Eleventh Circuit Dismisses ERISA Appeal For Lack Of Standing Under § 1132

In Dunn v. Harris Corp. (08-13847), the Eleventh Circuit affirmed the district court's dismissal of the plaintiff's ERISA claim.

“Section 1132 is essentially a standing provision [that] sets forth those parties who may bring civil actions under ERISA and specifies the types of actions each of those parties may pursue.” Gulf Life Ins. Co. v. Arnold, 809 F.2d 1520, 1524 (11th Cir. 1987). The only parties authorized to bring a lawsuit under § 1132 are participants, beneficiaries, fiduciaries, or the Secretary of Labor. ERISA defines a beneficiary as “a person designated by a participant, or by the terms of an employee benefit plan, who is or may become entitled to a benefit thereunder.” 29 U.S.C. § 1002(8). “Standing represents a jurisdictional requirement which remains open to review at all stages of the litigation.” Nat’l Org. For Women, Inc. v. Scheidler, 114 S. Ct. 798, 802 (1994).

 

The only basis for Dunn to have standing to sue Harris and Fidelity in this case is if she is deemed a beneficiary. Dr. Cox has already been determined to be the proper beneficiary of Buddy’s 401(k) plan, and that determination has been affirmed by this Court. In light of that judgment, Dunn cannot become entitled to the 401(k) plan benefits, so she is not a beneficiary or potential beneficiary who has standing to bring a claim under § 1132. See Arnold, 809 F.2d at 1524. Dunn does not have standing, so we dismiss this appeal.

First District Posts Documents Filed In Pending NCAA v. AP Records Dispute

The First District posted the filings in the "high profile" case of National Collegiate Athletic Association v. The Associated Press; Cape etc., et al. (1D09-4385).  Included is the court's order staying the trial court's order pending resolution of the appeal.

Disclaimer: GrayRobinson is involved with this case.

Evidence Obtained From Warrantless Canine Search Improperly Suppressed

In United States v. Marrocco, --- F.3d ----, No. 07-3101, 2009 WL 2581339 (7th Cir. Aug. 24, 2009), the Seventh Circuit reversed the district court's decision and held "that the district court improperly suppressed the evidence of the contents of the briefcase and the results of the dog-sniff test."  Chief Judge Easterbrook wrote a concurring opinion which began "I join the court's opinion without reservation but add a few words about an issue that, as the court notes (slip op. 10 n. 5), the litigants have overlooked." 

Judge Ripple wrote the court's opinion and summarized the facts as follows:

"How much is a life worth? Debate rages on medical malpractice caps"

The Palm Beach Post has an article about Rapheal v. Schecter (4D08-432), currently pending before the Fourth District. [Click here for the case docket].  The article in the Palm Beach Post is titled "How much is a life worth? Debate rages on medical malpractice caps" and states:

Citizens United v. Federal Election Commission And The Connection To Florida And Florida Lobbyists

The Supreme Court will hear oral argument (again) in Citizens United v. Federal Election Commission (08-205) this coming Wednesday, September 8, 2009.   The schedule for the 80 minute argument can be found here, courtesy of the SCOTUS Blog.  The case was previously discussed on this blog here.  The SCOTUS Wiki page provides all of the briefs, the amicus filings, etc.  Lyle Denniston at the SCOTUS Blog published his argument preview yesterday which can be found here.

Besides the impact any Supreme Court case has on Florida,  and the amicus brief filed in Citizens by a number of states including Florida, there is a petition pending before the Supreme Court challening Florida's lobbying disclosure laws that in large part relies on its hope the Court will strike the challenged portions of the Bipartisan Campaign Reform Act of 2002.  The case, Florida Association of Professional Lobbyists, Inc., et al. v. Division of Legislative Information Services of the Florida Office of Legislative Services, et al. (09-154),  has some history.  The case was filed in the Leon County Circuit Court, but removed to the Northern District of Florida (Case No. 06-00123-CV-4-SPM-WCS).  Northern District Judge Stephen Mickle ruled in favor of the State and the decision was appealed to the Eleventh Circuit [Published at 2006 WL 3826985 (N.D. Fla. Dec. 28, 2006) and a preliminary order published at 431 F. Supp. 2d 1228 (N.D. Fla. 2006)].  On April 23, 2008, the Eleventh Circuit released its first published opinion [published at 525 F.3d 1073 and can be found here] and phrased the issue as follows:

In this case, we are asked to assess the constitutionality of legislation enacted by the Florida Legislature that regulates legislative and executive lobbying in the State of Florida. The Florida Association of Professional Lobbyists, Inc., et al., (“Plaintiffs”) assert that the legislation — Chapter 2005-359, Laws of Florida (“the Act”) — is facially unconstitutional under both the Florida and United States Constitutions.

***

On appeal, Plaintiffs raise four issues. Three involve questions of state constitutional law: (1) whether the Act violates Florida’s separation of powers doctrine; (2) whether the Act was improperly enacted under the Florida Constitution; and (3) whether the Act infringes upon the Florida Supreme Court’s regulatory authority over the practice of law. The fourth issue involves a question of federal constitutional law: whether the Act is unconstitutionally vague or overbroad.

The Eleventh Circuit certified the three state law issues to the Florida Supreme Court, which issued its decision in favor of the State of Florida on March 19, 2009 [Docket Number SC08-791, published at 7 So. 3d 511 and can be found here].  The Eleventh Circuit affirmed Judge Mickle, also ruling in favor of the State of Florida, with regard to the Federal constitutional issue.  The Eleventh Circuit held:

We conclude that the Act does not violate due process standards about vagueness. For instance, it clearly provides that an expenditure — which is separately defined in sections 11.045(1)(d) and 112.3215(1)(d) — is unlawful only if it is made by a lobbyist or principal and accepted by a government official. Contrary to Plaintiffs’ suggestion, the Act cannot reasonably be read to bar all expenditures for lobbying purposes (for example, a cab fare to the capitol). Instead, it only bars those lobbying expenditures that are accepted by a government official. See Fla. Stat. §§ 11.045(4)(a), 112.3215(6)(a) (stating that “no lobbyist or principal shall make, directly or indirectly, and no member or employee of the legislature” nor any “agency official, member, or employee shall knowingly accept, directly or indirectly, any expenditure” (emphasis added)). In a similar way, we do not regard the term “indirect” as vague: a person of common intelligence would understand that it applies to expenditures or compensation paid through a third party.

***

Because the First Amendment allows required reporting of considerably more than face-to-face contact with government officials, we decline to invalidate the Act on its face as substantially overbroad. See Meggs, 87 .3d at 461.  Instead, we leave “whatever overbreadth may exist [to] be cured through case-bycase analysis of the fact situations to which [the Act’s] sanctions, assertedly, may not be applied.” Broadrick, 93 S. Ct. at 2918.

After the Florida Supreme Court answered the certified questions (see above), on May 7, 2009 the Eleventh Circuit released its opinion affirming the district court [Published at 566 F.3d 1281 and found here].   The May 7, 2009 Eleventh Circuit opinion led to the lobbyist's petition for certiorari to the United States Supreme Court [The petition is hosted by the Miami Herald].  Page 13 of the petition sums it up: "If the Court overturns Austin and McConnell, in Citizens United, this would undermine the Eleventh Circuit’s decision to uphold both the disclosure requirement applicable to grassroots lobbying and the wholesale prohibition of direct and indirect gifts."

I am sure the lobbyist's will be one of the first to access the audio from the Citizens oral argument, which the Supreme Court has announced will be released "as soon as possible following the conclusion of the oral argument."

ABA Journal Accecpting Nominations For Its Blawg 100 - Its List Of The 100 Best Legal Blogs

The ABA Journal is taking nominations for inclusion in its annual "Blawg 100" which is its "annual list of the 100 best legal blogs."  To nominate a legal blog, fill out the Blawg 100 Amici form here.  They provided a  few suggestions [rules] for the Blawg 100 Amici which are copied below:

Tell us about a blawg you read regularly that you think other lawyers should know about. Keep it pithy—you have a 500-character limit. We’ll be including some of the best comments in our coverage.

 

Some additional tips:

• We’re not interested in “occasional” blawgs—blawgs you name should be updated at least weekly.

• We’ll ignore comments from authors suggesting their own blawgs. That’s just plain tacky.

• Campaigns to flood us with comments about a particular blog will turn us off. And you don’t want to do that, because the editors make the final decisions about what’s included in the Blawg 100.

News

Above the Law had a link to the following:

• I would have thought specific intent to escape from prison would be implied in any prison escapee situation. But I would have been wrong. I wonder if resisting arrest requires specific intent to not go to prison, or if I could argue that the sound of police sirens just happens to make me want to run wind sprints. [Underdog]

The Palm Beach Post has the following story:

• 
  
  State prosecutors sue Boca condo's developer over 'deceptive' sales practices

The Sun-Sentinel has the following:

• 
  
  Boca trader pleads guilty in Ponzi scheme
• 
  
  Jury awards former Palm Beach County DCF worker $1 million
• 
  
  Boca investment fraud case spotlights need to be vigilant

The ABA Journal has the following stories:

• 
  
  One Big Happy High Court Family? New Justice Changes Chemistry, Thomas Says

• 
  
  NALP Group to Review Law Firm Recruitment, OCI Schedule

• 
  
  Cops Shoot Fire Chief in Courtroom Scuffle After His Speed Trap Complaints

• 
  
  Former AG John Ashcroft Can Be Sued By Material Witness Detainee, 9th Circuit Says
• 
  
  Judge Calabresi Describes Banned Salinger ‘Sequel’ as ‘Rather Dismal’

• 
  
  Mom Loses Case Over Unauthorized 10 a.m. Breast-Pumping Bathroom Break

The Wall Street Journal's Law Blog has the following stories:

• 
  
  Word Up! Microsoft Wins a Stay, More

• 
  
  ‘Will It Ever Be the Same?’ Justices Wring Hands Over New Kid in Class

• 
  
  Calabresi on ‘Catcher’ Sequel: A ‘Rather Dismal Piece of Work’

The Blog of Legal Times has the following stories:

• 
  
  Supreme Court Opens Up to C-SPAN

Howard Bashmam at How Appealing has links to the following stories:

• 
  
  "Canada Supreme Court to hear Gitmo case"

• 
  
  "Early release of Citizens United audio."

• 
  
  "Want a Wiretap Warrant? No Problem, Court Says."

• 
  
  "State Supreme Court: Parents can keep cars used by drug dealing son; The state Supreme Court ruled today that parents must know for certain that their children are using their cars to deal drugs before the authorities can seize those cars."

Other

• 
  
  Clerks of court deal with budget cuts
• 
  
  Appeals court blocks release of documents in NCAA lawsuit
• 
  
  Kottkamp sues over Chinese drywall
• 
  
  Florida lawmakers want names behind political attack ads
• 
  
  Florida Supreme Court reviews access to records

"The Fourth Amendment Has Drawn A Firm Line At The Entrance To The House"

In Mestral v. State (3D08-216), the Third District reversed the trial court's order denying a motion to suppress evidence because the police conducted an unconstitutional search.  

The court stated:

The police took defendant-appellant Mestral into custody in his front yard and conducted a protective sweep inside his house. Because the police entered without consent, exigent circumstances, or a search warrant, the protective sweep was illegal. The motion to suppress evidence should have been granted.

***

“[T]he Fourth Amendment has drawn a firm line at the entrance to the house.” Payton v. New York, 445 U.S. 573, 590 (1980). Entry into a home is permissible only by consent, a warrant, or exigent circumstances.

***

In this case there was no warrant and the officers did not ask consent for the protective sweep. The State argued that there were exigent circumstances. Where, as here, the State relies on exigent circumstances, “[t]he burden rests on the State to show the existence of such an exceptional situation.”

***

No such circumstances existed here. The detention of the defendant occurred in the front yard. Even if the police had not ascertained that the defendant resided there, the wife was present and the officers knew she resided there.

The question, then, is whether the police could, as a matter of routine practice, enter the dwelling to conduct a protective sweep where the defendant was detained in the front yard.

The United States Supreme Court has rejected the idea “that an arrest on the street can provide its own ‘exigent circumstance’ so as to justify a warrantless search of an arrestee’s house.” Vale, 399 U.S. at 35. It is therefore clear that an entry into a home to conduct a protective sweep cannot be done simply as a matter of routine practice.

***

In this case the officers entered the residence as part of a routine practice and not on the basis of any articulable facts which would warrant a reasonable belief that there was any dangerous individual inside who posed a threat to those on the arrest scene. Because the protective sweep was impermissible, the motion to suppress evidence should have been granted, and the evidence should not have been admitted at the defendant’s trial.

Published Eleventh Circuit Opinion On Medicare Lawsuit Against Tenet Health

In Boca Raton Community Hospital v. Tenet Health Care Corporation (07-14352), the Eleventh Circuit affirmed the district court's denial of class certification, striking of the plaintiff's expert witness and the entry of summary judgment.

Judge Carnes started the opinion by stating:

More than a hundred years ago the mother of modern nursing, Florence Nightingale, observed: “It may be a strange principle to enunciate as the very first requirement in a Hospital that it should do the sick no harm. It is quite necessary, nevertheless, to lay down such a principle . . . .” When Nightingale wrote those words hospitals were not the sanitary sanctuaries they have become, and the harm she meant to shield her patients from was new or worsening illness. Since then the health care situation has become more complicated. Some hospitals are part of profit-driven, multi-billion dollar corporations, and the harm they can do has taken on additional forms. One such corporation is Tenet Health Care, and this case is about the economic harm it did by manipulating part of the Medicare program.

***

Boca believed that in the period before the 2003 changes, Tenet had been gaming the outlier program to get more reimbursements than its extraordinary-cost cases justified. Boca filed a class action complaint to that effect in March 2005 and amended it to include a revised class definition in June 2006. In the amended complaint, Boca alleged that Tenet increased its outlier reimbursements by dramatically raising its charges without reference to any actual cost increases, making average-cost cases look like outlier cases.

The Plaintiff's Expert

The party offering the expert testimony has the burden of demonstrating that the testimony is “relevant to the task at hand” and “logically advances a material aspect” of its case.  The offering party must show that the opinion meets the Daubert criteria, including reliable methodology and helpfulness to the factfinder in understanding the evidence or determining a fact, by a preponderance of the evidence. See Rink, 400 F.3d at 1292.  The district court found Boca’s method inadequate and speculative because it did not attempt to show what amount of Tenet’s charges were unlawful. Instead it focused on approximating Tenet’s actual costs more closely. To do this, Boca’s method swapped the outdated audited ratios (or the artificially high average ratios) the Center used to determine Tenet’s outlier payments for the more current and accurate unaudited ratios.

***

The district court’s conclusion that Boca’s expert opinion on injury and damages did not fit its liability theory was not manifestly erroneous because, like an oversized coat, the expert opinion covered too much. Under Boca’s liability theory, it is not unlawful for hospitals to overcharge (that is, to increase charges out of step with costs) as long as their audited ratios do not fall below the low National Threshold. Because Boca’s expert opinion uses unaudited ratios to approximate Tenet’s actual costs, it includes the outlier payments Tenet got from lawful overcharging, as well as unlawful overcharging, as part of Boca’s injury and damages.

***

Boca drew a line between lawful and unlawful behavior for liability purposes: the low National Threshold. Boca could have walked that line in a way that fit its theory of injury and damages to its liability theory; it could have chosen a method that showed that the behavior Boca claims caused its injuries, Tenet’s unlawful overcharging, actually impacted the loss threshold. All that Boca’s expert opinion purported to show, however, was the amount of most clearly lawful outlier payments Tenet could have gotten—the amount of outlier money Tenet would have received if it had used its actual costs to apply for the payments. What Boca’s expert opinion fails to recognize (which, by contrast, its liability theory does) is the range of behavior between clearly unlawful and perfectly lawful. Having tailored a trim-fitting liability theory for the body of its case against Tenet, Boca cannot hang a baggy injury and damages theory on it. Whatever expert opinion Boca provided had to be suitably proportioned. And because Boca’s injury and damages opinion was not confined to charges that its liability theory would consider unlawful, it was too broad. It was ill-fitting. Thus the district court did not abuse its discretion by excluding Boca’s expert opinion on injury and damages for lack of fit with its liability theory.

The Summary Judgment and Class Certification Order

 

The decision to affirm the district court's conclusion about the expert ended the discussion about the other two issues.  The court stated:

 

Our conclusion that the district court did not abuse its discretion in excluding Boca’s expert opinion on injury and damages compels a second one: that the district court’s grant of summary judgment in favor of Tenet was appropriate. Without its expert opinion, Boca has not offered any evidence of injury—an essential element of its RICO claim.

Additionally:

 

Because summary judgment was appropriate, Boca’s challenge to the district court’s denial of class certification is moot. See Rink, 400 F.3d at 1297 (“Because we have found that summary judgment was properly granted as to the underlying claims of the class representatives, the issue of class certification is moot.”).

Tenet Was Not Blameless

 

The district court made a point to emphasize, as we do now, that while summary judgment for Tenet was appropriate, Tenet was not blameless. The record shows that Tenet hospitals took advantage of a system designed to help pay for the sickest and least fortunate patients to heal. The people hurt the most by Tenet’s manipulation of the Medicare outlier program through excessive charge increases are the uninsured, who are forced to pay hospitals’ “sticker prices” instead of the reduced rates insurance companies negotiate for their clients. This may not be what Florence Nightingale had in mind when she warned about the harm hospitals could do, but it is still a harm against which patients deserve protection. The government has addressed this new strain of harm by recovering almost a billion dollars from Tenet and making changes to the way the outlier program runs. Hopefully those actions will help prevent similar abuse in the future and serve to remind hospitals that their first duty is to do no harm to anyone.