Court Opinion

ID: 4664658
Source: CourtListenerOpinion
Date Created: 2021-03-03 21:00:22.657724+00
Date Added: 2024-06-11T08:02:37.444744
License: Public Domain

NOT FOR PUBLICATION                            FILED
                    UNITED STATES COURT OF APPEALS                         MAR 3 2021
                                                                      MOLLY C. DWYER, CLERK
                                                                        U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

EMERGENCY GROUP OF ARIZONA                      No.    20-15684
PROFESSIONAL CORPORATION, an
Arizona professional corporation; et al.,       D.C. No. 2:19-cv-04687-MTL

                Plaintiffs-Appellants,
                                                MEMORANDUM*
 v.

UNITED HEALTHCARE, INC., a
Delaware corporation; et al.,

                Defendants-Appellees.

                   Appeal from the United States District Court
                            for the District of Arizona
                   Michael T. Liburdi, District Judge, Presiding

                      Argued and Submitted February 4, 2021
                                Phoenix, Arizona

Before: W. FLETCHER, MILLER, and HUNSAKER, Circuit Judges.

      Plaintiff-Appellant Emergency Group of Arizona P.C. and other out-of-

network emergency medical providers (collectively, the Medical Groups) appeal

the district court’s dismissal of their state-law claims against Appellee United

Healthcare, Inc., et al., (United) challenging United’s rate of reimbursement for

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
services provided to its insureds. United removed the action from Arizona state

court to the federal district court, which concluded that the Medical Groups’ claims

were completely preempted by § 502(a)(1)(B) of the Employee Retirement Income

Security Act of 1974 (ERISA). 29 U.S.C. § 1132(a). The parties are familiar with

the facts, so we do not repeat them here. We have jurisdiction under 28 U.S.C.

§ 1291, and we reverse and remand with instructions to the district court to remand

this case back to state court.

      Under Aetna Health Inc. v. Davila’s two-prong test, ERISA completely

preempts a state-law claim if: (1) a plaintiff, “at some point in time, could have

brought [the] claim under ERISA § 502(a)(1)(B),” and (2) “there is no other

independent legal duty that is implicated by a defendant’s actions.” 542 U.S. 200,

210 (2004). United’s preemption argument fails to satisfy prong two. Id. The

Medical Groups assert legal duties arising under an implied-in-fact contract based

on a course of dealing between the parties. These alleged legal duties “would exist

whether or not an ERISA plan existed” and thus are independent from the legal

obligations imposed by the ERISA plans. Marin Gen. Hosp. v. Modesto & Empire

Traction Co., 581 F.3d 941, 950 (9th Cir. 2009) (legal duties based on an alleged

oral contract between the parties were independent duties); Barmat v. John & Jane

Doe Partners A-D, 747 P.2d 1218, 1220 (Ariz. 1987) (in banc) (“A contract

implied in fact is a true contract—an undertaking of contractual duty imposed ‘by

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reason of a promissory expression.’” (quoting 1 A. Corbin, Corbin on Contracts

§ 18, at 39 (1963)). Thus, because the Medical Groups’ claims are based on

independent legal duties, they are not completely preempted by § 502(a)(1)(B) of

ERISA. Marin, 581 F.3d at 949–50.

         Because prong two of the Davila complete preemption test fails, we need not

reach prong one. See Hansen v. Grp. Health Coop., 902 F.3d 1051, 1059 (9th Cir.

2018). Moreover, because we conclude the district court erred in dismissing the

Medical Groups’ state-law claims based on complete preemption, we need not

address the Medical Groups’ argument that the district court erred by treating all of

their claims the same for purposes of preemption and dismissing their amended

complaint in its entirety.

         Absent complete preemption, the Medical Groups’ claims do not arise under

federal law and there is no basis for federal-question jurisdiction. Marin, 581 F.3d

at 951. We therefore reverse and remand with instructions for the district court to

remand this case to state court.

         REVERSED and REMANDED with instructions to remand to state

court.

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