IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

BLUE CROSS AND BLUE SHIELD OF 

ILLINOIS, a division of HEALTH CARE 

SERVICE CORPORATION, A Mutual Legal 

Reserve Company; and BLUE CROSS BLUE 

SHIELD ASSOCIATION, 

 Plaintiffs, 

 v. 

JULIA CRUZ, as Special Administrator for 

JOSE S. CRUZ, 

 Defendant. 

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Civil Action No. 01-C-9821 

Judge St. Eve 

PLAINTIFFS’ OPPOSITION TO DEFENDANT’S MOTION TO STAY 

PROCEEDINGS PENDING DISPOSITION OF DEFENDANT’S 

PETITION FOR WRIT OF CERTIORARI

Plaintiffs Blue Cross and Blue Shield of Illinois, a Division of Health Care Service 

Corporation, a Mutual Legal Reserve Company (“HCSC”) and Blue Cross and Blue Shield 

Association (“BCBSA”) respectfully submit this memorandum in opposition to Defendant’s 

Motion to Stay Proceedings Pending Disposition of Defendant’s Petition for Writ of Certiorari. 

BACKGROUND AND SUMMARY

On January 24, 2005, the Seventh Circuit ruled that federal common law governs 

reimbursement suits brought by carriers administering health benefits plans pursuant to the 

Federal Employees Health Benefits Act (“FEHBA”), 5 U.S.C. §§ 8901-8914. Blue Cross & 

Blue Shield of Ill. v. Cruz, 396 F.3d 793 (7th Cir. 2005). On that basis, the Seventh Circuit 

reversed this Court’s holding that it lacked federal question jurisdiction over Plaintiffs’ 

complaint and “REMAND[ED] for further proceedings consistent with [its] opinion.” Id. at 801. 

Case 1:01-cv-09821 Document 98 Filed 01/25/06 Page 1 of 11
Just after the Seventh Circuit’s ruling, Defendant Julia Cruz filed a motion with the Seventh 

Circuit to stay issuance of the Seventh Circuit’s mandate while she petitioned the Supreme Court 

for a writ of certiorari. See Defendant-Appellee’s Mot. to Stay Mandate and Opp. to PlaintiffsAppellants’ Mot. to Stay Mandate (Exh. A). Plaintiffs opposed Cruz’s stay motion, and the 

Seventh Circuit denied Cruz’s motion. See Appellants’ Opp. to Appellee’s Mot. to Stay the 

Mandate (Exh. B); Seventh Circuit Order in Appeal No. 03-4170 (May 5, 2005) (Exh. C). 

Cruz then filed a petition for writ of certiorari. See Cruz v. Blue Cross & Blue Shield of 

Ill., No. 04-1467 (U.S.) (filed June 6, 2005). She did not seek a stay of the Seventh Circuit’s 

mandate from the Supreme Court. Subsequently, the Supreme Court invited the United States 

Solicitor General to file a brief stating his views on Cruz’s petition and on a separate petition 

seeking certiorari with respect to the Second Circuit’s decision in Empire HealthChoice 

Assurance, Inc. v. McVeigh, 396 F.3d 136 (2d Cir. 2005). See 126 S. Ct. 414 (2005). Empire 

had reach a conclusion opposite to the Seventh Circuit in Cruz. That is, the Second Circuit held 

that there is no federal question jurisdiction over reimbursement disputes involving FEHBA 

plans. In his brief, the Solicitor General stated that he believed the Seventh Circuit decision was 

correct, that the Second Circuit’s decision was wrong, and that the Court should grant certiorari 

to review the Second Circuit’s decision. See Br. of Solicitor General at 15-20 (Exh. D). On 

January 6, 2006, the Supreme Court granted certiorari in Empire. See 2006 U.S. LEXIS 4 (Jan. 

6, 2006) (Exh. E). The Supreme Court did not grant Cruz’s certiorari petition and has taken no 

action on her petition as of this date. 

Cruz now raises in this Court anew her motion to stay the case pending disposition of her 

certiorari petition. The Court should deny Cruz’s motion for at least four reasons, any one of 

which alone requires denial of the motion: (1) the Court has no jurisdiction to grant the motion; 

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(2) granting the motion would violate the rule that this Court must adhere to the Seventh 

Circuit’s mandate; (3) Cruz has failed to satisfy the standards for issuance of a stay pending 

disposition of a writ for certiorari; and (4) there are no substantial reasons for the Court to 

exercise its discretion to stay the case. 

ARGUMENT

I. THIS COURT LACKS JURISDICTION TO ENTER A STAY PENDING 

DISPOSTION OF CRUZ’S PETITION FOR WRIT OF CERTIORARI. 

This Court lacks jurisdiction to enter the stay that Cruz requests. The procedure for 

seeking a stay pending disposition of a writ of certiorari is set by statute. The relevant provision 

states: 

In any case in which the final judgment or decree of any court is 

subject to review by the Supreme Court on writ of certiorari, the 

execution and enforcement of such judgment or decree may be

stayed for a reasonable time to enable the aggrieved party to obtain 

a writ of certiorari from the Supreme Court. The stay may be

granted by a judge of the court rendering the judgment or decree 

or by a justice of the Supreme Court, and may be conditioned on 

the giving of security, approved by such judge or justice, that if the 

aggrieved party fails to make application for such writ within the

period allotted therefore, or fails to obtain an order granting his 

application, or fails to make his plea good in the Supreme Court, 

he shall answer for all damages and costs which the other party 

may sustain by reason of the stay. 

28 U.S.C. § 2101(f) (emphasis added). Thus, a stay may be granted by a court of appeals (where 

review of a decision of the court of appeals is sought) or by the Supreme Court. Consistent with 

that statutory direction, the Federal Rules of Appellate Procedure provide further detail about 

seeking a stay from a court of appeals pending disposition of a certiorari petition, see FRAP 

41(d)(2), and the Supreme Court’s rules likewise outline procedures to be followed there to 

obtain a stay. See S. Ct. Rule 23. There is no reference in § 2101 or in the Federal Rules of 

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Civil Procedure to any authority of a district court to enter a stay pending the outcome of a 

certiorari petition. 

In light of § 2101, “a district court does not have jurisdiction to stay a judgment rendered 

by the Court of Appeals.” Mister v. Ill. C. Gulf R.R. Co., 680 F. Supp. 297, 298 (S.D. Ill. 1988). 

“By its plain language, § 2101(f) confers authority only on the . . . Circuit or a justice of the 

Supreme Court to stay execution or enforcement of a . . . Circuit judgment while awaiting the 

outcome of a certiorari petition.” United States v. Lentz, 352 F. Supp. 2d 718, 726-27 (E.D. Va. 

2005). As the Eighth Circuit has put it in reviewing a district court’s grant of a stay pending the 

disposition of a certiorari petition: “We are not persuaded that Section 2101(f) grants the District 

Court this authority . . . . [O]nly a judge of this Court, or a justice of the Supreme Court, is 

empowered by 28 U.S.C. Section 2010(f) to stay the execution or enforcement of this Court’s 

judgment.” In re Stumes, 681 F.2d 524, 525 (8th Cir. 1982). 

On this basis, the Court must deny Cruz’s stay request, for lack of jurisdiction. Cruz here 

effectively seeks a stay of the Seventh Circuit’s mandate that this Court exercise federal 

jurisdiction and proceed consistent with the Seventh Circuit’s opinion, in order to await the 

disposition of her previously filed certiorari petition. Under the straightforward terms of § 2101, 

only the Seventh Circuit can do that (and, indeed, has already refused to do so), or the Supreme 

Court may enter a stay. 

“Nor as a prudential matter would it be appropriate for [this Court] to exercise 

jurisdiction to issue such a stay.” Lentz, 352 F. Supp. 2d at 726. In order to obtain a stay 

pending a petition for writ of certiorari, Cruz must demonstrate – under the standards applicable 

in this Circuit – both that four Justices of the Supreme Court will vote to grant certiorari as well 

as a reasonable probability that five Justices will vote to reverse the judgment of the circuit court. 

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United States ex rel. Chandler v. Cook County, Ill., 282 F.3d 448, 450 (7th Cir. 2002); see also 

Books v. City of Elkhart, 239 F.3d 826 (7th Cir. 2001); Cruz’s Mot. ¶ 9. “It is simply ‘not an 

appropriate function for this court to pass on the likelihood that the ruling of a higher court will 

be accepted for review by the Supreme Court’” and ultimately reversed; “rather, that function is 

properly performed by the court of appeals or the Supreme Court, as contemplated by § 2101(f).” 

Lentz, 352 F. Supp. at 726 (quoting Studiengesellschaft Kohle, mb H v. Novamont Corp., 578 F. 

Supp. 78, 79-80 (S.D.N.Y. 1983)). Furthermore, district courts have held that they are “‘not in a 

proper position’” to determine the prospects for a grant of certiorari and a reversal “‘particularly 

where, as here, the judgment sought to be reviewed modified [the district court’s] initial 

determination.’” Mister, 680 F. Supp. at 298 (quoting Studiengesellschaft, 578 F. Supp. at 80). 

The only case cited by Cruz that comes close to addressing the specific issue of a stay 

pending disposition of a petition for certiorari is Peaceable Planet, Inc. v. Ty, Inc., 2004 U.S. 

Dist. LEXIS 13006, *5 (N.D. Ill. July 13, 2004) (Exh. F). There, the district court did not even 

mention § 2101. The Court should not follow that precedent, when “the great weight of recent, 

reasoned authority has concluded that § 2101(f) does not permit a district court to exercise 

jurisdiction to stay a circuit court’s final judgment pending filing or resolution of a certiorari 

petition.” Lentz, 352 F. Supp. 2d at 726 (collecting cases, including In re Stumes, 681 F.2d at 

525; Brinkman v. Dep’t of Corrections, 857 F. Supp. 775, 777 (D. Kan. 1994); Gander v. FMC 

Corp., 733 F. Supp. 1346, 1347 (E.D. Mo. 1990); Mister, 680 F. Supp. at 298; Hovater v. 

Equifax Servs., Inc., 669 F. Supp. 392, 393 (N.D. Ala. 1987); Deretich v. St. Francis, 650 F. 

Supp. 645, 647 (D. Minn. 1986); Studiengesellschaft, 578 F. Supp. at 79-80 (S.D.N.Y. 1983); 

Kozman v. Trans World Airlines, Inc., 145 F. Supp. 140 (S.D.N.Y. 1956)). 

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II. ENTRY OF A STAY WOULD VIOLATE THE MANDATE RULE.

Even if this Court found it had jurisdiction, it lacks – under the mandate rule – “authority 

to issue a stay or a continuance pending resolution of [Cruz’s] certiorari petition where, as here, 

[Cruz] already sought and failed to obtain a stay of the circuit court’s mandate when the case was 

on appeal.” Lentz, 352 F. Supp. 2d at 726. The mandate rule “requires a lower court to adhere” 

both to the “‘spirit as well as the letter’” of the “commands of a higher court on remand.” United 

States v. Polland, 56 F.3d 776, 777 (7th Cir. 1995) (quoting In re Continental Ill. Securities 

Litig., 985 F.2d 867, 869 (7th Cir. 1993)). 

It is “clear that a stay of this case would violate the ‘mandate rule,’ as it would 

contravene the spirit of the [Seventh] Circuit’s mandate in this case.” Lentz, 352 F. Supp. 2d at 

727. The Seventh Circuit ordered that this Court proceed with this action consistent with the 

appellate opinion, which held that this Court has jurisdiction. When Cruz sought a stay from the 

Seventh Circuit, the Seventh Circuit expressly rejected Cruz’s request. “[F]or this Court to grant 

the stay requested would permit [Cruz] to obtain in the district court that which the [Seventh]

Circuit explicitly refused.” Id. Cruz nowhere mentions in her current motion that she, in effect, 

sought and failed to obtain from the Seventh Circuit the very relief she now seeks from this 

Court. But that event is dispositive. 

The Supreme Court’s grant of certiorari in Empire does not somehow constitute a 

development that permits the Court to stray from the Seventh Circuit’s earlier ruling denying a 

stay. It is true that this Court may reconsider issues decided by the Seventh Circuit when there 

are “subsequent factual discoveries or changes in the law.” Barrow v. Falck, 11 F.3d 729, 731 

(7th Cir. 1993). But nothing about the Supreme Court’s grant of certiorari in Empire suggests 

that the Seventh Circuit would now find that a stay is warranted. In our opposition to Cruz’s stay 

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motion in the Seventh Circuit, we did not dispute that a grant of certiorari in this case or Empire

was a distinct possibility, in light of the conflict between the two circuits. What we did contest is 

that five Justices would ever vote to reverse the Seventh Circuit’s decision, a prerequisite for a 

stay of these proceedings (see supra pp. 4-5). The Supreme Court’s grant of review in Empire

does not provide any greater indication than before that five Justices would vote to overturn the 

Seventh Circuit ruling. In fact, it suggests the opposite. The Supreme Court granted certiorari in 

Empire, not this case, and it did so only after the Solicitor General asserted that the Second 

Circuit erred and the Seventh Circuit acted correctly. The simple grant of certiorari in Empire 

does not upset the Seventh Circuit’s denial of a stay of the mandate in this case, a denial that 

necessarily included a finding that five Justices would not vote to reverse the Seventh Circuit’s 

determination. 

III. CRUZ’S MOTION TO STAY DOES NOT MEET THE REQUIREMENTS FOR A 

STAY PENDING DISPOSITION OF A CERTIORARI PETITION. 

Even if Cruz could overcome the jurisdictional hurdle and the mandate rule, her motion 

should still be denied because she cannot satisfy the two requirements necessary for entry of a 

stay pending disposition of a petition for certiorari. Those requirements, again, are that four 

Justices will vote to grant certiorari and that five Justices are reasonably likely to vote to reverse. 

On the first element, because the Supreme Court granted the petition in the Empire case, it is 

unlikely it will also grant Cruz’s petition. At this juncture, it appears that the Supreme Court 

would only grant Cruz’s petition in the event that it affirms Empire (i.e., holds that the federal 

courts lack federal question jurisdiction in FEHBA reimbursement disputes); in that instance, the 

Supreme Court would likely grant Cruz’s petition in order for the Seventh Circuit to reconsider 

its decision in light of Supreme Court’s Empire ruling. Hence, whether the Supreme Court will 

grant certiorari seems to turn on the prospect that a majority of the Justices will favor the Second 

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Circuit’s viewpoint over the Seventh Circuit’s. The first inquiry under the stay standard 

consequently collapses into the second – namely, whether it is reasonably likely that five Justices 

would vote to reverse the Seventh Circuit (and affirm Empire). 

That is not a reasonably likely scenario. As already noted, the Solicitor General takes the 

position that Empire was wrongly decided and that the Seventh Circuit correctly determined that 

federal courts have jurisdiction. Moreover, the Empire decision was aberrational, with the 

relevant prior appellate decisions being in line with the Seventh Circuit’s holding that state law is 

preempted and that federal common law governs disputes under FEHBA. E.g. Caudill v. Blue 

Cross & Blue Shield of N.C., Inc., 999 F.3d 74, 77-79 (4th Cir. 1993); Medcenters Health Care 

v. Ochs, 26 F.3d 865 (8th Cir. 1994). While Cruz argues that the Supreme Court rejected federal 

jurisdiction over reimbursement disputes in the ERISA context in Great-West Life & Annuity Ins. 

Co. v. Knudson, 534 U.S. 204 (2002), and thereby supposedly can be expected to rule similarly 

in the FEHBA context, the Seventh Circuit has not read Great-West so broadly. It has ruled that, 

consistent with Great-West, federal jurisdiction does exist under ERISA where a constructive 

trust can be imposed on funds held by a defendant. E.g. Admin. Comm. of the Wal-Mart Stores, 

Inc. Assocs. Health & Welfare Plan v. Varco, 338 F.3d 680, 687-89, 691 (7th Cir. 2003). And 

the Seventh Circuit expressly referenced its Wal-Mart decision in its opinion in this case, noting 

that the ERISA rule supported jurisdiction over FEHBA reimbursement claims. Cruz, 396 F.3d 

at 799. Accordingly, Great-West provides no grounds for anticipating a reversal of the Seventh 

Circuit’s FEHBA ruling. 

IV. THIS COURT CANNOT AND SHOULD NOT EXERCISE ITS DISCRETION TO 

ENTER A STAY. 

 

Cruz should not be allowed to end-run the requirements of § 2101(f) by asking the Court 

to enter a stay as part of its inherent powers to manage its own docket. As a preliminary matter, 

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it is not clear this inherent power overrides the very specific statutory directive that only a court 

of appeals or the Supreme Court retains authority to stay the final judgment of a circuit court. In 

any event, even if the Court retained such authority, it may only be invoked “to the extent that its 

exercise is consistent with the letter and spirit of [the] circuit court’s mandate.” Lentz, 352 F. 

Supp. 2d at 728. Here, a discretionary stay is “plainly unwarranted in light of the [Seventh] 

Circuit’s denial of [Cruz’s] application for a stay,” for it cannot be a proper exercise of a district 

court’s discretion to award what the circuit court has previously denied. Id. 

Most important, the Court must deny even a discretionary stay because a delay in these 

proceedings would prejudice Plaintiffs. As the Court is aware, there are competing proceedings 

in the state court involving these same parties, proceedings to which the Seventh Circuit in Cruz

said that this Court should not abstain. See Cruz, 396 F.3d at 800-01. If the Court now stays 

these federal proceedings pending disposition of Empire or Cruz’s certiorari petition, then the 

federal proceedings could be on hold for six or more months (since the Supreme Court cannot be 

expected to rule in Empire until about June 2006). In the meantime, Cruz has not agreed to a 

stay of the state court proceedings. As a result, the state court case, to which, again, the Seventh 

Circuit said that this Court should not defer, would gain an advantage in the race to judgment 

with this Court. The Court should not exercise its discretion to give Cruz that unfair procedural 

advantage. 

Cruz incorrectly asserts that Plaintiffs’ earlier request that the Seventh Circuit stay its 

mandate pending disposition of Plaintiffs’ own motion in the Seventh Circuit to enjoin the state 

court proceedings “shows that [Plaintiffs] did not consider staying this case as prejudicial to its 

interests.” Cruz’s Mot. ¶ 12. That was a limited stay that Plaintiffs requested so that their 

motion addressed to the Seventh Circuit would not be mooted by the return of the case to this 

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Court. The Seventh Circuit implicitly granted that limited stay, because it did not issue its 

mandate until after disposing of Plaintiffs’ motion. In any event, Plaintiffs’ request for a limited 

stay in no way suggests that they then or now believed an indefinite stay of these proceedings is 

appropriate while the state case continues to proceed. 

CONCLUSION

Cruz’s Motion to Stay Proceedings Pending Disposition of Defendant’s Petition for Writ 

of Certiorari should be denied. 

Respectfully submitted, 

 s/ John E. Thies 

John E. Thies (06199338) 

 Attorney for Defendant 

 WEBBER & THIES, P.C.

 202 Lincoln Square 

 P.O. Box 189 

 Urbana, IL 61803 

 Telephone: (217) 367-1126 

 Facsimile: (217) 367-3752 

E-mail: jthies@webberthies.com

Helen E. Witt 

KIRKLAND & ELLIS LLP 

200 East Randolph Drive 

Chicago, Illinois 60601 

(312) 861-2000 

 John E. Thies Anthony F. Shelley 

 WEBBER & THIES, P.C. MILLER & CHEVALIER 

 202 Lincoln Square CHARTERED 

 Urbana, Illinois 61801 655 Fifteenth Street, NW 

 (217) 367-1126 Suite 900 

 Washington, D.C. 20005 

 (202) 626-5924 

 Attorneys for the Plaintiffs

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No. 01-9821 

PROOF OF SERVICE

I, John E. Thies, hereby certify that on January 25, 2006 I electronically filed the 

foregoing PLAINTIFFS’ OPPOSITION TO DEFENDANT’S MOTION TO STAY 

PROCEEDINGS PENDING DISPOSITION OF DEFENDANT’S PETITION FOR WRIT 

OF CERTOIRARI with the Clerk of the Court using the CM/ECF system which will send 

notification of such filing to the following: 

 Clinton A. Krislov 

Michael R. Karnuth 

s/ John E. Thies 

John E. Thies (06199338) 

 Attorney for Defendant 

 WEBBER & THIES, P.C.

 202 Lincoln Square 

 P.O. Box 189 

 Urbana, IL 61803 

 Telephone: (217) 367-1126 

 Facsimile: (217) 367-3752 

E-mail: jthies@webberthies.com

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