Sewell, et al., v. Amerigroup Tennessee, Inc.,
Filing
112
MEMORANDUM OPINION OF THE COURT. Signed by Chief Judge Waverly D. Crenshaw, Jr on 4/18/2019. (DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(am)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
C.S. SEWELL, M.D. P.C. and
CHRISTOPHER SEWELL, M.D.,
Plaintiffs,
v.
AMERIGROUP TENNESSEE, INC.
d/b/a AMERIGROUP COMMUNITY
CARE,
Defendant.
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NO. 2:17-cv-00062
CHIEF JUDGE CRENSHAW
MEMORANDUM OPINION
Christopher Sewell, M.D. (“Dr. Sewell”), and his medical practice C.S. Sewell, M.D. P.C.
(together “Sewell”) and Amerigroup Tennessee, Inc. d/b/a Amerigroup Community Care
(“Amerigroup”) have filed cross-motions for summary judgment. (Doc. Nos. 81, 84.) Amerigroup
seeks summary judgment on Counts I-IV of the First Amended Complaint and its own
counterclaims for breach of contract and declaratory judgment (“Counterclaims”). (Doc. No. 81 at
1.) Sewell seeks summary judgment in its favor on the Counterclaims and its own declaratory
judgment claim. Each party has filed a response in opposition as well as replies to those competing
responses. (Doc. Nos. 95, 97, 106, 107.) Further, both Sewell and Amerigroup have filed
competing Motions to Strike. (Doc. Nos. 92, 98.) For the reasons stated below, the Court will deny
the instant motions as moot.
I. Factual and Procedural Background 1
Dr. Sewell is a family physician who provides medical care, including allergy-related care,
through his practice—C.S. Sewell, M.D. P.C.—a Tennessee professional corporation with its
principal place of business located at 341 W. Central Avenue, Jamestown, Tennessee. (Doc. No.
42 at 1.) Amerigroup is a Tennessee-based health insurance and managed health contractor that
manages the provision and reimbursement of healthcare services to patients enrolled in
Tennessee’s Medicaid program. (Id. at 2.) In the First Amended Complaint, Sewell asserted claims
for: (1) declaratory judgment; (2) breach of contract; (3) violation of Tennessee’s Prompt Payment
Act; (4) tortious interference with a business relationship; (5) Sherman Anti-Trust Act (“Sherman
Act”) violations; (6) deprivation of federal rights in violation of 42 U.S.C. § 1983; and (7) violation
of First Amendment free speech guarantees. (Id. at 18-29.) Sewell alleged that the Court had
jurisdiction over these claims because: (1) the declaratory judgment, Sherman Act, § 1983, and
First Amendment claims alleged violations of federal law; and (2) the Court retained supplemental
jurisdiction over the remaining state law claims. (Id. at 2.)
In its answer, Amerigroup included counterclaims for: (1) breach of contract; and (2)
declaratory judgment. (Doc. No. 62 at 40.) Amerigroup argued that the Court had jurisdiction over
these counterclaims based on 28 U.S.C. §§ 1367 (supplemental jurisdiction), 1441(c) (removal of
civil actions), and 2202 (Declaratory Judgment Act). (Id.)
Amerigroup subsequently filed a Motion to Dismiss Sewell’s claims for declaratory
judgment, tortious interference with a business relationship, Sherman Act violations, and § 1983
and First Amendment violations. (See Doc. No. 43.) Amerigroup also separately moved for partial
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The Court assumes that the parties are familiar with the factual and procedural record and
therefore will discuss only the facts necessary to decide the instant motions.
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summary judgment on the remaining claims. (Doc. No. 45.) After briefing, the Court first denied
without prejudice Amerigroup’s partial summary judgment motion because discovery was
ongoing on those claims, and, therefore, they were not ripe for disposition. (See Doc. No. 61.) As
to Amerigroup’s Motion to Dismiss, the Court granted that motion in part, dismissing Sewell’s
Sherman Act, § 1983, and First Amendment claims, but allowing Sewell’s declaratory judgment,
breach of contract, Tennessee Prompt Payment Act, and tortious interference with a business
relationship claims to proceed. (See Doc. No. 67.) After further discovery was conducted, the
parties each filed the instant motions.
II. Jurisdictional Analysis
Section 1367 of Title 28 of the United States Code provides that “the district court shall
have supplemental jurisdiction over all other claims that are so related to the claims in the action
within such original jurisdiction that they form a part of the same case or controversy.” 28 U.S.C.
§ 1367(a). Here, when considering the claims in the First Amended Complaint, the Court exercised
its supplemental jurisdiction over Sewell’s state law claims because those claims were closely
related to the alleged Sherman Act, § 1983, and First Amendment claims. “The dismissal of
[Sewell’s] federal claims against [Amerigroup], however, requires the [C]ourt to reexamine the
issue of supplemental jurisdiction for state law claims against this defendant.” Smith v. Osceola
Cty., Case No. 1:06-cv-89, 2008 WL 2036826, at *4 (W.D. Mich. May 9, 2008) (reexamining
propriety of exercising supplemental jurisdiction at the summary judgment stage).
A district court “may decline to exercise supplemental jurisdiction” if it “has dismissed all
claims over which it has original jurisdiction.” 28 U.S.C. § 1367(c)(3); see also Ford v. Frame, 3
F. App’x 316, 318 (6th Cir. 2001) (“[D]istrict courts possess broad discretion in determining
whether to retain supplemental jurisdiction over state claims once all federal claims are
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dismissed.”). “In determining whether to retain jurisdiction over [remaining] state-law claims, a
district court should consider and weigh several factors, including the ‘values of judicial economy,
convenience, fairness, and comity.’” Gamel v. City of Cincinnati, 625 F.3d 949, 951 (6th Cir.
2010) (quoting Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988)). The Supreme Court
has noted that “in the usual case in which all federal-law claims are eliminated before trial, the
balance of factors to be considered . . . will point toward declining to exercise jurisdiction over the
remaining state-law claims.” Carnegie-Mellon Univ., 484 U.S. at 350 n.7; see also Gamel, 625
F.3d at 952. (“When all federal claims are dismissed before trial, the balance of considerations
usually will point to dismissing the state law claim[.]”) (quoting Musson Theatrical, Inc. v. Fed.
Exp. Corp., 89 F.3d 1244, 1254-55 (6th Cir. 1996)).
The sole reason that this case is in federal court is that Amerigroup removed it from state
court based upon subject matter jurisdiction arising from Sewell’s “federal claim for violation of
the Patient Protection and Affordable Care Act.” (Doc. No. 1 at 2.) Amerigroup noted that the
Court had original jurisdiction over that claim under 28 U.S.C. § 1331 and supplemental
jurisdiction over Sewell’s state law claims under 28 U.S.C. § 1367. (Id.) As discussed above, after
Sewell amended the Complaint, Amerigroup filed its Motion to Dismiss, and the Court made its
subsequent ruling on that motion, no federal claims are left in the instant action. 2 It is well in
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The Court notes that both Amerigroup and Sewell have asserted claims under the
Declaratory Judgment Act. (See Doc. Nos. 42 at 18, 62 at 43.) With the dismissal of Sewell’s
federal claims, both parties still seek declaratory judgment regarding their rights under the
contracts at issue in this case. (See Doc. Nos. 82 at 26, 85 at 24.) To the extent that either party
relies on the Declaratory Judgment Act to confer this Court with independent jurisdiction, that
reliance is misplaced. The Declaratory Judgment Act, 28 U.S.C. § 2201, provides that “[i]n a case
of actual controversy within its jurisdiction . . . any court of the United States . . . may declare the
rights and other legal relations of any interested party seeking such declaration, whether or not
further relief is or could be sought.” But § 2201 does not create an independent cause of action.
Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 671 (1950) (holding that “Congress
enlarged the range of remedies available in the federal courts [under the Act] but did not extend
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advance of trial. Sewell’s remaining claims (i.e., breach of contract, Tennessee Prompt Payment
Act, tortious interference, and declaratory judgment) are those that Tennessee courts routinely and
skillfully consider. Furthermore, these claims arise in the context of the alleged negative treatment
of a Tennessee physician and professional corporation by a Tennessee insurance company
involved in the administration of Tennessee’s own Medicaid program; the State therefore has an
overwhelming interest in resolving such claims in the first instance. After weighing the relevant
factors, the Court does not find substantial justification to depart from general rule of declining to
exercise supplemental jurisdiction over Sewell’s remaining state law claims.
IV. Conclusion
For the foregoing reasons, Sewell and Amerigroup’s competing Motions for Summary
Judgment (Doc. Nos. 81, 84) and Motions to Strike (Doc. Nos. 92, 98) will be denied as moot. The
Court will decline to exercise jurisdiction over the only claims remaining in this action—the
parties’ state law claims. The case will be remanded to the Fentress County Chancery Court.
The Court will file an accompanying order.
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WAVERLY D. CRENSHAW, JR.
CHIEF UNITED STATES DISTRICT JUDGE
their jurisdiction.”) A federal court accordingly “must have jurisdiction already under some other
federal statute” before a plaintiff can “invok[e] the Act.” Toledo v. Jackson, 485 F.3d 836, 839
(6th Cir. 2007). At this juncture, no independent federal claims exist under which this Court has
jurisdiction, and, therefore, the parties’ Declaratory Judgment Act claims do not confer federal
jurisdiction. To the extent that the parties seek declaratory relief, in addition to the other, additional
forms of relief, such relief can be sought in state court.
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