532 F.Supp.3d 956
S.D. Cal.2021Background
- Fast Access Specialty Therapeutics (Specialty), an out-of-network pharmacy, dispensed $720,384.81 in self‑infused medication to Patient A after receiving “preapproval” letters and other oral/written communications from UnitedHealthcare; Specialty submitted 14 reimbursement claims and was paid one claim (~$24,110); remaining claims denied for lack of medical records evidencing self‑infusion and appeals were denied.
- Specialty sued UnitedHealth defendants for breach of express and implied contract, promissory estoppel, unjust enrichment/quasi‑contract, quantum meruit, and intentional interference with prospective economic relations.
- United moved to dismiss under Rule 12(b)(6), arguing ERISA express preemption under 29 U.S.C. § 1144(a); United asserted preemption was properly raised in the second motion to dismiss and not waived.
- The court found the preemption defense was not waived and framed the core question under ERISA’s broad "relates to"/"reference to" preemption—whether Specialty’s claims are premised on Patient A’s ERISA plan and thus require interpretation of the plan.
- The court concluded Specialty’s claims repeatedly and substantively reference Patient A’s plan (via preapprovals and other communications), so adjudication would require consulting and interpreting plan terms; accordingly the claims are preempted.
- Dismissal was granted on ERISA express preemption grounds, but Specialty was given leave to amend and the court invited claim‑by‑claim preemption analysis if re‑litigated.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Waiver of preemption defense | United waived ERISA preemption by not raising it in its first motion to dismiss | Rule 12 waiver provision does not apply to 12(b)(6) defenses; preemption may be raised later | Not waived; United properly raised preemption in subsequent motion and as to newly added defendant |
| Whether state common‑law claims are preempted under ERISA §1144(a) ("relates to"/"reference to") | Claims arise from United’s independent preapprovals and assurances, not from Patient A’s ERISA plan; plan references are background only | Claims ‘‘reference’’ and depend on the terms/limitations of Patient A’s plan; resolution requires plan interpretation | Preempted: the court found the claims make reference to and are related to the ERISA plan and therefore fall within §1144(a) |
| Breach of express/implied contract based on preapprovals and communications | Preapprovals and additional written/oral assurances created an enforceable agreement or implied contract to pay Specialty | Preapprovals expressly condition payment on plan terms; verifications/authorizations do not, by themselves, create a contract enforceable independent of the plan | Preempted: preapprovals and related communications are tied to plan terms so contract claims are preempted |
| Equitable claims (promissory estoppel, unjust enrichment, quantum meruit) | Specialty reasonably relied on United’s promises/authorizations and would be unjustly deprived if not paid | Promises/authorizations were made because of Patient A’s plan; adjudication depends on plan terms and their application | Preempted: equitable claims depend on plan existence/terms and thus are preempted |
| Tort claim — intentional interference with prospective economic advantage | United’s refusal to reimburse was an independently wrongful act (breach of duty to patient) that interfered with Specialty’s relationship with Patient A | Alleged wrongful act is the denial of benefits tied to the plan; proving wrongfulness requires examining plan terms | Preempted: claim premised substantively on plan/preapprovals and requires plan interpretation |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading must contain sufficient factual content to state a plausible claim)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (complaint must plead factual content allowing reasonable inference of liability)
- Ingersoll‑Rand Co. v. McClendon, 498 U.S. 133 (1990) (state law claim is preempted where plan existence is critical to establishing liability)
- Aetna Health Inc. v. Davila, 542 U.S. 200 (2004) (ERISA has extraordinary preemptive power over state laws relating to employee benefit plans)
- Shaw v. Delta Air Lines, 463 U.S. 85 (1983) (the phrase "relates to" is to be read broadly)
- Providence Health Plan v. McDowell, 385 F.3d 1168 (9th Cir. 2004) (focus on whether claim is premised on existence/terms of ERISA plan)
- Wise v. Verizon Commc'ns, Inc., 600 F.3d 1180 (9th Cir. 2010) (state‑law claims preempted when they necessarily reference an ERISA plan)
- Cedars‑Sinai Med. Ctr. v. Nat'l League of Postmasters, 497 F.3d 972 (9th Cir. 2007) (distinguishing third‑party provider/assignee contexts in preemption analysis)
- Blue Cross of Cal. v. Anesthesia Care Assocs. Med. Grp., Inc., 187 F.3d 1045 (9th Cir. 1999) (consulting a plan in litigation does not automatically trigger preemption when plan meaning is undisputed)