Vigdor et al v. UnitedHealthcare Insurance Company et al
ORDER granting 19 Motion to Remand to State Court; affirming 33 Memorandum and Recommendations.Signed by District Judge Max O. Cogburn, Jr on 11/18/2022. (ams)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
CYNTHIA PUSEY VIGDOR,
RONALD EASTER, ROBERT VIGDOR,
VANESSA KROMBEEN, VASHISTA
KOKKIRALA, RICHARD SMITHSON,
JESSICA HUCK, and PROVIDENCE
ANESTHEOSIOLOGY ASSOCIATES, P.A.,
COMPANY, UNITEDHEALTHCARE OF
NORTH CAROLINA, INC., UNITEDHEALTH )
GROUP INC., and UMR, INC.,
THIS MATTER is before the Court on review of a Memorandum and Recommendation
(“M&R”) granting Plaintiffs’ Motion to Remand (Doc. No. 33). In the M&R, the magistrate
judge advised the parties of the right to file objections within 14 days, in accordance with 28,
United States Code, Section 636(b)(1)(c). Defendants filed their objections within the time
allowed. (Doc. No. 36). After careful consideration of the magistrate judge’s recommendation,
this Court will fully affirm the M&R and grant Plaintiffs’ motion to remand.
Cynthia Pusey Vigdor, Robert Vigdor, Vanessa Krombeen, Vashista Kokkirala, Jessica
Huck, Richard Smithson, and Ronald Easter (together the “Patient Plaintiffs”), and Providence
Anesthesiology Associates, P.A. (“Providence”) (collectively “Plaintiffs”), initiated this action
by filing of a “Class Action Complaint” (Doc. No. 1-2) (the “Complaint”) on August 16, 2021, in
the Superior Court of Mecklenburg County, North Carolina, Case No. 2021 CVS 13028. The
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Complaint names as the defendants UnitedHealthcare Insurance Company, UnitedHealthcare of
North Carolina, Inc., UMR, Inc., and UnitedHealth Group, Inc. (collectively “Defendants” or
Plaintiffs’ Complaint asserts claims for: (1) violation of the North Carolina Patient
Protection Act, N.C. GEN. STAT. § 58-3-200(d), as actionable under North Carolina’s Unfair or
Deceptive Trade Practices Act, N.C. GEN. STAT. § 75-1.1; and (2) breaches of contract by
refusing to reimburse Patient Plaintiffs and other class members at a reasonable, fair rate. (Doc.
No. 1-2, at 2, 24–27).
Defendants assert that this action is removable to this Court under 28 U.S.C. § 1331
because the alleged claims “arise under and are completely preempted by the Employment
Retirement Income Security Act of 1974, as amended, 29 U.S.C. §§ 1001, et seq. (“ERISA”).”
(Doc. No. 1 at 1). Defendants further assert that federal district courts have original jurisdiction
over completely preempted claims and that venue is appropriate here since the lawsuit was
removed from the Superior Court in Mecklenburg County, North Carolina. (Doc. No. 1 at 3–5)
(citing 29 U.S.C. §§ 113(e)(1) and (f); 28 U.S.C. § 1331; and 28 U.S.C. §§ 113(c), 1391, 1441(a)
Soon after asserting federal jurisdiction and venue as appropriate, Defendants filed a
motion to dismiss, seeking to “dismiss the Complaint in its entirety with prejudice.” (Doc. No.
10). Defendants’ motion to dismiss contends that there is no personal jurisdiction over two UHC
Defendants; that Plaintiff Providence should be compelled to arbitration; and that all claims
should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). Id.
Plaintiffs subsequently filed a motion to remand this case to state court. (Doc. No. 19).
Plaintiffs contend that this matter only alleges state law claims and is not preempted by ERISA,
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and therefore, this Court lacks subject matter jurisdiction. Id. The magistrate judge issued an
M&R granting Plaintiffs’ Motion to Remand (Doc. No. 33). Defendants filed both factual and
legal objections to the M&R.
Standard of Review
The Federal Magistrates Act of 1979, as amended, provides that “a district court shall
make a de novo determination of those portions of the report or specific proposed findings or
recommendations to which objection is made.” 28 U.S.C. § 636(b)(1); United States v. De LeonRamirez, 925 F.3d 177, 181 (4th Cir. 2019); Camby v. Davis, 718 F.2d 198, 200 (4th Cir. 1983).
However, “when objections to strictly legal issues are raised and no factual issues are challenged,
de novo review of the record may be dispensed with.” Orpiano v. Johnson, 687 F.2d 44, 47 (4th
Cir. 1982). Similarly, de novo review is not required “when a party makes general or conclusory
objections that do not direct the Court to a specific error in the magistrate judge’s proposed
findings and recommendations.” Id. Moreover, “the statute does not on its face require any
review at all . . . of any issue that is not the subject of an objection.” Thomas v. Arn, 474 U.S.
140, 149 (1985).
A district judge is responsible for the final determination and outcome of this case. As the
magistrate judge noted, this case presents a close call, and this Court has conducted a careful
review of the magistrate judge’s recommendation. After such careful review, this Court
determines that the recommendation of the magistrate judge is fully consistent with and
supported by current law. Further, the factual background and recitation of issues is supported by
the applicable pleadings. Based on these determinations, the Court will fully affirm the M&R
and grant relief in accordance therewith.
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Defendants make four objections to the M&R. First, Defendants claim that the M&R
erred in its analysis of the complete preemption dispute. However, Defendants’ argument that the
dispute is a member-insurer dispute that arises solely from the members’ ERISA-governed
insurance contracts is a reiteration of the arguments already considered and rejected by the
magistrate judge. Plaintiffs lodge their disagreement with the ultimate conclusions of the
magistrate judge and rehash their earlier arguments in the process. “[M]erely reiterating the same
arguments made in the pleading submitted to the Magistrate Judge does not warrant de novo
review” by the district court. North Carolina ex rel. Bishop v. Cnty. of Macon, 809 F. Supp. 2d
438, 442 (W.D.N.C. 2011), aff’d in part, vacated in part, remanded sub nom. Bishop v. Cnty. of
Macon, 484 Fed. Appx. 753 (4th Cir. 2012); accord Betancourt v. Ace Ins. Co. of Puerto Rico,
313 F. Supp. 2d 32, 34 (D.P.R. 2004) (“The objections presented, however, are not to be
construed as a second opportunity to present the arguments already considered by the Magistrate
Judge.”). Rather, the Court must review this objection only for clear error. Lesser v. TD Bank
NA, 463 F. Supp. 3d 438, 445 (S.D.N.Y. 2020) (“To the extent that the objecting party makes
only conclusory or general objections, or simply reiterates the original arguments, the court will
review the report and recommendation strictly for clear error.”). Here, the magistrate judge did
not commit clear error in ruling that Plaintiffs’ claims are not preempted. Therefore, this
objection is rejected.
Second, Defendants argue that the M&R incorrectly compares this case to “rate of
payment cases.” However, as the M&R noted, “the crux of this case is a dispute about ‘rate of
payment.’” (Doc. No. 33 at 11). According to Plaintiffs, Defendants did not reimburse them at a
reasonable rate for medical care they received from out-of-network providers, such as
Providence, and that this inadequate rate of reimbursement violates North Carolina state law.
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(Doc. No. 1-2 at 24–25). Indeed, this same conduct underlies many of the rate of payment cases
the magistrate judge referred to in the M&R. See, e.g., Freemont Emergency Servs. (Mandavia),
Ltd. v. UnitedHealth Grp., Inc., 446, F. Supp. 3d 700 (D. Nev. 2020); Lone Star OB/GYN
Assocs. v. Aetna Health, Inc., 579 F.3d 525 (5th Cir. 2009). For this reason, the Court finds the
M&R’s comparison convincing and rejects Defendants’ second objection.
Third, Defendants claim that the North Carolina Patient Protection Act does not provide a
private cause of action. However, Plaintiffs do not argue that the North Carolina Patient
Protection Act provides a private cause of action. Rather, Plaintiffs argue that a violation of the
North Carolina Patient Protection Act is actionable under North Carolina’s Unfair or Deceptive
Trade Practices Act. Therefore, this objection does not cut in Defendants’ favor.
Lastly, Defendants suggest that the magistrate judge incorrectly relied on a presumption
against removal. However, this Court finds that the magistrate judge reasonably relied on a
presumption against removal. When it appears a case should not be removed after applying
prevailing law to a factual background, but some doubt remains, it is correct to rely on the
principle that such doubt–regardless of whether it is a complete preemption case–should be
resolved in favor of remand. See Wolfe FA, LLC v. Bula Def. Sys., Inc., LLC, No. 1:19-CV124-MR, 2019 WL 3783308, at *2 (W.D.N.C. Aug. 12, 2019).
Thus, the Court overrules Defendants’ objections, and the Court will affirm the
magistrate judge’s M&R.
IT IS, THEREFORE, ORDERED that Plaintiffs’ Motion to Remand (Doc. No.
19) is GRANTED, Defendants’ Objections, (Doc. No. 36), are OVERRULED, and the
Memorandum and Recommendation (Doc. No. 33) is AFFIRMED. In accordance with
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the Memorandum and Recommendation, this matter is remanded to state court. Finally,
since the action is being remanded, the Motion to Dismiss, (Doc. No. 10), shall be
terminated as moot.
Signed: November 18,
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