254 F. Supp. 3d 424
E.D.N.Y2017Background
- Plaintiffs are a same-sex male couple (Uddoh and Koev) insured under the Empire Plan administered by United Healthcare; Uddoh added Koev as an insured and Koev’s application identified him as male.
- Plaintiffs sought pre-approval for IVF-related procedures and received a May 16, 2014 preapproval letter listing covered fertility procedures for “you and Plamen Koev,” subject to Empire Plan provisions.
- United personnel then discovered Koev is male, revoked/modified coverage: United agreed to pay for sperm-collection-related procedures but refused coverage for oocyte procurement or third-party surrogacy (excluded by the Empire Plan).
- Plaintiffs allege they relied on the initial preapproval and incurred $150,000 in expenses; they sued United and two United claims administrators asserting breach of contract, promissory estoppel, discrimination, and misrepresentation, seeking compensatory, punitive and treble damages.
- The district court dismissed plaintiffs’ original complaint with leave to amend; plaintiffs filed an amended complaint and the United Defendants moved to dismiss under Rule 12(b)(6).
- The court granted the motion to dismiss, concluding plaintiffs pleaded at most a unilateral mistake by United and failed to state plausible legal theories that could overcome the policy exclusions or other legal defects.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of contract: whether the May 16 preapproval formed a contract obligating United to cover surrogacy | The preapproval letter was an "integrated contract" promising coverage (including surrogacy-related services) | The letter was a mistaken unilateral approval; it expressly conditioned coverage on Empire Plan terms, which exclude surrogacy | Dismissed — letter was a blunder; no intent or consideration to form a contract for excluded surrogacy services |
| Promissory estoppel: whether plaintiffs reasonably relied on United’s preapproval | Plaintiffs relied on the preapproval and incurred expenses | Reliance was unreasonable because the preapproval could not reasonably be read to override the Empire Plan exclusions; revocation occurred before many expenses were incurred | Dismissed — no reasonable reliance on a promise to cover excluded services |
| Discrimination: whether the denial constituted unlawful discrimination against a same-sex couple | Plaintiffs allege they were treated unfavorably as a same-sex couple | Empire Plan excludes surrogacy for all insureds; both same-sex and opposite-sex couples are treated the same; cited statutes do not support claim | Dismissed — no actionable discrimination; plaintiffs treated the same as heterosexual couples and cited statutes inapplicable |
| Misrepresentation (including negligent misrepresentation/slander) | United and its employees made false statements and induced reliance/harm | Alleged defamatory statements to third parties are time-barred; misrepresentation to plaintiffs lacks reasonable reliance and no special relationship exists between insurer and insured | Dismissed — claims fail for lack of reliance, absence of special relationship, and abandonment in opposition brief |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading must state a plausible claim for relief)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (complaint requires more than labels and conclusions)
- Kassner v. 2nd Ave. Delicatessen Inc., 496 F.3d 229 (2d Cir. 2007) (pleading standards and drawing inferences for motion to dismiss)
- Sira v. Morton, 380 F.3d 57 (2d Cir. 2004) (documents integral to the complaint may be considered on Rule 12(b)(6))
- Erickson v. Pardus, 551 U.S. 89 (2007) (pro se complaints are afforded liberal construction)