SHAH v. HORIZON BLUE CROSS BLUE SHIELD OF NEW JERSEY
OPINION. Signed by Judge Noel L. Hillman on 3/30/2017. (dmr)
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
RAHUL SHAH, M.D., assignee of
HONORABLE NOEL L. HILLMAN
CIVIL ACTION NO. 16-2397
WELLMARK BLUE CROSS BLUE
CALLAGY LAW, P.C.
By: Samuel S. Salman, Esq.
Michael Gottlieb, Esq.
650 From Road, Suite 565
Paramus, New Jersey 07652
Counsel for Plaintiff
By: Michael E. Holzapfel, Esq.
Revmont Park North
1151 Broad Street, Suite 112
Shrewsbury, New Jersey 07702
Counsel for Defendant
HILLMAN, United States District Judge:
This is one of many ERISA suits 1 filed by Plaintiff Dr. Rahul
Shah, as purported assignee of his individual patients, against his
The Court has federal question subject matter jurisdiction
pursuant 28 U.S.C. § 1331, and supplemental jurisdiction pursuant to
28 U.S.C. § 1367.
patients’ various insurance companies. 2
In each suit, Dr. Shah
asserts that the insurance companies wrongfully denied requests for
payment of benefits under the patients’ health insurance policies,
and consequently, Dr. Shah’s bills for services were not paid, or
not fully paid.
Presently before the Court is Defendant Wellmark Blue Cross
Blue Shield’s Motion to Dismiss the Amended Complaint pursuant to
Fed. R. Civ. P. 12(b)(1)(standing), 12(b)(3) (improper venue), and
12(b)(6)(failure to state a claim).
For the reasons stated herein,
the motion will be granted to the extent that it seeks dismissal for
improper venue based on the forum selection clause in the applicable
On July 15, 2013, Dr. Shah allegedly performed back surgery on
Karyn G. (Amend. Compl. ¶ 4-6; and Ex. A)
He alleges all services
were medically necessary and reasonable (Id. at ¶ 4-5), yet Karyn
G.’s health insurance company, Defendant Wellmark Blue Cross and
Blue Shield, allegedly underpaid the claim by $114,704.07. (Amend.
In addition to this case, three other such suits are pending
before the undersigned, Shah v. Horizon Blue Cross Blue Shield of
New Jersey, Docket No. 17-cv-0632, Shah v. Blue Cross Blue Shield of
Michigan, Docket No. 17-0711, Shah v. Horizon Blue Cross Blue Shield
of New Jersey, Docket No. 16-2397, and a fourth was dismissed by
stipulation of the parties, Shah v. Horizon Blue Cross Blue Shield
of New Jersey, Docket No. 16-2495. The Court’s records reflect 12
other open cases in this District.
Compl. ¶ 16)
Dr. Shah further alleges that he obtained an
assignment of benefits from Karyn G. (Amend. Compl. ¶ 7)
It is undisputed that the applicable ERISA plan contains a
forum selection clause: “To the extent not superseded by the laws of
the United States, the group health plan will be construed in
accordance with and governed by the laws of the state of Iowa.
action brought because of a claim under this plan will be litigated
in the state or federal courts located in the state of Iowa and in
no other.” (VonHagel Cert. Ex. A, p. 103)
The Amended Complaint asserts four claims: breach of contract;
denial of benefits in violation of § 1132(a)(1)(B); breach of
fiduciary duty in violation of § 1132(a)(3)(B); and failure to
maintain a reasonable claims process pursuant to 29 C.F.R. 2560.5031.
Mandatory forum selection clauses are entitled to a presumption
of enforceability. See M/S Bremen v. Zapata Off-Shore Co., 407 U.S.
The presumption can be overcome upon a demonstration of
“extraordinary circumstances unrelated to the convenience of the
parties” that clearly disfavor a transfer or dismissal.
Marine Const. Co., Inc. v. U.S. Dist. Court for W. Dist. of Tx., 134
S. Ct. 568, 581 (2013).
In opposition to Wellmark’s argument that the forum selection
clause should be enforced, Plaintiff asserts that the forum
selection clause is unenforceable because it contravenes the “strong
public policy of ERISA” which according to Plaintiff, favors
honoring a participant’s choice to pursue his claims in his home
venue. (Opposition brief, p. 10)
While Plaintiff cites authority that arguably supports his
argument, see Dumont v. PepsiCo, 192 F. Supp. 3d 209 (D. Me. 2016),
the clear weight of authority rejects Plaintiff’s argument. See
Smith v. Aegon Companies Pension Plan, 769 F.3d 922, 931 (6th Cir.
2014)(“A majority of courts that have considered this question have
upheld the validity of venue selection clauses in ERISA-governed
plans.”)(collecting cases), cert. denied by 136 S.Ct. 791 (2016);
Mathias v. Caterpillar, Inc., 2016 U.S. Dist. LEXIS 115314 at *17-18
(E.D. Pa. Aug. 29, 2016)(following Smith); Feather v. SSM Health
Care, 2016 U.S. Dist. LEXIS 147558 at *12 (S.D. Ill. Oct. 25,
2016)(following Smith and declining to follow Dumont, stating that
Dumont is an “outlier” that “other courts have declined to follow”). 3
Admittedly, there is room for disagreement on this issue. See
Smith, 769 F.3d at 934 (Clay, Circuit Judge, dissenting); Dumont,
192 F. Supp. 3d at 221 (“I conclude that enforcement of the forum
Even Dumont acknowledged that “[t]he majority of district courts
to address the issue have . . . held that forum selection clauses
are permissible in the ERISA plan context.” 192 F. Supp. 3d at 212.
selection clause would run afoul of the strong ERISA public policy
in favor of ready access to the federal courts.”).
precedent or other clear direction from the Court of Appeals for the
Third Circuit, this Court adopts the reasoning and holding of Smith,
769 F.3d 922, 931 (6th Cir. 2014), cert. denied by 136 S.Ct. 791
(2016) and holds that the forum selection clause in this case is
Accordingly, Wellmark’s Motion to Dismiss for improper
venue will be granted. 4
In light of the disposition of the venue issue, the Court need
not address the other arguments raised by Wellmark in support of its
Motion to Dismiss.
For the reasons set forth above, the Motion to Dismiss will be
An appropriate Order accompanies this Opinion.
Dated: March 30, 2017
At Camden, New Jersey
___s/ Noel L. Hillman ___
Noel L. Hillman, U.S.D.J.
The Court will dismiss, rather than transfer this suit, because
dismissal is the relief requested by Wellmark and Plaintiff has not
requested alternative relief. See Salovaara v. Jackson Nat'l Life
Ins. Co., 246 F.3d 289, 300 (3d Cir. 2001)(“we conclude that the
District Court was not required to treat Lazard’s motion for
dismissal as a motion for transfer simply because the forum
selection clause specified that suit be brought in either a federal
or a state forum.”).
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