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GRAUBERGER v. ST. FRANCIS HOSP.

June 15, 2001

MARINA GRAUBERGER PLAINTIFF,
v.
ST. FRANCIS HOSPITAL, CATHOLIC HEALTH CARE WEST, DEFENDANTS.



The opinion of the court was delivered by: Legge, District Judge.

ORDER ON CROSS-MOTIONS

Defendants St. Francis Memorial Hospital (the "Hospital") and Catholic Healthcare West ("CHW") (collectively "defendants") move for summary judgment on the first amended complaint ("FAC"). Plaintiff cross-moves for partial summary judgment, seeking: (1) an injunction restraining defendants from asserting or collecting on the hospital lien discussed below; and (2) an order stating that the funds currently held in trust pendente lite be disbursed to Grauberger.

The motions have been briefed, argued and submitted for decision. Having considered the arguments of counsel, the moving and opposing papers, the evidence of record, and the applicable authorities, the court now orders as follows.

I.

The underlying facts are not significantly in dispute. Plaintiff was injured in an automobile collision on January 14, 1998. She received treatment for her injuries at the Hospital between April 20 and April 24, 1998 and again between January 19 and January 23, 1999. She alleges that her group insurance policy — issued by Blue Cross as part of the employee benefit plan of United Airlines, her spouse's employer — paid the hospital its negotiated rates in full except for the deductible amounts and copayments, which plaintiff paid herself.*fn1 See FAC at ¶¶ 5-6.

Grauberger brought suit against Loren Holden, the driver who allegedly caused the accident ("tortfeasor"). FAC at ¶ 7. The Hospital then filed a lien in that action pursuant to the Hospital Lien Act ("HLA"), California Civil Code sections 3045.1-3045.6, seeking to recover the balance of its "regular rates," i.e., the difference between the Hospital's normal rates and the negotiated rates that it charged to Grauberger as a plan member.*fn2 Grauberger settled the suit with Holden for $100,000. After deducting attorneys' fees and costs, the net proceeds to plaintiff from the settlement totaled $63,495.48.*fn3 Plaintiff and defendants have placed half of this figure, or $31,747.74, in trust pending resolution of this suit. See FAC at ¶ 11.

II.

Plaintiff filed the instant action in San Francisco Superior Court and alleges that the Hospital is "double billing" her. FAC at ¶ 8. She contends that she and her insurance plan had already paid their negotiated rate in full, so there was no underlying obligation for the Hospital's lien in the Holden lawsuit. Id. at ¶ 10. Moreover, plaintiff alleges that defendants' customary charges are "false and inflated" and are intentionally concealed from patients. Id. at ¶¶ 9, 11. She further claims that the Hospital filed the lien in order "to extort payment" on the double billings, knowing that the lien claims "impede and impair settlement." Id. at ¶ 10.

Plaintiff's first amended complaint states eight claims for relief: (1) conversion; (2) fraudulent concealment; (3) unfair business practices; (4) breach of contract; (5) violation of public policy; (6) interference with contract; (7) abuse of process; and (8) violation of civil RICO. Plaintiff seeks declaratory and injunctive relief as well as treble damages. Plaintiff also seeks to certify a class consisting of "all other patients of defendants' facilities who are insured by private insurance and to whom treatment is rendered on account of accidental injury and who make claim against third party tortfeasors for recovery." FAC at ¶ 13.*fn4

Defendants removed the action to federal court because it involves RICO allegations and is "related to" an ERISA plan. Defendants maintain that the HLA authorizes a hospital that provides services to any person injured in an accident to file a lien, in the amount of the hospital's "reasonable and necessary charges," against any damages recovered by the injured person. They point out that a lien can be placed on damages recovered by "judgment, settlement or compromise." Defendants contend that they are not double billing plaintiff; instead they seek "additional compensation from the third party tortfeasor responsible for the patient's injuries, not from the patient."

III.

Summary judgment should be granted if "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no `genuine issue for trial.'" Matsushita Elec. Industrial Co. v. Zenith Radio, 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citing First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 289, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968)). "At the summary judgment stage, the district court is not to weigh the evidence or determine the truth of the matter but should only decide whether there is a genuine issue for trial." Washington v. Garrett, 10 F.3d 1421, 1428 (9th Cir. 1993) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)).

The moving party bears the initial responsibility of "informing the district court of the basis for its motion, and identifying those portions of `the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (quoting Fed.R.Civ.P. 56(c)).

When the nonmoving party will bear the burden of proof at trial on a dispositive issue, the nonmoving party must then "go beyond the pleadings and by her own affidavits, or by the `depositions, answers to interrogatories and admissions on file,' designate `specific facts showing that there is a genuine issue for trial.'" Id. at 324, 106 S.Ct. 2548 (quoting Fed.R.Civ.P. 56(c) & (e)). The court views all facts and draws all inferences therefrom in the light most favorable to the nonmoving party. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962). If, however, the ...


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