Justia Contracts Opinion Summaries

LeGrand Belnap, M.D., was a surgeon at the Salt Lake Regional Medical Center (“SLRMC”). Dr. Belnap and SLRMC entered into a Management Services Agreement under which he would provide consulting services to help SLRMC develop a new surgical center. The Agreement contained an arbitration provision, including an agreement to arbitrate questions of arbitrability. SLRMC subsequently disciplined Dr. Belnap for alleged misconduct and then reversed course and vacated the discipline. As a result, Dr. Belnap brought various claims against SLRMC, its alleged parent company, and several of its individual employees. These Defendants moved to compel arbitration on the basis of the arbitration provision in the Agreement. The district court determined that most of the claims fell outside the scope of the Agreement, and granted in part and denied in part the motion. Defendants appealed the portions of the district court’s order denying their motion to stay litigation and to compel arbitration, arguing: (1) because the parties agreed to arbitrate arbitrability, the district court erred when it failed to submit all questions of arbitrability to an arbitrator; and (2) even if the parties did not agree to arbitrate arbitrability, the district court erred when it found that any of Dr. Belnap’s claims fell outside the scope of the Agreement, despite also finding that the Agreement’s dispute-resolution provision was broad. The Tenth Circuit found that by incorporating the JAMS Rules into the Agreement, Dr. Belnap and SLRMC evidenced a clear and unmistakable intent to delegate questions of arbitrability to an arbitrator. Nevertheless, the Tenth Circuit concluded the district court reached the right outcome regarding Dr. Belnap’s first claim against SLRMC (compelling that claim to arbitration) and upheld that portion of its order. The Court felt “constrained,” however, to reverse the order as to the remainder of the SLRMC claims. The Court remanded, instructing the court to compel all of Dr. Belnap’s claims against SLRMC to arbitration. With respect to Defendants wh did not sign the Agreement, the Court held they were not entitled to enforce the arbitration provision of the Agreement. Thus, the Court affirmed the district court’s order in this respect. View "Belnap v. Iasis Healthcare" on Justia Law

A woman was admitted to a hospital emergency room with pregnancy-related complications. The attending physician recommended that she be transported by medivac to a different facility. The woman and her husband informed the physician that they needed their insurer’s preauthorization for that course of action or they could be personally liable for the costs. The physician allegedly promised to call the insurer and, if it would not approve the medivac, have the hospital bear the costs itself. But the physician failed to contact the insurer until much later, and the insurer declined coverage. The couple sued the physician and the hospital, alleging that the physician breached her fiduciary duty by failing to obtain preauthorization as promised; that her promise created an enforceable contract, which was breached; and that if there was no contract the physician’s promise should be enforced through the doctrine of promissory estoppel. The superior court granted summary judgment to the physician and hospital. The couple appealed. After review, the Alaska Supreme Court held that the superior court did not err when it ruled in favor of the physician and hospital on the claims for breach of fiduciary duty and breach of contract, but that genuine issues of material fact precluded summary judgment on the claim for promissory estoppel. The Court reversed and remanded for further proceedings. View "Thomas v. Archer" on Justia Law

If a patient who receives emergency medical services is an enrollee in a health care service plan, the plan is required to reimburse the emergency service provider for essential emergency medical services and care. Plans are statutorily permitted to delegate this financial responsibility to their contracting medical providers. Here the defendants - health care service plans - delegated their emergency services financial responsibility to their contractor medical providers, three individual practice associations (“IPAs”). The IPAs failed to reimburse the plaintiff noncontracting service providers for the emergency care that they provided to enrollees of the defendant health plans. When the IPAs went out of business, the plaintiff providers brought actions seeking reimbursement from the defendants. The Supreme Court held (1) a health care service plan may be liable to noncontracting emergency service providers for negligently delegating its financial responsibility to an IPA or other contracting medical provider group that it knew or should have known would not be able to pay for emergency service and care provided to the health plan’s enrollees; and (2) a health care service plan has a narrow continuing common law tort duty to protect noncontracting emergency service providers once it makes an initial delegation of its financial responsibility. View "Centinela Freeman Emergency Medical Associates v. Health Net of California" on Justia Law

Allstate filed suit against multiple defendants, alleging claims of fraud, negligent misrepresentation, and unjust enrichment. Defendants are medical clinics that appointed Dr. Sara Vizcay as their medical director. Allstate’s central allegation is that Dr. Vizcay failed to systematically review billings as required by Florida’s Health Care Clinic Act, Fla. Stat. 400.990 et seq., which caused the clinics to submit unlawful or fraudulent insurance claims to Allstate. A jury found the clinics liable and awarded damages to Allstate. The clinics challenge the jury’s verdict, and the district court’s denial of their dispositive motions, on numerous grounds. The court held that, under Florida law, there is judicial remedy for a licensed clinic’s violation of the Clinic Act; a licensed clinic can be held responsible for its medical director’s failure to comply with the duties enumerated in the Clinic Act; the evidence is sufficient to support the jury’s finding that Dr. Vizcay failed to substantially comply with those duties; Allstate's fraud claims are not barred by Florida's statute of limitations; and the district court did not err in denying defendants' motions to bifurcate the trial. Accordingly, the court affirmed the judgment. View "Allstate Ins. Co. v. Vizcay" on Justia Law

Patients filed suit to set aside accord and satisfaction agreements and to recover the amounts paid to release liens. Hospitals, health care providers who treated patients injured by third parties, were paid by the Patients' insurer, AHCCCS, which had negotiated reduced rates with the Hospitals. The Hospitals then recorded liens against the Patients pursuant to A.R.S. 33-931 and A.R.S. 36-2903.01(G) for the difference between the amount typically charged for their treatment and the reduced amount paid by AHCCCS. In order to receive their personal injury settlements with the third parties, Patients settled with the Hospitals by paying negotiated amounts to release the liens. At issue is the validity of these accord and satisfaction agreements. The court assumed, without deciding, that Arizona’s lien statutes are preempted by federal law. But, because there was a bona fide dispute about the enforceability of these liens when the Patients and Hospitals entered into settlement agreements to achieve lien releases, the agreements were supported by adequate consideration and addressed a proper subject matter. Therefore, the accord and satisfaction agreements are valid. View "Abbott v. Banner Health Network" on Justia Law

The Texas Optometry Act prohibits commercial retailers of ophthalmic goods from attempting to control the practice of optometry; authorizes the Optometry Board and the Attorney General to sue a violator for a civil penalty; and provides that “[a] person injured as a result of a violation . . . is entitled to the remedies. In 1992, Wal-Mart opened “Vision Centers” in its Texas retail stores, selling ophthalmic goods. Wal-Mart leased office space to optometrists. A typical lease required the optometrist to keep the office open at least 45 hours per week or pay liquidated damages. In 1995, the Board advised Wal-Mart that the requirement violated the Act. Wal-Mart dropped the requirement and changed its lease form, allowing the optometrist to insert hours of operation. In 1998, the Board opined that any commercial lease referencing an optometrist’s hours violated the Act; in 2003, the Board notified Wal-Mart that it violated the Act by informing optometrists that customers were requesting longer hours. Optometrists sued, alleging that during lease negotiations, Wal-Mart indicated what hours they should include in the lease and that they were pressured to work longer hours. They did not claim actual harm. A jury awarded civil penalties and attorney fees. The Fifth Circuit certified the question of whether such civil penalties, when sought by a private person, are exemplary damages limited by the Texas Civil Practice and Remedies Code Chapter 41. The Texas Supreme Court responded in the affirmative, noting that “the certified questions assume, perhaps incorrectly, that the Act authorizes recovery of civil penalties by a private person, rather than only by the Board or the Attorney General.” View "Wal-Mart Stores, Inc. v. Forte" on Justia Law

From 1983-2005, Moen entered into collective bargaining agreements (CBAs) with the union. Employees who retired 1983-1996 and their dependents received hospitalization, surgical and medical coverage without cost. If the retirees (or spouses) were over age 65, Moen also reimbursed the full cost of Medicare Part B premiums. After 1996, retirees and dependents received hospitalization, surgical, and medical coverage upon payment of a co-premium frozen at the time of retirement. If over 65, they received Part B premium reimbursements at specified rates. In 2008, Moen shut down its Elyria operations. A “Closure Effects Agreement” provided that health-care coverage “shall continue” for retirees and spouses “under the [final] Collective Bargaining Agreement.” In 2013, Moen decreased benefits in response to “recent Medicare improvements” and the imposition of an excise tax on “Cadillac plans” through the Patient Protection and Affordable Care Act, 26 U.S.C. 4980I. Medicare-eligible retirees no longer receive coverage or Part B premium reimbursements; Moen shifted non-Medicare-eligible retirees to a plan that requires higher out-of-pocket payments. The court certified a class of about 200 individuals who had retired from the plant and were not covered by an earlier settlement agreement, then granted the plaintiffs summary judgment in reliance on Sixth Circuit precedent that was subsequently repudiated by the Supreme Court. The Sixth Circuit reversed, based on that 2015 decision. View "Gallo v. Moen Inc." on Justia Law

The issue this case presented for the Pennsylvania Supreme Court’s review centered on review of a Commonwealth Court order Court interpreting a provision of a consent decree, negotiated by the Office of Attorney General of Pennsylvania ("OAG") and approved by the Commonwealth Court, between Appellant UPMC, a nonprofit health care corporation, and Appellee Highmark, a nonprofit medical insurance corporation, which established the obligations of both parties with respect to certain health care plans serving vulnerable populations. Specifically, the Court considered whether the Commonwealth Court erroneously interpreted this "vulnerable populations" provision as creating a contractual obligation for UPMC to treat all participants in Highmark’s "Medicare Advantage Plans" (for which Highmark and UPMC currently have provider contracts which UPMC has indicated it will terminate) as "in-network" for purposes of determining the rates it is permitted to charge these individuals for physician, hospital, and other medical services during the duration of the consent decree. After careful review, the Supreme Court affirmed the Commonwealth Court’s finding that the "vulnerable populations" clause of the consent decree required UPMC to "be in a contract" with Highmark for the duration of the consent decree, and, thus, that UPMC physicians, hospitals, and other services shall be treated as "in-network" for participants in Highmark Medicare Advantage plans which were subject to provider contracts between Highmark and UPMC set to be terminated by UPMC on December 31, 2015. The Court also affirmed the portion of the Commonwealth Court’s order requiring judicial approval for any further changes in business relationships between these parties which were governed by the consent decree, but quashed as not yet ripe for review the portion of the order which directed the OAG to file a request for supplemental relief to effectuate compliance with the consent decree. View "Pennsylvania v. UPMC" on Justia Law

Todd Kiser initiated this action by filing a form complaint against Noel Kiser and Marie McDowell alleging that Noel and Marie owed him a sum of money arising out of an asserted agreement among them regarding their father’s nursing care and cremation costs. The small claims court entered judgment in favor of Todd. Noel and Marie appealed the judgment to the district court. The district court dismissed the appeal, reasoning that the brief filed by Noel and Marie had been untimely filed. The Supreme Court reversed, holding that the district court erred in dismissing the appeal on the basis of the briefing deadline imposed in the inapplicable Municipal Court Appellate Rules. Remanded to the district court for reinstatement of Noel and Marie’s appeal and for further proceedings. View "Kiser v. Kiser" on Justia Law

In 2011, 74-year-old Garnell Wilcoxon lived alone. He suffered a stroke, awoke on the floor of his bedroom covered in sweat, feeling sore and with no memory of how he got there. Wilcoxon was admitted to the Troy Regional Medical Center for analysis and treatment for approximately one year before he died. Following Wilcoxon's death, Brenda McFarland, one of Wilcoxon's daughters, filed a complaint as the personal representative for Wilcoxon's estate, asserting claims for : (1) medical malpractice; (2) negligence; (3) breach of contract; (4) negligent hiring, training, supervision, and retention; and (5) loss of consortium. In its answer, Troy Health asserted, in part, that McFarland's claims were barred from being litigated in a court of law "by virtue of an arbitration agreement entered into between plaintiff and defendant." Troy Health then moved to compel arbitration, asserting that forms signed by one of Wilcoxon's other daughters, acting as his attorney-in-fact, contained a valid and enforceable arbitration clause. McFarland argued that "Wilcoxon did not have the mental capacity to enter into the contract with [Troy Health,] and he did not have the mental capacity to give legal authority to enter into contracts on his behalf with" relatives who initially helped admit him to Troy Health facilities when he first fell ill. According to McFarland, "[t]he medical records document that Wilcoxon was habitually and/or permanently incompetent." Therefore, McFarland argued, both a 2011 arbitration agreement and a 2012 arbitration agreement were invalid. The circuit court denied Troy Health's motion to compel arbitration. The Supreme Court reversed, finding that McFarland failed to prove that Wilcoxon was mentally incompetent when he executed a 2012 durable power of attorney naming his other daughter as his attorney-in-fact, and also failed to demonstrate that Wilcoxon was "permanently incompetent" before that date, and because there was no other issue concerning the validity of the 2012 arbitration agreement. View "Troy Health and Rehabilitation Center v. McFarland" on Justia Law