Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Fox-Quamme v. Health Net Health Plan of Oregon, Inc.

United States District Court, D. Oregon

March 19, 2017

EILEEN FOX-QUAMME, individually and on behalf of all others similarly situated; LISA HESS, individually and on behalf of all others similarly situated; MARY REDFIELD, individually and on behalf of all others similarly situated; O.W., a minor child, individually and on behalf of all others similarly situated; JEFF CLARK, individually and on behalf of all others similarly situated; and LEIGH ANN CHAPMAN, individually and on behalf of all others similarly situated, Plaintiffs,
v.
HEALTH NET HEALTH PLAN OF OREGON, INC., an Oregon corporation, and AMERICAN SPECIALTY HEALTH GROUP, INC., a California corporation, Defendants.

          THOMAS K. DOYLE RICHARD B. MYERS Bennett, Hartman, Morris & Kaplan, LLP Attorneys for Plaintiffs

          STEVAN D. PHILLIPS BRAD S. DANIELS REED W. MORGAN Stoel Rives LLP Attorneys for Defendant Health Net Plan of Oregon, Inc.

          KERRY J. SHEPHERD HARRY B. WILSON Markowitz Herbold PC ELIZABETH MANN ANDREW Z. EDELSTEIN Mayer Brown LLP Attorneys for Defendant American Specialty Health Group, Inc.

          OPINION AND ORDER

          THOMAS K. DOYLE RICHARD B. MYERS, Judge

         This matter comes before the Court on Plaintiffs' Motion (#62) for Class Certification and the Motions (#80, #81) to Strike Certain Evidence in Support of Plaintiffs' Reply by Defendants Health Net Health Plan of Oregon and American Specialty Health Group (ASH).

         For the reasons that follow, the Court DENIES Plaintiffs' Motion for Class Certification and DENIES as moot Defendants' Motions to Strike.

         BACKGROUND

         On July 7, 2015, Plaintiffs filed a Class Action Allegation Complaint (#1) in which they allege Defendants violated § 2706 of the Patient Protection and Affordable Care Act (ACA)(codified at 42 U.S.C. § 300gg-5).

         On September 9, 2015, Defendants each filed a Motion to Dismiss Plaintiffs' Complaint on the grounds that Plaintiffs lacked standing, failed to state a claim, and failed to join a necessary party.

         On January 7, 2016, following oral argument, the Court dismissed Plaintiffs' Complaint on the ground that Plaintiffs failed to allege sufficient facts to state a claim and granted Plaintiffs leave to amend their Complaint.

         On February 26, 2016, Plaintiffs filed their First Amended Class Action Allegation Complaint (FAC) (#38) alleging three claims against Defendants. In Claim One Plan Participant Plaintiffs Eileen Fox-Quamme, Lisa Hess, Mary Redfield, and O.W. seek recovery of benefits, enforcement of terms, and clarification of terms pursuant to 29 U.S.C. § 1132(a) (1) (B) based on Defendants' alleged violation of § 2706 of the ACA for discrimination against naturopathic physicians with respect to participation in or coverage of services under the health-care plans issued and administered by Defendants. In Claim Two Plan Participant Plaintiffs seek injunctive and equitable relief pursuant to 29 U.S.C. § 1132(a) (3) also based on Defendants' alleged violation of § 2706 of the ACA for discrimination against naturopathic physicians with respect to participation in or coverage of services under the health-care plans issued and administered by Defendants. In Claim Three Practitioner Plaintiffs Jeff Clark and Leigh Ann Chapman seek declaratory judgment pursuant to 28 U.S.C. § 2201 on the ground that the contracts between Defendants contain provisions that violate § 2706 of the ACA, and those provisions are, therefore, unenforceable.

         On March 18, 2016, Defendants filed further Motions (#41, #42) to dismiss Practitioner Plaintiffs' Claim Three for lack of standing. On April 29, 2016, the Court granted those Motions by Order (#49) and dismissed both Practitioner Plaintiffs and their Third Claim.

         On September 30, 2016, Plan Participant Plaintiffs (hereinafter referred to as Plaintiffs) filed a Motion for Class Certification. In their Motion Plaintiffs seek certification of a class of persons "who at any time from January 1, 2014, through the present were enrolled in an employer-issued health plan administered by Health Net Health Plan of Oregon." On December 13, 2016, Defendants filed Motions to Strike Certain Evidence submitted in support of Plaintiffs' Motion for Class Certification.

         STANDARDS

         Federal Rule of Civil Procedure 23 governs class certification and provides:

(a) Prerequisites. One or more members of a class may sue ... as representative parties on behalf of all members only if:
(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and
(4) the representative parties will fairly and adequately protect the interests of the class.
(b) Types of Class Actions. A class action may be maintained if Rule 23(a) is satisfied and if:
(3) the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. The matters pertinent to these findings include:
(A) the class members' interests in individually controlling the prosecution or defense of separate actions;
(B) the extent and nature of any litigation concerning the controversy already begun by or against class members;
(C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and
(D) the likely difficulties in managing a class action.

         In Wal-Mart Stores, Inc. v. Dukes the United States Supreme Court addressed class-action certification and set out general standards under Rule 23:

The class action is "an exception to the usual rule that litigation is conducted by and on behalf of the individual named parties only." Califano v. Yamasaki, 442 U.S. 682, 700-701 (1979). In order to justify a departure from that rule, "a class representative must be part of the class and 'possess the same interest and suffer the same injury' as the class members." East Tex. Motor Freight System, Inc. v. Rodriguez, 431 U.S. 395, 403 (1977)(quoting Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208, 216 (1974)). Rule 23(a) ensures that the named plaintiffs are appropriate representatives of the class whose claims they wish to litigate. The Rule's four requirements - numerosity, commonality, typicality, and adequate representation - "effectively 'limit the class claims to those fairly encompassed by the named plaintiff's claims.'" General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 156 (1982)(quoting General Telephone Co. of Northwest v. EEOC, 446 U.S. 318, 330 (1980)).

564 U.S. 338, 348 (2011).

         The decision to grant or to deny class certification is within the discretion of the trial court. Bateman v. Am. Multi-Cinema, Inc., 623 F.3d 708, 712 (9th Cir. 2010). The plaintiff has the burden to comply with Federal Rule Civil Procedure 23. Narouz v. Charter Commc'ns, LLC, 591 F.3d 1261, 1266 (9th Cir. 2010). A class may be certified only if the court is satisfied "after a rigorous analysis that the prerequisites of Rule 23(a) have been satisfied." Wal-Mart, 564 U.S. at 350-51 (citing Gen. Tel. Co. of S.W. v. Falcon, 457 U.S. 147, 161 (1982)). A class may be certified as to one or more claims without certifying the entire complaint. Fed.R.Civ.P. 23(c)(4).

         The court must determine whether certification is based on actual as opposed to presumed compliance with the requirements of Rule 23. Wal-Mart, 564 U.S. at 350 (citing Falcon, 457 U.S. at 160). Because Rule 23 "is not a mere pleading standard, " a party seeking class certification "must affirmatively demonstrate compliance with the Rule." Wal-Mart, 564 U.S. at 351. This inquiry may in some cases overlap into the "merits of plaintiff's underlying claim" because "class determination generally involves considerations that are enmeshed in the factual and legal issues comprising plaintiff's cause of action." Id. (quoting Falcon, 457 U.S. at 160).

         Plaintiffs "bear the burden of demonstrating that they have met each of the requirements of Federal Rule of Civil Procedure 23(a) and at least one of the requirements of Rule 23(b)." Ellis v. Costco Wholesale Corp., 657 F.3d 970, 979-80 (9th Cir. 2011) (citing Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180, 1186 (9th Cir. 2001), amended by 273 F.3d 1266 (9th Cir. 2001)).

         DISCUSSION

         I. Plaintiffs' Motion for Class Certification

         Defendants oppose Plaintiffs' Motion for Class Certification on the ground that Plaintiffs lack standing under Article III of the United States Constitution. Even if Plaintiffs have standing, Defendants also assert:

(1) the proposed class definition is improper;
(2) the proposed class fails to meet the requirements of Rule 23(a) for numerosity, commonality, typicality, or adequacy of representation; and
(3) Plaintiffs' claims do not meet the requirements of Rule 23(b)(3) for predominance and superiority.

         A. Plaintiffs do not have standing under Article III.

         Defendants contend the Court must determine whether Plaintiffs have standing under Article III before considering the merits of class certification. Defendants assert Plaintiffs lack standing because the allegations in their FAC are "sham, " none of these Plaintiffs are obligated to pay their providers for any services rendered, Plaintiffs have not suffered any economic injury, and Defendants have not denied Plaintiffs any medical care. Defendants also contend Plaintiffs are not entitled to injunctive relief because (1) three out of four Plaintiffs are no longer Health Net members, (2) the remaining Plaintiff who is a member no longer sees a naturopath, and (3) Oregon House Bill 3301 now requires insurers to allow naturopathic physicians to apply for credentials as primary-care providers.

         In addition, Defendants note the naturopathic physicians agreed by contract with Defendants that they would not "balance-bill" members for services not covered without a signed agreement made in advance with the member. Defendants contend th*e letters subsequently sent by the naturopathic physicians to Plaintiffs demanding payment for services that Defendants did not cover were merely a pretense to establish Plaintiffs' standing by showing they were injured. Defendants point out that each Plaintiff testified during deposition that they understood they were not obligated to pay any of these bills from those providers.

         Plaintiffs, in turn, contend the Court is not required to address Article III standing before addressing class certification. Plaintiffs assert they were injured by Defendants' alleged discriminatory practices when Plaintiffs received billing statements from the naturopathic physicians requiring Plaintiffs to pay for services not covered by their health plans, Plaintiffs subsequently incurred out-of-pocket expenses, and Plaintiffs reduced or discontinued medical care by their naturopathic physicians. Regardless of their payment obligations, Plaintiffs did not receive care after Defendants denied Plaintiffs coverage for services provided by the naturopathic physicians.

         1. Standards

         In Easter v. American West Financial the Ninth Circuit held the district court properly addressed the issue of standing before addressing the issues of class certification. 381 F.3d 948, 962 (9th Cir. 2004). The court held the borrowers of second mortgage loans failed to establish investment trusts that purchased borrowers' loans were juridically linked, and, therefore, the named borrowers lacked standing to bring a class action against the trusts. The borrowers, however, relied on Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999), to support their contention that courts must consider class certification before addressing Article III standing. Id. The Easter court held:

Fibreboard examined class issues before the question of Article III standing, [and] it did so in the very specific situation of a mandatory global settlement class. Fibreboard does not require courts to consider class certification before standing. See Id. [527 U.S.] at 831 (noting that a "court must be sure ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.