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Vacca v. Trinitas Hospital

November 14, 2006


The opinion of the court was delivered by: Joseph F. Bianco, District Judge


Defendant now moves, under Federal Rule of Civil Procedure 56, for summary judgment Plaintiffs John Vacca, Mark Ruggiero, dismissing all of plaintiffs' claims. For the Dennis Perry, Alan Isaacs and Jeffrey Isaacs, reasons that follow, defendant's motion for (trustees on behalf of Health Fund 917) and summary judgment on the ERISA claims is Benefit Services of PA (third-party claims granted in its entirety. Further, the Court administrator of the Fund and agent for the exercises its discretion to decline jurisdiction trustees) (collectively, "plaintiffs") filed the over the remaining state claims, and thus instant action pursuant to the Employee dismisses the state claims without prejudice. Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1191,and Plaintiffs move under Rule 56 for New York State law, seeking recovery of an summary judgment in their favor. Plaintiffs' alleged overpayment to defendant Trinitas motion for summary judgment is denied. Hospital ("Trinitas") for medical benefits provided to a plan beneficiary.



Patient psychiatric treatment for participant under the plan at a daily rate of $550, for a Maximum of 30 days. (Id.) The participant remained hospitalized at Trinitas for 30 days Plaintiff Health Fund 917 ("the Fund") is and was discharged on June 13, 2001. (Id. ¶ a self-insured, multi-employer employee 29-30.) The total charge approved by TCS for benefit plan providing medical benefits to his stay was $16,500. (Id. ¶ 27.) approximately 2,000 employees located in New York and New Jersey. (Plaintiffs' On June 29, 2001, Trinitas billed the Fund Statement of Undisputed Material Facts ¶¶ 1- $68,553.51 for medical services that had been 2.) Plaintiffs Vacca, Ruggiero, Perry, Alan provided to participant. (Id. ¶ 31.) On August Isaacs and Jeffrey Isaacs are trustees of the 2, 2001, plaintiffs re-priced the amount due as Fund.*fn1 (Id. ¶ 3.) Benefit Services of if Trinitas were an in-network provider. (Id. Pennsylvania, Inc. is the third-party claims ¶ 32.) Benefit Services, the Fund's third-party administrator for the Fund and agent for the claims administrator, paid $55,290.13 to Trustees. (Id. ¶ 5.) Trinitas, a difference of $38,790.13 more than the pre-approved charge of $16,500 for On May 14, 2001, a participant participant's psychiatric services. (Id. ¶ 33.) ("participant") in Group 4CC of the Fund's Upon discovering the overpayment, both the healthcare plan was admitted to the Fund trustees and the Fund third-party claims emergency room of Trinitas Hospital's facility administrator contacted Trinitas in an attempt on East Jersey Street in Elizabeth, New to recover the $38,790.13 paid in error. (Id. ¶ Jersey. (Id. ¶ 16; Defendant Trinitas 34-35.) Trinitas refused to return the funds. Hospital's Response to Plaintiff's Statement (Id. ¶ 35.) of Undisputed Material Facts ¶ 16.)


All medical benefits to be provided to the participant were to be pre-approved by the On January 24, 2005, plaintiffs "CareReview" division of the Fund. (Id. ¶ commenced the instant action pursuant to 11.) Psychiatric benefits for participant were Section 502(a)(3) of ERISA, 29 U.S.C. § to be pre-approved by the "Teamsters Center 1132(a)(3). Plaintiffs also allege pendent Services" ("TCS") division of the Fund. (Id. state claims for breach of contract and unjust ¶ 12.) On May 22, 2001, Trinitas Hospital enrichment. ("Trinitas") contacted "CareReview" to obtain pre-certification for medical services that On September 12, 2006, defendant moved were being provided to participant; the request to dismiss this action for lack of subject-was denied. (Id. ¶ 25.) Trinitas then matter jurisdiction, pursuant to Federal Rules contacted TCS to obtain pre-certification for of Civil Procedure 12(h) and 12(b)(1). psychiatric services that were being provided Defendant asserted that plaintiffs' claims for to participant. (Id. ¶ 26.) TCS approved in- money damages were not cognizable under ERISA Section 502(a)(3), and therefore did.


Plaintiffs cross-moved for summary judgment on the same date. Following oral argument on October 27, 2006, this Court Defendants in the instant case move for permitted defendant to convert the motion to summary judgment against plaintiffs pursuant dismiss for lack of subject matter jurisdiction to Fed. Rule Civ. P. 56, arguing that plaintiffs to a cross-motion for summary judgment have no basis for an ERISA claim under under Fed. R. Civ. P. 56, without objection by Section 502(a)(3) because the statute only plaintiffs. On October 31, 2006, defendant provides for equitable remedies and does not Trinitas cross-moved for summary judgment permit recovery of the alleged overpayment. against plaintiffs, incorporating the arguments made in their prior pleadings.*fn2


The standards for summary judgment are pleadings, depositions, answers to summary judgment. Id. at 247-48. Thus, the interrogatories, and admissions on file, nonmoving party may not rest upon mere together with affidavits, if any, show that conclusory allegations or denials, but must set there is no genuine issue as to any material forth "concrete particulars" showing that a fact and that the moving party is entitled to trial is needed. R.G. Group, Inc. v. Horn & judgment as a matter of law." Fed. R. Civ. P. Hardart Co.,751 F.2d 69, 77 (2d Cir. 1984) 56(c); Globecon Group, LLC v. Hartford Fire (internal quotations omitted). Accordingly, it Ins. Co.,434 F.3d 165, 170 (2d Cir. 2006). is insufficient for a party opposing summary The moving party bears the burden of judgment "merely to assert a conclusion showing that he or she is entitled to summary without supplying supporting arguments or judgment. See Huminski v. Corsones,396 facts." BellSouth Telecomms., Inc. v. W.R. F.3d 53, 69 (2dCir. 2005). The court "is not Grace & Co.,77 F.3d 603, 615 (2d Cir. 1996) to weigh the evidence but is instead required (internal quotations omitted). to view the evidence in the light most favorable to the party opposing summary judgment, to draw all reasonable inferences in SECTION 502(a)(3) favor of that party, and to eschew credibility assessments." Amnesty Am. v. Town of West Under Section 502(a)(3) of the ERISA Hartford,361 F.3d 113, 122 (2d Cir. 2004); statute, a civil action may be brought by a Anderson v. Liberty Lobby, Inc.,477 U.S. plan participant, beneficiary or fiduciary: "(A) 242, 248, 106 S.Ct. 2505, 91 L.Ed. 2d 202 to enjoin any act or practice which violates (1986) (summary judgment is unwarranted if any provision of this subchapter or the terms "the evidence is such that a reasonable jury of the plan, or (B) to obtain other appropriate could return a verdict for the nonmoving equitable relief (i) to redress such violations party."). or (ii) to enforce any provisions of this subchapter or the terms of the plan." 29 Once the moving party has met its burden, U.S.C. § 1132(a)(3) (2006). Plaintiffs argue the opposing party "must do more than simply that this clause of ERISA permits them to show that there is some metaphysical doubt as recover the alleged overpayment made by the to the material facts . . . . [T]he nonmoving Fund to Trinitas. In this case, the question is party must come forward with specific facts whether the remedy sought by plaintiffs falls showing that there is a genuine issue for within the "appropriate equitable relief" trial." Caldarola v. Calabrese,298 F.3d 156, authorized by the statute. The complaint 160 (2d Cir. 2002) (quoting Matsushita Elec. demands repayment of the $38,790.13 Indus. Co. v. Zenith Radio Corp.,475 U.S. allegedly overpaid to Trinitas, plus interest, 574, 586-87, 106 S.Ct. 1348, 89 L.Ed. 2d attorneys' fees, and litigation costs. 538 (1986)). As the Supreme Court stated in Anderson, "[i]f the evidence is merely Money awards under Section 502(a)(3) colorable, or is not significantly probative, are only rarely permitted, and generally are summary judgment may be granted." 477 given in circumstances that are not applicable U.S. at 249-50 (citations omitted). Indeed, here. The Second Circuit has held that "the mere existence of some alleged factual compensatory and punitive damages are dispute between the parties" alone will not "never included within 'other appropriate defeat a properly supported motion for equitable relief.'" Gerosa v. Savasta & Co., Inc.,329 F.3d 317, 321 (2d Cir. 2003) depends upon the basis for the claim and the (emphasis added) (citing Lee v. Burkhart,991 nature of the remedies sought by the plaintiffs.

B. AVAILABILITY OF RELIEF UNDER F.2d 1004, 1011 (2d Cir. 1993)). Citing the Id. at 213 (internal citation omitted).

The Supreme Court's decision in Great-West Life Supreme Court distinguished equitable & Annuity Ins. Co. v. Knudson,534 U.S. 204 restitution "in the form of a constructive trust (2002), the Second Circuit cautioned against or an equitable lien" on money or property suits "purporting to seek equitable relief while belonging to the plaintiff that could be clearly also seeking monetary damages": traced to particular funds or property in the defendant's possession, from legal restitution "Almost invariably . . . suits seeking in cases "in which the plaintiff 'could not (whether by judgment, injunction, or assert title or right to possession of particular declaration) to compel the defendant property, but in which nevertheless he might to pay a sum of money to the plaintiff be able to show just grounds for recovering are suits for 'money damages,' as that money to pay for some benefit the defendant phrase has traditionally been applied, had received from him.'" Id. since they seek no more than compensation for loss resulting from Plaintiffs argue that because they can the defendant's breach of legal duty." identify the specific checks that were paid to Bowen v. Massachussetts,487 U.S. defendants, as well as the bank accounts into 879, 918-919, 108 S.Ct. 2722, 101 L. which the checks were deposited, the Ed. 2d 749 (1988) (Scalia, J., overpayment to Trinitas can be traced with dissenting). And "money damages enough particularity to establish an equitable are, of course, the classic form of legal lien over the funds. However, plaintiff's relief." Mertens v. Hewitt Associates, interpretation of equitable restitution would 508 U.S. 248, 255, 113 S.Ct. 2063, encompass nearly every payment between two 124 L.Ed. 2d 161 (1993). parties in which the source and destination of the funds paid could be identified. Plaintiff's Frommert, v. Conkright,433 F.3d 254, 270 approach was rejected by the Second Circuit (2d Cir. 2006). in Nechis v. Oxford Health Plans, Inc.,where the court held that no claim in equity could be In Gerosa, where trustees of an ERISA established where the defendant was not plan sued its actuarial firm for negligence, the required to segregate the monies upon which Second Circuit reiterated that in the case of plaintiff sought to impose a trust, and where non-fiduciary defendants, the "'only there was no allegation that the funds were conceivable equitable claim' for cash money kept in a separate account. 421 F.3d 96, 103 lies under the antique equitable remedy of (2d Cir. 2005). Similarly, there is no restitution." 329 F.3d at 321. In determining indication or argument that the alleged whether a claim for restitution may stand overpayment in this case was retained under Section 502(a)(3) of ERISA, the separately from defendant's other funds. Supreme Court noted that "not all relief Although plaintiffs have framed their claim falling under the rubric of restitution is for restitution ...

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