United States District Court, E.D. New York
NEUROLOGICAL SURGERY, P.C., JEFFREY A. BROWN, M.D., Plaintiffs,
SIEMENS CORPORATION, Defendants.
Garfunkel Wild PC Attorneys for the Plaintiffs By: Colleen M.
Tarpey, Esq., Marc Andrew Sittenreich, Esq., Roy W.
Breitenbach, Esq., of Counsel.
McGuireWoods LLP Attorneys for the Defendant By: Philip A.
Goldstein, Esq. Dana Rust, Esq., Summer L. Speight, Esq., of
MEMORANDUM OF DECISION AND ORDER
D. SPATT UNITED STATES DISTRICT JUDGE.
Plaintiffs Neurological Surgery, P.C. (“NSPC”)
and Jeffrey A. Brown, M.D. (“Dr. Brown”)
(collectively, the “Plaintiffs”) brought this
action against the Defendant Siemens Corporation
(“Siemens” or the “Defendant”)
alleging various violations of the Employee Retirement Income
Security Act of 1974, 29 U.S.C. § 1001 et seq.
(“ERISA”), and New York State common law.
before the Court is a motion by the Defendant to dismiss the
Plaintiffs' complaint pursuant to Federal Rule of Civil
Procedure (“Fed. R. Civ. P.” or
“Rule”) 12(b)(6) on the grounds that the
Plaintiffs' state law causes of action are preempted by
ERISA, and that the Plaintiffs failed to exhaust their
administrative remedies. For the following reasons, the
Defendant's motion is granted in part, and denied in
The Relevant Facts
following facts are drawn from the Plaintiffs' complaint,
and for the purposes of the instant motion, are presumed
the largest private neurosurgery practice in the tristate
area. Dr. Brown is one of the neurosurgeons in the practice.
is the administrator of a self-funded employee benefit plan
(the “Plan”) established pursuant to ERISA.
Siemens employs Empire BlueCross BlueShield
(“Empire”) as its claims administrator. Empire
enters into contracts with health care providers to establish
and maintain a network of providers. As administrator, Empire
has discretionary authority to process claims and appeals for
Plaintiffs do not participate in Empire's provider
network. Nevertheless, the Plaintiffs allege that NSPC
receives authorization and assignments from Empire patients,
including Siemens employees, to receive payment directly from
Siemens through Empire for medical services rendered. The
Plaintiffs state that as out-of-network (“OON”)
providers, they are entitled to reimbursement for usual,
customary, and reasonable charges less any co-payment,
co-insurance, member out of pocket amount, or deductible
amounts (the “UCR rate”).
JM - June 30, 2014
30, 2014, the Plaintiffs provided health care services to JM,
who is a participant in, or beneficiary of, the Plan. The
Plaintiffs state that the services provided to JM were
medically necessary. JM assigned her rights to receive
reimbursement from Empire to the Plaintiffs. JM also provided
documents to the Plaintiffs that purportedly showed that
Siemens was contractually obligated to pay for the health
care services provided by the Plaintiffs.
29, 2014, the Plaintiffs submitted a bill to Siemens'
claims administrator for $200, 000 for the medical services
provided to JM on June 30, 2014. The Plaintiffs have not
received any reimbursement for their claim despite numerous
communications with Empire and Siemens.
December 8, 2015, the Plaintiffs appealed their claim. The
Plaintiffs allege that Siemens and Empire have not answered
JM - August 11, 2014
August 11, 2014, the Plaintiffs again provided health care
services to JM which they state were medically necessary. JM
again assigned her rights to receive reimbursement from
Empire to the Plaintiffs, and provided documents to the
Plaintiffs that purportedly showed that Siemens was
contractually obligated to pay for the health care services
provided by the Plaintiffs.
October 6, 2014, the Plaintiffs submitted a bill to
Siemens' claims administrator for an additional $200, 000
for the health care services provided to JM on August 11,
2014. The Plaintiffs communicated with Siemens and Empire on
several occasions. Nevertheless, Siemens has not reimbursed
the Plaintiffs in full or paid the UCR rate. Instead, the
Plaintiffs have received the sum of only $6, 477.12 on the
August 11, 2014 claim.
August 13, 2014, NSPC appealed the claim, and it was denied.
The Plaintiffs state, upon information and belief, that
“appeals to Empire on [NSPC's] claims are routinely
denied and/or ignored, thus rendering further appeals
futile.” (Compl. ¶ 63).
The Relevant Procedural History
19, 2017, the Plaintiffs filed their complaint in the Supreme
Court of the State of New York, Nassau County. The complaint
alleges causes of action for violations of ERISA; breach of
express contract; breach of implied contract; unjust
enrichment; breach of N.Y. Ins. Law § 3224-a (the
“Prompt Pay Law”); and for breach of contract as
a third party beneficiary. The Plaintiffs seek damages and
9, 2017, the Defendant removed this action pursuant to 28
U.S.C. § 1446, claiming that this Court has original
jurisdiction because the case presents a federal question
under 28 U.S.C. § 1331.
17, 2017, before filing an answer, the Defendant filed the
instant motion to dismiss the complaint pursuant to Rule
The Legal Standard
reviewing a motion to dismiss pursuant to Rule 12(b)(6), the
Court must accept the factual allegations set forth in the
complaint as true and draw all reasonable inferences in favor
of the Plaintiff. See Walker v. Schult, 717 F.3d
119, 124 (2d Cir. 2013); Cleveland v. Caplaw
Enters., 448 F.3d 518, 521 (2d Cir. 2006); Bold
Elec., Inc. v. City of N.Y., 53 F.3d 465, 469 (2d Cir.
1995); Reed v. Garden City Union Free School Dist.,
987 F.Supp.2d 260, 263 (E.D.N.Y. 2013).
the now well-established Twombly standard, a
complaint should be dismissed only if it does not contain
enough allegations of fact to state a claim for relief that
is “plausible on its face.” Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 1974, 167
L.Ed.2d 929 (2007). The Second Circuit has explained that,
after Twombly, the Court's inquiry under Rule
12(b)(6) is guided by two principles:
First, although a court must accept as true all of the
allegations contained in a complaint, that tenet is
inapplicable to legal conclusions, and [t]hreadbare recitals
of the elements of a cause of action, supported by mere
conclusory statements, do not suffice. Second, only a
complaint that states a plausible claim for relief survives a
motion to dismiss and [d]etermining whether a complaint
states a plausible claim for relief will . . . be ...