Maine Education Ass'n Benefits Trust v. Cioppa
2012 U.S. App. LEXIS 20021
| 1st Cir. | 2012Background
- Maine enacted LD 1326 to require health insurers disclose aggregate loss information to a district upon written request.
- MEA Benefits Trust manages a statewide, community-rated health plan covering ~67,000 members and claims confidentiality over loss data.
- Trust maintained confidentiality through its own agreements; loss data traditionally remained with insurer and was not disclosed.
- Districts may request district-specific loss information to obtain competing bids, potentially altering plan participation and premiums.
- District court denied preliminary injunction; Trust sought to enjoin LD 1326, arguing a Fifth Amendment taking; First Circuit affirmed denial.
- Regulatory regime in Maine historically regulates insurance disclosure, with prior statutes expanding access to loss information to policyholders and insured groups.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether LD 1326' s disclosure requirement constitutes a taking | Trust argues loss data is confidential trade secret | State regulation promotes public benefit by enabling competition | No taking likely; regulatory action not a per se taking; Penn Central factors depress likelihood |
| Whether the reasonable investment-backed expectations support a takings claim | Trust expected confidentiality of loss data prior to LD 1326 | Expectations tempered by long-standing state regulation | Not reasonable given regulatory history and foreseeability; likelihood of success rejected |
| Economic impact and burden on Trust from potential district exodus | Loss information disclosure will cause districts to leave the Plan | Impact speculative and not proven yet | Economic impact too speculative to show a taking at preliminary stage |
| Whether the government action’s character supports a taking finding | Disclosures burden Trust uniquely | Law applies broadly to all districts and serves public interest | Action characterized as regulatory, not a physical taking; burden not singled out |
Key Cases Cited
- Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (U.S. 2005) (per se physical takings and regulatory takings framework; no automatic take under mere regulation)
- Penn Central Transp. Co. v. City of New York, 438 U.S. 104 (U.S. 1978) (three-factor Penn Central test for regulatory takings)
- Lucas v. S.C. Coastal Council, 505 U.S. 1003 (U.S. 1992) (categorical taking where there is total deprivation of economically beneficial use)
- Monsanto Co. v. Berube, 467 U.S. 100 (U.S. 1984) (treatment of trade secrets and regulatory takings context)
- Philip Morris I, 159 F.3d 670 (1st Cir. 1998) (takings analysis in regulatory context; investment-backed expectations)