12-3023-cv Biomed Pharmaceuticals, Inc. v. Oxford Health Plans (NY), Inc.



### UNITED STATES COURT OF APPEALS **FOR THE SECOND CIRCUIT**



## SUMMARY ORDER

**R ULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT**  **. C**  **ITATION TO A SUMMARY ORDER FILED**
**ON OR AFTER J** **ANUARY 1,**  **2007, IS PERMITTED AND IS GOVERNED BY**  **F EDERAL**  **R ULE OF**  **A PPELLATE**  **P ROCEDURE**  **32.1 AND THIS COURT**  **’ S**  **L OCAL**  **R ULE**  **32.1.1. W**  **HEN CITING A SUMMARY ORDER IN A**
**DOCUMENT FILED WITH THIS COURT ,**  **A PARTY MUST CITE EITHER THE F**  **EDERAL A** **PPENDIX OR AN**
**ELECTRONIC DATABASE (**  **WITH THE NOTATION “**  **SUMMARY ORDER ”).**  **A PARTY CITING A SUMMARY ORDER MUST** 
**SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL .** 
**At a stated term of the United States Court of Appeals** 1 **for the Second Circuit, held at the Thurgood Marshall United** 2 **States Courthouse, 40 Foley Square, in the City of New York,** 3 **on the 18 th** **day of June, two thousand thirteen.** 4 5 **PRESENT: DENNIS JACOBS,** 6 **Chief Judge ,**  7 **CHRISTOPHER F. DRONEY,** 8 **Circuit Judge ,**  9 **JOHN F. KEENAN,** 10 **District Judge**

**.** ***** 11 12 - - - - - - - - - - - - - - - - - - - -X 13 **BIOMED PHARMACEUTICALS, INC.,** 14 **Plaintiff-Appellant ,**  15 16 **-v.- 12-3023-cv** 17 18 **OXFORD HEALTH PLANS (NY), INC.,** 19 **Defendant-Appellee ,**  20 21 **OXFORD HEALTH INSURANCE, INC.,** 22 **UNITEDHEALTH GROUP INCORPORATED,** 23 **Defendants**

**.** 24 - - - - - - - - - - - - - - - - - - - -X 25

*Judge John F. Keenan, of the United States District Court for the Southern District of New York, sitting by designation.

1**FOR APPELLANT:** MARCOS DANIEL JIMENEZ (Michael 1 Dillon, McDermott Will & Emery 2 LLP, New York, New York, on the 3 brief ), McDermott Will & Emery 4 LLP, Miami, Florida. 5 6 **FOR APPELLEE:** MICHAEL H. BERNSTEIN (John T. 7 Seybert, on the brief ), Sedgwick 8 LLP, New York, New York. 9 10 Appeal from a judgment of the United States District 11 Court for the Southern District of New York (Rakoff, J. ). 12 13 **UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED** 14 **AND DECREED**that the judgment of the district court be 15
**AFFIRMED**

. 16 17 Biomed Pharmaceuticals, Inc. appeals from the judgment 18 of the United States District Court for the Southern 19 District of New York (Rakoff, J. ), dismissing Biomed’s 20 complaint after a bench trial

. We assume the parties’ 21 familiarity with the underlying facts, the procedural 22 history, and the issues presented for review. 23 24 Biomed, a provider of injectable medications, sued 25 Oxford Health Plans (NY), Inc., under the Employee 26 Retirement Income Security Act (“ERISA”), 29 U.S.C. § 27 1132(a)(1)(B) (allowing a beneficiary to bring a civil 28 action for benefits due under a plan), after Oxford reduced 29 payments to Biomed for services that Biomed provided to a 30 boy suffering from hemophilia. After discovering that 31 Biomed had waived the patient’s deductible and coinsurance 32 obligations, Oxford launched an investigation and ultimately 33 concluded that the waivers granted by Biomed were 34 fraudulent. Because the deductible and coinsurance 35 obligations were unpaid and no valid waiver had been 36 granted, Oxford stopped paying Biomed the full amount 37 charged. 38 39 After a bench trial, we review a district court’s 40 factual findings for clear error and its legal conclusions 41 de novo . Giordano v. Thomson , 564 F.3d 163, 168 (2d Cir. 42 2009). On de novoreview of a claim of denial of benefits, 43 we apply the same standard that the district court applied 44

2to the ERISA fund administrator’s decision. McCauley v. 1 First Unum Life Ins. Co. , 551 F.3d 126, 130 (2d Cir. 2008). 2 When (as here) an ERISA fund administrator has discretionary 3 authority to deny benefits, we review the denial of benefits 4 under a deferential “arbitrary and capricious” standard. 5 Hobson v. Metro. Life Ins. Co. , 574 F.3d 75, 82-83 (2d Cir. 6 2009). “Under the arbitrary and capricious standard of 7 review, we may overturn a decision to deny benefits only if 8 it was without reason, unsupported by substantial evidence 9 or erroneous as a matter of law.” Pagan v. NYNEX Pension 10 Plan , 52 F.3d 438, 442 (2d Cir. 1995) (internal quotation 11 marks omitted). An administrator that both evaluates and 12 pays claims for benefits has a conflict of interest, and a 13 reviewing court “should weigh the conflict as a factor in 14 its analysis.” Durakovic v. Bldg. Serv. 32 BJ Pension Fund
, 15 609 F.3d 133, 138 (2d Cir. 2010). 16 17 Under the relevant provision of ERISA (Section 502, 18 codified at 29 U.S.C. § 1132), “[a] civil action may be 19 brought . . . by a participant or beneficiary . . . to 20 recover benefits due to him under the terms of his plan.” 21 29 U.S.C. § 1132(a). ERISA plaintiffs are thus “required to 22 prove their case; to establish that they were entitled to 23 that benefit pursuant to the terms of the Contract or 24 applicable federal law.” Juliano v. Health Mgmt. Org. of 25 N.J., Inc. , 221 F.3d 279, 287-88 (2d Cir. 2000). Oxford’s 26 determination that the beneficiary had not satisfied the 27 plan’s cost-share obligations was reasonable and supported 28 by substantial evidence. Biomed’s waivers were not based on 29 a good faith inquiry into the family’s financial condition, 30 and it appeared that Biomed granted such waivers routinely. 31 Given the beneficiary’s failure to fulfill the deductible 32 and coinsurance obligations or to obtain an appropriately 33 vetted waiver, it was reasonable for Oxford to pay a reduced 34 amount. These determinations were not arbitrary and 35 capricious, and the judgment should be affirmed. 36 37 For the foregoing reasons, and finding no merit in 38 Biomed’s other arguments, we hereby **AFFIRM** the judgment of 39 the district court. 40 41 FOR THE COURT: 42 CATHERINE O’HAGAN WOLFE, CLERK 43 44 45 46

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