2nd Circuit Dismisses Pro Se’s PCA Claim for Lack of Allegation of Injury-in-Fact

By Rafael Gonzalez, Esq.
Vice President, Strategic Solutions

LawOn October 30, 2015, the United States Court of Appeals for the Second Circuit published its opinion on Plante v. Dake, McDermott, Stewart’s Shop Corp concluding that although the District Court below erred in ruling that it lacked federal-question jurisdiction over Plante’s MSP claims, since it is a federal statute which confers the Court with federal-question jurisdiction, the District Court nonetheless properly dismissed Plante’s complaint for lack of subject-matter jurisdiction because Plante lacked Article III standing to bring the MSP claims.

Plaintiff-appellant Joan Patricia Plante (Plante), proceeding pro se, appeals the United States District Court for the Northern District of New York’s judgment dismissing her complaint against Gary Dake, President of the Stewart’s Shops Corp., Joanne McDermott, Consumer Affairs Director of the Stewart’s Shops Corp., and the Stewart’s Shops Corp. (defendants), arising out of an alleged incident where Plante sustained injuries on Stewart’s Shops Corp. premises. The District Court dismissed Plante’s complaint for lack of subject-matter jurisdiction and entered judgment August 4, 2014. On appeal, Plante contends that the Court erred by dismissing her case for lack of subject-matter jurisdiction. She argues that one of her claims–under the Medicare Secondary Payer Act–confers federal-question jurisdiction on the Court.

Plante commenced an action against defendants on January 30, 2014, alleging that she sustained injuries as a result of defendants’ negligence after she slipped, tripped, and fell on the morning of January 31, 2011, at a Stewart’s Shop in Gansevoort, New York, on asphalt affected by a buildup of ice. Plante’s First Amended Complaint (“FAC”), filed February 26, 2014, asserted six causes of action sounding in state-law theories of common-law negligence and violations of New York’s Premises Liability Law. She also asserted a claim under the private cause of action provided in the Medicare Secondary Payer Act (MSP), 42 U.S.C. § 1395y(b)(3)(A), which, according to Plante, required defendants to reimburse Medicare for past and future medical bills resulting from the slip and fall.

Defendants moved to dismiss the FAC on March 3, 2014, under Rules 12(b)(1) and 12(b)(6), arguing that the District Court lacked subject-matter jurisdiction and that Plante failed to state a claim upon which relief could be granted. Plante filed an opposition on March 28, 2014, and the same day filed a second amended complaint without leave of court. After defendants objected to the second amended complaint in their reply brief, Plante sought leave of court on April 9, 2014, to file a third amended complaint.

On August 1, 2014, the District Court dismissed Plante’s FAC, ruling that it lacked subject-matter jurisdiction over the case. Specifically, the Court ruled that it lacked federal-question jurisdiction because Plante “had not fulfilled the condition precedent for bringing a MSP claim,” i.e., demonstrating that defendants were indeed responsible for payments to Medicare for Plante’s medical costs. The Court declined to exercise supplemental jurisdiction over Plante’s state-law claims, and denied Plante’s request for leave to amend, finding that amendment would be futile. This appeal followed.

The Circuit Court concludes that the District Court erred in dismissing Plante’s FAC for lack of federal-question jurisdiction because Plante asserts claims under the MSP, which is a federal statute. However, even if an MSP claim can confer federal-question jurisdiction, the Circuit Court finds that the District Court lacked subject-matter jurisdiction because Plante did not have Article III standing to bring the claim.

The Circuit Court indicates that “Article III standing consists of three ‘irreducible’ elements: (1) injury-in-fact, which is a ‘concrete and particularized’ harm to a ‘legally protected interest’; (2) causation in the form of a ‘fairly traceable’ connection between the asserted injury-in-fact and the alleged actions of the defendant; and (3) redressability, or a non-speculative likelihood that the injury can be remedied by the requested relief.” Thus, a plaintiff must have suffered an injury-in-fact in order to have standing under Article III of the Constitution.

In the present case, Plante lacks Article III standing to bring the MSP claim because the FAC does not allege that Plante suffered an injury-in-fact. The FAC alleges that Medicare alone has suffered an injury as a result of the defendants’ purported failure to pay Medicare for Plante’s medical bills resulting from the slip and fall. The injury to Plante, however, is predicated on tort liability alleged in the very same complaint. Plante’s injuries from the trip and fall cannot be traced back to defendants’ alleged nonpayment to Medicare, and therefore do not support standing to bring an MSP claim.

Given the allegations set forth in the FAC, the Circuit Court concludes in this case that Plante lacks standing to bring the MSP claims. Because Plante lacks Article III standing to bring the MSP claims, the Court does not consider any question regarding statutory standing to bring a private cause of action against a tortfeasor under the MSP.

Having considered Plante’s remaining arguments, the Court finds them to be without merit, and therefore affirms the August 4, 2014, judgment of the District Court.

As we have all seen from the various decisions rendered by the USDC for the Southern District of Florida throughout 2015, appropriately pleading a Medicare Secondary Payer private cause of action is not easy. As this decision by the USDC for the Northern District of New York and the USCA for the Second Circuit make clear, pleading such matters must include not only allegations that the primary payer is responsible for payment or reimbursement of the outstanding medical bills related to the claim by way of settlement, agreement, judgment, award, payment, or other means, but must also include a recitation of how the non-payment of such bills by the primary payer affects or injures the claiming party or parties. Although it would seem innate that non-payment of such medical bills by the primary or responsible payer would mean that the plaintiff claiming such payment or reimbursement would then have to make such payment or reimbursement out of his/her settlement proceeds or damages awarded, the Court here makes it clear that such injury-in-fact must be plead with specificity, clarity, and detail in order to survive a motion to dismiss. Count on Helios Settlement Solutions to keep you updated on the evolution of MSP compliance, and especially the ever changing landscape of private causes of action.

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