Court Opinion

ID: 4097219
Source: CourtListenerOpinion
Date Created: 2016-11-10 15:01:25.470109+00
Date Added: 2024-06-11T14:33:39.001206
License: Public Domain

Case: 16-11488    Date Filed: 11/10/2016   Page: 1 of 7

                                                         [DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 16-11488
                        Non-Argument Calendar
                      ________________________

               D.C. Docket No. 8:13-cv-01925-EAK-TBM

TRANSATLANTIC, LLC,

                                                          Plaintiff-Appellant,

                                  versus

HUMANA, INC.,
HUMANA INSURANCE COMPANY,
HUMANA HEALTH INSURANCE COMPANY OF FLORIDA, INC.,
HUMANA MEDICAL PLAN, INC.,
PCA FAMILY HEALTH PLANS OF FLORIDA, INC., et al.,

                                                         Defendants-Appellees.

                      ________________________

               Appeal from the United States District Court
                   for the Middle District of Florida
                     ________________________

                            (November 10, 2016)

Before WILLIAM PRYOR, JORDAN and ROSENBAUM, Circuit Judges.

PER CURIAM:
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      Transatlantic, LLC, appeals the dismissal of its third amended complaint

against Humana, Inc., Humana Insurance Company, Humana Health Insurance

Company of Florida, Inc., Humana Medical Plan, Inc., and PCA Family Health

Plans of Florida, Inc. The district court dismissed with prejudice Counts I through

IV, which alleged that the defendants violated the Racketeer Influenced and

Corrupt Organizations Act, see 18 U.S.C. § 1962(a)–(d), and declined to exercise

supplemental jurisdiction over Counts V and VI, which alleged that the defendants

violated Florida law. Transatlantic contests the dismissal only of Counts I and II,

which alleged that the defendants operated a racketeering enterprise that used or

maintained itself by withholding funds owed to Transatlantic under a Medicare

Advantage program. See id. § 1962(a), (b). The district court ruled that the counts

lacked the particularity required to state a claim for relief. See Fed. R. Civ. P. 9(b).

We affirm.

      Allegations of fraud, like those made by Transatlantic, are subject to the

heightened pleading standard of Federal Rule of Civil Procedure 9(b), which

requires that “a party . . . state with particularity the circumstances constituting

fraud.” Id. To satisfy Rule 9(b) in a civil action involving a scheme to defraud, a

plaintiff must identify the time, place, and substance of each allegedly fraudulent

act. Brooks v. Blue Cross and Blue Shield of Fla., Inc., 116 F.3d 1364, 1381 (11th

Cir. 1997). And when the alleged fraud involves multiple defendants, Rule 9(b)

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requires that the plaintiff plead sufficient facts to “inform each defendant of the

nature of [its] alleged participation in the fraud.” Id. (quoting Vicom, Inc. v.

Harbridge Merchant Servs., Inc., 20 F.3d 771, 777–78 (7th Cir. 1994)).

      When the district court dismissed the second amended complaint without

prejudice, it warned Transatlantic that its pleading failed to satisfy the particularity

requirements of Rule 9(b). The district court explained that Transatlantic had

“fail[ed] to separate the individual Defendants in the RICO causes of action, and

. . . group[ed] them as a collective ‘Humana.’” The district court instructed

Transatlantic to refile a complaint that contained “specific allegations [about] each

defendant involved in the RICO causes of action, and their interrelationships for

RICO . . . .”

      Transatlantic disregarded the instruction to identify the individual

defendants’ alleged racketeering activities. The third amended complaint treats the

defendants as a single entity. Transatlantic attributes the predicate acts jointly to

“HUMANA, INC., HUMANA INSURANCE COMPANY, HUMANA HEALTH

INSURANCE COMPANY OF FLORIDA, INC. and HUMANA MEDICAL

PLAN, INC,” to “Defendant HUMANA,” to “HUMANA,” or to “Defendant.”

Transatlantic argues that the term “HUMANA” refers exclusively to Humana, Inc.,

but the opening paragraph of the amended complaint states that the term

“HUMANA” refers “collectively” to “the Defendants, HUMANA, INC.,

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HUMANA INSURANCE COMPANY, HUMANA HEALTH INSURANCE

COMPANY OF FLORIDA, INC., HUMANA MEDICAL PLAN, INC., PCA

HEALTH PLANS OF FLORIDA, INC., PCA FAMILY HEALTH PLAN, INC.,

PCA LIFE INSURANCE COMPANY, AND EMPLOYERS HEALTH

ISNURANCE [sic] COMPANY.” The third amended complaint fails to apprise

each defendant of its involvement in each allegedly fraudulent activity. Brooks,

116 F.3d at 1381.

      Transatlantic also failed to adequately allege the existence of a pattern of

racketeering activity. A pattern of racketeering activity consists of at least two

predicate acts of racketeering committed within a ten-year period. 18 U.S.C.

§ 1961(1), (5). Transatlantic alleged predicate acts of mail and wire fraud, see id.

§§ 1341, 1343, the interstate transmission and transfer of more than $5,000, id.

§ 2314, conversion, id. § 2315, and extortion, id. § 1951, but failed to describe any

predicate act with particularity. See Brooks, 116 F.3d at 1381.

      The third amended complaint contains conclusory allegations of mail and

wire fraud. Transatlantic alleged that the defendants “did place and cause to be

placed mail matter to be sent and delivered by the United States Postal Service”

without mentioning a date of mailing or what “matter or thing” was sent. See 18

U.S.C. § 1341. With respect to wire fraud, Transatlantic alleged that there were six

occasions between 2009 and 2010 when “Defendant” sought a “disbursement of

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funding for TRANSATLANTIC” and “caused an interstate wire transmission of

funds,” but failed to describe the parties to, the place of, or the content of the wire

communications, any misrepresentations made, or how the communications were

entwined in the scheme to defraud. See Brooks, 116 F.3d at 1371. In an attempt to

taint the transactions, Transatlantic alleged the “Defendant . . . intended to impose

an illegal and unwarranted withhold,” but Transatlantic neglected to allege that any

funds were actually withheld or why it was entitled to payment. Transatlantic

alleged it was “lulled into not taking action concerning . . . reimbursement”

because of an email that an employee of “HUMANA” sent “on or about January

10, 2013,” but Transatlantic described emails it sent in February and March of

2013 that inquired about its “outstanding account.” This collection of conclusions

and unrelated events falls far short of alleging a single episode of wire fraud.

      The allegations of unlawful transmissions of funds, conversion, and

extortion suffer from similar infirmities. The third amended complaint was bereft

of any details pertaining to the allegations that, on four occasions, the defendants

“did cause to be transmitted and transferred in interstate commerce securities and

money of a value greater than five thousand dollars” with the “inten[t] to convert

and steal” and that, on four different occasions, the defendants “did receive,

possess, and conceal securities and money . . . [that had] been unlawfully

converted and taken.” The conclusory allegations made it impossible to discern

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who initiated the transfers, how much was transferred, what entity transferred the

funds, the reason for the transfer, the route that the funds traveled, how

Transatlantic was entitled to the funds, or the means used to convert the funds. And

Transatlantic omitted from its allegation of extortion that its property was taken

“by wrongful use of actual or threatened force, violence, or fear, or under color of

official right,” which is an element of the offense. See 18 U.S.C. § 1951(b)(2);

United States v. Smalley, 754 F.2d 944, 947 (11th Cir. 1985).

      The district court did not err by dismissing the third amended complaint

filed by Transatlantic. The amended complaint failed to state a claim of

racketeering in violation of section 1962(a) or (b). Transatlantic failed to allege a

single predicate act of racketeering activity or to identify how the individual

defendants participated in the alleged scheme to defraud.

      Transatlantic asks that we remand for it to file an amended complaint, but it

would be futile to allow further amendment. The third amended complaint, like its

predecessor, is a quintessential “shotgun pleading.” It incorporates virtually every

antecedent allegation by reference in each subsequent claim for relief, is devoid of

facts to substantiate its allegations of racketeering, and leaves the defendants

unable to frame a response. See Anderson v. Dist. Bd. of Trs. of Cent. Fla. Cmty.

Coll., 77 F.3d 364, 366 (11th Cir. 1996). Transatlantic proved incapable over the

course of three years—during which it amended the complaint numerous times—to

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file a complaint that stated a claim of racketeering against the defendants. The

district court did not abuse its discretion when it dismissed the third amended

complaint with prejudice. See Gratton v. Great Am. Commc’ns, 178 F.3d 1373,

1374 (11th Cir. 1999).

      We AFFIRM the dismissal of the third amended complaint.

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