- Genord v. Blue Cross Blue Shield of Michigan No. 07-21688 S.D. Fla. November 24, 2008
- January 23, 2009 | Authors: Arthur N. Lerner; Bruce O. Tavel
- Law Firm: Crowell & Moring LLP - Washington Office
The U.S. District Court for the Southern District of Florida dismissed a group of physicians' claims alleging that Blue Cross and Blue Shield of Michigan ("BCBSM") violated RICO, a Michigan statute requiring the payment of clean insurance claims, breached contracts, and were unjustly enriched by instructing the physicians to use new billing code procedures and then fraudulently rejecting those claims. These physicians had opted out of the Love class action settlement. BCBSM filed a motion for judgment on the pleadings, asserting that the physicians failed to sufficiently plead their RICO claims.
Under the Supreme Court's 2007 Twombly decision, which heightened the pleading standards for a § 1962(c) RICO claim, a plaintiff must "set forth a violation….that is plausible on its face because they do not raise a right to relief above a speculative level." Although the physicians presented examples of BCBSM communications regarding its new claims procedures coinciding with the rejection of allegedly proper claims, the Court noted that the physicians' amended complaint "did not connect the allegedly fraudulent communications to the specific rejection of any individual claims." (emphasis in original) As a result, the Court dismissed the physicians' § 1962(c) claim.
The Court also dismissed the physicians' § 1962 (a) claim, which required a violation of the § 1962(c) claim, as well as the RICO conspiracy claim because the Amended Complaint did not sufficiently allege that BCBSM conspired with other people or entities.