PHILADELPHIA – A lawsuit filed by a Newtown Square couple against Aetna Insurance to recoup damages for uncovered medical services has been sent back to state court.
U.S. District Judge Richard Barclay Surrick ruled on Thursday the litigation initiated by spouses Gregory and Kerri Fitzsimmons versus the insurance provider, Timothy Kelly and Kelly & Associates (the “Kelly Defendants”) would return to the Montgomery County Magisterial District Court.
Both Gregory and Kerri received health benefits through their employment prior to their marriage. Gregory received his benefits through a self-funded plan from Johnson & Johnson (J&J), while Kerri received hers through the West Philadelphia Achievement Charter Elementary School (WPACES), under an Aetna-issued plan. It is alleged the Kelly Defendants brokered the WPACES plan agreement between WPACES and Aetna as insurance agents.
Upon their marriage in the early summer of 2012, Gregory and Kerri decided to consolidate their health insurance under Gregory’s J&J plan. Kerri then notified WPACES to remove her from its policy. Thereafter, Gregory and Kerri had a child, and Kerri underwent medical procedures processed by Aetna.
Later that year, the plaintiffs received bills for medical services. They believe that the bills were not covered by the J&J Plan because one of the three defendants failed to communicate or process Kerri’s request to terminate her WPACES plan coverage, resulting in a clerical error.
The plaintiffs subsequently filed suit in the Montgomery County Magisterial District Court, but Aetna countered to file removal to the U.S. District Court for the Eastern District of Pennsylvania. However, the plaintiffs argued the federal court does not have jurisdiction over their case, and Aetna did not file its removal petition or consent to removal within 30 days of being served with the complaint.
While Aetna believes the federal court has jurisdiction in this matter under the Employee Retirement Income Security Act of 1974 (ERISA), the plaintiffs countered “they could not have brought their claims under ERISA because they are not alleging a breach of the WPACES or J&J plan provisions.”
Surrick agreed with the plaintiffs.
“Even though plaintiffs’ alleged damages are in the form of medical expenses, defendants have not met their burden in proving that plaintiffs’ claims arise exclusively under ERISA,” Surrick said. “Here, plaintiffs do not assert that Aetna failed to pay medical bills according to the terms of the plans.”
Surrick added, “Plaintiffs have not alleged a denial of benefits due under the plan, nor have they filed this suit to enforce or recover specific plan benefits. Therefore, plaintiffs’ state law claims are not completely preempted by ERISA and this Court lacks removal jurisdiction.”
The Court also concurred with the plaintiffs on the issue of removal, stating Aetna was served with the complaint on March 16; and while it was unclear when the Kelly Defendants were served with the complaint, they filed an intent to defend notice on May 15 and their removal notice on June 12. Aetna or its counsel did not sign the removal petition.
However, Aetna did not file its motion to dismiss for failure to state a claim until July 22, about 90 days after being served with the complaint and about 60 days after the removing defendants had been served. Further, Aetna still has not filed consent to removal or explicitly joined in the removal petition.
“Accordingly, removal is improper and the case must be remanded to state court,” Surrick stated. Surrick further declared remaining motions associated with the case as moot.
The plaintiffs are represented by John A. Gallagher of Gallagher Law Group, in Berwyn.
The defendants are represented by Thomas M. Blewitt Jr. of Connell Foley in Cherry Hill, N.J., plus Christopher C. Negrete and John Philip Morgenstern of Deasey, Mahoney & Valentini in Philadelphia.
U.S. District Court for the Eastern District of Pennsylvania case 2:15-cv-03297
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at firstname.lastname@example.org