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Meyer v. UnitedHealthcare Insurance Co.

United States District Court, D. Montana, Missoula Division

July 30, 2019

JOHN MEYER, Plaintiff,
v.
UNITEDHEALTHCARE INSURANCE COMPANY, Defendant.

          ORDER

          Dana L. Christensen, Chief Judge United States District Court

         Before the Court is the Motion for Judgment on the Pleadings (Doc. 23) filed by Defendant UnitedHealthcare Insurance Company ("United"). United seeks to dismiss Plaintiff John Meyer's First Amended Complaint in its entirety as being preempted by federal law. United's Motion will be granted.

         Background

          In October 2015, Meyer began receiving health care coverage from United. In December 2015, Meyer was involved in a life-threatening ski accident at Big Sky Resort in Big Sky, Montana. (Doc. 10 at 2.) Meyer was insured by United at the time of his accident. (Id. at 3.) Meyer's annual in-network out-of-pocket maximum was $6, 000. (Id. at 5.)

         As a result of the accident, Meyer was hospitalized for two weeks at the Billings Clinic in Billings, Montana, before being transferred to the Community Medical Center in Missoula, Montana, for "in-patient physical and mental rehabilitation." (Doc. 10 at 3.) Ultimately, Meyer was personally billed well over his $6, 000 out-of-pocket maximum. (Id. at 7-8.)

         Meyer originally brought suit in this Court in July of 2017, alleging claims against United under ERISA. (Id. at 6.) However, after United's Associate General Counsel informed Meyer that she believed that the group policies were not subject to ERISA, he agreed to dismiss his case without prejudice. (Id.) That case was dismissed on December 5, 2017. Meyer v. UnitedHealthcare Ins. Co., No. CV 17-98-M-DLC, Doc. 5 at 1 (D. Mont. Dec. 5, 2017).

         In his First Amended Complaint filed in this case, Meyer alleges three claims for relief under Montana's Unfair Trade Practices Act ("MUTPA"). (Doc. 10 at 10-12.) Meyer claims that United "engaged in unfair practices," "breached its contract," and "committed fraud" during its handling of his claim, all in violation of the MUTPA. (Id. at 10-12.) Meyer seeks general and compensatory damages, special damages, punitive damages, attorney fees, and injunctive relief regarding United's prospective billing practices. (Id. at 12.)

         United insured Meyer through group policies issued to his then-employer Wildearth Guardians.[1] (Docs. 12 at 3-4; 12-1; 12-2.) At the time of his accident, Meyer was covered by the 2015 Policy. (Docs. 12 at 3-4; 12-1 at 12.) Meyer's continued treatment spanning into 2016 was covered by the 2016 Policy. (Docs. 12 at 3-4; 12-2 at 12.) Both policies contained provisions which required Wildearth Guardians to contribute "at least 50% of the Premium" for each of its eligible employees. (Docs. 12-1 at 12; 12-2 at 12.)

         Legal Standard United filed its motion under Federal Rule of Civil Procedure 12(c). "The principle difference between motions filed pursuant to Rule 12(b) and 12(c) is the time of filing." Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989). The latter provides that "[a]fter the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings." Fed.R.Civ.P. 12(c). "A judgment on the pleadings is properly granted when, assuming the truth of the allegations in the non-moving party's pleadings, the moving party is entitled to judgment as a matter of law." Rubin v. United States, 904 F.3d 1081, 1083 (9th Cir. 2018). As with a motion filed under Rule 12(b)(6), a successful motion under Rule 12(c) must show either that the complaint lacks a cognizable legal theory or fails to allege facts sufficient to support its theory.

         Discussion

         United claims that dismissal is warranted here because Meyer's insurance policies are governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). Consequently, United asserts that Meyer's claims under the MUTPA are preempted by ERISA's principles of both conflict preemption and express preemption. (Doc. 24 at 6.) For his part, Meyer asserts that there is a material fact at issue that prevents dismissal-whether his insurance policies are governed by ERISA. (Doc. 26 at 2-3.) The Court's analysis begins there.

         I. The Purview of ERISA

         "ERISA is a remedial statute which Congress enacted to protect employee pension benefit rights and to protect employers from conflicting and inconsistent state and local regulations of pension benefit plans." Carver v. Westinghouse Hanford Co., 951 F.2d 1083, 1086 (9th Cir. 1991). ERISA applies to "any employee benefit plan" if it is established or maintained "by any employer engaged in commerce or in any industry or activity affecting commerce." 29 U.S.C. § 1003(a)(1). An "employee benefit plan" is an "employee welfare benefit plan." 29 U.S.C. § 1002(3). An "employee welfare benefit plan" is any plan, fund, or program, that is maintained by an employer that was "established or is maintained for the purpose of providing" its participants, "through the purchase of insurance or otherwise, ... medical, surgical, or hospital care or benefits" 29 U.S.C. § 1002(1). Whether the insurance plan in question is an ERISA plan is a fact question to be decided in the context of all the surrounding circumstances by a reasonable person standard. Zavora v. Paul Revere Life Ins. Co., 145 F.3d 1118, 1120 (9th Cir. 1998).

"To aid in the determination, the Secretary of Labor has issued an interpretive regulation that creates for certain employer practices a 'safe harbor' from ERISA coverage." Id. The regulation provides ...

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