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Bay Area Surgical Group, Inc v. Anthem Blue Cross Life & Health Insur. Co

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION


April 19, 2011

BAY AREA SURGICAL GROUP, INC.,
PLAINTIFF,
v.
ANTHEM BLUE CROSS LIFE & HEALTH INSUR. CO.,
DEFENDANT.

The opinion of the court was delivered by: Lucy H. Koh United States District Judge

ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND AND DENYING MOTION TO STRIKE AS MOOT

Plaintiff Bay Area Surgical Group, Inc. ("Plaintiff") brings the instant action against Defendant Anthem Blue Cross Life and Health Insurance Company ("Defendant"). In brief, Plaintiff alleges that, pursuant to a written assignment agreement, it is entitled to receive full 20 payment from Defendant for health care services it provided to a patient as the patient's assignee.

Defendant moves to dismiss the complaint for failure to state a claim upon which relief may be 22 granted and also moves to strike portions of the complaint. Although Plaintiff's oppositions were 23 due no later than March 31, 2011, as of the date of this Order, Plaintiff has not filed any 24 oppositions. The Court deems these motions appropriate for resolution without oral argument, and 25 vacates the April 21, 2011 motion hearing and case management conference. See Civ. L. R. 7-1(b).

For the reasons explained below, Defendant's motion to dismiss is GRANTED with leave to 27 amend. Defendant's motion to strike is DENIED as moot.

health care services at its facility in Santa Clara, California. See Compl. ¶ 8. On May 20, 2009, a 4 patient of Plaintiff underwent epidural injections. Plaintiff alleges that the patient was insured by a "health benefits agreement" with Defendant. Id. Under that agreement, Defendant promised to 6 pay for certain costs of health care services incurred by the patient. Id.

(Defendant) directly. Pursuant to the assignment agreement, Plaintiff alleges it submitted a timely 10 claim for payment. Id. at ¶ 10. However, according to Plaintiff, Defendant has not made the full

payment of the outstanding charges.

Based on these allegations, Plaintiff brings suit for three California state law claims: (1) breach of contract; (2) implied covenant of good faith and fair dealing; and (3) common counts.

Presently before the Court are Defendant's motion to dismiss for failure to state a claim and motion 15 to strike portions of the complaint.

Dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim is "proper only where there is no cognizable legal theory or an absence of sufficient facts alleged to 19 support a cognizable legal theory." Shroyer v. New Cingular Wireless Services, Inc., 606 F.3d 658, 20 664 (9th Cir. 2010) (quoting Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)). In considering 21 whether the complaint is sufficient to state a claim, the court must accept as true all of the factual 22 allegations contained in the complaint. Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). While a 23 complaint need not allege detailed factual allegations, it "must contain sufficient factual matter, 24 accepted as true, to "'state a claim to relief that is plausible on its face.'" Iqbal, 129 S.Ct. at 1949 25

(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). If the court concludes that the 26 complaint should be dismissed, it must then decide whether to grant leave to amend. "[A] district 27 court should grant leave to amend even if no request to amend the pleading was made, unless it 28 determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v.

I.BACKGROUND

In the Complaint, Plaintiff describes itself as an ambulatory surgery center that provides Plaintiff alleges that, on May 20, 2009, the patient executed an "Assignment of Benefits" to Plaintiff, which authorized Plaintiff, as the patient's assignee, to bill the insurance carrier

II.ANALYSIS

Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (quoting Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995)).

is preempted by the Employment Retirement Income Security Act of 1974 ("ERISA"), as 5 amended, 29 U.S.C. §§ 1001 et seq. Section 1144(a) of ERISA provides that ERISA provisions

Defendant moves to dismiss on the ground that each of Plaintiff's state law causes of action

"supersede any and all State laws insofar as they may now or hereafter relate to any employee 7 benefit plan . . . ." See 29 U.S.C. § 1144(a). The provisions of ERISA "apply to any employee 8 benefit plan if it is established or maintained--(1) by any employer engaged in commerce or in any 9 industry or activity affecting commerce; or (2) by any employee organization or organizations 10 representing employees engaged in commerce or in any industry or activity affecting commerce; or (3) by both." covered by a health insurance policy with Defendant. The Court finds that the Agreement is an "employee benefit plan" as defined in Section 1003(a). See Notice of Removal (with supporting 15 declaration identifying Agreement as expressly covered by ERISA). As the Agreement is covered 16 by ERISA, Plaintiff's three state law claims based on violation of the Agreement are preempted.

(recognizing that "ERISA preempts the state claims of a provider suing as an assignee of the 19 beneficiary's rights to benefits under an ERISA plan"); see also The Meadows v. Employers Health Ins., 47 F.3d 1006, 1008 (9th Cir. 1995) (affirming "the principle that ERISA preempts the state 21 claims of a provider suing as an assignee of a beneficiary's rights to benefits under an ERISA 22 plan").*fn1

See 29 U.S.C. § 1003(a).

Here, Plaintiff seeks to recover payment as the assignee of one of its patients, a patient See Cedars-Sinai Med. Ctr. v. Nal League of Postmasters, 497 F.3d 972, 978 (9th Cir. 2007)

III. CONCLUSION

Accordingly, for good cause shown:

(1) the motion to dismiss is GRANTED with leave to amend;

(2) the motion to strike portions of the complaint is DENIED as moot;

(3) any amended pleading must be filed within twenty-one (21) days of the date of this

Order. Failure to timely amend the complaint will result in dismissal with prejudice; and

(4) the April 21, 2011 motion hearing and case management conference are VACATED.

IT IS SO ORDERED.


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