655. Far from
“unconditionally” assigning her right to collect no-fault PIP benefits to Michigan
Ambulatory, Ms. Burrell clearly reserved the right to commence a lawsuit against
State Farm, to notify Michigan Ambulatory of any such proceeding and to attempt
to collect in such a proceeding any bills that Ms. Burrell owed to Michigan
Ambulatory arising out of her August 19, 2014 motor vehicle accident. Indeed Ms.
Burrell guaranteed, in her February 9, 2016 Assignment, that she would pay any
expenses she had incurred at Michigan Ambulatory related to the accident out of any
settlement of her claim for no-fault PIP benefits. The record establishes that Ms.
Burrell did include the Michigan Ambulatory bill in her state court case evaluation,
that Michigan Ambulatory had notice of that proceeding, and elected not to
17

participate.

Under the terms of the February 9, 2016 Assignment, Michigan

Ambulatory may have a claim against Ms. Burrell, but not against State Farm. See
Covenant, 500 Mich. at 217 (“This conclusion does not mean that a healthcare
provider is without recourse; a provider that furnishes healthcare services to a person
for injuries sustained in a motor vehicle accident may seek payment from the injured
person for the provider’s reasonable charges.”). Because Covenant establishes that
Michigan Ambulatory never had an independent statutory right to collect no-fault
benefits directly from State Farm, and because Ms. Burrell expressly retained her right
to commence a lawsuit against State Farm to collect all no-fault benefits owed her as
a result of her August 2014 accident in the February 9, 2016 Assignment, and in fact
did so, she did not unconditionally assign that right to Michigan Ambulatory in the
February 9, 2016 Assignment.
Michigan Ambulatory disputes this conclusion, relying on the following
language of the February 9, 2016 Assignment: “I agree to notify the Center
immediately to pursue its rights to expenses owed for my care under a lawsuit.”
Michigan Ambulatory argues that this language establishes that “the Assignment on
February 9, 2016 not only assigned to [Michigan Ambulatory] Ms. Burrell’s rights to
collect the No-Fault benefits owed to [Michigan Ambulatory], but also included the
right to file a lawsuit against [State Farm].” (Pl.’s Resp. 9, PgID 892.)
18

This

interpretation of the assignment language is simply not reasonable. “Absent an
ambiguity or internal inconsistency, contractual interpretation begins and ends with
the actual words of a written agreement.” Universal Underwriters Ins. Co. v.
Kneeland, 464 Mich. 491, 496 (2001). “A contract is ambiguous if its provisions may
reasonably be understood in different ways.” Id. Because Michigan Ambulatory
drafted the Assignment, any ambiguity that may exist “must be construed most
strongly against [Michigan Ambulatory].” Stark v. Kent Products, Inc., 62 Mich.
App. 546, 547-48 (1975).
First, as discussed supra, the February 9, 2016 Assignment is invalid because
it does not clearly reflect Ms. Burrell’s intent to unconditionally transfer and
relinquish control over “the thing” (her right to collect PIP benefits from her auto
insurer) purportedly transferred. But additionally, Covenant establishes that providers
never had, and do not have, an independent statutory right to file a claim against a nofault insurer and Ms. Burrell could not bestow such an independent right on Michigan
Ambulatory by signing the February 9, 2016 Assignment. The only rights that Ms.
Burrell could transfer were her rights to collect no-fault benefits – which she did not
effectively do in the February 9, 2016 Assignment.

In fact, Ms. Burrell

unambiguously retained for herself the right to proceed in a lawsuit against State Farm
to collect the benefits she claimed were owed her under the Michigan No-Fault Act,
19

including Michigan Ambulatory’s bill. And she exercised that right when she filed
suit against State Farm to collect all no-fault PIP benefits due and payable from State
Farm related to her August 19, 2014 automobile accident.

She did not

“unconditionally” assign that right to Michigan Ambulatory, under the clear and
unambiguous language of the February 9, 2016 Assignment. Therefore, the February
9, 2016 Assignment does not afford Michigan Ambulatory the right to proceed against
State Farm.
B.

The June 12, 2017 Assignment

As discussed supra and as this Court explained in the related Burrell case, on
or before June 6, 2017, Ms. Burrell and State Farm accepted a case evaluation award
and settled in full all claims that Ms. Burrell possessed against State Farm for no-fault
PIP benefits arising out of her August 19, 2014 motor vehicle accident. Pursuant to
Michigan Court Rule 2.403(M)(1), Ms. Burrell’s and State Farm’s acceptance of the
case evaluation award “dispose[d] of all [plaintiff’s] claims in the action.” Mich. Ct.
R. 2.403(M)(1). Michigan Ambulatory, although notified of the case evaluation
proceedings in which Ms. Burrell had expressly listed or “blackboarded” the Michigan
Ambulatory bill, elected not to participate in that case evaluation process. Michigan
Ambulatory did so at its own peril as Ms. Burrell’s acceptance of the case evaluation
award resulted in the settlement and dismissal of her claims against State Farm with
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prejudice and extinguished Ms. Burrell’s claims against State Farm for the Michigan
Ambulatory bill. Therefore, Ms. Burrell had no rights to assign to Michigan
Ambulatory when she executed the second assignment on June 12, 2017.
Michigan Ambulatory argues that “as of signing her Assignment on February
9, 2016, Ms. Burrell no longer owned her rights to collect No-Fault Personal Injury
Benefits from [State Farm].” As discussed supra, Ms. Burrell did not unconditionally
assign to Michigan Ambulatory her rights to collect no-fault PIP benefits from State
Farm in the February 9, 2016 Assignment. And Ms. Burrell’s conduct confirms that
she retained the right to commence a suit to collect no-fault benefits from State Farm
that were payable as a result of her August 2014 accident. The February 9, 2016
Assignment expressly reserved to Ms. Burrell her right to proceed with a lawsuit
against State Farm for recovery of all no-fault PIP benefits owed her arising out of her
August 2014 motor vehicle accident, specifically including the right to collect
Michigan Ambulatory’s bill. In that February 9, 2016 Assignment, Ms. Burrell also
guaranteed that she would pay Michigan Ambulatory out of her settlement proceeds.
And she did proceed with a lawsuit against State Farm, and she did notify Michigan
Ambulatory, and she did blackboard Michigan Ambulatory’s bill in her case
evaluation statement, and she did settle all of her claims against State Farm for all nofault PIP benefits payable to her as a result of her August 19, 2014 motor vehicle
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accident.
Covenant establishes that Michigan Ambulatory’s rights to collect are wholly
derivative of Ms. Burrell’s. Michigan Ambulatory states in its brief that “Defendant
was put on notice of Plaintiff’s Counsel representation on March 31, 2016 and the fact
that Ms. Burrell did not have authority to represent [Michigan Ambulatory’s]
billings.” (Pl.’s Resp. 12, PgID 895.) Of course, Michigan Ambulatory cites no
authority for this blanket proposition regarding Ms. Burrell’s authority to settle her
own no-fault claim against State Farm. Michigan Ambulatory continues: “Ms.
Burrell had no power to settle [Michigan Ambulatory’s] bill.” But saying this doesn’t
make it so and Michigan Ambulatory cites no law in support of this position.
Michigan Ambulatory, under Covenant, possesses no independent statutory basis for
pursuing a claim against State Farm. Its claims, if any, are entirely derivative of Ms.
Burrell’s claims against State Farm. Ms. Burrell settled all of her claims for no-fault
PIP benefits against State Farm by accepting a case evaluation award on or about June
6, 2017, and dismissing her claim against State Farm for all no-fault benefits arising
out of her August 19, 2014 automobile accident, expressly including Michigan
Ambulatory’s bill. She had no rights to recovery against State Farm that she could

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assign to Michigan Ambulatory on June 12, 2017.6 The June 12, 2017 Assignment
does not afford Michigan Ambulatory a right to proceed against State Farm.
IV.

CONCLUSION
For the foregoing reasons, State Farm’s Motion for Summary Judgment is

GRANTED.
IT IS SO ORDERED.

s/Paul D. Borman
PAUL D. BORMAN
UNITED STATES DISTRICT JUDGE
Dated: October 3, 2018
CERTIFICATE OF SERVICE
The undersigned certifies that a copy of the foregoing order was served upon each
attorney or party of record herein by electronic means or first class U.S. mail on
October 3, 2018.

s/Deborah Tofil
Case Manager

6

As this Court noted in ZMC, Covenant was issued on May 25, 2017, and the case
evaluation award could have been accepted anytime on or before June 6, 2017. 307
F. Supp. 3d at 674 n. 3. By electing not to be involved in the case evaluation process,
Michigan Ambulatory “chose instead to proceed ahead in very uncharted waters.” Id.
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