Woska et al v. Health Care Service Corporation et al

Filing 20

ORDER granting in part and denying in part 7 Motion to Dismiss. Plaintiffs are granted leave to file an amended complaint within 21 days. Signed by Honorable Timothy D. DeGiusti on 2/20/2019. (mb)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
ANTHONY WOSKA, et al.,
Plaintiffs,
v.
HEALTH CARE SERVICE
CORPORATION, et al.,
Defendants.

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Case No. CIV-17-89-D

ORDER
Before the Court is Defendants’ Motion to Dismiss [Doc. No. 7], which is
brought pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure. Plaintiffs have
responded to the Motion [Doc. No. 16], and Defendants have replied [Doc. No. 19].
The matter is fully briefed and at issue.
BACKGROUND
Physicians at Oklahoma Procure Management, d/b/a Procure Proton Therapy
Center (Procure) recommended that Plaintiff Anthony Woska (Woska) undergo
proton beam radiotherapy to treat his prostate illness. At all times relevant to this
action, Woska was married to Plaintiff Debbie Woska1 and insured under an
insurance policy issued by Defendants Health Care Service Corporation (HCSC) and
Blue Cross Blue Shield of Oklahoma (BCBS). Defendants denied Woska’s claims

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Mrs. Woska was inadvertently referred to as “Daniel” in the Petition.

for benefits relating to the proton therapy, and upheld the denial after multiple
appeals by Woska. Woska claims Defendants’ denial constitutes breach of contract,
breach of the duty of good faith and fair dealing, negligence per se, and tortious
interference with his business relationship with Procure. Defendants also refused to
approve Procure’s requests for authorization relating to the proton therapy treatment.
Procure, likewise, contends that Defendants’ refusal to authorize and pay for
Woska’s proton therapy constituted a breach of contract, breach of the duty of good
faith and fair dealing, and an attempt to drive Procure from the medical marketplace.
Defendants move to dismiss Plaintiffs’ Petition on the grounds that (1) Woska
has failed to establish any purported breach; (2) Woska fails to allege sufficient facts
to establish a bad faith denial; (3) Woska’s negligence per se action fails as a matter
of law because he fails to identify any statutes, regulations, or code provisions that
were violated; (4) Woska’s tortious interference claim fails because he fails to allege
interference with a contract between him and Procure; (5) Procure fails to allege
sufficient facts to state a claim for relief; and (6) The complaint fails to assert any
cause of action on behalf of Plaintiff Debbie Woska.
STANDARD OF DECISION
Pursuant to the seminal decisions of Bell Atlantic Corp. v. Twombly, 550 U.S.
544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009), to survive a motion to
dismiss, a complaint must contain enough allegations of fact, taken as true, “to state
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a claim to relief that is plausible on its face.” Khalik v. United Air Lines, 671 F.3d
1188, 1190 (10th Cir. 2012) (quoting Twombly, 550 U.S. at 570).2 Under this revised
standard, “the mere metaphysical possibility that some plaintiff could prove some
set of facts in support of the pleaded claims is insufficient; the complaint must give
the court reason to believe that this plaintiff has a reasonable likelihood of mustering
factual support for these claims.” Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th
Cir. 2008) (quoting Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d 1174, 1177
(10th Cir. 2007) (emphasis in original)). The “plausibility” standard announced in
Twombly and Iqbal is not considered a “heightened” standard of pleading, but rather
a “refined standard,” which the court of appeals has defined as “refer[ring] to the
scope of the allegations in a complaint: if they are so general that they encompass a
wide swath of conduct, much of it innocent, then the plaintiffs have not nudged their
claims across the line from conceivable to plausible.” Khalik v. United Air Lines,

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Although this action was originally brought in state court, both the Federal Rules
of Civil Procedure and the Supreme Court’s standards in Twombly, Iqbal, and their
progeny govern the sufficiency of Plaintiffs’ claims. See Fed. R. Civ. P.
81(c)(1)(“These rules apply to a civil action after it is removed from a state court.”);
McKnight v. Linn Operating, Inc., No. CIV-10-30-R, 2010 WL 9039794, at *1
(W.D. Okla. Apr. 1, 2010) (“Because the Federal Rules apply after removal, Rule
12(b)(6) and the attendant standards set by the Supreme Court apply. If, however,
the Court concludes that Plaintiffs’ allegations fail under the Twombly and Iqbal
standard, it may order Plaintiffs to replead their claims if necessary.”); accord Lynch
v. Jackson, 478 F. App’x 631, 616 (11th Cir. 2012) (per curiam) (“Although the case
has been removed to federal court and federal procedural rules apply, Plaintiff must
still comply with federal pleading requirements.”) (unpublished).
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671 F.3d 1188, 1191 (10th Cir. 2012) (citing Kansas Penn Gaming, LLC v. Collins,
656 F.3d 1210, 1214 (10th Cir. 2011); Robbins, 519 F.3d at 1247.
The Tenth Circuit has further noted that the nature and specificity of the
allegations required to state a plausible claim will vary based on context. Robbins,
519 F.3d at 1248. “Thus … the Twombly/Iqbal standard is ‘a middle ground between
heightened fact pleading, which is expressly rejected, and allowing complaints that
are no more than labels and conclusions or a formulaic recitation of the elements of
a cause of action, which the Court stated will not do.’ ” See id. at 1247. Accordingly,
in deciding Twombly and Iqbal, there remains no indication the Supreme Court
“intended a return to the more stringent pre-Rule 8 pleading requirements.” Khalik,
671 F.3d at 1191 (citing Iqbal, 556 U.S. at 678). It remains true that “[s]pecific facts
are not necessary; the statement need only ‘give the defendant fair notice of what the
... claim is and the grounds upon which it rests.’ ” Erickson v. Pardus, 551 U.S. 89,
93 (2007) (quoting Twombly, 550 U.S. at 555); Khalik, 671 F.3d at 1192 (“Twombly
and Iqbal do not require that the complaint include all facts necessary to carry the
plaintiff’s burden.”) (quoting al-Kidd v. Ashcroft, 580 F.3d 949, 977 (9th Cir. 2009)).
Lastly, “[w]hile the 12(b)(6) standard does not require that Plaintiff establish
a prima facie case in [the] complaint, the elements of each alleged cause of action
help to determine whether Plaintiff has set forth a plausible claim.” Khalik, 671 F.3d
at 1191 (citing Swierkiewicz v. Sorema N.A., 534 U.S. 506, 515 (2002)).
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DISCUSSION
I.

ANTHONY WOSKA
A.

Breach of Contract

To state a claim for breach of contract under Oklahoma law, a plaintiff must
sufficiently plead the following elements: (1) the existence of a contract, (2) the
defendant’s breach of that contract, and (3) damages the plaintiff suffered as a result
of the breach. Digital Design Group, Inc. v. Information Builders, Inc., 2001 OK 21,
¶ 33, 24 P.3d 834, 843; Coen v. SemGroup Energy Partners G.P., LLC, 2013 OK
CIV APP 75, ¶ 32, 310 P.3d 657, 666.
Defendants contend Woska has not alleged sufficient facts to state a plausible
claim for breach of contract because he has not identified the terms of an existing
contract that would allow the Court to draw a reasonable inference that BCBS is
liable for any breach. See Mot. at 4. The Court disagrees. In ruling on a motion to
dismiss for failure to state a claim, the Court assumes as true all well-pled facts and
views them in a light most favorable to the plaintiff. Brokers’ Choice of America,
Inc. v. NBC Universal, Inc., 757 F.3d 1125, 1135-36 (10th Cir. 2014). Here, the
Petition alleges that Plaintiff had in force and effect an insurance policy issued by
Defendants. Petition, ¶ 24 [Doc. No. 1-2]. It alleges proton therapy treatment was
expressly—or should have been—a covered service under the policy’s provisions.
Petition at ¶¶ 24, 40. The Petition further alleges that Defendants wrongfully
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breached the policy by refusing to provide coverage for Woska’s proton therapy
treatment. See id. at ¶¶ 28, 30, 34-35, 37, 43-44. Lastly, the Petition alleges as a
result of Defendants’ breach, Woska incurred financial losses in excess of $75,000.
See id. ¶¶ 62-63.
In the Court’s view, the aforementioned allegations are sufficient to state a
claim for breach of contract. At this stage of the proceedings, the material issue is
whether Plaintiffs have sufficiently stated a claim for breach of contract, not whether
they will actually succeed on their claim(s). See Skinner v. Switzer, 562 U.S. 521,
529-30 (2011) (“[O]n a motion to dismiss for failure to state a claim, the question
below [is] ‘not whether [Plaintiff] will ultimately prevail’ on his ... claim ... but
whether his complaint [is] sufficient to cross the federal court’s threshold[.]”)
(citation omitted); Sanchez v. Hartley, 810 F.3d 750, 756 (10th Cir. 2016) (“a wellpleaded complaint may proceed even if it strikes a savvy judge that actual proof of
[the alleged] facts is improbable, and that a recovery is very remote and unlikely.”)
(quoting Twombly, 550 U.S. at 556) (internal quotations omitted). In this regard, the
Court is mindful of the specific policy provisions at issue, but the Court should not
evaluate the veracity or weight of potential evidence on a motion to dismiss.
Brokers’ Choice of America, 757 F.3d at 1136. Thus, although the weight of
Defendants’ evidence may prove Plaintiffs’ claims insufficient, Plaintiffs have
alleged sufficient facts in support of their breach of contract claim. Construing these
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facts in the light most favorable to Plaintiffs, Defendants’ Motion to Dismiss must
be denied on this issue.
B.

Bad Faith

To state a claim for bad faith under Oklahoma law, an insured must
sufficiently plead the following elements: (1) he was covered under the policy and
the defendants were required to take reasonable actions in handling the claim; (2)
the defendants’ actions were unreasonable under the circumstances; (3) the
defendants failed to deal fairly and act in good faith toward the insured in their
handling of the claim; and (4) the breach or violation of the duty of good faith and
fair dealing was the direct cause of the plaintiff’s damages. Edens v. The Netherlands
Ins. Co., 834 F.3d 1116, 1128 (10th Cir. 2016) (citing Badillo v. Mid Century Ins.
Co., 2005 OK 48, ¶ 25, 121 P.3d 1080, 1093; Bannister v. State Farm Mut. Auto.
Ins. Co., 692 F.3d 1117, 1126-27 (10th Cir. 2012)).
On this issue, the Court agrees with Defendants that the Petition fails to state
a plausible claim for bad faith.3 As noted supra, the Petition alleges an insurance
policy was in place that provided coverage for proton therapy and Defendants
breached the policy by refusing to provide coverage for Woska’s proton therapy

3

A breach of contract claim—standing alone—is not tantamount to bad faith, as both
are distinct claims that require different elements of proof. See, e.g., Jas Hospitality,
LLC v. Auto-Owners Ins. Co., No. 15-cv-967, 2016 WL 9735746, at *2 (D. Colo.
July 12, 2016); Equity Income Partners LP v. Chicago Title Ins. Co., No. CV-111614, 2014 WL 12745025, at *2 (D. Ariz. Jan. 29, 2014).
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treatment. Woska, however, fails to allege any facts as to how or why Defendants’
underwriting process was deficient and unreasonable or how or why Defendants’
investigation and/or evaluation of his claim was deficient and unreasonable. Woska
only summarily contends such denial was “wrongful.” Absent additional, supporting
allegations, the Court finds Woska has failed to allege a plausible claim for bad faith.
Defendants’ Motion on this issue is granted.
C.

Negligence Per Se

Defendants also seek dismissal of Woska’s claim of negligence per se. To
establish negligence, a plaintiff must show that the defendant owed a duty of care to
the plaintiff, that the defendant breached that duty of care, and that the breach caused
injury to the plaintiff. Martinez v. Angel Exploration, LLC, 798 F.3d 968, 974 (10th
Cir. 2015). To this end, “[t]he negligence per se doctrine is employed to substitute
statutory standards for parallel common law, reasonable care duties.” Howard v.
Zimmer, 2013 OK 17, ¶ 13, 299 P.3d 463, 474. The following elements must be
shown in order to establish negligence per se: (1) the claimed injury is of a type
intended to be prevented by the statute or regulation; (2) the injured party is a
member of the class intended to be protected by the statute or regulation; and (3) the
claimed injury was caused by the statutory or regulatory violation. Id. at 467.
Plaintiffs’ response asserts that Defendants violated 36 OKLA. STAT.
§6060.9b, which states health benefit plans “shall be prohibited from holding proton
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radiation therapy to a higher standard of clinical evidence for medical policy benefit
coverage decisions than the health plan requires for coverage of any other radiation
therapy treatment.” See id. § 6060.9b(A). It also states that “[n]othing in this section
shall be construed to mandate the coverage of proton radiation therapy by a health
benefit plan.” See id. § 6060.9b(B). However, when evaluating a motion to dismiss
brought under Rule 12(b)(6), the Court is guided by the allegations of the complaint,
not Plaintiffs’ response brief. Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir.
1994) (“The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations
within the four corners of the complaint after taking those allegations as true.”)
(citation omitted); Iqbal, 556 U.S. at 678 (“To survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as true, to ‘state a claim
to relief that is plausible on its face.’”) (citation omitted). Here, the Petition does not
identify any statute or regulation Defendants are alleged to have violated in denying
Woska’s claim; and although Plaintiffs have now referenced certain statutes, such
averments are absent from Plaintiffs’ pleading. Defendants’ Motion on this issue is
granted.
D.

Tortious Interference

Under Oklahoma law, a tortious interference claim has four elements: “(1) the
interference was with an existing contractual or business right; (2) such interference
was malicious and wrongful; (3) the interference was neither justified, privileged nor
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excusable; and (4) the interference proximately caused damage.” Wilspec Techs.,
Inc. v. DunAn Holding Grp., Co., 2009 OK 12, ¶ 15, 204 P.3d 69, 74 (citing Mac
Adjustment, Inc. v. Prop. Loss Res. Bureau, 1979 OK 41, ¶ 5, 595 P.2d 427, 428);
see also Tuffy’s, Inc. v. City of Oklahoma City, 2009 OK 4, ¶ 14, 212 P.3d 1158,
1165. The Court finds that the complaint sufficiently sets forth a claim for tortious
interference. Woska alleges (1) he and Procure had a business relationship (Petition,
¶ 49); (2) Defendants knew of the relationship, yet intentionally and wrongfully
interfered with that relationship (see id. ¶¶ 50-51); (3) such interference was
improper, and done through unfair means, i.e., not justified or otherwise excusable
(id. ¶ 52); and (4) Woska suffered damages as a result (id. ¶ 63). As stated above,
whether Woska is ultimately successful on such claim is not dispositive at this stage
of the proceedings. Accordingly, Defendants’ Motion on this issue is denied.
II.

PROCURE PROTON THERAPY CENTER
Defendants next contend that the Petition fails to sufficiently plead a cause of

action on behalf of Procure. In summary, with respect to Procure, the Petition alleges
the following:
●

Procure made a claim for insurance coverage to Defendants for
treatment of Woska pursuant to the insurance policy and
contracts between Procure and Defendants stemming from
Procure’s status as a participating or preferred provider
organization (PPO) [Petition, ¶¶ 53, 55];

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●

●

●

●

●

Procure complied with all of its duties under the contracts, met
all conditions precedent thereto, and was entitled to payment for
Woska’s treatment (see id. ¶¶ 54, 55);
Defendants denied authorization for Woska’s treatment, which
constituted a breach of the agreements between Procure and
Defendants (see id. ¶ 57);
Defendants’ conduct undermined Procure’s ability to provide
proton beam therapy and is an attempt to drive Procure from the
market (see id. ¶ 59);
Defendants’ conduct was unreasonable, intentional, and a
violation of its duty of good faith and fair dealing (see id. ¶ 60);
Procure suffered damages as a result (see id. ¶ 61).

Petition at pp. 9-11.
Defendants argue that Procure’s breach of contract claim fails for the same
reason as Woska’s—Procure has not identified any specific terms it claims
Defendants have breached and proton therapy treatment was specifically excluded
in Woska’s policy. Defendants also contend there was no obligation to pay for proton
therapy because there was an express exclusion for the service. Mot. at 13. The Court
denies Defendants’ Motion for substantially the same reasons addressed above
regarding Woska’s claim. Even in light of the modified approach set forth in
Twombly and Iqbal, it remains true that a plaintiff need not prove their case at the
pleading stage. “In other words, Rule 8(a)(2) still lives. Under Rule 8, specific facts
are not necessary; the statement need only give the defendant fair notice of what the
claim is and the grounds upon which it rests.” Burnett v. Mortg. Elec. Registration
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Sys., Inc., 706 F.3d 1231, 1235-36 (10th Cir. 2013) (quoting Khalik, 671 F.3d at
1191). Accordingly, the Court finds Procure has set forth a sufficient claim for
breach of contract. Defendants’ Motion on this issue is denied.
Likewise, for the same reasons announced regarding Woska’s claim, to the
extent Procure seeks to bring a claim for breach of the duty of good faith and fair
dealing, the Court finds the Petition fails to state sufficient supporting allegations to
state a viable claim. Defendants’ Motion on this issue is granted.
III.

DEBBIE WOSKA
Lastly, Defendants seek to dismiss Debbie Woska from this action on the basis

she has not stated a claim for relief. Plaintiffs respond Mrs. Woska seeks damages
for loss of consortium, which is a derivative claim that stems from the allegations
surrounding Mr. Woska’s claims. Indeed, the Petition is devoid of any factual
allegations regarding Mrs. Woska except for a statement under the “Damages”
section that reads:
As a further result of the conduct of [Defendants], [Debbie] Woska,
wife of Anthony Woska, has incurred financial [losses], suffered
shame, humiliation, embarrassment and mental pain for which she
seeks actual damages in excess of $75,000.00, exclusive of interest,
attorney’s fees, and costs.
Petition, ¶ 64. Loss of consortium is unique in that it may serve as a derivative claim,
see, e.g., Rodgers v. Higgins, 1993 OK 45, ¶ 1, 871 P.2d 398, 401,4 and a category

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See also Laws v. Fisher, 1973 OK 69, ¶ 4, 513 P.2d 876, 877.
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of compensable damages. Albeit a close call, the Court finds Plaintiffs’ loss of
consortium allegations do not cross the requisite threshold of stating enough facts,
which if taken as true, plausibly state a claim for relief. At its essence, loss of
consortium is meant to compensate for the loss of society, affection, assistance and
conjugal fellowship in the marriage relationship. Rodgers, 871 P.2d at 401 n. 5.
Here, Plaintiff’s allegations do not provide sufficient supporting facts regarding the
effects of Defendants’ actions on the Woskas’ marriage. Accordingly, Defendants’
Motion on this issue is granted.
CONCLUSION
Defendants’ Motion to Dismiss [Doc. No. 7] is GRANTED IN PART AND
DENIED IN PART as set forth herein. Where dismissal is granted for failure to
state a claim, the Court should grant leave to amend freely “if it appears at all
possible that the plaintiff can correct the defect.” Triplett v. Leflore County, Okla.,
712 F.2d 444, 446 (10th Cir.1983). Leave to amend is not automatic and may be
properly denied where an amendment would be futile. Anderson v. Suiters, 499 F.3d
1228, 1238 (10th Cir. 2004). “A court properly may deny a motion for leave to
amend as futile when the proposed amended complaint would be subject to dismissal
for any reason, including that the amendment would not survive a motion for
summary judgment.” E.spire Commc’ns, Inc. v. N.M. Pub. Regulation Comm’n, 392
F.3d 1204, 1211 (10th Cir. 2004) (internal quotation marks omitted). With respect
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to the claims that have been dismissed, the Court is not convinced Plaintiffs are
unable to state a claim for which relief can be granted. Accordingly, Plaintiffs are
granted leave to file an amended complaint within twenty-one (21) days of this
Order or seek an extension of time to do so.
IT IS SO ORDERED this 20th day of February 2018.

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