Paragon Office Services LLC et al v. UnitedHealthGroup, Inc. et al
Filing
104
MEMORANDUM OPINION AND ORDER: Although the court grants plaintiffs' #94 motion for leave to amend, it declines to remand the case. Given that plaintiffs' purpose for seeking leave to amend is to obtain a remand that the court declines to enter, the court gives plaintiffs the option of not filing the amended complaint. If they do amend, however, they must file their amended complaint within 14 days of the date this memorandum opinion and order is filed. (Ordered by Chief Judge Sidney A Fitzwater on 11/22/2013) (tln)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
PARAGON OFFICE SERVICES, LLC,
et al.,
§
§
§
Plaintiffs,
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§ Civil Action No. 3:11-CV-2205-D
VS.
§
§
UNITEDHEALTHCARE INSURANCE §
COMPANY, INC., et al.,
§
§
Defendants. §
MEMORANDUM OPINION
AND ORDER
Plaintiffs Paragon Office Services, LLC, Paragon Ambulatory Physician Services, PA,
Office Surgery Support Services, LLC, and Ambulatory Health Systems, LLC move for
leave to file a third amended complaint (“amended complaint”) against defendants
UnitedHealthcare Insurance Co., Inc., UnitedHealthcare of Texas, Inc., UnitedHealthcare
Benefits of Texas, Inc., and Ingenix, Inc. (collectively, “United”), and on the filing of the
amended complaint, to remand the case to state court. For the reasons that follow, the court
grants the motion for leave to amend but declines to remand the case, and it gives plaintiffs
the option of not filing the amended complaint in light of this decision.
I
To decide the instant motion, the court need not recount the background facts and
procedural history at length. As pertinent to this ruling, the court has repeatedly held that it
has federal question subject matter jurisdiction under the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001 et seq.1 Plaintiffs “seek[] leave to file
an amended Complaint to remove all doubt that [they do] not assert claims under ERISA.”
Ps. Mot. 2. Although plaintiffs assert the same claim for breach of implied contract that the
court has held is completely preempted by ERISA, see Paragon Office Services, LLC v.
UnitedHealthGroup, Inc., 2012 WL 1019953, at *9 (N.D. Tex. Mar. 27, 2012) (Fitzwater,
C.J.), they maintain that this claim is based on their “independent relationship with
[United]—not any ERISA plan.” Ps. Mot. 4. As support for their motion, plaintiffs cite their
May 13, 2013 motion to reconsider remand, which the court has denied, and Burnett v.
Petroleum Geo-Services, Inc., 2013 WL 1723011 (N.D. Tex. Apr. 22, 2013) (Fitzwater,
C.J.).
II
“It is settled that the grant of leave to amend the pleadings pursuant to [Fed. R. Civ.
P.] 15(a) is within the discretion of the trial court.” Zenith Radio Corp. v. Hazeltine
Research, Inc., 401 U.S. 321, 330 (1971). “The court should freely give leave when justice
so requires.” Rule 15(a)(2). Granting leave to amend, however, “is by no means automatic.”
Wimm v. Jack Eckerd Corp., 3 F.3d 137, 139 (5th Cir.1993) (quoting Addington v. Farmer’s
Elevator Mut. Ins. Co., 650 F.2d 663, 666 (5th Cir. Unit A July 1981)). The court can
1
See Paragon Office Servs., LLC v. UnitedHealthGroup, Inc., 2012 WL 1019953, at
*9 (N.D. Tex. Mar. 27, 2012) (Fitzwater, C.J.); Paragon Office Servs., LLC v.
UnitedHealthcare Ins. Co., 2012 WL 4442368, at *1 (N.D. Tex. Sept. 26, 2012) (Fitzwater,
C.J.); Paragon Office Servs., LLC v. UnitedHealthcare Ins. Co., 2013 WL 5477145, at *2-3
(N.D. Tex. Oct. 2, 2013) (Fitzwater, C.J.).
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consider factors such as undue delay, bad faith or dilatory motive on the part of the movant,
repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to
the opposing party, and futility of amendment. Id. (citing Foman v. Davis, 371 U.S. 178, 182
(1962)). This court often permits plaintiffs to amend their pleadings to drop federal claims
and secure a remand of a removed case, and it has done so in ERISA cases. See, e.g.,
Burnett, 2013 WL 1723011, at *1. The court discerns no reason to deny plaintiffs’ motion
to file an amended complaint for this purpose.
But the court disagrees that, under plaintiffs’ amended complaint, all federal question
claims have dropped out of the case. “Although [plaintiffs] attempt by their amended
complaint to delete any basis for complete preemption, they cannot circumvent the
preemptive reach of ERISA by artful pleading.” Roark v. Humana, Inc., 2001 WL 585874,
at *1 (N.D. Tex. May 25, 2001) (Fitzwater, J.) (citing Johnson v. Baylor Univ., 214 F.3d 630,
632 (5th Cir. 2000); Pryzbowski v. U.S. Healthcare, Inc., 245 F.3d 266, 274 (3d Cir. 2001)),
aff’d, 307 F.3d 298 (5th Cir. 2002). “[A] federal court may look beyond the face of the
complaint to determine whether a plaintiff has artfully pleaded his suit so as to couch a
federal claim in terms of state law[.]” Id. at * 1 (quoting Pryzbowski, 245 F.3d at 274)
(internal quotation marks omitted).
In their amended complaint, plaintiffs have removed all references to ERISA, but their
breach of implied contract claim is still completely preempted. See Paragon Office Servs.,
LLC v. UnitedHealthcare Ins. Co., 2013 WL 5477145, at *2-3 (N.D. Tex. Oct. 2, 2013)
(Fitzwater, C.J.) (rejecting argument that new evidence showed claim was not preempted).
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Although plaintiffs omit any reference to “agreements” between the parties, cf. Pet. ¶ 23, they
aver as before that the implied contract was established through United’s “course of dealing,”
Proposed 3d Am. Compl. ¶ 15. Plaintiffs have not advanced any arguments or pointed to any
basis that convinces the court to reconsider its earlier conclusion that, “in order for plaintiffs
to recover from United, they must do so as assignees of United plan benefits, and they must
establish a right to recover under the relevant ERISA plans.” Paragon, 2013 WL 5477145,
at *2 (internal quotation marks omitted).
*
*
*
Although the court grants plaintiffs’ motion for leave to amend, it declines to remand
the case. Given that plaintiffs’ purpose for seeking leave to amend is to obtain a remand that
the court declines to enter, the court gives plaintiffs the option of not filing the amended
complaint. If they do amend, however, they must file their amended complaint within 14
days of the date this memorandum opinion and order is filed.
SO ORDERED.
November 22, 2013.
_________________________________
SIDNEY A. FITZWATER
CHIEF JUDGE
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