SHAH v. HORIZON BLUE CROSS BLUE SHIELD OF NEW JERSEY et al

Filing 16

OPINION FILED. Signed by Judge Noel L. Hillman on 5/4/17. (js)

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

HONORABLE NOEL L. HILLMAN

RAHUL SHAH, M.D., assignee of
Monica M.,

CIVIL ACTION NO. 16-5946

Plaintiff,

OPINION

v.
HORIZON BLUE CROSS BLUE SHIELD
OF MASSACHUSETTS,
Defendant.

APPEARANCES:
CALLAGY LAW, P.C.
By: Michael Gottlieb, Esq.
650 From Road, Suite 565
Paramus, New Jersey 07652
Counsel for Plaintiff
BECKER LLC
By: Michael E. Holzapfel, Esq.
Revmont Park North
1151 Broad Street, Suite 112
Shrewsbury, New Jersey 07702
Counsel for Defendant Horizon Blue Cross Blue Shield
of Massachusetts

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,

The Court has federal question subject matter jurisdiction
pursuant 28 U.S.C. § 1331, and supplemental jurisdiction
pursuant to 28 U.S.C. § 1367.
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against his patients’ various insurance companies.

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’s Motion to Dismiss
the Complaint pursuant to Fed. R. Civ. P. 12(b)(6).

For the

reasons stated herein, the motion will be granted in part,
denied in part, and denied as moot in part.
I.
On October 28, 2013, Dr. Shah allegedly performed surgery
on Monica M. (Compl. ¶ 5-6; and Ex. A)

He alleges all services

were medically necessary and reasonable (Id. at ¶ 5), yet Monica
M.’s health insurance company, Defendant Horizon Blue Cross Blue
Shield of Massachusetts, allegedly denied the claim. (Compl. ¶
8)
Dr. Shah alleges that he obtained an assignment of benefits
from Monica M. (Compl. ¶ 7 and Ex. B)

The 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. 2560.503-1.
II.
When considering a motion to dismiss a complaint for
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failure to state a claim upon which relief can be granted
pursuant to Federal Rule of Civil Procedure 12(b)(6), a court
must accept all well-pleaded allegations in the complaint as
true and view them in the light most favorable to the plaintiff.
Evancho v. Fisher, 423 F.3d 347, 351 (3d Cir. 2005).

It is well

settled that a pleading is sufficient if it contains “a short
and plain statement of the claim showing that the pleader is
entitled to relief.”

Fed. R. Civ. P. 8(a)(2).

Under the liberal federal pleading rules, it is not
necessary to plead evidence, and it is not necessary to plead
all the facts that serve as a basis for the claim. Bogosian v.
Gulf Oil Corp., 562 F.2d 434, 446 (3d Cir. 1977).

However, “the

Federal Rules of Civil Procedure . . . do require that the
pleadings give defendant fair notice of what the plaintiff’s
claim is and the grounds upon which it rests.” Baldwin Cnty.
Welcome Ctr. v. Brown, 466 U.S. 147, 149-50 n.3 (1984)
(quotation and citation omitted).
A district court, in weighing a motion to dismiss, asks
“‘not whether a plaintiff will ultimately prevail but whether
the claimant is entitled to offer evidence to support the
claim.’” Bell Atlantic v. Twombly, 550 U.S. 544, 563 n.8 (2007)
(quoting Scheuer v. Rhoades, 416 U.S. 232, 236 (1974)); see also
Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009)(“Our decision in
Twombly expounded the pleading standard for ‘all civil actions’
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. . . .”); Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir.
2009)(“Iqbal . . . provides the final nail in the coffin for the
‘no set of facts’ standard that applied to federal complaints
before Twombly.”).
III.
Defendant asserts the following arguments: (1) Dr. Shah
lacks standing because the applicable ERISA plan contains an
anti-assignment clause; (2) the suit is barred by the Plan’s
limitations period; (3) the breach of contract claim (Count One)
is preempted by ERISA; and (4) Count Four, violation of 29
C.F.R. 2560.503-1, fails to state a claim.

The Court addresses

each argument in turn.
1.
Defendant’s standing argument is not ripe for decision on a
motion to dismiss.
In opposition to Defendant’s Motion to Dismiss, Dr. Shah
argues that Defendant waived the enforceability of the antiassignment clause through its course of dealing with Dr. Shah.
This defense implicates facts outside the pleadings and cannot
be decided on a motion to dismiss.

Atl. Orthopaedic Assocs.,

LLC v. Blue Cross & Blue Shield of Tex., 2016 U.S. Dist. LEXIS
29360 at *12 (D.N.J. Mar. 7, 2016)(declining to rule, on a
Motion to Dismiss, that an anti-assignment clause was or was not
waived by a course of dealing, explaining that the issue may be
“explored further in discovery” and decided on “a far more
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complete record.”).

Accordingly, Defendant’s Motion to Dismiss

on the basis of Dr. Shah’s asserted lack of standing will be
denied.
2.
Defendant’s limitations period argument is also not ripe
for a decision on a motion to dismiss.
Similarly, Defendant’s argument that this suit is untimely
implicates matters outside the pleadings, such as whether
Defendant failed to inform Dr. Shah (or his patient) of the
plan-imposed deadline for judicial review.

Thus, Defendant’s

timeliness defense is more appropriately addressed at summary
judgment. Shah v. Horizon Blue Cross Blue Shield, 2017 U.S.
Dist. LEXIS 23885 at *6-7 (D.N.J. Feb. 21, 2017).
3.

Count One (the breach of contract claim) will be dismissed.
In his opposition brief, Dr. Shah states “Plaintiff agrees

to voluntarily dismiss [the breach of contract count].”
(Opposition Brief, p. 3)

The Court will dismiss this claim

pursuant to Fed. R. Civ. P. 41(a), and the Motion to Dismiss
Count One will be denied as moot.
4.
Count Four (violation of 29 C.F.R. 2560.503-1) will be
dismissed.
“29 C.F.R. 2560.503-1 does not give rise to a private
right of action.” Rahul Shah on assignment from Marjorie M. v.
Horizon Blue Cross Blue Shield of New Jersey, 2016 U.S. Dist.
LEXIS 113556 at *31-34 (D.N.J. Aug. 25, 2016) (collecting
authorities); see also Shah v. Horizon Blue Cross Blue Shield,
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2017 U.S. Dist. LEXIS 23885 at *6 (D.N.J. Feb. 21, 2017).
Accordingly, Defendant’s Motion to Dismiss Count Four will be
granted.
IV.
For the reasons set forth above, Count One of the Complaint
will be dismissed pursuant to Fed. R. Civ. P. 41(a), and the
Motion to Dismiss Count One will be denied as moot.
Additionally, the Motion to Dismiss will be granted as to Count
Four, and denied in all other respects.

An appropriate Order

accompanies this Opinion.

Dated: May 4, 2017
At Camden, New Jersey

___s/ Noel L. Hillman____
Noel L. Hillman, U.S.D.J.

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