DECATUR HOSPITAL AUTHORITY, doing business as Wise Regional Health System, Plaintiff-Appellee v. AETNA HEALTH, INCORPORATED, Defendant-Appellant
No. 16-10313
United States Court of Appeals, Fifth Circuit.
April 18, 2017
VI
For the foregoing reasons, we AFFIRM the district court‘s denial of Alviar‘s motion to remand. We REMAND to the district court with instructions to VACATE its grant of Lillard‘s motion to dismiss for failure to state a claim. Because the court lacks subject matter jurisdiction over Lillard, the claim against Lillard must be dismissed without prejudice.
John Bruce Shely, Esq., Mitchell A. Reid, Andrews Kurth Kenyon, L.L.P., Houston, TX, for Defendant-Appellant.
Before JOLLY, HIGGINBOTHAM, and GRAVES, Circuit Judges.
JAMES E. GRAVES, JR., Circuit Judge:
This appeal relates to ongoing litigation between Wise Regional Health System, a Texas municipal hospital authority, and Aetna Health Inc., an insurance plan administrator, regarding medical insurance claims Wise Regional submitted on behalf of its patients. Wise Regional sued Aetna in Texas state court, and, when Aetna removed, it relied in part upon the federal officer removal statute,
We have appellate jurisdiction over the remand order, and, upon de novo review, we AFFIRM. We also perceive no abuse of discretion in the separate attorneys’ fee award, and we AFFIRM.
BACKGROUND
On May 27, 2015, Wise Regional sent Aetna a demand letter “to address claims Wise [Regional] has against Aetna for Aetna‘s violations of the timely claim processing requirements imposed by the Texas Prompt Pay Act.” Wise Regional‘s letter claimed state-law late-payment penalties in excess of $17.4 million had accrued.
Wise Regional‘s demand letter made three specific requests. First, the letter asked Aetna to contact Wise Regional‘s counsel to coordinate a “secure, HIPPA-compliant” transmission of “a detailed list of the claims at issue.” Second, “[t]o make pre-suit negotiations more productive,” Wise Regional asked Aetna to conduct a “line-of-business analysis” on the claims list to identify “the payment arrangement (e.g., self-funded ERISA, fully insured, Medicare Advantage, FEHBA)” implicated by each claim.1 Third, Wise Regional asked Aetna to provide information regarding any claim “Aetna believes was timely paid.” Aetna‘s counsel asked for the claims list on June 19, 2015, and Wise Regional provided it three days later.
On June 24, two days after sending the claims list, Wise Regional filed in Texas state court a lawsuit predicated upon insurance claims it alleges Aetna paid, but paid too slowly. On November 4, 2015, Wise Regional provided objections and answers to Aetna‘s first set of interrogatories. On December 4, 2015, Aetna removed the case to federal court pursuant to
Wise Regional filed a motion to remand, and the district court issued a remand order on February 19, 2016. The district court‘s memorandum opinion stated that
Wise Regional also filed a motion for attorneys’ fees. The district court granted that motion on March 7, 2016, and awarded Wise Regional $14,500. The district court ruled that Aetna “lacked an objectively reasonable basis for seeking removal of this action almost five months after expiration of the thirty-day deadline for removal,” and stated that “[Aetna‘s] contention that it first ascertained from the interrogatory answers that the case is one that was removable borders on being absurd considering that the state court pleading of [the] plaintiff provided exactly that same information.”
Aetna timely noticed its appeal of both the remand order and the attorneys’ fees award.
JURISDICTION
The parties dispute whether this court has jurisdiction to review the remand order. Aetna contends that we may review the remand order under
An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.
As the parties correctly acknowledge, we also have jurisdiction to review the award of attorneys’ fees. See Miranti v. Lee, 3 F.3d 925, 927-28 (5th Cir. 1993) (holding “that
STANDARD OF REVIEW
We review the district court‘s remand order de novo, “without a thumb on the remand side of the scale.” Savoie v. Huntington Ingalls, Inc., 817 F.3d 457, 462 (5th Cir. 2016), cert. denied, --- U.S. ---, 137 S.Ct. 339, 196 L.Ed.2d 262 (2016). “The decision of the district court to award attorneys’ fees is reviewed for an abuse of discretion.” Garcia, 254 F.3d at 587.
DISCUSSION
As a threshold matter, this appeal requires us to analyze our appellate jurisdiction over the district court‘s remand order. We hold that appellate jurisdiction exists. Applying de novo review, we hold that remand was proper. Finally, we conclude the district court did not abuse its discretion by awarding attorneys’ fees.
I. Appellate jurisdiction
“Orders remanding a case to state court are generally not reviewable.” Savoie, 817 F.3d at 460. “The statute governing removal procedure [i.e.,
Wise Regional notes that the district court expressly based its remand order on the untimeliness of Aetna‘s removal, and it contends this ground for remand bars our review. “Untimely removal is a defect in removal procedure,” Belser v. St. Paul Fire & Marine Ins. Co., 965 F.2d 5, 8 (5th Cir. 1992), and we ordinarily lack jurisdiction to review a remand order based on such a defect, see Price v. Johnson, 600 F.3d 460, 462 (5th Cir. 2010). Here, however, the fact that Aetna relied upon the federal officer removal statute in its notice of removal permits appellate review.
This conclusion flows from the text of Section 1447(d). As the Supreme Court observed in Kircher, Section 1447(d) “specifically excepts certain [statutory] actions from its bar.” Kircher v. Putnam Funds Trust, 547 U.S. 633, 640 n.7 (2006).2 Put another way, “Congress has, when it wished, expressly made
In Robertson v. Ball, we declined to review “the part of [a] remand order” expressing a Section 1447(c) ground (lack of subject matter jurisdiction) for rejecting a party‘s reliance upon a portion of the general removal statute, Section 1441(b). See 534 F.2d 63, 65 (5th Cir. 1976). Robertson implies only that we cannot review a remand order (or a portion thereof) expressly based on a Section 1447(c) ground when the basis for removal is a statute that, like Section 1441, Section 1447(d) does not specifically exempt from Section 1447(c)‘s bar.
By recognizing “[t]he exception in [Section] 1447(d)‘s prohibition of appellate review for remands of removals effected under [Section] 1443,” Robertson supports our elevation of Aetna‘s purported Section 1442 basis for removal (which supports appellate review) over the district court‘s
II. Merits of the remand order
Having established our jurisdiction to review the remand order, we consider its merits de novo. We hold that the district court correctly remanded; Aetna‘s notice of removal was untimely.
“In essence, when read as a whole,
Aetna urges us to conclude that this case only became removable when Wise Regional provided its interrogatory responses. Aetna maintains that one interrogatory response specified, for the first time, Wise Regional‘s intention to pursue removable claims.
We disagree with Aetna‘s position essentially for the reasons cogently articulated by the district court in its order awarding attorneys’ fees. See Decatur Hospital Authority v. Aetna Health Inc., No. 4:15-cv-922-A, 2016 WL 950950 at *2-3 (N.D. Tex. March 7, 2016). There is no new information in the interrogatory response at issue, which, in relevant part, referred Aetna “to the spreadsheet served on its counsel on or about June 22, 2015.” Decatur Hosp., 2016 WL 950950 at *2.
Aetna bases its theory of removability on the proposition that the medical claims list includes entries that would support removal. Of course, Aetna received the medical claims list two days before Wise Regional filed its petition. Wise Regional‘s petition referred to the medical claims list. Decatur Hosp., 2016 WL 950950 at *2.
Given this factual context, even if we accepted Aetna‘s theory of why this case presents removable subject matter,4 we would agree with the district court‘s conclusion that Aetna‘s 30-day window for removal began to run under
III. Award of attorneys’ fees
“The decision of the district court to award attorneys’ fees is reviewed for an abuse of discretion.” Garcia, 254 F.3d at 587. “[A] court may award attorney‘s fees when the removing party lacks an objectively reasonable basis for removal.” Am. Airlines, Inc. v. Sabre, Inc., 694 F.3d 539, 542 (5th Cir. 2012) (internal quotations and citation omitted). “A defendant‘s subjective good faith belief that removal was proper is insufficient to establish that the district court abused its discretion in awarding attorney‘s fees under Section 1447(c).” Id. at 542, n.2.
The district court ruled that Aetna “lacked an objectively reasonable basis for seeking removal of this action almost five months after expiration of the thirty-day deadline for removal.” As stated in the previous section, we agree with the district court‘s conclusion that Aetna‘s removal was untimely. We perceive no abuse of discretion in the district court‘s finding that Aetna had no reasonable basis to think otherwise.
CONCLUSION
Accordingly, we AFFIRM both the district court‘s remand order and award of attorneys’ fees.
Lionel ALEXANDER, Plaintiff-Appellant v. CITY OF ROUND ROCK, a Municipal Entity; Officer Marciano Garza, Individually and in His Official Capacity; Sergeant Greg Brunson, Individually and in His Official Capacity; Sergeant Sampson Connell, Individually and in His Official Capacity; Officer Tracy Staggs, Individually and in His Official Capacity; John Does, City of Round Rock Police Officers, Individually and in Their Official Capacity, Defendants-Appellees
No. 16-50839
United States Court of Appeals, Fifth Circuit.
FILED April 18, 2017