Nazari v. State
497 S.W.3d 169
Tex. App.2016Background
- State sued Dental Groups under the Texas Medicaid Fraud Prevention Act for allegedly obtaining improper Medicaid payments and seeking civil penalties.
- Dental Groups asserted counterclaims against the State and third-party claims against Xerox related to prior-authorization reviews and contractual duties.
- State moved to dismiss the counterclaims on sovereign-immunity grounds and moved to dismiss Xerox-related third-party claims on non-jurisdictional grounds.
- District court granted the State’s plea to the jurisdiction and dismissed the Dental Groups’ counterclaims and third-party claims against Xerox.
- Dental Groups appealed challenging both rulings; Xerox supported reversal on the third-party-claims dismissal.
- Court affirmed dismissal of the counterclaims against the State and dismissed for lack of interlocutory appellate jurisdiction the challenge to the Xerox third-party-dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Dental Groups’ counterclaims are barred by sovereign immunity | Dental Groups contend immunity does not bar counterclaims related to the State's enforcement action | State argues immunity bars such counterclaims and that Reata/Emeritus do not apply here | Counterclaims barred by sovereign immunity; district court affirmed dismissal |
| Whether the district court properly dismissed the Dental Groups’ third-party claims against Xerox | Dental Groups argue third-party claims are permissible under the Act or by applicable statutes | State argues Act does not authorize third-party claims or they are barred by immunity | Court lacks jurisdiction to review the third-party-dismissal; issue dismissed for want of jurisdiction |
Key Cases Cited
- Risk Mgmt. Strategies, Inc. v. Texas Workforce Comm'n, 464 S.W.3d 864 (Tex.App.-Austin 2015) (sovereign immunity and jurisdictional questions governed by de novo review)
- Reata Construction Coloration v. City of Dallas, 197 S.W.3d 371 (Tex. 2006) (gov't entity may pursue monetary relief; immunity limitations in offsetting claims)
- City of Dallas v. Albert, 354 S.W.3d 368 (Tex. 2011) (ultra vires and offsetting-claims discussion in immunity context)
- Emeritus Corp., 466 S.W.3d 233 (Tex.App.-Corpus Christi 2015) (state seeking civil penalties under statute; sovereign-immunity considerations distinguishing penalties from damages)
- City of San Antonio v. KGME, Inc., 340 S.W.3d 870 (Tex.App.-San Antonio 2011) (jurisdictional and interlocutory-appeal considerations in governmental actions)
- Anderson, Clayton & Co. v. State ex rel. Allred, 62 S.W.2d 107 (Tex. 1933) (early sovereign-immunity discussion and defense-authority interplay)
- Hawkins v. Dallas Cty. Hosp. Dist., 150 S.W.3d 535 (Tex.App.-Austin 2004) (Medicaid as federal-state program context)
- City of New Braunfels v. Carowest Land, Ltd., 432 S.W.3d 501 (Tex.App.—Austin 2014) (compulsory/offsetting claims and immunity context)
- University of Texas at Austin v. Hayes, 327 S.W.3d 113 (Tex. 2010) (sovereign immunity as jurisdictional question; de novo review)