Peters v. Aetna Inc. et al

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
ASHEVILLE DIVISION
CIVIL CASE NO. 1:15-cv-00109-MR
SANDRA M. PETERS, on behalf )
of herself and all others similarly )
situated, )
)
Plaintiff, ) MEMORANDUM OF
vs. ) DECISION AND ORDER
)
AETNA, INC., AETNA LIFE )
INSURANCE COMPANY, and )
OPTUMHEALTH CARE SOLUTIONS, )
INC., )
)
Defendants. )
________________________________ )
THIS MATTER is before the Court on remand from the United States
Court of Appeals for the Fourth Circuit for, inter alia, further consideration of
the Plaintiff’s Motion for Class Certification [Doc. 144]. Peters v. Aetna, Inc.,
2 F.4th 199 (4th Cir. 2021).
I. PROCEDURAL BACKGROUND
The Plaintiff Sandra M. Peters brings this putative class action against
the Defendants Aetna, Inc., Aetna Life Insurance Company (collectively,
“Aetna”), and OptumHealth Care Solutions, Inc. (“Optum”), asserting claims
pursuant to the Employee Retirement Income Security Act of 1974, as
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amended, 29 U.S.C. § 1001, et seq. (“ERISA”).1 [Doc. 1]. In her Complaint,
the Plaintiff alleges that Aetna engaged in a fraudulent scheme with its
subcontractor Optum, whereby insureds were caused to pay Optum’s
administrative fees because the Defendants misrepresented such fees as
medical expenses. The Plaintiff alleges that these misrepresentations
allow[ ] Aetna to illegally (i) obtain payment of
[Optum’s] administrative fees directly from insureds
when the insureds’ deductibles have not been
reached; (ii) use insureds’ health spending accounts
to pay for these fees; (iii) inflate insureds’ co-
insurance obligations using administrative fees; (iv)
artificially reduce the amount of available coverage
for medical services when such coverage is subject
to an annual cap; and (v) obtain payment of the
administrative fees directly from employers when an
insured’s deductible has been exhausted or is
inapplicable.
[Id. at ¶ 2]. The Plaintiff seeks relief for the Defendants’ misconduct under
ERISA, 29 U.S.C. § 1132(a)(1)(B), (a)(2), and (a)(3) for the following relief:
(1) restitution for amounts overcharged; (2) disgorgement and surcharge for
the Defendants to return any improper gains; and (3) various declaratory and
injunctive relief. [See id. at ¶¶ 91-101]. The Plaintiff seeks to bring this as a
class action on behalf of two classes: a class of self-insured plans which
1 The Plaintiff also asserted two claims under the Racketeer Influenced and Corrupt
Organizations Act, 18 U.S.C. § 1961, et seq. (“RICO”). Those counts, however, were
dismissed pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. [Doc. 54].
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were forced to pay Optum’s administrative fees as a result of the Aetna-
Optum arrangement, and a class of “members,” i.e., participants and
beneficiaries of Aetna insured/administered plans, who were also forced to
pay such fees.
Following a period of discovery, the Plaintiff moved for class
certification [Doc. 144], which the Defendants opposed [Doc. 171], and the
Defendants filed motions for summary judgment [Docs. 188, 225]. The Court
denied the class certification motion, and in a separate order granted both
Defendants summary judgment, thereby dismissing all of the Plaintiff’s
claims. [Docs. 203, 242].
The Plaintiff appealed both rulings. The Fourth Circuit affirmed in part,
reversed in part, vacated in part, and remanded this matter for further
proceedings consistent with the Fourth Circuit’s opinion. Peters v. Aetna,
Inc., 2 F.4th 199 (4th Cir. 2021). The Defendants filed a petition for rehearing
or rehearing en banc, which was denied. See Peters v. Aetna, Inc., No. 19-
2085, Doc. 96 (4th Cir. July 20, 2021). The Supreme Court denied the
Defendants’ petition for a writ of certiorari. OptumHealth Care Solutions v.
Peters, 142 S. Ct. 1227 (2022).
On remand, the Court directed the parties to file supplemental briefs
on the issue of class certification. [Doc. 254]. The parties thereafter filed
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their supplemental briefs. [Docs. 256, 259, 262, 267]. Additionally, the
Defendants filed a Notice of Supplemental Authority [Doc. 270], to which the
Plaintiff responded [Doc. 271]. Having been fully briefed, this matter is ripe
for disposition.
II. STANDARD OF REVIEW
The party seeking class certification bears the burden of demonstrating
compliance with Rule 23. “A party seeking class certification must do more
than plead compliance with the aforementioned Rule 23 requirements.
Rather, the party must present evidence that the putative class complies with
Rule 23.” EQT Prod. Co. v. Adair, 764 F.3d 347, 357 (4th Cir. 2014) (internal
citations omitted). While the plaintiff bears the burden of demonstrating
compliance with Rule 23, the Court “has an independent obligation to
perform a ‘rigorous analysis’ to ensure that all of the prerequisites have been
satisfied.” Id. at 358 (quoting in part Wal-Mart Stores, Inc. v. Dukes, 564
U.S. 338, 350-51 (2011)). To satisfy this obligation, the Court may “probe
behind the pleadings before coming to rest on the certification question.”
Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013) (citation and internal
quotation marks omitted). Ultimately, the decision to certify a class action is
within the discretion of the Court. Gunnells v. Healthplan Servs., Inc., 348
F.3d 417, 424 (4th Cir. 2003).
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III. FACTUAL BACKGROUND
Aetna insures, underwrites, and administers health benefits plans.
[Doc. 56 at ¶ 5]. Aetna’s responsibilities under its plans include processing
and administering claims, as well as entering into network participation
agreements with providers. [Id. at ¶ 21]. In addition, Aetna receives
compensation from plan sponsors of self-funded2 plans in exchange for
providing these administrative services. Those fees are set forth in
“administrative services agreements.” [Id. at ¶ 14].
At the time that this litigation was filed, the Plaintiff Sandra Peters was
a member of a self-insured health insurance plan offered through her
husband’s former employer, Mars, Inc. (“the Mars Health Care Plan” or
simply “the Plan”). The Mars Health Care Plan is one of approximately 1,600
self-insured plans that Aetna administers. The Plaintiff, however, is no
longer a member of the Mars Health Care Plan. See Peters, 2 F.4th at 221
n.11 (citing J.A. 2046: Peters Dep. at 39)9.
In 2011, Aetna sought to retain Optum to contract with physical therapy
and chiropractic providers on its behalf and process claims for member
benefits submitted by those providers. [See Doc. 146-7 at 2-3 (Feb. 28,
2 “Self-funded” or “self-insured” plans are ones in which employers are “financially
responsible for payment of benefits owed under the terms of the plan.” [Id. at ¶ 4].
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2011 email)]. Aetna agreed to pay Optum a “per-visit rate” or “case rate” for
each claim (the “Optum Rate”). [Doc. 144-13: Network Reference Tool at 3-
4; Doc. 146-23: Aetna 30(b)(6) Dep. at 101-02]. As such, Aetna treated
Optum as the “provider.” The result was to include Optum’s administrative
fees as part of the claim, and the Optum Rate (including those administrative
fees) as the “Negotiated Charge” and a “Covered Expense” under all of its
plans. [Doc. 146-23: Aetna 30(b)(6) Dep. at 39-42, 150-54]. When a plan
was responsible to pay for some or all of a claim, Aetna would determine
both the plan’s and the member’s financial responsibility using the Optum
Rate, rather than using the actual amount the medical provider had agreed
to receive for the treatment rendered.3 [Id. at 170]. Through this practice,
Optum was able to collect an administrative fee from the payments made by
the plans as compensation for its services to Aetna.
The Plaintiff received chiropractic care and physical therapy services
from Optum providers from 2013 through 2015. [Doc. 1 at ¶¶ 40-56]. She
contends that the Aetna-Optum arrangement wrongfully allowed Optum to
3 According to the Defendants, when a claim was subject to a member’s deductible—
such that the plan did not have to pay for the claim—the Defendants did not instruct the
provider to collect the Optum Rate, and Optum itself did not seek to collect it, such that
the member was responsible for paying only the actual provider’s agreed charge. [See
Doc. 146-23: Aetna 30(b)(6) Dep. at 167-69].
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“bury” its administrative fees in claims, and that Aetna misled her by
representing these administrative fees as medical expenses. [Id.]. The
Plaintiff further contends Defendants repeated this identical conduct as to
the putative class members. [See Doc. 146-22: Expert Report of Constantijn
Panis, Ph.D. (“Panis Rpt.”) at ¶¶ 37, 39; see also Docs. 146-18, 146-19, 146-
20 (Aetna EOB and Optum files for other members reflecting the same
practice)].
To state this more simply, the dispute is whether Optum is a “provider”
of the chiropractic and physical therapy services. If it is a “provider” that
simply subcontracts for the services and charges a fee for serving as the
“general contractor,” then its arrangement is consistent with the Plan. On
the other hand, if Aetna has simply contracted with Optum for Optum to
provide some administrative services that Aetna had agreed to perform in its
contract with the Plan, then the Aetna/Optum arrangement allows for
charging a fee greater than allowed by the plan contract, and further serves
to hide that excess fee from the Plan and its members by misidentifying it as
part of a claim for services.
The Plaintiff seeks class-wide relief under 29 U.S.C. § 1132(a)(1)(B),
(a)(2), and (a)(3). In so doing, the Plaintiff seeks to represent two classes: a
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class of plans and a class of members. The Plaintiff defines the plan class
as follows:
Plan Claim Class: All participants or beneficiaries of
self-insured ERISA health insurance plans
administered by Aetna for which plan responsibility
for a claim was assessed using an agreed rate
between Optum and Aetna that exceeded the
provider’s contracted rate with Optum for the
treatment provided.
[Doc. 144 at 1]. Even though this is expressed in terms of a class of
“participants or beneficiaries,” this class consists of those who have a right
to bring a derivative action on behalf of their self-insured plans for the plans
having been overcharged by the Defendants as a result of the Aetna/Optum
arrangement. Such right to bring a derivative action arises from 29 U.S.C. §
1132(a)(2), which allows participants or beneficiaries to seek “appropriate
relief.”4
The Plaintiff defines the member class as follows:
Member Claim Class: All participants or beneficiaries
of ERISA health insurance plans insured or
administered by Aetna for whom coinsurance
responsibility for a claim was assessed using an
4 This class is limited to self-insured plans because in the case of plans insured or
underwritten by Aetna, the arrangement “overcharges” Aetna itself. Thus, its ill-gotten
gains resulting from the arrangement would equal its loss as insurer or underwriter. (To
the extent that the Court misunderstands or mischaracterizes the Plaintiff’s intent in the
definition and operation of this class, it would be best that such be addressed now rather
than later.)
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agreed rate between Optum and Aetna that
exceeded the provider’s contracted rate with Optum
for the treatment provided.
[Id.]. This class consists of individuals who were covered by plans
administered by Aetna—whether those plans were self-insured or
insured/underwritten by Aetna, where the individual participants or
beneficiaries stood to lose some amount as a result of the Aetna/Optum
arrangement. Such would arise from the impact on the individuals’
coinsurance responsibility under their respective plans.
IV. DISCUSSION
In this action, the Plaintiff asserts the following claims for herself, the
Plan, and the putative class members under ERISA: (i) equitable restitution
for self-insured plans pursuant to 29 U.S.C. § 1132(a)(2) and for participants
pursuant to § 1132(a)(1); (ii) surcharge and disgorgement5 for self-insured
plans and participants/beneficiaries pursuant to § 1132(a)(1) and (2); and (iii)
declaratory and injunctive relief for both self-insured plans and
5 Surcharge is an equitable remedy under § 1132(a) of ERISA intended to provide relief
in the form of monetary compensation for a loss resulting from a fiduciary’s breach of duty
or to prevent the fiduciary’s unjust enrichment. See CIGNA Corp. v. Amara, 563 U.S.
421, 441-42 (2011). Disgorgement is also an equitable remedy under § 1132(a) which
allows a plan or plan participant to seek “the disgorgement of ‘profits produced by property
which in equity and good conscience belonged to the plaintiff.’” Pender v. Bank of Am.
Corp., 788 F.3d 354, 364-65 (4th Cir. 2015) (quoting in part 1 D. Dobbs, Law of Remedies
§ 4.3(5) at 608 (2d ed. 1993)).
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participants/beneficiaries pursuant to § 1132(a)(3). Peters, 2 F.4th at 216.
The Fourth Circuit remanded the case for further consideration of various
issues impacting each of these causes of action, as well as a “full
reevaluation” of the Plaintiff’s motion for class certification. Id.
In their supplemental briefing post-remand, the Defendants raise
several arguments challenging the Plaintiff’s standing to assert her claims in
light of recent Supreme Court precedent. Optum also specifically challenges
the propriety of the Plaintiff seeking relief against Optum, and it renews its
request to be dismissed from this action.
In light of the Fourth Circuit’s remand, as well as the issues raised by
the Defendants in their supplemental briefing, the Court will now address the
following issues: (1) the effect of the Fourth Circuit’s decision on the
restitution claims asserted by the Plaintiff; (2) the Defendants’ arguments
regarding the Plaintiff’s standing; (3) Optum’s renewed request to be
dismissed from this action; and (4) the Plaintiff’s motion for class certification.
A. Restitution Claims
On appeal, the Fourth Circuit concluded that the Plaintiff had
demonstrated a financial injury sufficient to establish standing so as to
proceed with her individual restitution claim, reasoning that for standing
purposes, “the financial loss analysis must be conducted at the individual
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claims level rather than at the aggregate claims level.” Peters, 2 F.4th at
218. Applying this principle, the Court concluded that the Plaintiff had
adequately shown “that combining Optum’s administrative fee with the
provider’s Negotiated Charge via the bundled rate caused her to pay more
on certain individual claims than she otherwise would have had to pay under
the Plan’s terms, therefore causing a financial injury sufficient to establish an
injury-in-fact for Article III standing purposes.” Id. at 219.
Ultimately, however, the Fourth Circuit concluded that the Plaintiff had
failed to show a financial loss sufficient to establish a compensable injury on
the merits of her restitution claim. Specifically, applying the formula set forth
in Donovan v. Bierwirth, 754 F.2d 1049 (2d Cir. 1985), the Court held as
follows:
[T]he measure of loss applicable in an ERISA trust
circumstance like this case requires a comparison of
what Peters or the Plan would have paid had Peters’
claims excluded Optum’s administrative fee with
what they actually paid on those claims . . . . [I]f what
Peters and the Plan actually paid on Peters’ claims
is less than—or equal to—what they would have paid
had Peters’ claims excluded Optum’s administrative
fee, no loss was sustained.
* * *
Although, as noted, we disagree with the district
court's reasoning, we affirm the grant of summary
judgment to [the Defendants] as applied to Peters
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because she failed to demonstrate that she suffered
the required financial injury for purposes of
restitution. Applying the Donovan formula to Peters’
total claims reflects that she would have paid more
each year, or broken even, if she had only paid the
health care provider's Negotiated Charge as
opposed to what she paid in the aggregate under the
bundled rate . . . .
* * *
Therefore, Peters experienced no direct financial
injury (but rather a net gain) based on the bundled
rate scheme in the aggregate.
Peters, 2 F.4th at 225-27. The Fourth Circuit therefore affirmed the grant of
summary judgment to the Defendants on the Plaintiff’s individual claim for
restitution under § 502(a)(1) and (3). Id. at 221.
As for the Plaintiff’s restitution claim on behalf of the Plan, however,
the Fourth Circuit remanded for further consideration of the Plan’s
entitlement to restitution under § 502(a)(2) using the Donovan framework.
Id. at 222. In light of the Fourth Circuit’s decision, the Plaintiff states in her
supplemental brief that she is now electing to pursue equitable relief solely
in the form of disgorgement, surcharge, and declaratory and injunctive relief.
[See Doc. 256 at 13 n.2]. As the Plaintiff no longer seeks a restitution remedy
on a class-wide basis, for either the Member Claim Class or the Plan Claim
Class, the Fourth Circuit’s directive to further consider the Plan’s entitlement
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to restitution is rendered moot, and the Plaintiff’s claim for restitution on
behalf of the Plan under § 502(a)(2) will be dismissed.
B. Standing
1. Requirement of Financial Injury for Equitable Claims
The Fourth Circuit held that the Plaintiff has Article III standing to
pursue equitable claims in the nature of surcharge, disgorgement, and
declaratory and injunctive relief, both as an individual participant and on
behalf of her Plan, holding that a demonstration of financial injury is not a
prerequisite for such claims under ERISA.6 See Peters, 2 F.4th at 219-21.
In so holding, the Court relied on Pender v. Bank of America Corp., 788 F.3d
354, 365-66 (4th Cir. 2015) (holding that “a financial loss is not a prerequisite
for standing to bring a disgorgement claim under ERISA”); CIGNA Corp. v.
Amara, 563 U.S. 421, 441-42 (2011) (holding that equity courts could permit
surcharge “to provide relief in the form of monetary compensation for a loss
resulting from a trustee’s breach of duty, or to prevent the trustee’s unjust
enrichment”) (emphasis added); and Loren v. Blue Cross & Blue Shield of
Mich., 505 F.3d 598, 610 (6th Cir. 2007) (“Plaintiffs need not demonstrate
6 The Fourth Circuit left open the question of whether the Plaintiff has standing to seek
prospective injunctive relief in light of the fact that she is no longer a member of the Mars
Plan. Id. at 221 n.11. The Court will address that issue separately in subsection C., infra.
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individualized injury to proceed with their claims for injunctive relief under §
[502](a)(3); they may allege only violation of the fiduciary duty owed to them
as a participant in and beneficiary of their respective ERISA plans.”).
On remand, the Defendants argue that the Fourth Circuit’s
determination of the Plaintiff’s standing to assert these equitable claims
without a showing of any actual financial injury was in error in light of three
recent Supreme Court decisions: Thole v. U.S. Bank N.A., 140 S. Ct. 1615
(2020); California v. Texas, 141 S. Ct. 2104 (2021); and TransUnion LLC v.
Ramirez, 141 S. Ct. 2190 (2021).7 The Defendants contend that these
decisions require the Plaintiff to demonstrate an actual, financial injury in
order to establish Article III standing. Because the Plaintiff suffered no direct
financial harm, the Defendants argue that these cases compel a conclusion
that the Plaintiff lacks standing to pursue even equitable claims for
surcharge, disgorgement, and declaratory and injunctive relief, either for
herself or on behalf of the Plan. [Doc. 259 at 13-17].
7 The Supreme Court decided Thole on June 1, 2020, after the parties had submitted their
appellate briefs to the Fourth Circuit. The Defendants cited Thole in a notice of
supplemental authority filed with the Fourth Circuit. Peters v. Aetna, Inc., No. 19-2085,
Doc. 55. The Supreme Court decided California v. Texas on June 17, 2021, shortly before
the Fourth Circuit published the Peters decision on June 22, 2021. TransUnion was
decided on June 25, 2021, three days after the Peters decision. The Defendants raised
all three cases in their petition for panel rehearing or rehearing en banc. See id., Doc.
94. The Fourth Circuit denied the Defendants’ petition for rehearing without specifically
discussing any of the cited cases. Id., Doc. 96.
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The Defendants’ argument in this regard presupposes that this line of
Supreme Court decisions effectively overruled the cases relied upon by the
Fourth Circuit in concluding that the Plaintiff could establish standing to
assert claims for surcharge, disgorgement, and declaratory and injunctive
relief even without a showing of a direct financial injury. A careful
examination of these decisions reveals, however, that the Fourth Circuit’s
analysis of the Plaintiff’s Article III standing is entirely consistent with the
Supreme Court’s reasoning in these cases. For example, in Thole, the
Supreme Court concluded that the plaintiffs had not suffered a cognizable
injury because they had not alleged that any benefit they sought had been
wrongfully adjudicated. Thole, 140 S. Ct. at 1619. As members of a defined-
benefit pension plan, the plaintiffs’ benefits were fixed by the plan’s written
terms, and they received exactly what the plan entitled them to receive every
month. The payments “d[id] not fluctuate with the value of the plan or
because of the plan fiduciaries’ good or bad investment decisions.” Id. at
1618. The Thole plaintiffs did not allege that any of their past benefit claims
had been wrongfully calculated in contravention of plan terms. Id. at 1619.
Because they could not allege that the outcome of the case would have any
impact on them whatsoever, the Supreme Court concluded that they had no
injury. Id.
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Here, in contrast, every class member was overcharged on at least
one benefit claim and the Plaintiff has alleged that the challenged scheme
caused those overcharges for every member of the class. See Peters, 2
F.4th at 243 (“the underlying harm derives from the same common
contention—that [the Defendants’] fee shifting scheme breached the terms
of the applicable Plan and constituted a breach of fiduciary duty”). The
Plaintiff has shown precisely what the Thole plaintiffs could not—that the
misconduct at issue led to an overcharge on at least one benefit claim that
harmed her, just as it did for all class members. Thus, even under the
reasoning of Thole, the Plaintiff has established a direct financial injury of a
nature sufficient to confer Article III standing.
In TransUnion, the Supreme Court considered whether two groups of
class members had standing to challenge TransUnion’s failure to follow
reasonable procedures in violation of the Fair Credit Reporting Act.
TransUnion had flagged certain individuals as potential matches for names
of terrorists on the U.S. Treasury Department’s Office of Foreign Assets
Control’s list of “specially designated nationals” (the “OFAC list”) without
taking any further steps to assess whether the individuals were actually one
of the people identified on the OFAC list. TransUnion, 141 S. Ct. at 2201.
For the group of class members for whom TransUnion sent an alert to a third
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party that the individual was a potential match, the Supreme Court had “no
trouble” concluding that they had been injured, even without any evidence
that the class member had been denied credit or suffered any monetary harm
related to the alert. Id. at 2209. The concrete injury was the fact that the
third party now had the information, and this was precisely the type of harm
that Congress intended to stop by requiring adequate procedures. Id. For
the other group of class members whose information simply sat on a
TransUnion data server and was never used, the Supreme Court found they
had not been injured. See id. at 2212-13.
The putative classes in the present action are like those for whom the
TransUnion Court had “no trouble” finding Article III standing. All class
members in this case allege that they were overcharged on at least one
benefit claim in violation of their plan terms. For the purposes of determining
standing, it is of no moment whether these class members also suffered a
financial injury in the aggregate. The TransUnion Court’s holding that the
defendant’s disclosure of the “potential match” information alone caused “a
concrete harm that qualifies as an injury in fact”—without any showing of any
additional adverse event (e.g., being refused credit, suffering monetary
harm) that resulted from that disclosure, see id. at 2209—is entirely
consistent with the Fourth Circuit’s decision in this case.
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In California, the plaintiffs sought declaratory relief that the minimum
essential coverage provision of the Affordable Care Act was unconstitutional
because it set the penalty amount at zero dollars. 141 S. Ct. at 2114. The
Supreme Court concluded that, in the absence of anything else, the plaintiffs
lacked standing to sue because the declaration the plaintiffs sought would
not impact them and would amount to nothing more than an advisory opinion.
Id. at 2116. Here, the opposite is true. The Fourth Circuit carefully examined
each remedy potentially available to the Plaintiff—surcharge, disgorgement,
and declaratory and injunctive relief—with an eye towards how each
category of equitable relief would (or would not) redress the Plaintiff’s injury.
See Peters, 2 F.4th at 217-21. Since surcharge and disgorgement focus on
preventing a defendant’s unjust enrichment, the Fourth Circuit explicitly
concluded that standing for seeking those remedies did not require any
aggregate personal financial loss.8 Id. at 219-20. All that is required to
8 Again, even if such aggregate financial loss were required, the Fourth Circuit also found
that the Plaintiff had suffered a direct financial injury with respect to certain individual
claims. Thus, the Plaintiff still has standing even if she were required to demonstrate a
direct financial loss in order to establishing standing to assert claims for disgorgement,
surcharge, and declaratory and injunctive relief.
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establish standing is proof that the Defendants were unjustly enriched on
discrete benefit claims.9
For all these reasons, the Court concludes that the Plaintiff continues
to have Article III standing to assert claims for disgorgement, surcharge, and
(at least some forms of) declaratory and injunctive relief, both as an individual
participant and on behalf of her Plan, without proof of a financial loss. As the
Plaintiff has standing without proof of a financial loss to assert
disgorgement/surcharge claims, both as an individual member and on behalf
of her Plan, she also has standing to serve as a class representative on
behalf of other individual members and self-insured plans who allege that
Aetna likewise bypassed its obligation to pay Optum’s administrative fees
with respect to their claims.
2. Standing to Seek Prospective Declaratory and
Injunctive Relief
While holding that the Plaintiff has standing to assert claims for
disgorgement, surcharge, and declaratory and injunctive relief, the Fourth
9 It does not appear that the Plaintiff would personally be entitled to any
disgorgement/surcharge proceeds because she suffered no loss in the aggregate as a
result of the Defendants’ alleged scheme. See Peters, 2 F.4th at 223 (noting that Plaintiff
“suffered no direct financial injury for [the Defendants’] actions”) (discussing restitution
claim). This, in turn, raises questions as to whether she may properly serve as a class
representative for individual members who may in fact be entitled to such proceeds. The
Court will address such concerns in the discussion regarding class certification, infra.
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Circuit noted that “[t]he record appears to indicate that Peters is no longer a
Plan participant, which raises a question on prospective injunctive relief
because she may not be able to rely on only past conduct to establish Article
III standing.” Peters, 2 F.4th at 221 n.11 (citation omitted) (emphasis
added). Noting that the parties had not raised this issue on appeal, the
Fourth Circuit “le[ft] consideration of this matter for the district court’s
resolution in the first instance upon remand.” Id.
“[A] plaintiff seeking prospective injunctive relief may not rely on prior
harm to establish Article III standing.” Abbott v. Pastides, 900 F.3d 160, 176
(4th Cir. 2018) (citation and internal quotation marks omitted). Rather, the
plaintiff must show an “ongoing or future injury in fact.” Id. (citation omitted).
To establish standing based on a future injury, the plaintiff must show that
there is a “substantial risk” that the future harm will occur. See Beck v.
McDonald, 848 F.3d 262, 275 (4th Cir. 2017).
Here, the Plaintiff argues that the Defendants calculated her financial
responsibility for deductible claims using Optum’s rate and told the Plaintiff
in Explanation of Benefit forms (EOBs) that she owed those charges. While
the Defendants have never attempted to collect this money from her, the
Plaintiff argues that the Defendants have never told her that those
statements are false or that she was not financially responsible for those
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charges. As such, the Plaintiff contends, she has a “risk of future harm”
should the Defendants ever attempt collect on those deductible claims. [Doc.
262 at 24-25].
The Plaintiff’s contention that the Defendants may attempt at some
point in the future to collect on charges related to benefits claims from a
decade ago is far too speculative and nebulous to establish a substantial risk
of future harm.10 See Beck, 848 F.3d at 274-75 (finding the plaintiffs’ claim
of an enhanced risk of future identity theft resulting from data breach “too
speculative” to establish Article III standing). Without a concrete risk of future
harm, the Plaintiff’s lack of continued participation in the Mars Plan is fatal to
her standing to assert claims for prospective injunctive relief. Simply put,
she no longer has “skin in the game.” Because the Plaintiff lacks the
necessary standing, her claim for prospective injunctive relief must be
dismissed.11
10 The Plaintiff also has shown nothing to indicate that the statute of limitations has not
expired with regard to such claims.
11 The dismissal of the Plaintiff’s claim for prospective injunctive relief would not defeat
any claim the Plaintiff might have for injunctive relief that is retrospective in nature.
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C. Plaintiff’s Remaining Claims Against Optum
In the Defendants’ supplemental briefing on the issue of class
certification, Optum separately asks this Court to deny class certification
against it and renews its request to be dismissed from this action. [Doc. 259
at 33-34].
Optum’s arguments are foreclosed by the Fourth Circuit’s opinion,
which concluded that the Plaintiff had presented sufficient evidence from
which a reasonable factfinder could conclude that “Optum could be held as
a party in interest involved in prohibited transactions based on its apparent
participation in and knowledge of Aetna’s administrative fee billing model.”
Peters, 2 F.4th at 240. As for Optum’s claim that the Plaintiff has abandoned
her sole remaining claim against Optum for disgorgement, this argument is
misguided. First and foremost, the Plaintiff still has claims for declaratory
and non-prospective injunctive relief against Optum that remain. Further, as
the Fourth Circuit pointed out, the Plaintiff did not abandon her disgorgement
claim against Optum on appeal, see Peters, 2 F.4th at 240 n.21, and the
Court does not construe her supplemental briefing as abandoning any such
claim. Optum’s renewed request to be dismissed from this action is therefore
denied.
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D. Class Certification
Having resolved the issues left open by the Fourth Circuit as well as
the issues raised by the Defendants in their supplemental briefing on
remand, the Court now turns to the Plaintiff’s motion for class certification.
“The class action is an exception to the usual rule that litigation is
conducted by and on behalf of the individual named parties only.” Dukes,
564 U.S. at 348 (citation and internal quotation marks omitted). To justify a
departure from that usual rule, “a class representative must be part of the
class and possess the same interest and suffer the same injury as the class
members.” Id. at 348-49 (quoting E. Tex. Motor Freight Sys., Inc. v.
Rodriguez, 431 U.S. 395, 403 (1977)). Thus, in seeking the certification of
a class action, a putative class representative must demonstrate as a
threshold matter that she is a member of the proposed class and that the
other class members are “readily identifiable” or “ascertainable.” EQT Prod.,
764 F.3d at 358 (“A class cannot be certified unless a court can readily
identify the class members in reference to objective criteria.”).
Once this threshold determination has been made, the Court must then
determine whether the readily identifiable class should be certified. Rule
23(a) of the Federal Rules of Civil Procedure sets forth the four prerequisites
that an action must satisfy in order to be certified as a class action: (1) the
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class must be so numerous that joinder of all members is impracticable
(“numerosity”); (2) there must be questions of law or fact common to the
class (“commonality”); (3) the claims or defenses of the representative
parties must be typical of the claims and defenses of the class as a whole
(“typicality”); and (4) the representative party must fairly and adequately
protect the interests of the class (“adequacy of representation”). Fed. R. Civ.
P. 23(a). “Rule 23(a) ensures that the named plaintiffs are appropriate
representatives of the class whose claims they wish to litigate. The Rule’s
four requirements—numerosity, commonality, typicality, and adequate
representation—effectively limit the class claims to those fairly encompassed
by the named plaintiff’s claims.” Dukes, 564 U.S. at 349 (citations and
internal quotation marks omitted). In addition to satisfying the requirements
of Rule 23(a), “the class action must fall within one of the three categories
enumerated in Rule 23(b).” Gunnells, 348 F.3d at 423.
1. Definition of the Proposed Classes
The Plaintiff proposes the certification of two claim classes. The first
class is referred to as the “Plan Claim Class.” This proposed class would
present derivative claims, brought by individual participants or beneficiaries
of self-insured, Aetna-administered health insurance plans, to address plan
losses on behalf of their respective plans through the remedies of
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disgorgement, surcharge, and declaratory and non-prospective injunctive
relief. Further, this proposed class encompasses only participants and
beneficiaries of self-insured plans and does not include plans insured by
Aetna itself.12 Because the “Plan Claim Class” would present only derivative
claims on behalf of the identified plans, any losses incurred by those
participants or beneficiaries individually would not be addressed in the “Plan
Claim Class” but would instead be addressed through the “Member Claim
Class,” discussed below. Thus, it is possible for an individual participant or
beneficiary to be a member of both the “Plan Claim Class” and the “Member
Claim Class,” depending on the type of claim being asserted by that
individual.
The second proposed class is the “Member Claim Class.” This class
would present the individual claims of participants and beneficiaries,
including both participants and beneficiaries of Aetna health insurance plans
as well as participants and beneficiaries of self-insured health insurance
plans that are only administered (as opposed to both administered and
insured) by Aetna, for the remedies of disgorgement/surcharge of any benefit
12 The proposed class definition would also seemingly exclude health insurance plans
administered by Aetna but insured by a third party insurer. Plaintiff’s expert indicates,
however, that only 0.2% of claims involve such a situation. [Doc. 146-22 at 11]. As such,
this category is immaterial to the questions presented here.
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the Defendants received at the expense of such participants or beneficiaries,
as well as declaratory and non-prospective injunctive relief.
2. Rule 23(a) Certification
a. Ascertainability
“The plaintiff bears the burden of offering a reliable and administratively
feasible mechanism for determining whether putative class members fall
within the proposed class definition.” Krakauer v. Dish Network L.L.C., 311
F.R.D. 384, 390 (M.D.N.C. 2015) (quoting in part Hayes v. Wal-Mart Stores,
Inc., 725 F.3d 349, 355 (3d Cir. 2013)) (internal quotation marks omitted).
Here, the Fourth Circuit noted that “the proposed class members
appear[ ] to be objectively identifiable based on the [Defendants’] own data,
as Peters identified 87,754 members who experienced a scenario such as
hers, whether they (or their plan) were charged Optum’s administrative fee.”
Peters, 2 F.4th at 242-43. The Defendants’ data13 show the amount of
administrative fees that the Defendants forced the plans and plan members
to bear for each claim—i.e., the amount by which the member’s and the
13 The Plaintiff’s expert, Constantijn Panis, Ph.D., examined data from both Aetna and
Optum for the relevant time period. In examining the claims data, Dr. Panis noted that
the Aetna and Optum data did not match up exactly, with some medical visits appearing
in the Aetna data only, others in the Optum data only, and yet others in both sources.
Nevertheless, Dr. Panis was able to match members’ medical visits between the Aetna
and Optum data for a substantial portion of claims. [Doc. 146-22: Panis Rpt. at ¶¶ 17-
24].
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plan’s financial responsibility exceeded the actual provider’s Negotiated
Charge for a particular claim. [See Doc. 146-22: Panis Rpt. at ¶¶ 30-39
(discussing claims)]. As both the Plan Claim Class and the Member Claim
Class appear to be generally ascertainable through an examination of the
Defendants’ own data from the class period, the Court concludes that the
Plaintiff has provided an administratively feasible method of determining the
two proposed classes.
b. Numerosity
Rule 23(a)(1) requires that a class be “so numerous that joinder of all
members is impracticable.” Fed. R. Civ. P. 23(a)(1). Here, the Plaintiff has
identified 87,754 members and 1,954 plans that were subjected to paying
Optum’s administrative fees. [See Doc. 146-22: Panis Rpt. at 16]. There
appears to be no dispute that the putative classes meet the numerosity
requirement set forth in rule 23(a)(1). Accordingly, the Court concludes that
the Plaintiff has sufficiently demonstrated that the classes of plaintiffs are so
numerous that joinder would be impracticable, thereby satisfying the
numerosity requirement for both the Plan Claim Class and the Member Claim
Class.
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c. Commonality
Rule 23 requires that there be “questions of law or fact common to the
class.” Fed. R. Civ. P. 23(a)(2). “Although the rule speaks in terms of
common questions, ‘what matters to class certification . . . [is] the capacity
of a classwide proceeding to generate common answers apt to drive the
resolution of the litigation.’” EQT Prod. Co., 764 F.3d at 360 (alterations and
emphasis in original) (quoting Wal-Mart Stores, Inc., 564 U.S. at 350). “A
single common question will suffice, but it must be of such a nature that its
determination ‘will resolve an issue that is central to the validity of each one
of the claims in one stroke.’” Id. (citation omitted) (quoting Wal-Mart Stores,
Inc., 564 U.S. at 350).
Re-examining the commonality issue in light of the claims that it
concluded had survived summary judgment, the Fourth Circuit noted that
there are a number of common issues of law and fact related to Aetna’s
conduct, including: (1) whether Aetna was a fiduciary; (2) whether Aetna
breached its duties to plans and plan participants by directing Optum to bury
its administrative fees in the claims process; and (3) whether Aetna’s breach
amounted to a harm to the particular plan and plan participants. See Peters,
2 F.4th at 243. In addition to the common questions identified by the Fourth
Circuit, the Court concludes that there are also common issues of law and
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fact related to Optum, including: (1) whether Optum was a party in interest
under ERISA; and (2) whether Optum participated in prohibited transactions
based on the evidence of the Aetna-Optum contracts and the claim data
reflecting payments from the plans that were used to pay Optum’s
administrative fees.
In their supplemental briefing on remand, the Defendants argue that,
despite the existence of these identified issues, the commonality
requirement is nevertheless lacking here because these issues cannot be
answered with common evidence due to the variances in the relevant plan
language.14 [Doc. 259 at 22-24].
In support of her motion for class certification, the Plaintiff presented a
random sample of language from twenty-one of the plans in the proposed
Plan Claim Class. [Doc. 146-13]. As the Court has previously noted, these
sampled plans do not contain “any meaningful variation” in their relevant
terms. [Doc. 156 at 2]. The Defendants do not dispute that the relevant
14 The Defendants also argue that there are significant variances in the administrative
service contracts with plan sponsors as well as in the plan communications that defeat
commonality. [Id.]. Such contracts and communications, however, are not “documents
and instruments governing the plan” and therefore are not controlling on the issue of the
Defendants’ obligations arising under the plans. See Boyd v. Met. Life Ins. Co., 636 F.3d
138, 140 (4th Cir. 2011) (discussing the “plan documents rule” endorsed by Kennedy v.
Plan Adm’r for DuPont Sav. & Inv. Plan, 555 U.S. 285 (2009)).
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30
language of the majority of the twenty-one plans in the Plaintiff’s random
sample is basically identical to her plan. Indeed, most of these plans define
the charge that members and plans are responsible to pay as the
“Negotiated Charge” or “Negotiated Rate,” which is the “maximum charge” a
“Network Provider [or preferred care provider or PPO provider] has agreed
to make as to any service or supply.” [See id.]. A “Network Provider,” in
turn, is the “health care provider” that “has contracted to furnish services or
supplies for this plan” and “is, with Aetna’s consent, included in the directory
as a network provider.” [See id.]. Although the Defendants argue that four
of the plans sampled are materially distinct and “irreconcilable” with the other
seventeen [Doc. 163 at 17], the Defendants fail to explain how the variations
in the plan language are material. In fact, while four of the plans sampled
appear to use slightly different language from the other seventeen [see Doc.
146-13 at 4 (Summary Plan Description, or SPD, for Allstate Cafeteria Plan);
at 5 (SPD for CarMax Health Plan); at 6 (SPD for Compass Group Benefits
Program); at 10 (SPD for Johnson & Johnson Salaried Medical Plan)], the
written terms of these four plans state essentially the same thing. Like the
other seventeen, none of these four plans define a “provider” as a “general
contractor” for services, such as Optum, that Aetna hires to process claims
and perform network contracting for it. [See id.]. Further, like the other
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seventeen, none of the four plans states that members and plans will be
required to pay Optum’s administrative fees as part of their insurance claims
for the work Optum does on Aetna’s behalf. [Id.]. The only thing different
about these four plans is that they define the relevant charge to be the rate
that the medical provider agreed “with Aetna” to accept, whereas the other
seventeen plans do not explicitly reference with whom the provider has an
agreement. [Id.]. However, all of the plans define the relevant negotiated
charge to be the one that the medical provider has agreed to receive. Thus,
the outcome-determinative question under all of these plans is whether
Optum could be treated as the medical provider and its administrative fee as
an obligation that members and plans were required to pay.15 As such, the
Court concludes that the purported distinctions among the plans are nothing
more than “minor variations in the phrasing of the relevant plan language,”
which are “incidental to the shared legal theory and similar conduct” at issue
and do not bar class certification. Smith v. United HealthCare Servs., Inc.,
15 It is undisputed that all healthcare providers have administrative costs and thus collect
administrative fees as part of their charges for services. The question is whether the
agreements in question deem Optum to be a medical provider and therefore allow for the
charging of such administrative fees.
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No. CIV 00-1163 ADM/AJB, 2002 WL 192565, at *4 (D. Minn. Feb. 5,
2022).16
Accordingly, the Court concludes that there exist questions of law and
fact that are common to both the Plan Claim Class and the Member Claim
Class, and that resolution of these questions in a class-wide proceeding can
generate common answers apt to drive the resolution of the litigation. The
commonality prong of the Rule 23 analysis is therefore satisfied with respect
to both the Plan Claim Class and the Member Claim Class.
d. Typicality
Rule 23 requires that “the claims or defenses of the representative
parties are typical of the claims or defenses of the class.” Fed. R. Civ. P.
23(a)(3). “The essence of the typicality requirement is captured by the notion
that ‘as goes the claim of the named plaintiff, so go the claims of the class.’”
Deiter v. Microsoft Corp., 436 F.3d 461, 466 (4th Cir. 2006) (quoting
Broussard v. Meineke Discount Muffler Shops, Inc., 155 F.3d 340 (4th Cir.
16 Even if the Court were later to determine that such variations as those identified in
these four plans are material, the Court could address that issue by creating a subclass
for that category of plans. See EQT Prod., 764 F.3d at 363 (stating that plaintiffs who
alleged ownership claims based on varying deeds could potentially “identify a finite
number of variations in [the] deed language, such that the ownership question is
answerable on a subclass basis”).
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1998)). This requirement tends to merge with the commonality requirement.
Id.
The above analysis as to the commonality requirement also applies to
the typicality requirement. The Plaintiff has sufficiently shown that her claims
and the claims of the putative classes are based on the same alleged facts
and legal theory—namely, that Aetna created a scheme by which plans and
plan members would pay Optum’s administrative fees and that this scheme
violated ERISA. This is true even for those class members who were
members of other plans. See Selby v. Principal Mut. Life Ins. Co., 197 F.R.D.
48, 58 n.14 (S.D.N.Y. 2000) (“When the named plaintiff in an ERISA class
action challenges an insurer’s practice that the insurer engages in with
respect to all of its plans, the court will allow the plaintiff to represent persons
in the insurer’s other insurance plans.”).
The Defendants argue that the Plaintiff’s claims are not typical of the
putative class members because she suffered no direct financial injury and
therefore is not personally entitled to disgorgement or surcharge. [Doc. 259
at 17-21]. With respect to the Plan Claim Class, the Court finds the Plaintiff’s
claims to be typical. All participants and beneficiaries have the same right to
bring a derivative claim on behalf of their self-funded plan to prevent the
Defendants’ unjust enrichment. With respect to the Member Claim Class,
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34
the Plaintiff has alleged that all of the class members were subjected to the
same type of administrative scheme, and that such scheme resulted in a
benefit accruing to one or both of the Defendants. In this regard, the
Plaintiff’s claim appears to be typical of some of these class members, but
not of others, as it has already been determined that she did not suffer a
financial loss as a result of the Defendants’ scheme. A claim for
disgorgement of ill-gotten gains for the benefit of oneself is materially
different from a claim for disgorgement for the benefit of one’s plan—even
where the plaintiff may have standing to bring such a claim.
Nevertheless, the Court finds that there is sufficient commonality
between all the Member Class claims at this point to determine that the
Plaintiff’s claim is typical for the purpose of initial class certification. The
Court will reserve the question of whether the Member Claim Class should
be divided into subclasses to distinguish those participants/beneficiaries who
suffered a net financial loss and those who did not.
e. Adequacy of Representation
Rule 23 requires a determination that “the representative parties will
fairly and adequately protect the interests of the class.” Fed. R. Civ. P.
23(a)(4). This analysis is two-pronged. The Court must determine (1) that
the plaintiff “possess[es] the same interest and suffer[s] the same injury as
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35
the class members” and that the plaintiff’s interests are not antagonistic to
the other members; and (2) that the plaintiff’s counsel is “qualified,
experienced and generally able to conduct the proposed litigation.” Rehberg
v. Flowers Baking Co. of Jamestown, LLC, No. 3:12-cv-00596-MOC-DSC,
2015 WL 1346125, at *11 (W.D.N.C. Mar. 24, 2015) (first quoting Amchem
Prods., Inc. v. Windsor, 521 U.S. 591, 625-26 (1997); and then quoting
Romero v. Mountaire Farms, Inc., 796 F. Supp. 2d 700, 715 (E.D.N.C.
2011)).
As with the commonality and typicality analysis, the Court concludes
the Plaintiff has sufficiently shown she has the same interest in identifying
and correcting fiduciary breaches as the putative class members, thereby
satisfying the first prong of the adequacy of representation analysis.17 The
Court also concludes that the Plaintiff’s counsel is qualified, experienced,
and generally capable of conducting this litigation. Accordingly, the Court
concludes the Plaintiff has met the requirements of Rule 23(a)(4).
17 As noted supra, to the extent that some of the putative class members have interests
that vary from the Plaintiff (i.e., they actually suffered a financial loss as a result of the
Defendants’ conduct and thus could assert a claim to part of the disgorgement/surcharge
proceeds), such variances could be addressed with the creation of a sub-class of such
individuals in order to adequately protect their interests. If division of the Member Class
into such sub-classes occurs, a determination will have to be made as to whether the
Plaintiff has “suffer[ed] the same injury as the [sub-]class members,” see E. Tex. Motor
Freight Sys., 431 U.S. at 403, such that her representation of that sub-class continues to
satisfy the adequacy of representation requirement.
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3. Rule 23(b) Certification
Having determined that the Plaintiff has adequately cleared the hurdle
of each of the requirements of Rule 23(a) at this stage, the Court next turns
to the issue of certification under Rule 23(b). Here, the Plaintiff seeks
certification under Rule 23(b)(1) and (3), which provide, respectively, as
follows:
(1) prosecuting separate actions by or against
individual class members would create a risk of:
(A) inconsistent or varying adjudications with respect
to individual class members that would establish
incompatible standards of conduct for the party
opposing the class; or
(B) adjudications with respect to individual class
members that, as a practical matter, would be
dispositive of the interests of the other members not
parties to the individual adjudications or would
substantially impair or impede their ability to protect
their interests;
* * *
(3) the court finds that the questions of law or fact
common to class members predominate over any
questions affecting only individual members, and that
a class action is superior to other available methods
for fairly and efficiently adjudicating the controversy.
The matters pertinent to these findings include:
(A) the class members' interests in individually
controlling the prosecution or defense of separate
actions;
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37
(B) the extent and nature of any litigation concerning
the controversy already begun by or against class
members;
(C) the desirability or undesirability of concentrating
the litigation of the claims in the particular forum; and
(D) the likely difficulties in managing a class action.
Fed. R. Civ. P. 23(b)(1), (3).18
Here, if a class action were not allowed to proceed, there would be a
significant risk of inconsistent judgments, resulting in conflicting standards of
conduct for the Defendants. See Kennedy v. United Healthcare of Ohio, Inc.,
206 F.R.D. 191, 198 (S.D. Ohio 2002) (“Plaintiffs seek prospective equitable
relief on the basis that defendant’s earlier practices violated ERISA.
Separate lawsuits could result in inconsistent judgments on the merits of
such claims. Simply stated, one court could determine that defendant's
practice violated ERISA, while another court could conclude that it did not.”);
see also Stanford v. Foamex L.P., 263 F.R.D. 156, 173 (E.D. Pa. 2009) (“the
risk of inconsistent orders . . . satisfies Rule 23(b)(1)(A)”); West v. Cont’l
Auto., Inc., No. 3:16-cv-502-FDW-DSC, 2017 WL 2470633, at *3 (W.D.N.C.
18 Because the Court concludes that certification is appropriate under Rule 23(b), the
Court need not address the Plaintiff’s alternative argument that certification of each of the
proffered common questions as an issue class is appropriate under Rule 23(c)(4).
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38
June 7, 2017) (“there is a risk that class members would seek relief in other
courts, leading to conflicting interpretations of the Plan and conflicting
remedies”). Because the classes’ claims “implicate misconduct” in the
administration of the plans, “disparate lawsuits by individual participants
would raise the specter of varying adjudications.” In re Marsh ERISA Litig.,
265 F.R.D. 128, 144 (S.D.N.Y. 2010) (citation and internal quotation marks
omitted). Accordingly, the Court concludes that the certification of these
classes is appropriate under Rule 21(b)(1)(A).
“[C]ertification under Rule 23(b)(3) is appropriate when all of the
prerequisites of Rule 23(a) are satisfied and two other requirements are met.
Specifically, (1) common questions of law or fact must predominate over any
questions affecting only individual class members; and (2) proceeding as a
class must be superior to other available methods of litigation.” EQT Prod.
Co., 764 F.3d at 357 (citations omitted). While the predominance analysis
is governed by the same analytical principals as the Rule 23(a) commonality
analysis, the 23(b)(3) analysis is “more demanding.” Id. at 365. This is
because “[t]he predominance inquiry focuses not only on the existence of
common questions, but also how those questions relate to the controversy
at the heart of the litigation.” Id. at 366. “Even a plethora of identical practices
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will not satisfy the predominance requirement if the defendant[’s] common
conduct has little bearing on the central issue in the litigation . . . .” Id.
Here, common issues will predominate, as the Defendants’ common
conduct is critical to the determination of their ultimate liability. Each of the
putative class members were insured by ERISA plans, and ERISA provides
common definitions for the type of conduct that renders one a fiduciary or a
party in interest and the type of conduct that violates fiduciary duties or
constitutes prohibited transactions. These common legal standards, coupled
with the common evidence showing that Aetna engaged in a policy of forcing
members and plans to bear responsibility for Optum’s fees, easily satisfies
the predominance requirement. See Brooks v. Educators Mut. Life Ins. Co.,
206 F.R.D. 96, 104 (E.D. Pa. 2002) (certifying ERISA class based on
insurer’s common scheme of applying cap on payments).
Similarly, the issue of the classes’ entitlement to equitable monetary
relief also predominates over the insignificant issues that Defendants may
raise, such as speculation about providers’ billing or forgiveness of member
obligations. The Defendants’ own data details precisely the amount of the
financial responsibility that members and plans were assessed for Optum’s
fees that ostensibly should have been paid directly by Aetna. The Plaintiff’s
expert provided formulaic class-wide approaches to calculating the
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40
Defendants’ unjust enrichment, using their own data. [See Doc. 146-22:
Panis Rpt. at ¶¶ 35-38, 41-44]. Thus, the data alone can be used to
determine how much the Defendants owe.19
In determining whether proceeding in a class action is superior to other
available methods of litigation, courts consider, among other factors:
concerns of judicial economy; the risk of inconsistent judgments against the
defendants; the barriers to individual litigation faced by class members; the
split of state and federal claims in a litigation; and whether there are
alternative mechanisms to resolving the claims. See EQT Prod. Co., 764
F.3d at 371. Here, judicial economy weighs heavily in favor of proceeding
as a class action. The issue at the heart of this case is common to all class
members and there is little incentive for individual plaintiffs to bring their
cases independently because the cost of doing so far exceeds the value of
their individual claims. Accordingly, the Court concludes that proceeding as
19 Here, the Defendants argue, as they did in their original opposition to certification, that
resolving the putative class members’ claims would require individualized inquiries into
each class member’s applicable plan language and complete claims experience. [Doc.
172 at 48; Doc. 259 at 27-30]. The Defendants’ argument in this regard is premised on
the notion that the Plaintiff and putative class members seek individualized recalculating
and reprocessing of their claims to omit the wrongfully imposed administrative fees. The
Fourth Circuit’s opinion, however, makes clear that the remedy that the Plaintiff seeks is
not individualized monetary damages awards, but rather is class-wide equitable relief in
the form of disgorgement or surcharge of the amount by which Aetna was unjustly
enriched by charging plans and plan members the administrative fees charged by Optum.
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41
a class action is superior to other methods of litigation. Therefore, the Plaintiff
has sufficiently shown that class certification pursuant to Rule 23(b) is
warranted.
4. Appointment of Class Counsel
Rule 23(g)(1) states that a “court that certifies a class must appoint
class counsel,” and “[i]n appointing class counsel, the court . . . must
consider: (i) the work counsel has done in identifying or investigating
potential claims in the action; (ii) counsel’s experience in handling class
actions, other complex litigation, and the types of claims asserted in the
action; (iii) counsel’s knowledge of the applicable law; and (iv) the resources
that counsel will commit to representing the class. . . .” Fed. R. Civ. P.
23(g)(1).
Here, the Plaintiff is represented by qualified and competent counsel
at The Van Winkle Law Firm and Zuckerman Spaeder LLP. These firms
have invested significant time and resources in this matter and are
committed to doing so in the future in order to represent the classes and
vigorously prosecute the claims. Further, the Court finds that the Plaintiff’s
counsel are qualified and experienced in actions like these. Accordingly, the
Court will appoint the Plaintiff’s counsel as class counsel.
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V. CONCLUSION
For the foregoing reasons, the Court concludes that the Fourth Circuit’s
directive to further consider the Plan’s entitlement to restitution is rendered
moot, and the Plaintiff’s claim for restitution on behalf of the Plan under 29
U.S.C. § 1132(a)(2) will be dismissed; that the Plaintiff lacks standing to seek
prospective injunctive relief in this case, and therefore, the Plaintiff’s claims
for prospective injunctive relief will be dismissed; and that certification
pursuant to Rule 23 of the Federal Rules of Civil Procedure is appropriate
for the Plaintiff’s claims of disgorgement, surcharge, and declaratory and
non-prospective injunctive relief under ERISA. The Court will certify this
matter as a class action pursuant to Rule 23, with two classes of individuals,
the Plan Claim Class and the Member Claim Class, as described more fully
below. The Court reserves the issue of whether the Member Claim Class
should be divided into sub-classes for resolution at a later date. Finally, the
Court will direct the Plaintiff to submit a proposed class action notice to the
Court, and the Defendants will be given an opportunity to object to such
notice.
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O R D E R
IT IS, THEREFORE, ORDERED that:
(1) The Plaintiff’s claims for prospective injunctive relief, both for
herself and on behalf of the Plan, are DISMISSED due to a lack
of standing;
(2) The Plaintiff’s claims for restitution, both for herself and on behalf
of the Plan, are hereby DISMISSED WITH PREJUDICE;
(3) The Plaintiff’s Motion for Class Certification [Doc. 144] is
GRANTED, and the following classes are hereby certified
pursuant to Federal Rules of Civil Procedure 23(a) and (b)(3):
 Plan Claim Class: All participants or
beneficiaries of self-insured ERISA health
insurance plans administered by Aetna for
which plan responsibility for a claim was
assessed using an agreed rate between
Optum and Aetna that exceeded the provider’s
contracted rate with Optum for the treatment
provided.
 Member Claim Class: All participants or
beneficiaries of ERISA health insurance plans
insured or administered by Aetna for whom
coinsurance responsibility for a claim was
assessed using an agreed rate between
Optum and Aetna that exceeded the provider’s
contracted rate with Optum for the treatment
provided.
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(4) The law firms of The Van Winkle Law Firm and Zuckerman
Spaeder LLP are hereby appointed as counsel for the class;
(5) Within fourteen (14) days of the entry of this Order, the Plaintiff
shall submit a proposed class action notice to the Court. The
Defendants shall have fourteen (14) days from the Plaintiff’s
submission to file objections to the proposed notice. The Plaintiff
will have fourteen (14) days thereafter to file any response to
those objections.
IT IS SO ORDERED.
Signed: June 5, 2023
Case 1:15-cv-00109-MR Document 272 Filed 06/05/23 Page 44 of 44