965 F.3d 1210
11th Cir.2020Background
- Plaintiffs: MSP Recovery Claims, Series LLC (MSP Series) and Series 16-05-456 sued QBE (no-fault insurer) under the Medicare Secondary Payer Act (MSPA) seeking double damages for alleged failure to reimburse MAOs.
- HFHP (a Medicare Advantage Organization) was the intended assignor of MSPA claims; HFAP (an administrative-services entity) was the actual named assignor in the original Recovery Agreement (Apr. 28, 2016) to MSP Recovery (a separate entity not a party here).
- After an Illinois decision rejecting attempts to sue on HFHP’s behalf, HFHP and MSP Recovery executed an Addendum (purporting to make HFHP a party to the Recovery Agreement) and a separate Nunc Pro Tunc Assignment (retroactively assigning HFHP’s MSPA claims to MSP Recovery, both executed June 1, 2018). MSP Recovery earlier assigned certain rights to Series 16-05-456 (2017 Series Assignment).
- District Court dismissed the complaint with prejudice for lack of Article III standing, treating the Addendum and Nunc Pro Tunc Assignment as impermissible parol evidence and holding the Recovery Agreement unambiguously named HFAP as assignor.
- Eleventh Circuit affirmed dismissal for lack of standing but held: (1) the Addendum is inadmissible parol evidence; (2) the Nunc Pro Tunc Assignment is a substantive, retroactive assignment that could confer standing if its rights reached the plaintiffs; (3) the Series Assignment did not convey the Nunc Pro Tunc Assignment rights to the plaintiffs; and (4) dismissal with prejudice was improper — remand to dismiss without prejudice and to reinstate Series 16-05-456 to the caption.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Addendum or Nunc Pro Tunc Assignment establishes plaintiffs’ standing by showing HFHP assigned MSPA claims | Addendum + Nunc Pro Tunc create a "straight-line" retroactive assignment of HFHP’s claims to MSP Recovery and thus to plaintiffs | Documents are extrinsic/parol evidence and cannot alter the unambiguous Recovery Agreement naming HFAP as assignor | Addendum is inadmissible parol evidence; Nunc Pro Tunc is an independent, admissible assignment document (but it did not end up giving plaintiffs rights) |
| Whether a nunc pro tunc (retroactive) assignment can confer Article III standing | Retroactive assignment executed before filing can supply standing as of the complaint date | Retroactive assignments should not be allowed to create standing that did not exist when claims arose (relies on precedent like Abraxis) | A nunc pro tunc assignment executed before filing may confer standing (assignee must hold rights on filing date) |
| Whether the Series Assignment transferred MSP Recovery’s Nunc Pro Tunc-assigned rights to the plaintiffs | Series Assignment conveyed "any and all" rights MSP Recovery obtained as an assignee, thus transferring Nunc Pro Tunc rights | Series Assignment references only claims defined in the Recovery Agreement (which assigned HFAP’s claims), so it did not pass HFHP’s Nunc Pro Tunc rights | Series Assignment did not convey MSP Recovery’s rights under the Nunc Pro Tunc Assignment to the plaintiffs; plaintiffs therefore lacked standing via that route |
| Whether dismissal should have been with prejudice | Plaintiffs argued dismissal should be without prejudice so defects could be cured | QBE argued dismissal with prejudice appropriate because no conceivable facts would give plaintiffs standing | Dismissal for lack of subject-matter jurisdiction is without prejudice; court vacated the with-prejudice dismissal and remanded to dismiss without prejudice and reinstate Series 16-05-456 in caption |
Key Cases Cited
- MSPA Claims 1, LLC v. Kingsway Amigo Ins. Co., 950 F.3d 764 (11th Cir. 2020) (MAOs may sue under the MSPA private cause of action)
- MSP Recovery, LLC v. Allstate Ins. Co., 835 F.3d 1351 (11th Cir. 2016) (Medicare Advantage organizations are secondary payers under the MSPA)
- Humana Med. Plan, Inc. v. W. Heritage Ins. Co., 832 F.3d 1229 (11th Cir. 2016) (Secretary may make conditional payments and primary plans must reimburse)
- MSPA Claims 1, LLC v. Tenet Fla., Inc., 918 F.3d 1312 (11th Cir. 2019) (assignee standing under MSPA requires assignor suffered injury and a valid assignment)
- Abraxis Bioscience, Inc. v. Navinta LLC, 625 F.3d 1359 (Fed. Cir. 2010) (assignment must vest the assignee with the right on the filing date; post-filing assignments cannot confer standing)
- Stalley ex rel. United States v. Orlando Reg'l Healthcare Sys., Inc., 524 F.3d 1229 (11th Cir. 2008) (dismissal for lack of subject-matter jurisdiction is entered without prejudice)