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Advanced Physicians, SC v. National Football League

United States District Court, N.D. Illinois, Eastern Division

October 10, 2019

Advanced Physicians, S.C., Plaintiff,
v.
National Football League, Defendant.

          MEMORANDUM OPINION AND ORDER

          Manish S. Shah, United States District Judge.

         I. Background

         Advanced Physicians filed a complaint against the National Football League in the circuit court of Cook County alleging tortious interference with prospective economic advantage. [1-1] at 5.[1] The complaint states that Advanced, a medical clinic, treated over 200 former NFL players, who were covered by the NFL Player Insurance Plan. [1-1] at ¶¶ 5, 9-10. Advanced provided a variety of services, including evaluations, diagnostic tests, physical therapy, rehabilitation treatment, and pain management. Id. at ¶ 5. These patients assigned their rights under the NFL insurance plan to Advanced. Id. at ¶ 13.

         From 2007 to 2014, Advanced submitted claims to Cigna, the plan's administrator, and received payment. Id. at ¶¶ 12-13. In 2015, Cigna stopped processing Advanced's claims. Id. at ¶ 14. Advanced alleges that it discovered that the “NFL directed Cigna to deny all of Advanced's claims as [presumptively] work- related. The NFL was upset that some of the retired players Advanced treated were using diagnostic tests performed by Advanced as evidence of a disability under the NFL's disability plan.” Id. at ¶ 15.

         As a result of these facts, Advanced “had and has a reasonable expectation that it would continue to treat its patients [former NFL players and their dependents] who were and are beneficiaries under the Plan.” Id. at ¶¶ 17, 19. Advanced also alleges that the NFL's interference caused “declining patient visits by beneficiaries of the Plan, increased cost of Advanced's operations, loss of financing, and increased costs of financing. Advanced specifically denies that it is seeking as damages the value of the denied claims.” Id. at 17.

         The NFL removed the claim to federal court, [1], and filed a motion to dismiss, [10], or, in the alternative, a motion to transfer the case to the Northern District of Texas, [13], where Advanced has been litigating a related claim against the NFL's insurance plan and its administrator, Cigna. See Advanced Physicians, SC v. Conn. Gen. Life Ins. Co., et al., No. 16-CV-2355 (N.D. Tex.). Advanced filed a motion to remand. [17].

         II. Motion to Remand

         Whether this case should be remanded back to state court depends on whether the NFL's removal was proper, and removal of Advanced's state-law tort claim is only appropriate if the claim is completely preempted by federal law.

         Complete preemption occurs when Congress has legislated an area of law so completely that a state-law claim automatically converts into a federal cause of action-in spite of what was pled. Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63-65 (1987). In contrast, conflict preemption serves as a federal defense to a state-law claim and does not authorize removal to federal court. Id. at 63.

         Under the Employee Retirement Income Security Act, complete preemption occurs if the plaintiff 1) could have brought its claim under ERISA § 502(a)(1)(B) at some point and 2) no other independent legal duty is implicated. Aetna Health Inc. v. Davila, 542 U.S. 200, 210 (2004); see also Studer v. Katherine Shaw Bethea Hosp., 867 F.3d 721, 724 (7th Cir. 2017) (citing Davila's “two-step test”). Complete preemption effectuates ERISA's purpose, “to provide a uniform regulatory regime over employee benefit plans” that eliminates conflicting or inconsistent state and local regulation over these plans. Davila, 542 U.S. at 208; Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 46 (1987) (describing the remarks of Senator Williams, who introduced ERISA legislation in the Senate). Claims seeking damages beyond those authorized by ERISA § 502(a) do not put the cause of action outside the scope of the ERISA civil enforcement mechanism. Davila, 542 U.S. at 214-15.[2]

         A plaintiff can bring a claim under § 502(a)(1)(B) if it is a “participant” or “beneficiary” of the plan, and the claim is to recover benefits, enforce rights, or clarify rights to future benefits under the plan. 29 U.S.C. § 1132(a)(1). When a participant assigns her rights under the plan to a medical provider, that provider qualifies as a “beneficiary.” Pennsylvania Chiropractic Ass'n v. Indep. Hosp. Indem. Plan, Inc., 802 F.3d 926, 928 (7th Cir. 2015) (internal citation omitted). NFL players and their dependents assigned their rights under the plan to Advanced, [1-1] at ¶ 13, meaning Advanced qualifies as a “beneficiary” that could bring a lawsuit under § 502(a)(1).

         To determine whether ERISA completely preempts a claim, a court must examine the complaint, the state law at issue, and plan documents. Davila, 542 U.S. at 211. To allege tortious interference with prospective economic advantage under Illinois law, Advanced must show: 1) a reasonable expectancy of entering into a valid business relationship; 2) the NFL's knowledge of the expectancy; 3) an intentional and unjustified interference by the NFL that induced or caused a breach or termination of the expectancy; and 4) damage to the plaintiff resulting from the NFL's interference. Voyles v. Sandia Mortg. Corp., 196 Ill.2d 288, 300-01 (2001) (internal citation omitted); see also Foster v. Principal Life Ins. Co., 806 F.3d 967, 971 (7th Cir. 2015) (quoting Voyles for the legal elements of an intentional interference with prospective economic advantage claim).

         As alleged in the complaint, whether the NFL insurance plan actually covered Advanced's services determines the “reasonableness” of Advanced's expectation to treat former NFL players and their dependents in the future. Beginning in 2007, Advanced submitted claims to Cigna and received payment, [1-1] at ¶¶ 12-13, and its history of treating former NFL players and their dependents was the basis for Advanced's expectancy. Id. at ¶ 17. That expectancy was based on the patients' status as beneficiaries under the plan. Id. The true dispute, then, is about Advanced's assigned rights and benefits under the plan, which is the type of claim ERISA § 502(a)(1)(B) permits. See Studer, 867 F.3d at 726. Advanced could have brought a claim under ERISA at some point-and has, against different defendants, in the Northern District of Texas. See Advanced Physicians, SC v. Conn. Gen. Life Ins. Co., et al., No. 16-CV-2355 (N.D. Tex.).

         For the second step of the Davila test, no other independent legal duty is implicated when the defendant's liability derives from the rights and obligations established by an ERISA-regulated plan. Davila, 542 U.S. at 213. Here, Advanced's “reasonable expectation” depends on establishing its right to payment under the plan, and since the assessment of Advanced's expectation requires interpreting a federally regulated contract, the claim cannot exist “independently” of ERISA under step two. See Rice v. Panchal, 65 F.3d 637, 644 (7th Cir. 1995), as amended on denial of reh'g (Nov. ...


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