Transatlantic, LLC v. Humana, Inc.
666 F. App'x 788
| 11th Cir. | 2016Background
- Transatlantic sued multiple Humana entities under RICO (18 U.S.C. § 1962(a), (b)) alleging the defendants withheld Medicare Advantage funds and thus operated a racketeering enterprise.
- The district court dismissed Transatlantic’s second amended complaint for failure to meet Rule 9(b) particularity requirements and instructed it to plead each defendant’s specific role.
- Transatlantic filed a third amended complaint that again grouped defendants collectively as “Humana” and attributed predicate acts (mail/wire fraud, interstate transfer, conversion, extortion) in conclusory fashion.
- The third amended complaint lacked dates, participants, communications content, amounts, routes of transfers, and specific facts establishing how each defendant participated.
- The district court dismissed the third amended complaint with prejudice as a shotgun pleading and denied further amendment as futile.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Rule 9(b) particularity for fraud-based RICO claims | Complaint plausibly alleged scheme and predicate acts | Pleading is conclusory, lacks time/place/substance and fails to identify each defendant’s role | Dismissed for failure to meet Rule 9(b) particularity; dismissal affirmed |
| Existence of a pattern of racketeering (predicate acts) | Alleged multiple predicate acts (mail/wire fraud; transfers; conversion; extortion) | Allegations are bare conclusions with no particularized description of any predicate act | No adequately pleaded predicate acts; pattern not established |
| Identification of each defendant’s participation | “Humana” term refers to Humana, Inc.; allegations apply to specific defendants | Complaint treats defendants collectively, failing to apprise each defendant of its role | Group pleading inadequate; court required individualized allegations |
| Leave to amend after prior dismissals | Requests remand to amend complaint | Prior amendments over years failed; complaint is shotgun pleading; amendment would be futile | Denied leave to amend; dismissal with prejudice upheld |
Key Cases Cited
- Brooks v. Blue Cross and Blue Shield of Fla., Inc., 116 F.3d 1364 (11th Cir.) (Rule 9(b) requires time, place, substance; must apprise each defendant of role in fraud)
- Vicom, Inc. v. Harbridge Merchant Servs., Inc., 20 F.3d 771 (7th Cir.) (requirement that plaintiffs plead each defendant’s participation in multi-defendant frauds)
- United States v. Smalley, 754 F.2d 944 (11th Cir.) (elements of Hobbs Act extortion include wrongful use of force, violence, fear, or color of official right)
- Anderson v. Dist. Bd. of Trs. of Cent. Fla. Cmty. Coll., 77 F.3d 364 (11th Cir.) (shotgun pleadings are deficient and justify dismissal)
- Gratton v. Great Am. Commc’ns, 178 F.3d 1373 (11th Cir.) (district court did not abuse discretion in dismissing with prejudice when repeated amendment failed to cure defects)