ABO Staffing Services Inc. v. UnitedHealthCare Insurance Company

Filing 10

OPINION AND ORDER GRANTING PLAINTIFF'S #5 MOTION FOR A TEMPORARY RESTRAINING ORDER AND SETTING HEARING AND BRIEFING SCHEDULE ON PLAINTIFF'S #2 MOTION FOR PRELIMINARY INJUNCTION, Set Motion and R&R Deadlines/Hearings as to #2 MOTION for Preliminary Injunction :( Response due by 8/5/2022, Reply due by 8/8/2022, Motion Hearing set for 8/10/2022 03:00 PM before District Judge Linda V. Parker). Signed by District Judge Linda V. Parker. (AFla)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
ABO STAFFING SERVICES, INC.,
Plaintiff,

Civil Case No. 22-11696
Honorable Linda V. Parker

v.
UNITEDHEALTHCARE INSURANCE
COMPANY,
Defendant.
____________________________________/
OPINION AND ORDER GRANTING PLAINTIFF’S MOTION FOR A
TEMPORARY RESTRAINING ORDER AND SETTING HEARING AND
BRIEFING SCHEDULE ON PLAINTIFF’S MOTION FOR PRELIMINARY
INJUNCTION (ECF NO. 2)
On July 22, 2022, Plaintiff ABO Staffing Services Inc. (“ABO”) initiated
this action against its healthcare provider, UnitedHealthcare Insurance Company
(“United”). (ECF No. 1.) ABO claims that United gave notice on June 30, 2022,
that it intended to rerate ABO’s group insurance policies effective July 1, 2022,
and that ABO had to accept the new rates by July 11, 2022, or United would cancel
the group policies on August 1, 2022. Additionally, United demanded that ABO
complete and return an eligibility audit by July 31, 2022 and sign a letter of
Agreement. ABO alleges that United had no right to change the Schedule of
Premium Rates because, per the Group Policy Contract, rate changes only could be

made after the first anniversary of the effective date, which is January 1, 2023, or
in response to a material misrepresentation.
On the date the Complaint was filed, ABO filed a motion for a preliminary
injunction. (ECF No. 2.) On July 26, 2022, ABO filed an amended complaint
(ECF No. 4) and a motion for temporary restraining order and/or preliminary
injunction (ECF No. 5). ABO alleges a breach of contract claim (Count I) and a
“claim” for injunctive relief (Count II). (ECF No. 4.) On July 28 and 29, 2022,
the Court held telephonic conferences with respect to ABO’s motion, which
counsel for ABO and United attended. At the conference, counsel for United
informed the Court that United was in receipt of the motion and stated United’s
position with respect to the parties’ dispute. After reviewing ABO’s motion and
hearing the representations of counsel, the Court is granting a temporary restarting
order and setting a briefing schedule and hearing on the motion for preliminary
injunction.
“When evaluating a motion for a temporary restraining order (“TRO”), a
district court must strictly adhere to the requirements of Federal Rule of Civil
Procedure 65.” Career Agents Network, Inc. v. Careeragentsnetwork.biz, No. 09CV-12269, 2009 WL 1707956, at *1 (E.D. Mich. June 17, 2009) (citing Leslie v.
Penn Cent. R. Co., 410 F.2d 750, 751 (6th Cir. 1969)). Federal Rule of Civil
Procedure 65 states in relevant part that:

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The court may issue a temporary restraining order without
written or oral notice to the adverse party or its attorney only if:
(A) specific facts in an affidavit or a verified complaint clearly
show that immediate and irreparable injury, loss, or damage
will result to the movant before the adverse party can be heard
in opposition; and
(B) the movant’s attorney certifies in writing any efforts made
to give notice and the reasons why it should not be required.
Fed. R. Civ. P. 65(b)(1). “Temporary restraining orders and preliminary
injunctions are extraordinary remedies designed to protect the status quo pending
final resolution of a lawsuit.” Richardson v. Wells Fargo Bank, NA, No. 13-cv10234, 2013 WL 3367434, at *2 (E.D. Mich. July 5, 2013).
The same factors are considered in determining whether to issue a TRO or a
preliminary injunction. Northeast Ohio Coalition for the Homeless v. Blackwell,
467 F.3d 999, 1009 (6th Cir.2008). Those factors are: (1) whether the movant has
a strong likelihood of success on the merits; (2) whether the movant would suffer
irreparable injury absent an injunction; (3) whether granting the injunction will
cause substantial harm to others; and (4) whether the public interest is served by
issuance of the injunction. Id.; see also In re DeLorean Motor Co., 755 F.2d 1223,
1228 (6th Cir. 1985). “[T]hese factors simply guide the discretion of the court;
they are not meant to be rigid and unbending requirements.” In re Eagle-Picher
Indus., Inc., 963 F.2d 855, 859 (6th Cir. 1992). The Court finds that: (1) ABO will
suffer irreparable injury if United is not required to maintain the status quo of
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coverage pending determination of the preliminary injunction request; (2) ABO
has shown, for purposes of this motion, that it is likely to succeed on the merits of
its breach of contract claim; and (3) the balance of hardships tips in favor of ABO
because failure to issue the restraining order could cause hundreds of families to be
suddenly uninsured.
Therefore,
IT IS ORDERED that ABO’s request for a temporary restraining order is
granted in that:
1) United is prohibited from rescinding group policy coverage
for a period of at least fourteen (14) days pursuant to Rule 65 of
the Federal Rules of Civil Procedure;
2) Each party reserves the right to litigate the issue of whether
the premium rate change is enforceable;
IT IS FURTHER ORDERED, that ABO shall post an undertaking within
five (5) business days of the entry of this Order with the Clerk of the Court in the
form of a bond, cash, or check in the sum of $94,468 as security for the payment of
such costs and damages as may be incurred or suffered by any party as a result of a
wrongful restraint hereunder.
IT IS FURTHER ORDERED, that the temporary restraining order will
expire in 14 days or if the parties execute an agreement negating the need for the
temporary restraining order, whichever occurs first.

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IT IS FURTHER ORDERED that the parties shall appear before the Court
for a hearing on Plaintiff’s motion for preliminary injunction on August 10, 2022
at 3:00 p.m. via Zoom Webinar:
https://www.zoomgov.com/j/1619868988?pwd=R2dzYjlOcnFHcktrV
0Rpb Ct3U3pxZz09 Passcode: 468540
Or One tap mobile : US: [phone],,1619868988# or
[phone],,1619868988#
Or Telephone: Dial(for higher quality, dial a number based on your
current location): US: [phone] or [phone] or +1
551 285 1373 or [phone]
Webinar ID: 161 986 8988.
United shall file a response to ABO’s motion on or before 5:00 p.m. on August 5,
and ABO shall file a reply brief on or before 5:00 p.m. on August 8.
IT IS SO ORDERED.
s/Linda V. Parker
LINDA V. PARKER
U.S. DISTRICT JUDGE
Dated and Time: July 29, 2022
at 7:30 p.m.

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