Preview
FILED
3/24/2023 2:01 PM
FELICIA PITRE
DISTRICT CLERK
DALLAS CO., TEXAS
Brandon Keys DEPUTY
CASE DC-23-01762
DALLAS MEDICAL CENTER, LLC § IN THE DISTRICT COURT
(dm/a Dallas Medical Center), PRIME §
HEALTHCARE SERVICES — MESQUITE §
LLC (d/b/a Dallas Regional Medical Center), §
and KNAPP MEDICAL CENTER, §
§
plaintiffs, §
§
v. §
§ 14th JUDICIAL DISTRICT
CIGNA HEALTHCARE OF TEXAS, INC., §
CIGNA HEALTH AND LIFE INSURANCE §
COMPANY, and CONNECTICUT GENERAL §
LIFE INSURANCE COMPANY, §
§
§
defendants. § DALLAS COUNTY, TEXAS
CIGNA’S PLEA TO THE JURISDICTION
Defendants Cigna Healthcare of Texas, Inc., Cigna Health and Life Insurance Company,
and Connecticut General Life Insurance Company (collectively, Cigna) files its plea to the
jurisdiction as follows:
I. INTRODUCTION
Plaintiffsl sue to collect damages from Cigna for its alleged failure to comply with Texas
law and to compel them to pay the “usual and customary rate” for services rendered. Specifically,
Plaintiffs allege that Cigna failed to properly reimburse them for out-of-network, emergency and
non-emergency services provided to enrollees of Cigna’s health plan. Plaintiffs are attempting to
repackage violations of the emergency care provisions of the Texas Insurance Code as state law
claims. But under Texas law, no private right of action exists under the Texas Insurance Code—
and any attempt to repackage these claims as something other, is improper. Additionally, Plaintiffs
1
Plaintiffs Dallas Medical Center, LLC (d/b/a/ Dallas Medical Center, Prime Healthcare Services—Mesquite LLC (d/b/a Dallas Regional
Medical Center), and Knapp Medical Center shall be collectively referred to as ”Plaintiffs.”
CIGNA’S PLEA T0 THE JURISDICTION Page 1 of 11
claims for (1) breach of implied contract, (2) promissory estoppcl, (3) negligent misrepresentation,
and (4) attorneys’ fees are dependent upon Plaintiffs establishing standing under the Texas
Insurance Code. Using alternative methods to redress Cigna’s alleged underpayment is an
improper method of repacking statutory claims the legislature declined to create. For these reasons,
the court should dismiss these claims for lack of subject-matter jurisdiction.
II. BACKGROUND
1. On February 6, 2023, Plaintiffs filed suit against Cigna alleging they rendered
emergency and non-emergency services to its enrollees. (orig. pet. at p. l, 2). Between September
2018 through December 31, 2021 the Plaintiffs allegedly provided emergency, stabilization, and
post-stabilization care to Cigna patients. (Id. at 1] 11.) Plaintiffs are not participating providers in
the Cigna network. (Id.)
2. Patients who receive treatment in the emergency department allegedly required
further stabilizing or post-stabilization care, as determined by their treating physicians. (Id. at 11
12.) The patients whose medical claims are at issue in this lawsuit received emergency care at
the hospitals, then were admitted for further stabilizing care or post-stabilization care at the
inpatient level of care. (Id.) The Plaintiffs allegedly notified Cigna of these patients' admissions
and requested it authorize the inpatient admission or make prompt arrangements for patient
transfer to an in-network facility. (Id.)
3. Plaintiffs specifically allege the Texas Insurance Code allows Cigna a “limited
amount of time to respond to these requests and issue a determination as to authorization. (Id. at
13); citing Tex. Ins. Code 1271.155(c). Plaintiffs allege Cigna responded to some requests and,
in other instances, failed to respond—allegedly agreeing to accept the Plaintiffs’ services and
pay them at the “usual and customary charges.” (Id. at 14.) Based on these allegations, Plaintiffs
CIGNA’S PLEA T0 THE JURISDICTION Page 2 of 11
bring claims for (1) breach of implied contract, (2) promissory estoppcl, (3) negligent
misrepresentation, and (4) attorneys’ fees.
III. ARGUMENTS AND AUTHORITIES
A. Applicable Legal Standard
4. A plea to the jurisdiction is a dilatory plea that contests the trial court's authority to
determine the subject matter of the cause of action. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d
547, 554 (Tex. 2000). When a plea to the jurisdiction challenges the pleadings, a court must
determine if the pleader has alleged sufficient facts to affirmatively demonstrate its jurisdiction to
hear the cause. See Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (TeX. 1993).
"The burden is on the plaintiff to affirmatively demonstrate the trial court's jurisdiction." Heckman
v. Williamson Cry, 369 S.W.3d 137, 150 (Tex. 2012). Standing is a prerequisite to subject matter
jurisdiction, and subject matter jurisdiction is essential to a court’s power to hear a case. M.D.
Anderson Cancer Ctr. V. Novak, 52 S.W.3d 704, 708 (Tex. 2001). Therefore, a plea to the
jurisdiction is a proper vehicle to challenge a plaintiff’s standing to maintain suit. Vernco Constr.,
Inc. v. Nelson, 460 S.W.3d 145, 149 (Tex. 2015) (per curiam).
B. No private right of afion exists for violations of the emergency care provi_sions of the
Texas Insurance Code.
5. Texas Insurance Code chapter 1271 contains regulations that, among other things,
outline minimum benefits that Health Maintenance Organizations must provide to members. The
section governing Plaintiffs claims neither enumerates an express cause of action nor includes
language from such a claim could be implied. Instead, Section 1271.155(a) states only that an
HMO “shall pay for emergency care performed by non-network physicians or providers at the
usual and customary rate or at an agreed rate.” Tex. Ins. Code 1271.155(a) (emphasis added).
While the Plaintiffs attempt to disguise their state law claims, they cite this “usual and customary
CIGNA’S PLEA T0 THE JURISDICTION Page 3 of 11
rate” statutory language over twenty times throughout their petition. (orig. pet. at 1H] nature of
action, 13-16, 19, 22, 26-27, 29, 31, 34, & 37). The court should decline Plaintiffs invitation to
enforce the same payment obligations under the statute by repackaging state law claims.
6. First, Texas courts have refused to read a private right of action into Section
1271.155(a). See Apollo MedFlight, LLC v. Blue Cross Blue Shield, No. 2: 1 8-cv-1 66-Z-BR, 2019
WL 48494263, (ND. Tex. Oct. 10, 2019) (holding no private right of action under section
1271.155), Dall. Med. Ctr., LLC v. Molina Healthcare of Tex., Ina, No. 05-19-01583-CV, 2021
Tex. App. LEXIS 8850, at *1 (Tex. App—Dallas Nov. 2, 2021, pet. denied) (holding trial court
did not have subject matter jurisdiction to resolve the breach of contract claim because the claim
arose from the defendant's obligation to pay at the rates set out in Tex. Ins. Code Ann. § 1271.155);
Tex. Med. Res., LLP v. Molina Healthcare of Tex., Ina, 659 S.W.3d 424 (Tex. 2023) (holding that
the Insurance Code does not create a private cause of action for claims under the Emergency Care
Statutes)).
7. In Apollo, for example, plaintiff Apollo MedFlight provided out-of-network
emergency services to patients insured by defendant BlueCross BlueShield. Apollo, 2019 WL
4894263 at *1. Like the Plaintiffs here, Apollo argued BlueCross failed to reimburse them at the
“usual and customary rate.” See id. Dismissing the claim, the Apollo court found the “Emergency
Care Statutes do not create a private right of action on the ground that they do not clearly express
a legislative intent to create such a right.” Id.
8. Second, “[v]ery few of [the Texas Insurance Code’s] sections explicitly provide for
a private right of action.” Peacock v. AARP, Inc., 181 F. Supp. 3d 430, 436 (S.D. Tex. 2016). Most
sections are expressly enforced by the Attorney General and Texas Department of Insurance (TDI),
who have broad authority to enforce the insurance code generally and Chapter 1271 specifically.
CIGNA’S PLEA T0 THE JURISDICTION Page 4 of 11
See, e.g., TEX. INS. CODE § 31.002 (TDI has duty to regulate business of insurance and ensure
provisions of TIC are executed); § 82.051 (TDI has authority to revoke authorization of insurer
that violates TIC). “For sections [of the Texas Insurance Code] that do not contain a private right
of action, the Attorney General of the State of Texas and [TDI] are tasked with monitoring and
enforcing Violations.” Peacock, 181 F. Supp. 3d at 436. Chapter 1271 is no exception. “When a
statute explicitly provides certain rights of enforcement but is silent as to the right sought to be
enforced, [the Court] may presume that the Legislature intended for that right to not be included.”
Witkowskz' v. Brian, Fooshee & Yonge Props., 181 S.W.3d 824, 831 (Tex. App—Austin 2005, no
pet).
C. The Court Should Di_smiss Plaintiffs Tag-Along Claims for Lack of Standing
9. Because Plaintiffs lack a private right of action to enforce the emergency care laws,
the court should dismiss their tag-along claims as an attempt to manufacture a non-statutory basis
to enforce identical payment obligations. (orig. pet. 1H] 18-42).
a. Plaintiffs cannot repackage statutory claims for which they lack standing
under alternative causes of action.
10. Plaintiffs first cause of action complains Cigna “entered into implied-in-fact
contracts with the Hospitals to pay for stabilization and post-stabilization care at the usual and
customary rate.” (orig. pet. 1] 19.) Under Texas law, an implied contract arises from the parties'
conduct only "if their conduct demonstrates a meeting of the minds on the essential terms."
Roberts, Taylor & Sensabaugh, Inc. v. Lexington Ins. Co., No. 06-cv-2197, 2007 WL 2592748, at
*8 (S.D. Tex. Sept. 5, 2007). Importantly, an implied contract, like an express agreement, must
have sufficiently definite terms "to enable the court to determine the respective legal obligations
of the parties." DAC Surgical Partners P.A. v. United Healthcare Servs., Inc., No. l l-cv-l355,
CIGNA’S PLEA T0 THE JURISDICTION Page 5 of 11
2016 WL 7177881, at *6 (S.D. Tex. Dec. 8, 2016).
1 1. Here, Plaintiffs merely allege that implied-in-fact contracts arose from the “acts and
conduct of Cigna and the Hospitals” and Cigna authorized the medical treatment conducted and
9“
then failed to pay Plaintiffs usual and customary” charges. (orig. pet. at 1H] 19, 22, 26-27.) But
Plaintiffs arguments for implied contract rely on the same factual footing as that stated in the Texas
Insurance Code 1271.155. See Tex. Ins. Code 1271.155(c) (“A health maintenance organization
shall approve or deny coverage of post stabilization care as requested by a treating physician or
provider Within the time appropriate to the circumstances relating to the delivery of the services
and the condition of the patient, but not to exceed one hour from the time of the request”)
Plaintiffs’ petition is facially insufficient to give rise to an implied contract as it tracks statutory
language which does not support a private right of action. Davis v. Hendrick Autoguard, Ina, 294
S.W.3d 835, 840 (Tex. App—Dallas 2009, no pet.) (concluding that party cannot “achieve
indirectly through a common law contract action what he cannot do directly under the statute”).
b. Plaintiffs’ promissory estoppel claim is not supported by Texas law.
12. "The requisites of promissory estoppel are: (1) a promise, (2) foreseeability of
reliance thereon by the promisor, and (3) substantial reliance by the promise to his detriment."
English v. Fischer, 660 S.W.2d 521, 524 (Tex. 1983). When promissory estoppel is used to enforce
a promise that would be unenforceable because of the statute of frauds, the promise must be a
promise to sign an already existing written agreement that would itself satisfy the requirements of
the statute of frauds." Ellen v. F.H. Partners, LLC, No. 03-09-00310-CV, 2010 Tex. App. LEXIS
9540, at *4 (Tex. App—Austin 2010, no pet.) citing Nagle v. Nagle, 633 S.W.2d 796, 800 (Tex.
App—Houston [14th Dist.] 2005, pet. den.). Moreover, such a promise must be sufficiently
definite to be enforced. Gilmartin v. K VTV-Channel I3, 985 S.W.2d 553, 558 (Tex. App—San
CIGNA’S PLEA T0 THE JURISDICTION Page 6 of 11
Antonio, no writ); Gillum v. Republic Health Corp, 778 S.W.2d 558, 570 (Tex. App—Dallas
1989, no writ); e.g. Allied Vista, Inc. v. Holt, 987 S.W.2d 138, 141-42 (Tex. App.—Houston [14th
Dist] 1999, pet. denied).
13. Here, Plaintiffs allege that they conferred “stabilization and post-stabilization care
to Cigna enrollees” and “Cigna promised to pay the Hospitals at the usual and customary rates”
for this care. (orig. pet. 1H] 29-30.) But as we explained above, Plaintiffs lack standing to bring
their claims for promissory estoppel to the extent these claims rely on Cigna’s alleged obligation
to pay Plaintiffs at the “usual and customary rate” pursuant to Section 1271.155. While the
Plaintiffs do not specifically refer to Texas Insurance Code Section 1271.155 in connection with
their promissory estoppel claim, the claim on its face is the exact obligation they seek to enforce
under section 1271.155. (Id. at 1H] 28-32.) Plaintiffs cannot create a private right of action under
Texas Insurance Code Section 1271.155 by way of bringing a state law claim based upon this
section. This claim should be dismissed.
c. Plaintiffs’ attempt to enforce a statutory obligation through a negligent
misrepresentation claim is improper.
14. Plaintiffs negligent misrepresentation claim is, on its face, an effort to improperly
enforce a statutory obligation under which they have no standing. To establish a cause of action
for negligent misrepresentation, a plaintiff must plead: (1) Cigna made a representation in the
course of his business, or in a transaction in which they have a pecuniary interest; (2) Cigna
supplied false information for the guidance of others in their business; (3) Cigna did not exercise
reasonable care or competence in obtaining or communicating the information; and (4) the
plaintiffs suffered pecuniary loss by justifiably relying on the representation. Miller v.
CitiMortgage, Ina, 970 F. Supp. 2d 568, 585 (N .D. Tex. 2013). In Texas, a cause of action for
negligent misrepresentation is governed by the two-year statute of limitations applicable to tort
CIGNA’S PLEA T0 THE JURISDICTION Page 7 of 11
actions. Tex. Am. Corp. v. Woodbridge Joint Venture, 809 S.W.2d 299, 302 (Tex. App—Fort
Worth 1991, writ denied).
15. But again, Plaintiffs allegations suggest they are attempting to enforce the
emergency care laws. For example, the Plaintiffs contend Cigna “represented to [plaintiffs] by,
among other things, providing the requested authorization or failing to transfer its patients when
the [plaintiffs] informed it that it would expect payment at the usual and customary rate if the
patient was not transferred.” (Orig. pet. at 1] 34.) Cigna’s alleged “misrepresentation was a
misstatement of fact [because it] did not reimburse the Hospitals for stabilization and post-
stabilization care at the usual and customary rates.” (Id. at 1] 37) (emphasis added). Compare this
language with the Texas Insurance Code which states, “(2) necessary emergency care shall be
provided to covered enrollees, including the treatment and stabilization of an emergency medical
condition; and (3) services originated in a hospital emergency facility or comparable facility
following treatment or stabilization of an emergency medical condition shall be provided to
covered enrollees as approved by the health maintenance organization, subject to Subsections (c)
and (d). (c) A health maintenance organization shall approve or deny coverage of post-stabilization
care as requested by a treating physician or provider within the time appropriate to the
circumstances relating to the delivery of the services and the condition of the patient, but not to
exceed one hour from the time of the request. (d) A health maintenance organization shall respond
to inquiries from a treating physician or provider in compliance with this provision in the health
care plan of the health maintenance organization.” Tex. Ins. Code 1271 .155(b)(2) and (3) and (c),
(d).
16. Even if the Plaintiffs were to contend they were not seeking the value of their
services pursuant to the Texas Insurance Code, the bottom line is that the Plaintiffs are seeking to
CIGNA’S PLEA T0 THE JURISDICTION Page 8 of 11
enforce the same payment obligations they cannot enforce under the insurance code.
Consequently, this is nothing more than an improper repackaging of a statutory claim for which
there is no standing.
17. Alternatively, Plaintiffs allege “[flrom September 2018 to December 31, 2021 the
Hospitals provided emergency, stabilization and post-stabilization care to hundreds of Cigna
patients.” (orig. pet. at 1] 1 1.) Assuming arguendo, Cigna did misrepresent some fact, the Plaintiffs’
cause of action for some of these claims has accrued. This is because Plaintiffs filed suit on
February 6, 2023, meaning any claim to reimbursement under a negligent misrepresentation claim
they are seeking prior to February 6, 2021 should be barred by limitations.
d. Plaintiffs independently lack standing to assert claims for attorneys’ fees.
18. Plaintiffs seek fees for their claims for implied-in-fact contract under Chapters 38
of the Texas Civil Practice and Remedies Code. But if Plaintiffs lack standing to assert the
underlying claims, then they also lack standing to enforce statutory remedies for attorney’s fees.
Chapter 38 of the Texas Civil Practice and Remedies Code allows a plaintiff to “recover reasonable
attorney’s fees from an individual or corporation, in addition to the amount of a valid claim and
costs” in connection with, among others, claims for rendered services and performed labor. Id. at
§ 38.001. Because Plaintiffs lack standing to assert any claims under their original petition,
Plaintiffs’ claims for attorneys’ fees predicated on those claims necessarily fail.
IV. PRAYER
For these reasons, Cigna respectfully requests that (i) the court dismiss all of Plaintiffs’
claims asserted under petition for lack of subject matter jurisdiction and With prejudice; (ii)
Plaintiffs take nothing by reason of its suit against Cigna; (iii) that Cigna be awarded its attorney
CIGNA’S PLEA T0 THE JURISDICTION Page 9 of 11
fees, court costs, and expenses; and (iv) that the court grant such other and further relief, at law or
in equity, to which Cigna is justly entitled.
Date: March 24, 2023
Respectfully Submitted:
/s/ Kyle A. Ferachz'
Kyle A. Ferachi
Texas Bar No. 24072624
kferachi@hinshawlaw.com
Alfredo Ramos
Texas Bar No. 241 10251
framos@hinshawlaw.com
HINSHAW & CULBERTSON LLP
5151 San Felipe, Suite 1380
Houston, Texas 77056
Telephone: (346) 344-4503
Facsimile: (313) 704-3001
ATTORNEYS FOR DEFENDANTS,
CIGNA HEALTHCARE 0F TEXAS, INC.,
CIGNA HEALTH AND LIFE INSURANCE
COMPANY, AND CONNECTICUT GENERAL
LIFE INSURANCE COMPANY
CIGNA’S PLEA TO THE JURISDICTION Page 10 of 11
CERTIFICATE OF CONFERENCE
Counsel for movant and counsel for respondent have personally conducted a conference at
which there was a substantive discussion of every item presented to the Court in this motion and
despite best efforts the counsel have not been able to resolve those matters presented.
/s/ Kyle A. Ferachi
Kyle A. Ferachi
CERTIFICATE OF SERVICE
A true and correct copy of this document was served on March 24, 2023 as follows:
Andrew Cookingham VIA TEXFILE
Anna Wortham
BRACEWELL LLP
1445 Ross Avenue, Suite 3800
Dallas, Texas 75202 /s/ Kyle A. Ferachz'
Kyle A. Ferachi
CIGNA’S PLEA T0 THE JURISDICTION Page 11 of 11
Automated Certificate of eService
This automated certificate of service was created by the efiling system.
The filer served this document via email generated by the efiling system
on the date and to the persons listed below. The rules governing
certificates of service have not changed. Filers must still provide a
certificate of service that complies with all applicable rules.
Kyle Ferachi on behalf of Kyle Ferachi
Bar No. 24072624
kferachi@hinshawlaw.com
Envelope ID: 74025683
Filing Code Description: Plea To Jurisdiction
Filing Description: CIGNA'S
Status as of 3/27/2023 11:29 AM CST
Associated Case Party: DALLAS MEDICAL CENTER, LLC
Name BarNumber Email TimestampSubmitted Status
Nancy McEvilyDavis nancy.davis@bracewell.com 3/27/2023 9:54:09 AM SENT
Andrew Cookingham andrew.cookingham@bracewell.com 3/27/2023 9:54:09 AM SENT
Sandi Mallon sandi.mallon@bracewell.com 3/27/2023 9:54:09 AM SENT
Anna Wortham anna.wortham@bracewell.com 3/27/2023 9:54:09 AM SENT
Eduardo Sanchez ed.sanchez@bracewell.com 3/27/2023 9:54:09 AM SENT
Associated Case Party: CIGNA HEALTHCARE OF TEXAS, |NC.,
Name BarNumber Email TimestampSubmitted Status
Kyle AFerchi kferachi@hinshawlaw.com 3/27/2023 9:54:09 AM SENT
Preview
FILED 3/24/2023 2:01 PM FELICIA PITRE DISTRICT CLERK DALLAS CO., TEXAS Brandon Keys DEPUTY CASE DC-23-01762 DALLAS MEDICAL CENTER, LLC § IN THE DISTRICT COURT (dm/a Dallas Medical Center), PRIME § HEALTHCARE SERVICES — MESQUITE § LLC (d/b/a Dallas Regional Medical Center), § and KNAPP MEDICAL CENTER, § § plaintiffs, § § v. § § 14th JUDICIAL DISTRICT CIGNA HEALTHCARE OF TEXAS, INC., § CIGNA HEALTH AND LIFE INSURANCE § COMPANY, and CONNECTICUT GENERAL § LIFE INSURANCE COMPANY, § § § defendants. § DALLAS COUNTY, TEXAS CIGNA’S PLEA TO THE JURISDICTION Defendants Cigna Healthcare of Texas, Inc., Cigna Health and Life Insurance Company, and Connecticut General Life Insurance Company (collectively, Cigna) files its plea to the jurisdiction as follows: I. INTRODUCTION Plaintiffsl sue to collect damages from Cigna for its alleged failure to comply with Texas law and to compel them to pay the “usual and customary rate” for services rendered. Specifically, Plaintiffs allege that Cigna failed to properly reimburse them for out-of-network, emergency and non-emergency services provided to enrollees of Cigna’s health plan. Plaintiffs are attempting to repackage violations of the emergency care provisions of the Texas Insurance Code as state law claims. But under Texas law, no private right of action exists under the Texas Insurance Code— and any attempt to repackage these claims as something other, is improper. Additionally, Plaintiffs 1 Plaintiffs Dallas Medical Center, LLC (d/b/a/ Dallas Medical Center, Prime Healthcare Services—Mesquite LLC (d/b/a Dallas Regional Medical Center), and Knapp Medical Center shall be collectively referred to as ”Plaintiffs.” CIGNA’S PLEA T0 THE JURISDICTION Page 1 of 11 claims for (1) breach of implied contract, (2) promissory estoppcl, (3) negligent misrepresentation, and (4) attorneys’ fees are dependent upon Plaintiffs establishing standing under the Texas Insurance Code. Using alternative methods to redress Cigna’s alleged underpayment is an improper method of repacking statutory claims the legislature declined to create. For these reasons, the court should dismiss these claims for lack of subject-matter jurisdiction. II. BACKGROUND 1. On February 6, 2023, Plaintiffs filed suit against Cigna alleging they rendered emergency and non-emergency services to its enrollees. (orig. pet. at p. l, 2). Between September 2018 through December 31, 2021 the Plaintiffs allegedly provided emergency, stabilization, and post-stabilization care to Cigna patients. (Id. at 1] 11.) Plaintiffs are not participating providers in the Cigna network. (Id.) 2. Patients who receive treatment in the emergency department allegedly required further stabilizing or post-stabilization care, as determined by their treating physicians. (Id. at 11 12.) The patients whose medical claims are at issue in this lawsuit received emergency care at the hospitals, then were admitted for further stabilizing care or post-stabilization care at the inpatient level of care. (Id.) The Plaintiffs allegedly notified Cigna of these patients' admissions and requested it authorize the inpatient admission or make prompt arrangements for patient transfer to an in-network facility. (Id.) 3. Plaintiffs specifically allege the Texas Insurance Code allows Cigna a “limited amount of time to respond to these requests and issue a determination as to authorization. (Id. at 13); citing Tex. Ins. Code 1271.155(c). Plaintiffs allege Cigna responded to some requests and, in other instances, failed to respond—allegedly agreeing to accept the Plaintiffs’ services and pay them at the “usual and customary charges.” (Id. at 14.) Based on these allegations, Plaintiffs CIGNA’S PLEA T0 THE JURISDICTION Page 2 of 11 bring claims for (1) breach of implied contract, (2) promissory estoppcl, (3) negligent misrepresentation, and (4) attorneys’ fees. III. ARGUMENTS AND AUTHORITIES A. Applicable Legal Standard 4. A plea to the jurisdiction is a dilatory plea that contests the trial court's authority to determine the subject matter of the cause of action. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). When a plea to the jurisdiction challenges the pleadings, a court must determine if the pleader has alleged sufficient facts to affirmatively demonstrate its jurisdiction to hear the cause. See Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (TeX. 1993). "The burden is on the plaintiff to affirmatively demonstrate the trial court's jurisdiction." Heckman v. Williamson Cry, 369 S.W.3d 137, 150 (Tex. 2012). Standing is a prerequisite to subject matter jurisdiction, and subject matter jurisdiction is essential to a court’s power to hear a case. M.D. Anderson Cancer Ctr. V. Novak, 52 S.W.3d 704, 708 (Tex. 2001). Therefore, a plea to the jurisdiction is a proper vehicle to challenge a plaintiff’s standing to maintain suit. Vernco Constr., Inc. v. Nelson, 460 S.W.3d 145, 149 (Tex. 2015) (per curiam). B. No private right of afion exists for violations of the emergency care provi_sions of the Texas Insurance Code. 5. Texas Insurance Code chapter 1271 contains regulations that, among other things, outline minimum benefits that Health Maintenance Organizations must provide to members. The section governing Plaintiffs claims neither enumerates an express cause of action nor includes language from such a claim could be implied. Instead, Section 1271.155(a) states only that an HMO “shall pay for emergency care performed by non-network physicians or providers at the usual and customary rate or at an agreed rate.” Tex. Ins. Code 1271.155(a) (emphasis added). While the Plaintiffs attempt to disguise their state law claims, they cite this “usual and customary CIGNA’S PLEA T0 THE JURISDICTION Page 3 of 11 rate” statutory language over twenty times throughout their petition. (orig. pet. at 1H] nature of action, 13-16, 19, 22, 26-27, 29, 31, 34, & 37). The court should decline Plaintiffs invitation to enforce the same payment obligations under the statute by repackaging state law claims. 6. First, Texas courts have refused to read a private right of action into Section 1271.155(a). See Apollo MedFlight, LLC v. Blue Cross Blue Shield, No. 2: 1 8-cv-1 66-Z-BR, 2019 WL 48494263, (ND. Tex. Oct. 10, 2019) (holding no private right of action under section 1271.155), Dall. Med. Ctr., LLC v. Molina Healthcare of Tex., Ina, No. 05-19-01583-CV, 2021 Tex. App. LEXIS 8850, at *1 (Tex. App—Dallas Nov. 2, 2021, pet. denied) (holding trial court did not have subject matter jurisdiction to resolve the breach of contract claim because the claim arose from the defendant's obligation to pay at the rates set out in Tex. Ins. Code Ann. § 1271.155); Tex. Med. Res., LLP v. Molina Healthcare of Tex., Ina, 659 S.W.3d 424 (Tex. 2023) (holding that the Insurance Code does not create a private cause of action for claims under the Emergency Care Statutes)). 7. In Apollo, for example, plaintiff Apollo MedFlight provided out-of-network emergency services to patients insured by defendant BlueCross BlueShield. Apollo, 2019 WL 4894263 at *1. Like the Plaintiffs here, Apollo argued BlueCross failed to reimburse them at the “usual and customary rate.” See id. Dismissing the claim, the Apollo court found the “Emergency Care Statutes do not create a private right of action on the ground that they do not clearly express a legislative intent to create such a right.” Id. 8. Second, “[v]ery few of [the Texas Insurance Code’s] sections explicitly provide for a private right of action.” Peacock v. AARP, Inc., 181 F. Supp. 3d 430, 436 (S.D. Tex. 2016). Most sections are expressly enforced by the Attorney General and Texas Department of Insurance (TDI), who have broad authority to enforce the insurance code generally and Chapter 1271 specifically. CIGNA’S PLEA T0 THE JURISDICTION Page 4 of 11 See, e.g., TEX. INS. CODE § 31.002 (TDI has duty to regulate business of insurance and ensure provisions of TIC are executed); § 82.051 (TDI has authority to revoke authorization of insurer that violates TIC). “For sections [of the Texas Insurance Code] that do not contain a private right of action, the Attorney General of the State of Texas and [TDI] are tasked with monitoring and enforcing Violations.” Peacock, 181 F. Supp. 3d at 436. Chapter 1271 is no exception. “When a statute explicitly provides certain rights of enforcement but is silent as to the right sought to be enforced, [the Court] may presume that the Legislature intended for that right to not be included.” Witkowskz' v. Brian, Fooshee & Yonge Props., 181 S.W.3d 824, 831 (Tex. App—Austin 2005, no pet). C. The Court Should Di_smiss Plaintiffs Tag-Along Claims for Lack of Standing 9. Because Plaintiffs lack a private right of action to enforce the emergency care laws, the court should dismiss their tag-along claims as an attempt to manufacture a non-statutory basis to enforce identical payment obligations. (orig. pet. 1H] 18-42). a. Plaintiffs cannot repackage statutory claims for which they lack standing under alternative causes of action. 10. Plaintiffs first cause of action complains Cigna “entered into implied-in-fact contracts with the Hospitals to pay for stabilization and post-stabilization care at the usual and customary rate.” (orig. pet. 1] 19.) Under Texas law, an implied contract arises from the parties' conduct only "if their conduct demonstrates a meeting of the minds on the essential terms." Roberts, Taylor & Sensabaugh, Inc. v. Lexington Ins. Co., No. 06-cv-2197, 2007 WL 2592748, at *8 (S.D. Tex. Sept. 5, 2007). Importantly, an implied contract, like an express agreement, must have sufficiently definite terms "to enable the court to determine the respective legal obligations of the parties." DAC Surgical Partners P.A. v. United Healthcare Servs., Inc., No. l l-cv-l355, CIGNA’S PLEA T0 THE JURISDICTION Page 5 of 11 2016 WL 7177881, at *6 (S.D. Tex. Dec. 8, 2016). 1 1. Here, Plaintiffs merely allege that implied-in-fact contracts arose from the “acts and conduct of Cigna and the Hospitals” and Cigna authorized the medical treatment conducted and 9“ then failed to pay Plaintiffs usual and customary” charges. (orig. pet. at 1H] 19, 22, 26-27.) But Plaintiffs arguments for implied contract rely on the same factual footing as that stated in the Texas Insurance Code 1271.155. See Tex. Ins. Code 1271.155(c) (“A health maintenance organization shall approve or deny coverage of post stabilization care as requested by a treating physician or provider Within the time appropriate to the circumstances relating to the delivery of the services and the condition of the patient, but not to exceed one hour from the time of the request”) Plaintiffs’ petition is facially insufficient to give rise to an implied contract as it tracks statutory language which does not support a private right of action. Davis v. Hendrick Autoguard, Ina, 294 S.W.3d 835, 840 (Tex. App—Dallas 2009, no pet.) (concluding that party cannot “achieve indirectly through a common law contract action what he cannot do directly under the statute”). b. Plaintiffs’ promissory estoppel claim is not supported by Texas law. 12. "The requisites of promissory estoppel are: (1) a promise, (2) foreseeability of reliance thereon by the promisor, and (3) substantial reliance by the promise to his detriment." English v. Fischer, 660 S.W.2d 521, 524 (Tex. 1983). When promissory estoppel is used to enforce a promise that would be unenforceable because of the statute of frauds, the promise must be a promise to sign an already existing written agreement that would itself satisfy the requirements of the statute of frauds." Ellen v. F.H. Partners, LLC, No. 03-09-00310-CV, 2010 Tex. App. LEXIS 9540, at *4 (Tex. App—Austin 2010, no pet.) citing Nagle v. Nagle, 633 S.W.2d 796, 800 (Tex. App—Houston [14th Dist.] 2005, pet. den.). Moreover, such a promise must be sufficiently definite to be enforced. Gilmartin v. K VTV-Channel I3, 985 S.W.2d 553, 558 (Tex. App—San CIGNA’S PLEA T0 THE JURISDICTION Page 6 of 11 Antonio, no writ); Gillum v. Republic Health Corp, 778 S.W.2d 558, 570 (Tex. App—Dallas 1989, no writ); e.g. Allied Vista, Inc. v. Holt, 987 S.W.2d 138, 141-42 (Tex. App.—Houston [14th Dist] 1999, pet. denied). 13. Here, Plaintiffs allege that they conferred “stabilization and post-stabilization care to Cigna enrollees” and “Cigna promised to pay the Hospitals at the usual and customary rates” for this care. (orig. pet. 1H] 29-30.) But as we explained above, Plaintiffs lack standing to bring their claims for promissory estoppel to the extent these claims rely on Cigna’s alleged obligation to pay Plaintiffs at the “usual and customary rate” pursuant to Section 1271.155. While the Plaintiffs do not specifically refer to Texas Insurance Code Section 1271.155 in connection with their promissory estoppel claim, the claim on its face is the exact obligation they seek to enforce under section 1271.155. (Id. at 1H] 28-32.) Plaintiffs cannot create a private right of action under Texas Insurance Code Section 1271.155 by way of bringing a state law claim based upon this section. This claim should be dismissed. c. Plaintiffs’ attempt to enforce a statutory obligation through a negligent misrepresentation claim is improper. 14. Plaintiffs negligent misrepresentation claim is, on its face, an effort to improperly enforce a statutory obligation under which they have no standing. To establish a cause of action for negligent misrepresentation, a plaintiff must plead: (1) Cigna made a representation in the course of his business, or in a transaction in which they have a pecuniary interest; (2) Cigna supplied false information for the guidance of others in their business; (3) Cigna did not exercise reasonable care or competence in obtaining or communicating the information; and (4) the plaintiffs suffered pecuniary loss by justifiably relying on the representation. Miller v. CitiMortgage, Ina, 970 F. Supp. 2d 568, 585 (N .D. Tex. 2013). In Texas, a cause of action for negligent misrepresentation is governed by the two-year statute of limitations applicable to tort CIGNA’S PLEA T0 THE JURISDICTION Page 7 of 11 actions. Tex. Am. Corp. v. Woodbridge Joint Venture, 809 S.W.2d 299, 302 (Tex. App—Fort Worth 1991, writ denied). 15. But again, Plaintiffs allegations suggest they are attempting to enforce the emergency care laws. For example, the Plaintiffs contend Cigna “represented to [plaintiffs] by, among other things, providing the requested authorization or failing to transfer its patients when the [plaintiffs] informed it that it would expect payment at the usual and customary rate if the patient was not transferred.” (Orig. pet. at 1] 34.) Cigna’s alleged “misrepresentation was a misstatement of fact [because it] did not reimburse the Hospitals for stabilization and post- stabilization care at the usual and customary rates.” (Id. at 1] 37) (emphasis added). Compare this language with the Texas Insurance Code which states, “(2) necessary emergency care shall be provided to covered enrollees, including the treatment and stabilization of an emergency medical condition; and (3) services originated in a hospital emergency facility or comparable facility following treatment or stabilization of an emergency medical condition shall be provided to covered enrollees as approved by the health maintenance organization, subject to Subsections (c) and (d). (c) A health maintenance organization shall approve or deny coverage of post-stabilization care as requested by a treating physician or provider within the time appropriate to the circumstances relating to the delivery of the services and the condition of the patient, but not to exceed one hour from the time of the request. (d) A health maintenance organization shall respond to inquiries from a treating physician or provider in compliance with this provision in the health care plan of the health maintenance organization.” Tex. Ins. Code 1271 .155(b)(2) and (3) and (c), (d). 16. Even if the Plaintiffs were to contend they were not seeking the value of their services pursuant to the Texas Insurance Code, the bottom line is that the Plaintiffs are seeking to CIGNA’S PLEA T0 THE JURISDICTION Page 8 of 11 enforce the same payment obligations they cannot enforce under the insurance code. Consequently, this is nothing more than an improper repackaging of a statutory claim for which there is no standing. 17. Alternatively, Plaintiffs allege “[flrom September 2018 to December 31, 2021 the Hospitals provided emergency, stabilization and post-stabilization care to hundreds of Cigna patients.” (orig. pet. at 1] 1 1.) Assuming arguendo, Cigna did misrepresent some fact, the Plaintiffs’ cause of action for some of these claims has accrued. This is because Plaintiffs filed suit on February 6, 2023, meaning any claim to reimbursement under a negligent misrepresentation claim they are seeking prior to February 6, 2021 should be barred by limitations. d. Plaintiffs independently lack standing to assert claims for attorneys’ fees. 18. Plaintiffs seek fees for their claims for implied-in-fact contract under Chapters 38 of the Texas Civil Practice and Remedies Code. But if Plaintiffs lack standing to assert the underlying claims, then they also lack standing to enforce statutory remedies for attorney’s fees. Chapter 38 of the Texas Civil Practice and Remedies Code allows a plaintiff to “recover reasonable attorney’s fees from an individual or corporation, in addition to the amount of a valid claim and costs” in connection with, among others, claims for rendered services and performed labor. Id. at § 38.001. Because Plaintiffs lack standing to assert any claims under their original petition, Plaintiffs’ claims for attorneys’ fees predicated on those claims necessarily fail. IV. PRAYER For these reasons, Cigna respectfully requests that (i) the court dismiss all of Plaintiffs’ claims asserted under petition for lack of subject matter jurisdiction and With prejudice; (ii) Plaintiffs take nothing by reason of its suit against Cigna; (iii) that Cigna be awarded its attorney CIGNA’S PLEA T0 THE JURISDICTION Page 9 of 11 fees, court costs, and expenses; and (iv) that the court grant such other and further relief, at law or in equity, to which Cigna is justly entitled. Date: March 24, 2023 Respectfully Submitted: /s/ Kyle A. Ferachz' Kyle A. Ferachi Texas Bar No. 24072624 kferachi@hinshawlaw.com Alfredo Ramos Texas Bar No. 241 10251 framos@hinshawlaw.com HINSHAW & CULBERTSON LLP 5151 San Felipe, Suite 1380 Houston, Texas 77056 Telephone: (346) 344-4503 Facsimile: (313) 704-3001 ATTORNEYS FOR DEFENDANTS, CIGNA HEALTHCARE 0F TEXAS, INC., CIGNA HEALTH AND LIFE INSURANCE COMPANY, AND CONNECTICUT GENERAL LIFE INSURANCE COMPANY CIGNA’S PLEA TO THE JURISDICTION Page 10 of 11 CERTIFICATE OF CONFERENCE Counsel for movant and counsel for respondent have personally conducted a conference at which there was a substantive discussion of every item presented to the Court in this motion and despite best efforts the counsel have not been able to resolve those matters presented. /s/ Kyle A. Ferachi Kyle A. Ferachi CERTIFICATE OF SERVICE A true and correct copy of this document was served on March 24, 2023 as follows: Andrew Cookingham VIA TEXFILE Anna Wortham BRACEWELL LLP 1445 Ross Avenue, Suite 3800 Dallas, Texas 75202 /s/ Kyle A. Ferachz' Kyle A. Ferachi CIGNA’S PLEA T0 THE JURISDICTION Page 11 of 11 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules. Kyle Ferachi on behalf of Kyle Ferachi Bar No. 24072624 kferachi@hinshawlaw.com Envelope ID: 74025683 Filing Code Description: Plea To Jurisdiction Filing Description: CIGNA'S Status as of 3/27/2023 11:29 AM CST Associated Case Party: DALLAS MEDICAL CENTER, LLC Name BarNumber Email TimestampSubmitted Status Nancy McEvilyDavis nancy.davis@bracewell.com 3/27/2023 9:54:09 AM SENT Andrew Cookingham andrew.cookingham@bracewell.com 3/27/2023 9:54:09 AM SENT Sandi Mallon sandi.mallon@bracewell.com 3/27/2023 9:54:09 AM SENT Anna Wortham anna.wortham@bracewell.com 3/27/2023 9:54:09 AM SENT Eduardo Sanchez ed.sanchez@bracewell.com 3/27/2023 9:54:09 AM SENT Associated Case Party: CIGNA HEALTHCARE OF TEXAS, |NC., Name BarNumber Email TimestampSubmitted Status Kyle AFerchi kferachi@hinshawlaw.com 3/27/2023 9:54:09 AM SENT