Justia Arbitration & Mediation Opinion Summaries

A group of plaintiffs, including a medical practice, individual physicians, a medical society, and two patients, brought various claims against a health insurer, alleging that the insurer interfered with doctor-patient relationships, denied or delayed coverage for medical services, and caused significant harm to patients. The claims included tortious interference with contractual rights, unfair competition, RICO violations, and emotional distress, with specific factual allegations that the insurer’s actions led to worsened medical outcomes for the patients involved.The Circuit Court of the Third Circuit reviewed the insurer’s motion to compel arbitration based on arbitration clauses in provider agreements and member handbooks. Instead of determining whether the claims were subject to arbitration, the circuit court focused on the alleged unconscionability of the contracts as a whole, finding them to be contracts of adhesion and unconscionable, and denied the motion to compel arbitration. The court also denied summary judgment as to one patient’s claims and did not stay the medical society’s claims pending arbitration.The Supreme Court of the State of Hawaiʻi reviewed the case and held that the circuit court erred by not following the required analytical framework for arbitrability. The Supreme Court vacated the lower court’s order in part, holding that claims arising under the Participating Physician Agreement must be referred to arbitration because the agreement delegated the question of arbitrability to the arbitrator. Claims under the Medicare and QUEST Agreements were also subject to arbitration, as the arbitration clauses were not shown to be substantively unconscionable. However, the Court held that the claims of one patient and the physician as a patient were not subject to mandatory arbitration, and another patient’s claims were not subject to a grievance and appeals clause. The case was remanded for further proceedings consistent with these holdings. View "Frederick A. Nitta, M.D., Inc. v. Hawaii Medical Service Association." on Justia Law

An individual diagnosed with Alzheimer’s disease was admitted to a personal care facility in Kentucky after his spouse, who had been appointed his conservator by a Tennessee court, signed a mandatory arbitration agreement required for admission. The spouse did not specify her capacity when signing. The patient later suffered injuries and died, leading his spouse, as administratrix of his estate, to file suit alleging negligence, wrongful death, and other claims against the facility and its operators.The defendants moved to compel arbitration, arguing that the spouse had authority to sign the agreement under the Tennessee conservatorship order or, alternatively, under Kentucky’s Living Will Directive Act, which allows a spouse to make “health care decisions” for an incapacitated person. The Fayette Circuit Court denied the motion, finding that signing an arbitration agreement was not a health care decision under the Act and that the spouse lacked authority to bind the patient. The court did not rule on unconscionability. The Kentucky Court of Appeals affirmed, distinguishing prior cases involving powers of attorney and holding that the Act’s definition of “health care decision” did not include entering arbitration agreements.The Supreme Court of Kentucky reviewed whether a spouse may bind an incapacitated person to arbitration for facility admission under the Living Will Directive Act. The Court held that signing an arbitration agreement is not a “health care decision” as defined by Kentucky law, which limits such decisions to consenting to or withdrawing consent for medical procedures, treatments, or interventions. The Court affirmed the Court of Appeals’ decision, upholding the denial of the motion to compel arbitration, and remanded the case for further proceedings. View "LEXINGTON ALZHEIMER'S INVESTORS, LLC V. NORRIS" on Justia Law

Acorda Therapeutics, Inc. developed Ampyra®, a drug for multiple sclerosis, and had a licensing agreement with Alkermes PLC, which owned a patent for Ampyra’s active ingredient. The patent expired in July 2018, but Acorda continued to make royalty payments to Alkermes until July 2020, when it began making payments under protest. Acorda initiated arbitration in July 2020, seeking a declaration that the royalty provisions were unenforceable post-patent expiration and a refund of royalties paid since July 2018.The arbitration tribunal agreed that the royalty provisions were unenforceable but ruled that Acorda could only recoup payments made under formal protest. Acorda then petitioned the United States District Court for the Southern District of New York to confirm the tribunal’s rulings except for the denial of recoupment of unprotested payments. The district court rejected Acorda’s arguments, which were based on the tribunal’s alleged “manifest disregard” of federal patent law and a non-patent-law principle, and confirmed the award in full.Acorda appealed to the United States Court of Appeals for the Federal Circuit, seeking to reverse the district court’s denial of the 2018–2020 recoupment. The Federal Circuit concluded that it lacked jurisdiction over the appeal because Acorda’s petition did not necessarily raise a federal patent law issue. The court determined that the petition’s request for confirmation did not require a determination of federal patent law, and the request for modification presented alternative grounds, one of which did not involve patent law. Consequently, the Federal Circuit transferred the case to the United States Court of Appeals for the Second Circuit. View "Acorda Therapeutics, Inc. v. Alkermes PLC" on Justia Law

Emergency air medical providers challenged award determinations made under the No Surprises Act (NSA). The NSA, enacted in 2022, protects patients from surprise bills for emergency services from out-of-network providers by creating an Independent Dispute Resolution (IDR) process for billing disputes between providers and insurers. Guardian Flight transported a patient in Nebraska, and a dispute arose with Aetna over the service value. Similarly, Guardian Flight and its affiliates provided emergency services to patients insured by Kaiser, leading to disputes over payment amounts. Both disputes were submitted to Medical Evaluators of Texas (MET) as the IDR entity, which sided with the insurers.The United States District Court for the Southern District of Texas consolidated the cases. The court dismissed Guardian Flight’s claims against Aetna and Kaiser, ruling that the providers failed to plead sufficient facts to trigger vacatur of the awards. However, the court denied MET’s motion to dismiss based on arbitral immunity, leading to MET’s cross-appeal.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court held that the NSA does not provide a general private right of action to challenge IDR awards, incorporating Federal Arbitration Act (FAA) provisions that allow courts to vacate awards only for specific reasons. The court affirmed the district court’s dismissal of the providers’ claims against Aetna and Kaiser, finding that the providers did not allege facts sufficient to show that the awards were procured by fraud or undue means under the FAA.Additionally, the Fifth Circuit addressed MET’s claim of arbitral immunity. The court concluded that MET, functioning as a neutral arbiter in the IDR process, is entitled to the same immunity from suit typically enjoyed by arbitrators. Consequently, the court reversed the district court’s judgment on this point and remanded with instructions to dismiss the providers’ claims against MET. View "Guardian Flight, L.L.C. v. Aetna Health, Inc." on Justia Law

The decedent, suffering from Parkinson’s disease, dysphagia, and dementia, was admitted to Elmcrest Care Center in February 2013. On August 4, 2017, he was found nonresponsive on the floor by Elmcrest staff, who administered CPR and called 911. He was transported to a hospital and passed away four days later. The Estate of Jose de Jesus Ortiz, represented by Ericka Ortiz, filed a civil action against Elmcrest and its staff, alleging elder abuse, neglect, negligence, willful misconduct, and fraud. The trial court compelled arbitration based on an agreement signed upon the decedent’s admission to Elmcrest.The arbitrator issued a First Interim Award on March 30, 2022, finding that the Estate did not meet its burden of proof on any of its claims. The award was labeled "interim" and allowed for further submissions by the parties to address any omitted issues. The Estate filed a request to amend the First Interim Award, arguing that damages for pre-death loss of dignity were not considered. The arbitrator issued a Second Interim Award on May 26, 2022, awarding $100,000 in damages for pre-death pain and suffering, and invited the Estate to file for attorney fees and costs.The trial court initially denied the Estate’s petition to vacate the First Interim Award, ruling it was not final. However, it later vacated the Final Award and confirmed the First Interim Award, reasoning that the First Interim Award had resolved all necessary issues. The Estate appealed.The California Court of Appeal reversed the trial court’s decision, holding that the First Interim Award was not final as it expressly reserved jurisdiction for further proceedings. The court concluded that the arbitrator did not exceed her authority in issuing the Final Award, which included the omitted decision on pre-death loss of dignity. The trial court was directed to enter a new order confirming the Final Award. View "Ortiz v. Elmcrest Care Center, LLC" on Justia Law

The case revolves around the death of Skyler A. Womack (Skyler) at Silverscreen Healthcare, Inc., a skilled nursing facility. Skyler's parents, Jonie A. Holland (Holland) and Wayne D. Womack (Wayne), filed a lawsuit against Silverscreen, alleging dependent adult abuse and negligence on behalf of Skyler, as well as their own claim for wrongful death. Silverscreen moved to compel arbitration of the entire complaint based on an arbitration agreement between Skyler and Silverscreen.The Superior Court of Los Angeles County granted Silverscreen’s motion to compel arbitration for the survivor claims but denied the motion for the wrongful death cause of action. The court reasoned that the parents did not have an enforceable arbitration agreement with Silverscreen. The court's decision was heavily influenced by the case Avila v. Southern California Specialty Care, Inc.Silverscreen appealed the decision to the Court of Appeal of the State of California, Second Appellate District. The appellant argued that, according to Ruiz v. Podolsky, the parents are bound by the arbitration agreement signed by Skyler, and therefore, the parents’ wrongful death claim should be subject to arbitration. The appellate court agreed with Silverscreen, stating that Ruiz governs this matter. Consequently, under Ruiz and Code of Civil Procedure section 1295, the parents’ wrongful death claim must go to arbitration along with Skyler’s survivor claims. The court reversed the trial court's decision and remanded the case with directions. View "Holland v. Silverscreen Healthcare, Inc." on Justia Law

The case involves Christine Matlock Dougherty, who sued U.S. Behavioral Health Plan, California (USB) for claims related to her son's healthcare. Dougherty's son, Ryan, was enrolled in a UnitedHealthcare HMO health plan, which Dougherty had access to through her employer. Ryan admitted himself into a residential treatment facility for severe drug addiction, but USB denied coverage for his stay after three days, arguing that he could be treated at home. Ryan fatally overdosed shortly after his discharge from the facility. Dougherty then sued USB, claiming that its wrongful denial of coverage for Ryan's treatment caused his death. USB petitioned to compel arbitration of her claims, but the trial court denied the petition, stating that USB's arbitration agreement was not enforceable because it did not comply with the disclosure requirements imposed by Health & Safety Code section 1363.1.The trial court denied USB's petition to compel arbitration on the grounds that the arbitration agreement did not comply with the disclosure requirements of Health & Safety Code section 1363.1. The court found that there were two separate contracts, one between Dougherty and UnitedHealthcare, and another between Dougherty and USB. The court ruled that the arbitration agreement in the supplement, which governed Dougherty's claims against USB, did not comply with section 1363.1's disclosure requirements.The Court of Appeal of the State of California Fourth Appellate District Division Two reversed the trial court's decision. The appellate court concluded that USB forfeited its argument that the issue of whether the arbitration agreement was valid under the disclosure requirements of section 1363.1 was delegated to the arbitrator. However, the court agreed with USB that the trial court erroneously denied USB’s petition because USB complied with section 1363.1. The court found that the only "health care service plan" at issue that "includes terms that require binding arbitration" is Dougherty’s plan with UnitedHealthcare, which includes both the EOC and the supplement as components of the plan. Therefore, the court concluded that there was no section 1363.1 violation and reversed the trial court's order denying the petition to compel arbitration. View "Dougherty v. U.S. Behavioral Health Plan" on Justia Law

The Supreme Court of California considered whether a health care agent, who had signed two contracts with a skilled nursing facility on behalf of a principal, had the authority to sign an optional, separate arbitration agreement. The first contract ensured the principal’s admission to the facility, while the second made arbitration the exclusive method for resolving disputes with the facility. The court concluded that the execution of the arbitration contract was not a "health care decision" within the authority of the health care agent. Therefore, the facility’s owners and operators could not rely on the agent’s execution of the arbitration agreement to compel arbitration of claims arising from the principal’s alleged maltreatment. The court affirmed the judgment of the Court of Appeal and remanded the case for further proceedings. View "Harrod v. Country Oaks Partners, LLC" on Justia Law

Salvatore Baglione, insured under Health Net of California Inc. through his employer, the County of Santa Clara, brought a lawsuit against Health Net alleging breach of contract and bad faith. This followed Health Net's inconsistent authorization of a medication prescribed for Baglione's chronic condition. Health Net moved to compel arbitration of Baglione's claims based on an arbitration provision in the enrollment form Baglione had signed. The Superior Court of Los Angeles County denied Health Net's motion, finding that the agreement between Health Net and the County did not satisfy the disclosure requirements of Health and Safety Code section 1363.1, and therefore, the arbitration provision was unenforceable. Health Net appealed the decision.The Court of Appeal of the State of California, Second Appellate District, Division Eight, affirmed the trial court's order. The appellate court ruled that the enrollment form did not comply with the requirements of section 1363.1. It found that the form was not clear in its disclosure of which disputes were subject to arbitration, particularly with references to additional documents and laws that did not pertain to the arbitration agreement. Furthermore, the form did not place the arbitration provision immediately before the signature line, as required by the statute. The court also agreed with the lower court that the agreement between Health Net and the County was non-compliant. It ruled that an arbitration agreement, which is part of a health plan, is not enforceable unless both the enrollment form and the County agreement are compliant. Therefore, the court affirmed the trial court's order denying Health Net's motion to compel arbitration. View "Baglione v. Health Net of Cal." on Justia Law

In this fifth appeal before the Supreme Court regarding a class action lawsuit stemming from two circuit court orders denying Appellant's motion to enforce arbitration agreements and its motion to compel class members with arbitration agreements to submit their claims to binding arbitration, holding that remand was necessary.After the Supreme Court's ruling in Phillips II, Appellant filed a motion to enforce arbitration agreements and to compel 197 residents with arbitration agreements to submit their claims to binding arbitration. After the ruling in Phillips III, Appellant moved to enforce arbitration agreements and to compel thirty-three residents with arbitration agreements to submit their claims to binding arbitration. The court entered an order with respect to both motions, from which Appellant appealed. The Supreme Court remanded the case with instructions, holding that the circuit court failed to provide the Supreme Court with specific findings with respect to each arbitration agreement and individual resident and that such findings were necessary for the Court to conduct a proper appellate review. View "Robinson Nursing & Rehabilitation Center, LLC v. Phillips" on Justia Law