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Jennie Rosario v. E Receivable Managements Services

June 21, 2012

JENNIE ROSARIO, PLAINTIFF,
v.
E RECEIVABLE MANAGEMENTS SERVICES CORPORATION AND OXFORD HEALTH PLANS : (NY), INC., DEFENDANTS.



The opinion of the court was delivered by: Denise Cote, District Judge:

OPINION & ORDER

Plaintiff Jennie Rosario ("Rosario") brings this action pursuant to Section 349 New York General Business Law ("Section 349") and the Fair Debt Collection Practices Act ("FDCPA"). Defendants Oxford Health Plans (NY), Inc. ("Oxford") and Oxford Health Plans LLC ("Oxford LLC") move for dismissal pursuant to Fed. R. Civ. P. 12(b)(6), and for sanctions pursuant to Fed. R. Civ. P. 11. For the following reasons, the motion to dismiss and the motion for sanctions are granted.

BACKGROUND

I. Litigation History

For purposes of ruling on the motion for sanctions, this Opinion recounts the history of litigation against Oxford and/or Oxford LLC pursued by Rosario and her counsel Anthony M. Bentley ("Bentley"). On September 3, 2010, Bentley commenced a civil action on behalf of Rosario in the Civil Court of the City of New York, New York County, captioned Jennie Rosario v. Oxford Health Plans (NY), Inc., Index No. 048798/10, seeking $16,102.20 from Oxford. The pleading in this action consisted of seven words: "1. Breach of Contract; 2. Violation of NYGBL § 349." On September 27, Bentley filed a Notice of Removal in the United States District Court for the Northern District of New York. In the Notice of Removal, Bentley indicated that claims in this action were brought pursuant to the Medicare Act.

On October 7, Oxford mailed a letter to the District Court for the Northern District of New York regarding the impropriety of removal on the basis that 1) removal is a tool reserved for defendants, 2) removal is proper only "in the district court of the United States for the district and division within which" a State court action is pending, 28 U.S.C. § 1446(a), and 3) plaintiff did not provide proper notice to adverse parties of the removal. Rosario v. Oxford Health Plans (NY), Inc., Case No. 1:10-cv-01158 (N.D.N.Y.) ("NDNY Case"), Doc. 3. On October 8, the District Court remanded the case back to state court for the reasons articulated in Oxford's letter. NDNY Case, Doc. 4.

On October 12, 2010, defendants removed the case to the proper district court, the Southern District of New York. On October 19, Oxford moved to dismiss the case, Rosario v. Oxford Health Plans (NY), Inc., 10-cv-7789 (JSR) (S.D.N.Y.) ("Rosario I"), for failure to state a claim. In opposing the motion to dismiss, Bentley argued, inter alia, that he did not need to comply with federal pleading standards because state procedural law trumps federal procedural law in federal court, and that notwithstanding his prior claims that the case was brought pursuant to the Medicare Act and his previously-filed notice of removal, the case should be remanded to State court. On December 14, the action was dismissed without prejudice for failure to exhaust administrative remedies and because the "bare bones" complaint was "plainly inadequate."

On May 22, 2011, Bentley filed a second action on behalf of Rosario against Oxford. This action was brought in the Supreme Court of the State of New York, County of New York, seeking $30,000 ("Rosario II"). The form summons with notice stated that the nature of the action was "Pursuant to Order of the Hon. Jed S. Rakoff, U.S.D.J. dated 12/9/2010, Case No. 10 Civ. 7789 (JSR) (SDNY)," and that the relief sought was "1. Accounting; 2. Class Action." Judge Rakoff, the district judge assigned to Rosario I, never ordered the plaintiff to file Rosario II. Rather, December 9, 2010 was the date Rosario I was dismissed. The Rosario II form summons with notice contained no other information on the nature of the action or the relief sought.

Oxford demanded a complaint from the plaintiff, which was served on July 5. The State court concluded that the complaint was "lacking in clarity," but appeared to base liability on the fact that Oxford issued dividend checks to the plaintiff that expired after six months. Oxford moved to dismiss the complaint on August 15. On November 9, the State court dismissed Rosario II without prejudice for failure to state a cause of action for which relief can be granted.

On October 21, 2011, Bentley filed the present action in State court, seeking $6,000 from Oxford and defendant The Receivable Management Services Corporation ("RMS"). The complaint, in its entirety, made the following allegations:

1. Declaratory Judgment as to joint liability;

2. Violation of FDCPA (see annexed Exhibit 'A')

3. Class Action 15 U.S.C. § 1692k On November 30, Oxford and RMS removed the action to this Court. On December 7, 2011, Oxford filed a motion to dismiss for failure to state a claim and to dismiss Oxford as an improper party. By Order of December 13, plaintiff was directed to file any Amended Complaint by January 2 and instructed that she would have no further opportunity to amend her pleadings. On January 3, 2012, Bentley filed the Amended Complaint.

On February 7, Bentley filed a "motion to assume supplemental jurisdiction." This motion appeared to request that the Court exercise appellate jurisdiction over Rosario II, the State court action dismissed on November 9, 2011. On February 21, Oxford and Oxford LLC moved to dismiss the Amended Complaint, and RMS filed its Answer. That same day, ...


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