Emergency Group of Arizona Pc v. United Healthcare, Inc. ( 2021 )

NOT FOR PUBLICATION FILED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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