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Meyer v. UnitedHealthcare Insurance Co.

United States District Court, D. Montana, Missoula Division

October 20, 2019

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

          ORDER

          Dana L. Christensen, United States District Court Chief Judge

         Before the Court is Plaintiff John Meyer's ("Meyer") Motion for Reconsideration Under Federal Rules of Civil Procedure 59(e). (Doc. 32.) Meyer urges the Court to reconsider its Order dismissing his case without prejudice. (Doc. 28.) There, the Court granted Defendant UnitedHealthCare Insurance Company's ("United") motion for judgment on the pleadings after concluding that: (1) ERISA governs Meyer's insurance policies; and (2) because Meyer failed to respond, United's argument that ERISA preempts his claims is well taken. (Id. at 7, 9.) Meyer now contends that his failure to provide a counter-argument on the preemption issue was excusable neglect that justifies the Court's reconsideration. (Doc. 33 at 3.) The Court agrees.

         Background

         In October 2015, Meyer began receiving health care coverage from United. United insured Meyer through group policies issued to his then-employer Wildearth Guardians.[1] (Docs. 12 at 3-4; 12-1; 12-2.)

         In December 2015, while he was covered by United, Meyer was involved in a life-threatening ski accident. (Doc. 10 at 2-3.) Meyer's annual in-network out-of-pocket maximum was $6, 000. (Id. at 5.) Meyer was hospitalized for two weeks at the Billings Clinic in Billings, Montana, before being transferred to the Community Medical Center in Missoula, Montana. (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.; see also Meyer v. UnitedHealthcareIns. Co., No. CV 17-98-M-DLC, Doc. 5 at 1 (D. Mont. Dec. 5, 2017)).

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

         United moved for judgment on the pleadings (Doc. 23), arguing that ERISA governs the policies at issue and, therefore, federal law preempts Meyer's state-law claims (Doc. 24). After considering whether the "safe-harbor" described by Zavora v. Paul Revere Life Ins. Co., 145 F.3d 1118, 1120 (9th Cir. 1998) exempted Meyer's group policies from ERISA, the Court concluded that ERISA does control in this case. (Doc. 28 at 5, 7.) Meyer only provided an argument regarding this threshold issue of whether ERISA applies at all. (Doc. 26 at 2-3.) Therefore, pursuant to Local Rule 7.1(d)(1)(B)(ii), the Court treated as well-taken United's next argument concerning ERISA's conflict and express preemption of Meyer's claims, and it accordingly granted United's motion. (Doc. 28 at 9.)

         Now, Meyer moves the Court to reconsider the preemption issue, arguing that his failure to address it in his response brief was excusable neglect based on United's alleged "misrepresentation, misconduct, and fraud," and as a result, he "has experienced injury and circumstances beyond his control." (Doc. 33 at 3, 33.)[2]

         LEGAL STANDARD

         By empowering a district court to vacate its own judgment "when the equities so demand," Am. Games, Inc. v. Trade Prods., Inc., 142 F.3d 1164, 1168 (9th Cir. 1998), Federal Rule of Civil Procedure 60 "attempts to strike a proper balance between the conflicting principles that litigation must be brought to an end and that justice should be done," Delay v. Gordon, 475 F.3d 1039, 1045 (9th Cir. 2007) (quoting 11 Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 2851 (2d ed. 1995)). Therefore, upon "just terms, the court may relieve a party .. . from a final judgment, order, or proceeding" based on, inter alia: "excusable neglect;" "fraud ... misrepresentation, or misconduct;" or "any other reason that justifies relief." Fed.R.Civ.P. 60(b)(1), (3), (6).

         Rule 60(b) "does not particularize the factors that justify relief; [instead] it provides courts with authority 'adequate to enable them to vacate judgments whenever such action is appropriate to accomplish justice.'" United States v. Washington, 98 F.3d 1163 (9th Cir. 1996) (quoting Klapprott v. United States, 335 U.S. 601, 614-15 (1949)). And, while a district court has "wide discretion in passing upon on motion under [Rule] 60(b)," the Ninth Circuit emphasizes that "the policy of the law is to favor a hearing of a litigant's claim on the merits." Russell v. Cunningham, 279 F.2d 797, 804 (9th Cir. 1960).

         "Excusable neglect encompass[es]... omissions caused by carelessness" and, as its name suggests, "includes cases of negligence." Lemoge v. United States, 587 F.3d 1188, 1192 (9th Cir. 2009) (alteration in original) (internal citations omitted). When a party argues for relief based on his "excusable neglect" under Rule 60(b)(1), "the court must consider all relevant circumstances." M.D. by and through Doe v. Newport-Mesa Sck, 840 F.3d 640, 642 (9th Cir. 2016) (per curiam) (citations and internal quotation marks omitted).

         To decide whether neglect is excusable, "district courts should explicitly use the Pioneer-Briones framework for analysis." Lemoge, 587 F.3d at 1192. The equitable Pioneer-Briones analysis requires a district court to examine "at least four factors: (1) the danger of prejudice to the opposing party; (2) the length of delay and its potential impact on proceedings; (3) the reason for the delay; and (4) whether the movant acted in good faith." Id. (quoting Bateman v. U.S. Postal Serv.,231 F.3d 1220, 1223-24 (9th Cir. 2000)). Furthermore, while discussion and analysis under the Pioneer-Briones framework is required, "the district court may consider [] the factors without discussing how much weight it gives to each." Newport-Mesa Sch., 840 F.3d at 643. Additionally, though not an explicit Pioneer-Br ...


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