The opinion of the court was delivered by: Reagan, District Judge
On July 11, 2007, Roche filed this putative class action under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2)(A), against Zenith Insurance Company in the Central District of California (Doc. 2). On December 7, 2007, that court granted Roche's motion to transfer the case to the Southern District of Illinois (Doc. 38). On March 21, 2008, Roche filed a second amended complaint alleging breach of contract (Count 1), unjust enrichment (Count 2), and violations of the Illinois Consumer Fraud Act (Count 3) (Doc. 60). On March 12, 2009, the Court dismissed Roche's breach of contract claim, as she was not in privity with Zenith (Doc. 115), but permitted her to file an amended complaint so as to state a breach of contract claim as a potential third party beneficiary.*fn1
On March 18, 2009, Roche filed a third amended complaint, alleging the same three causes of action, but altering the breach of contract claim to rely on Roche's alleged status as a third party beneficiary (Doc. 116). The general allegations therein are as follows.
Roche is a chiropractor in Illinois. In 1999, she entered an agreement with First Health to become a preferred provider in its preferred provider organization (PPO) network (Doc. 60-3, Exh. 2). Roche alleges that the gist of the PPO agreement is that First Health will contract with payors, the payors will direct patients to the preferred providers in the network, and the preferred providers, will accept reimbursement rates below the usual and customary charges for medical care. The benefit to Roche and other preferred providers is that they receive a higher volume of patients due to these referrals.
Zenith is a workers' compensation carrier, which insures employers with respect to injured workers' claims. Zenith is in fact one of First Health's payors, having entered into a separate Payor Agreement with First Health in 2004 (Sealed Doc. 61). In exchange for access to discounted rates via First Health's PPO network, Zenith agreed to compensate First Health by paying it a percentage of Zenith's savings. Roche also claims that the agreement obligated Zenith to encourage its claimants to use First Health's preferred providers. Though Zenith took discounts from providers in First Health's PPO network, however, Roche alleges that Zenith failed to establish any programs directing its covered claimants to Roche and other Illinois preferred providers.
In early 2007, Zenith submitted payment to Roche for one of its claimants and took a $160.63 discount (See Doc. 60-2, Exh. 1). In doing so, Zenith stated on its explanation of payment (EOP) form: "A PREFERRED PROVIDER DISCOUNT HAS BEEN TAKEN ON YOUR BILL IN ACCORDANCE WITH YOUR FIRST HEALTH CONTRACT." However, Roche claims that Zenith took no steps whatsoever to encourage its claimants to use Roche's services, nor those of other preferred providers in Illinois. As a result, Roche claims that Zenith had no right to take the discount. Roche refers to Zenith's use of First Health's discount without fulfilling its alleged obligation to encourage clients to use preferred providers as a "silent PPO scheme."
Now before the Court is Roche's motion for class certification (Doc. 93). Roche seeks certification of the following class:
All licensed healthcare providers in the State of Illinois who signed a First Health provider agreement (similar to Plaintiff's), and who:
(a) submitted a bill for services to Zenith for services provided to a Zenith covered claimant; and (b) received or were tendered partial payment but in an amount less than the submitted medical expenses based on a First Health PPO discount (e.g., codes A1E or A22).
The Court held a hearing on March 19, 2009 (Doc. 108). However, because Roche filed her third amended complaint only a day before the hearing (Docs.116 & 117), the Court permitted one round of supplemental briefing (Docs. 121 & 125).
Having fully reviewed all of the parties' filings, the Court now DENIES Roche's motion for class certification.
FEDERAL RULE OF CIVIL PROCEDURE 23governs the issue of class certification.
A proposed class must meet the four prerequisites listed in Rule 23(a):
(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.
Additionally, a class must be at least one of the three requirements of Rule 23(b). Here, Roche proceeds under Rule 23(b)(3), which requires a finding "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 movant bears the burden of proving that Rule 23's requirements are met. General Tel. Co. of S.W. v. Falcon, 457 U.S. 147, 160 (1982); Retired Chicago Police Ass'n v. City of Chicago, 7 F.3d 584, 596 (7th Cir. 1993). However, in determining whether a class should be certified, the Court does not consider the merits of the plaintiff's claims. Payton v. County of Kane, 308 F.3d 673, 677 (7th Cir. 2002); see Eisen v. Carlisle and Jacquelin, 417 U.S. 156, 178 (1974) ("In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met.") (quoting Miller v. Mackey Int'l, 452 F.2d 424 (5th Cir. 1971)). However, this does not mean that the Court is required to accept the ...