Maple Manor Rehab Center of Novi, Inc. et al v. Travelers Insurance Company

Filing 21

OPINION AND ORDER GRANTING PLAINTIFFS' MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT 18 , DENYING AS MOOT DEFENDANT'S MOTION FOR SUMMARY JUDGMENT 12 , AND DENYING DEFENDANT'S MOTION FOR JUDGMENT ON THE PLEADINGS 14 . Signed by District Judge Gershwin A. Drain. (TBan)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
MAPLE MANOR REHAB CENTER OF NOVI,
INC., ET AL.,
Case No. 17-cv-10695
Plaintiffs,
UNITED STATES DISTRICT COURT JUDGE
GERSHWIN A. DRAIN

v.
TRAVELERS INSURANCE COMPANY.

UNITED STATES MAGISTRATE JUDGE
DAVID R. GRAND

Defendant.
/
OPINION AND ORDER GRANTING PLAINTIFFS’ MOTION FOR LEAVE TO FILE
FIRST AMENDED COMPLAINT [18], DENYING AS MOOT DEFENDANT’S MOTION
FOR SUMMARY JUDGMENT [12], AND DENYING DEFENDANT’S MOTION FOR
JUDGMENT ON THE PLEADINGS [14]
On February 13, 2017, Maple Manor Rehab Center of Novi Inc., Maple
Manor Neuro Center Inc., Jose S. Evangelista, III, M.D., P.C., and Livonia
Diagnostic Center, P.C. (collectively, “Plaintiffs”) filed a complaint against
Travelers Insurance Company in Wayne County Circuit Court. See Dkt. No. 1-2.
Travelers Insurance Company removed the complaint to this Court on March 6,
2017 based on diversity jurisdiction. Dkt. No. 1.
The case is presently before the Court on Defendant Travelers Insurance’s
Motion for Summary Judgment [12], Defendant’s Motion to Dismiss Pursuant to
Rule 12(c), and Plaintiffs’ Motion for Leave to File First Amended Complaint
[18]. For the following reasons, the Court GRANTS Plaintiffs’ Motion for Leave
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to File First Amended Complaint [18], DENIES AS MOOT Defendant’s Motion
for Summary Judgment [12], and DENIES Defendant’s Motion to Dismiss
Pursuant to Rule 12(c).
A.

Plaintiffs’ Motion for Leave to File First Amended Complaint and
Defendant’s Motion for Summary Judgment
Although generally a “party may amend its pleading once as a matter of

course,” FED. R. CIV. P. 15(a), “in all other cases it may amend a pleading only
with the opposing party’s consent or with leave of the court.” Commerce Benefits
Grp., Inc. v. McKesson Corp., 326 F. App’x 369, 376 (6th Cir. 2009). “The court
should freely give leave when justice so requires.” FED. R. CIV. P. 15(a)(2). “If the
underlying facts or circumstances relied upon by a plaintiff may be a proper
subject of relief, he ought to be afforded an opportunity to test his claim on the
merits.” Foman v. Davis, 371 U.S. 178, 182 (1962).
In the present case, Plaintiffs concede that they misnamed Defendant in their
original Complaint. They now seek permission to amend their Complaint to correct
Defendant’s name from Travelers Insurance to Travelers Casualty and Surety
Company. Dkt. No. 18, pp. 1–2 (Pg. ID 130–31). Plaintiffs had filed a parallel
second action arising out of the same facts against Travelers Casualty and Surety
Company in Wayne County Circuit Court on May 4, 2017, upon which Defendant
based its Motion for Summary Judgment. Dkt. No. 12.

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Based on the pleadings, it appears that Defendant had adequate notice of the
claims against it, albeit under an incorrect name. Defendant has not demonstrated
that it will suffer any prejudice, undue delay, or futility from Plaintiffs’
amendment, as long as Plaintiffs dismiss the duplicative state court proceeding.
Accordingly, the Court will grant Plaintiffs’ Motion to amend their Complaint to
correct Plaintiff’s name. The Court will also order that Plaintiffs voluntarily
dismiss their second lawsuit, as agreed to in their pleadings, within 14 days of the
amendment. Such a ruling moots Defendant’s Motion for Summary Judgment,
which the Court will deny.
B.

Defendant’s Motion for Judgment on the Pleadings
Defendant’s second motion seeks judgment on the pleadings pursuant to

Federal Rule of Civil Procedure 12(c). Dkt. No. 14. In its motion, Defendants rely
on the Michigan Supreme Court’s recent decision in Covenant Med. Center, Inc. v.
State Farm Mutual Automobile Insurance Co., 895 N.W.2d 490 (Mich. 2017),
which held “that healthcare providers do not possess a statutory cause of action
against no-fault insurers for recovery of personal protection insurance benefits
under the no-fault act.” Id. at 493.
In response, Plaintiffs point out that Covenant’s holding did not “alter an
insured’s ability to assign his or her right to past or presently due benefits to a
healthcare provider.” Id. at 505 n.40. Thus, Covenant would not bar Plaintiffs from
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seeking relief should they receive an assignment of rights from the patient. Indeed,
Plaintiffs note that they are currently working on obtaining an assignment. Dkt.
No. 20, pp. 3, 12 (Pg. ID 162, 171).1
Because Plaintiffs are currently working on securing an assignment, the
Court will deny Defendant’s Motion for Judgment on the Pleadings without
prejudice. Should Plaintiffs fail to secure an assignment from the injured party
within the ordered time period, Defendant may file a renewed motion for judgment
on the pleadings, at which time the Court will consider whether Covenant is to be
applied prospectively or retroactively.
Accordingly, the Court GRANTS Plaintiffs’ Motion For Leave To File First
Amended Complaint [18] and DENIES AS MOOT Defendant’s Motion For
Summary Judgment [12].
IT IS FURTHER ORDERED that Defendant’s Motion for Judgment on
the Pleadings [14] is DENIED.

1

Plaintiffs’ response brief failed to comply with the Court’s Local Rule on type
size, which requires all text and footnotes be no smaller 14-point type size. E.D.
Mich. LR 5.1(a)(3). Plaintiffs’ text was smaller than 11-point type size and their
footnotes were smaller than 8-point type size, making their brief challenging to
read. This may be because Plaintiffs’ counsel failed to turn off the “track changes”
feature before filing the brief. Plaintiffs’ counsel is advised to at review his
pleadings to ensure compliance with the Local Rules before submitting them to the
Court.
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IT IS FURTHER ORDERED that Plaintiffs shall secure an assignment
from the injured party and submit proof of this assignment to the Court within
thirty (30) days of this order’s entry.
IT IS SO ORDERED.
Dated:

July 27, 2017
/s/Gershwin A Drain
HON. GERSHWIN A. DRAIN
United States District Court Judge

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