State of New York v. Unitedhealthcare of New York, Inc. et al

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
STATE OF NEW YORK,
Plaintiff,
v.
UNITEDHEALTHCARE OF NEW YORK, INC.,
OXFORD HEALTH PLANS (NY), INC., and,
OXFORD HEALTH INSURANCE, INC.,
Defendants.
1:25-cv-00087 (AMN/DJS)
APPEARANCES: 	OF COUNSEL:
HON. LETITIA JAMES 	AMANDA R. STERN, ESQ.
New York State Attorney General
The Capitol
Albany, New York 12224
Attorney for Plaintiff
DORSEY & WHITNEY LLP 	NICHOLAS PAPPAS, ESQ.
51 West 52nd Street 	JOSHUA R. KORNFIELD, ESQ.
New York, New York 10019 	JOHN PAUL MIXON, ESQ.
50 South 6th Street – Suite 1500 	KIRSTEN SCHUBERT, ESQ.
Minneapolis, Minnesota 55402
Attorneys for Defendants
Hon. Anne M. Nardacci, United States District Judge:
MEMORANDUM-DECISION AND ORDER
I. 	INTRODUCTION
On December 5, 2024, the State of New York (“Plaintiff”) commenced this action in New
York State Supreme Court, Albany County, against defendants UnitedHealthcare of New York,
Inc. (“United”), Oxford Health Plans (NY), Inc., and Oxford Health Insurance, Inc. (together,
“Oxford” and, collectively with United, “Defendants”), asserting state law claims in connection
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with Defendants’ alleged breach of certain contracts between Defendants and a state-owned
hospital. Dkt. No. 2 (“Complaint”); Dkt. No. 1 at ¶ 1. On January 16, 2025, Defendants removed
this action to federal court on the stated basis that federal question jurisdiction existed because the
Employee Retirement Income Security Act of 1984 (“ERISA”), 29 U.S.C. § 1001 	et seq.,
completely preempted Plaintiff’s state law claims. Dkt. No. 1.
As relevant here, the state-owned hospital is an “in-network” provider in Defendants’
insurance networks. 	The parties’ dispute arises from numerous 	instances in which the hospital
provided fewer than eight hours of a particular healthcare service to an emergency room patient
while deciding whether to admit the patient to the hospital. 	Dkt. No. 45 at 8.1 	Plaintiff seeks
reimbursement for these services under two non-insurance contracts between the hospital and
Defendants. 	See generally 	Dkt. No. 2. 	Defendants contend that the applicable health insurance
plans did not cover these services, and thus the hospital is not entitled to payment. 	See generally
Dkt. No. 1.
Presently before the Court is Plaintiff’s motion to remand this action pursuant to 28 U.S.C.
§ 1447(c). Dkt. No. 22 (“Motion”); 	see also 	Dkt. Nos. 45, 47.2 	For the reasons set forth below,
the Court grants the Motion, remands the case to New York State Supreme Court, Albany County,
and grants Plaintiff’s request for just costs and actual expenses, including attorney’s fees.
1 	Citations to court documents utilize the pagination generated by CM/ECF, the 	Court’s electronic
filing system, and not the documents’ internal pagination.
2 	Defendants have moved to seal a limited number of documents that contain sensitive patient
information and proprietary information, including pricing. Dkt. Nos. 24, 46; 	see also 	Dkt. Nos.
34-35. The Court finds that Defendants’ proposal is 	narrowly tailored and that the relevant factors
weigh in favor of sealing these documents and thus grants the motions. 	See generally Lugosch v.
Pyramid Co. of Onondaga, 435 F.3d 110 (2d Cir. 2006); 	see also AngioDynamics, Inc. v. C.R.
Bard, Inc., No. 17-cv-00598, 2021 WL 776701, at *4 (N.D.N.Y. Mar. 1, 2021); Dkt. No. 46-2.
The parties have not sought to seal their discussion of certain limited portions of these documents,
nor requested that the Court do so with respect to this opinion.
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II. 	BACKGROUND3
A. 	The Parties and Relevant Entities
Plaintiff is the State of New York. Dkt. No. 2 at ¶ 1. The State University of New York
(“SUNY”) is a governmental agency and an 	educational corporation of Plaintiff. 	Id. 	at ¶ 2. Stony
Brook University (“SBU”) is a 	member institution of SUNY. 	Id. 	at ¶ 3. Stony Brook University
Hospital is an academic medical center that operates a 	hospital (“SBUH” and, together with SBU,
“Stony Brook”). 	Id. 	at ¶ 4.
Defendants are alleged to be business entities that operate collectively. 	Id. 	at ¶¶ 6-10.
Defendants contend that they insure or administer various employer-sponsored health insurance
plans, at least some of which are governed by ERISA.4 	Dkt. No. 1 at ¶ 1; Dkt. No. 45 at 7 n.3.
B. 	Relevant Contracts
Defendants and Stony Brook contracted for Stony Brook to serve as an in-network
healthcare provider for Defendants’ insureds. 	Dkt. No. 2 at ¶¶ 	11, 13. 	At a high level, Stony
Brook would provide certain medical services to 	Defendants’ insureds, and Defendants would
reimburse Stony Brook at agreed rates for such services. 	See, e.g., id. 	at ¶ 15 (“Pursuant to the
terms and conditions set forth in the United Contract and the Oxford Contract . . . , the Defendants
are obligated to reimburse Stony Brook for covered medical services and treatment that Stony
Brook provides to the Defendants’ insureds.”); Dkt. No. 45 at 6 (“SBUH provided services
3 	The following facts are drawn from the Complaint unless otherwise noted and are assumed to be
true for purposes of ruling on the Motion. 	Winnie v. Sinagra, No. 24-cv-940, 2024 WL 4534054,
at *2 (N.D.N.Y. Oct. 21, 2024) (“When considering 	a motion to remand, the district court accepts
as true all relevant allegations contained in the complaint and construes all factual ambiguities in
favor of the plaintiff.”) (citation omitted).
4 	For convenience, the Court refers to individuals insured under such plans 	simply as Defendants’
insureds, instead of beneficiaries, participants, members, customers, etc., of employer-sponsored
health insurance plans that are insured or administered by Defendants. Dkt. No. 45 at 7 n.3.
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pursuant to network participation agreements with agreed rates for particular services.”); 	see also
Montefiore Med. Ctr. v. Teamsters Loc. 272, 642 F.3d 321, 326 n.4 (2d Cir. 2011) (“A Preferred
Provider Organization is ‘an entity 	that contracts with doctors, hospitals, and other health care
providers to arrange discounted payments for services for the PPO’s customers.’ In other words,
health care providers in a PPO’s ‘network’ agree 	to charge discounted rates for their services, and,
in exchange, the insurance plans affiliated with the PPO encourage their members (typically by
discounting the member’s own payment obligations) to patronize providers within the network.”)
(quoting 	United States v. Graf, 	610 F.3d 1148, 1154 (9th Cir. 2010)); 	Rojas v. Cigna Health &
Life Ins., 793 F.3d 253, 254-55 (2d Cir. 2015) (“[Plaintiff] is 	an in-network provider with [Cigna].
Cigna insureds use Cigna’s coverage to pay their 	bills when they receive medical services from
[plaintiff]; in exchange, [plaintiff] 	accepts reduced reimbursement rates.”).
More specifically, United and Stony Brook entered into a network participation agreement,
effective May 1, 2007, for Stony Brook to provide medical services 	to United’s insureds (as
amended, renewed, extended, and appended, the “United Contract”). Dkt. No. 2 at ¶¶ 11-12; 	see
also 	Dkt. No. 45 at 7-8. Likewise, Oxford and Stony Brook entered into a network participation
agreement, dated July 3, 2002, for Stony Brook to provide medical services to Oxford’s insureds
(as amended, renewed, extended, and appended, the 	“Oxford Contract”). Dkt. No. 2 at ¶¶ 13-14;
see also 	Dkt. No. 45 at 7-8.
Plaintiff alleges that pursuant to the terms of the United Contract and the Oxford Contract
(together, the “Contracts”), Defendants are obligated to reimburse Stony Brook for certain medical
services that Stony Brook provides to Defendants’ 	insureds. 	Dkt. No. 2 at ¶ 15. 	According to
Plaintiff, the Contracts establish which medical services are reimbursable and set the amounts
Defendants will reimburse Stony Brook for these services. 	Id. 	at ¶ 16.
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Plaintiff further alleges that 	“Observation” is one of the 	reimbursable services under the
Contracts. 	Id. 	at ¶¶ 19-20. Defendants explain that “‘Observation’ refers to the observation and
assessment that an emergency room provider furnishes to a patient while deciding whether to admit
the patient to the hospital.” Dkt. No. 45 at 8 (citation omitted). Plaintiff contends that the Contracts
obligate Defendants to reimburse Stony Brook for Observation services, regardless of the length
of an insured’s stay. 	Dkt. No. 2 at ¶¶ 23-24.
Under the United Contract, Plaintiff alleges that Observation is defined as:
Services furnished by [Stony Brook] at [Stony Brook]’s premises, regardless of the
length of stay, including use of a bed and periodic monitoring by [Stony Brook]’s
nursing or other staff, which are reasonable and necessary to evaluate an outpatient
condition or determine the need for a possible Admission to [Stony Brook] as an
inpatient.
Id. 	at ¶ 21 (alterations in original) (citation omitted). Under the Oxford Contract, Plaintiff alleges
that Observation is defined as:
Services furnished by [Stony Brook] on . . . [Stony Brook]’s premises, regardless
of the length of stay, including use of a bed and periodic monitoring by [Stony
Brook]’s nursing or other staff, which are 	reasonable and necessary to evaluate an
outpatient condition or determine the need for a possible Admission to [Stony
Brook] as an inpatient.
Id. 	at ¶ 22 (alterations in original) (citation omitted).
The Contracts also contain various provisions concerning Stony Brook’s ability to seek
reimbursement from both Defendants 	and Defendants’ insureds.
As to Defendants, Section 6.5 of the United Contract, entitled “Denial of claims for not
following Protocols or not filing timely[,]” states in pertinent part that “Payment to [Stony Brook]
may be denied if [Stony Brook] does not comply with the Protocols or does not file a timely
claim[.]” Dkt. No. 47-10 at 11, § 6.5. Section 3 of 	the Oxford Contract, entitled “Payment Policies
/ Financial Responsibility for Services,” contains similar provisions. 	See 	Dkt. No. 47-11 at 3-4,
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§§ 3.2, 3.4.
As to Defendants’ insureds, Section 6.7 of the United Contract, entitled “Payment under
this Agreement is payment in full[,]” states that
[Stony Brook] will not seek to recover, bring a collection action against, assert [a]
lien against, or accept any payment from Customer . . . in excess of payment in full
as provided in this Section 6.7, regardless of whether such amount is less than
[Stony Brook]’s billed charge or customary charge. 	This Section 6.7 will apply
regardless of whether Customer or anyone purporting to act on 	Customer’s behalf
has executed a waiver or other document of any kind purporting to allow [Stony
Brook] to collect such payment from Customer.
Dkt. No. 47-10 at 10-11, § 6.7. And Section 6.8 of 	the United Contract, entitled “Customer ‘Hold
Harmless’[,]” states in pertinent part that:
[Stony Brook] will not bill or collect payment from the Customer, or seek to impose
a lien, for the difference between the amount paid under this Agreement and [Stony
Brook]’s billed charge or Customary Charge, or for any amounts denied or not paid
under this Agreement due to:
i) [Stony Brook]’s failure to comply with the Protocols; or
ii) [Stony Brook]’s failure to 	file a timely claim; or
iii) Payer’s Payment Policies; or
iv) inaccurate or incorrect claim processing; or
v) insolvency or other failure by Payer to maintain its obligation to fund claims
payments, if Payer is United or is an entity required by applicable law to assure that
its Customers not be billed in such circumstances.
This obligation to refrain from billing Customers applies even in those cases in
which [Stony Brook] believes that United or Payer has made an incorrect
determination. 	In such cases, [Stony Brook] may pursue remedies under this
Agreement against United or Payer, as applicable, but must still hold the Customer
harmless.
Dkt. No. 47-10 at 12, § 6.8. The Oxford Contract also contains provisions concerning the ability
of Stony Brook to seek payment from Oxford’s insureds. 	See, e.g., 	Dkt. No. 47-11 at 3, § 3.1
(“[Stony Brook] shall seek payment . . . only from Oxford . . . and in no event, including but not
limited to nonpayment by Oxford[,] insolvency of Oxford[,] or breach of this Agreement by
Oxford, may [Stony Brook] bill, charge, collect a deposit from, or otherwise seek compensation
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or remuneration or have recourse 	against a Member, a Member’s 	family or any persons acting on
behalf of the member, for services provided pursuant to this Agreement.”).
C. 	Relevant Alleged Events
Plaintiff alleges that, prior to November 30, 2020, Stony Brook provided Observation
services to Defendants’ insureds and received corresponding reimbursement from Defendants,
regardless of the duration of Observation services. 	Dkt. No. 2 at ¶ 27. 	Beginning on or about
November 30, 2020, however, Defendants allegedly stopped reimbursing Stony Brook for
Observation services with a duration of less than eight hours. 	Id. 	at ¶ 28.
Plaintiff contends that this change was the result of a policy decision by Defendants, taken
in contravention of the Contracts. 	Id. 	at ¶ 29. 	Defendants have submitted a document entitled
“Outpatient Hospital Observation Policy, Facility[.]” Dkt. No. 45-26 (the “Policy”). The Policy’s
“History” section indicates that it was first “implemented” on October 1, 2020, after being
“approved by [the] Reimbursement Policy Oversight Committee” on June 25, 2020. 	Id. 	at 5. The
Policy states in pertinent part:
IMPORTANT NOTE ABOUT THIS REIMBURSEMENT POLICY
. . . . This reimbursement policy is intended to ensure that you are reimbursed based
on the code or codes that correctly describe the health care services provided. . . .
. . . .
Policy
Overview
Observation care is a well-defined set of specific, clinically appropriate
services, which include ongoing short term treatment, assessment, and
reassessment, that are furnished while a decision is being made regarding
whether patients will require further treatment as hospital inpatients or if
they are able to be discharged from the hospital. Observation services are
commonly ordered for patients who present to the emergency department
and who then require a significant period of treatment or monitoring in order
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to make a decision concerning their admission or discharge.
. . . .
Reimbursement Guidelines
. . . .
Observation services must be reported by facilities utilizing the following
guidelines:
Observation services are submitted with type of bill 13X, 78X, or
85X.
Report HCPCS code G0378 (hospital observation service, per hour)
under the appropriate revenue code (0762) with units that represent
the hours in observation care (rounded to the nearest hour).
Observation 	service 	code 	G0378 	will 	only 	be 	considered 	for
reimbursement when the observation period meets or exceeds 8
hours.
. . . .
Questions and Answers
. . . .
Q: 	How would I report the appropriate hours/units when an observation
service started at 10:15 AM and ended at 6:52 PM on the same day?
A: 	It would be appropriate to round to the nearest hour, so in this example
you would round the start time to 10:00 AM and the end time to 7:00 PM.
That would equate to 9 hours/units of observation services that can be
reported.
Id. 	at 2, 3, 4.
Plaintiff provided notice of its objection to the alleged policy decision by Defendants
through correspondence dated April 4, 2023. Dkt. No. 22-1 at 2-3, ¶ 6(b). This correspondence
states in pertinent part that “United and Oxford (collectively the ‘carriers’) 	have refused to pay for
observation services rendered by [Stony Brook] to its patients for periods of less than eight hours
submitted between November 30, 2020 and the present. 	This ongoing practice breaches the
existing cont[r]acts between [Stony Brook] and both carriers.” 	Id. 	at 116. Defendants responded
by correspondence dated June 1, 2023. 	Id. 	at 2-3, ¶ 6(c). This correspondence states in pertinent
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part that:
We recently received your correspondence on behalf of Stony Brook University
Hospital dated April 4, 2023, about our Facility Outpatient Hospital Policy, which
is the first time we were Notified of Stony Brook disputing the policy. Thank you
for taking the time to contact us. 	We appreciate the chance to share more
information with you.
To help reinforce accurate coding practices and to align with the Centers for
Medicare and Medicaid Services (“CMS”) coding guidance, effective for dates of
service on or after October 1, 2020, UnitedHealthcare implemented a Payment
Policy 	for 	UnitedHealthcare 	commercial 	plans 	entitled 	“Outpatient 	Hospital
Observation Policy, Facility” (the “Observation Policy”). Claims for observation
that do not align with the Observation Policy will be denied. The Provider has the
option to resubmit the denied claim according to the terms of the Facility
Participation Agreement between 	us (the ‘Agreement’)[.]
There is no direct conflict 	between the Observation Policy and the Agreement’s
Payment Appendices. 	The Observation Policy operates in conjunction with the
terms 	set forth in the Agreement and 	its Payment 	Appendixes. 	With the
implementation of the Observation Policy, UnitedHealthcare is adopting certain
CMS coding guidelines related to observation services, including that observation
service 	code 	GO378 	will 	only 	be 	considered 	for 	reimbursement 	when 	the
observation period meets or exceeds 8 hours. 	As CMS indicates, the number of
units reported with code GO378 must equal or exceed 8 hours. 	Otherwise, the
services rendered do not meet the criteria for reimbursement of observation services
pursuant to CMS guidelines. 	Denials of 	claims that don’t meet the 8-hour
requirement are consistent with Stony 	Brook’s Agreement and applicable Payment
Appendices, as well as support existing contractual obligations to code claims
correctly.
Id. 	at 121.
Plaintiff alleges that on or about September 19, 2024, Defendants partially reversed the
Policy and agreed to resume reimbursing Stony Brook for Observation services with a duration of
less than eight hours rendered between December 15, 2023 and December 15, 2026. Dkt. No. 2
at ¶ 30. Plaintiff submits an email dated September 20, 2024, from a representative of Defendants,
which states:
[This email is] to confirm that, between December 15, 2023 and December 15,
2026, Stony Brook [ ] will not be subject to the eight-hour requirement with respect
to the following Payment Policy: Outpatient Hospital Observation Policy, Facility.
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Claims that have previously been processed as subject to this requirement shall be
reprocessed[.]
Dkt. No. 22-2 at 13; 	see also id. 	at 4-5, ¶ 13. 	The “History” section of the Policy submitted by
Defendants indicates that the Policy changed on September 22, 2024. Dkt. No. 45-26 at 5.
According to Plaintiff, more 	than 500 of Stony Brook’s claims for reimbursement, for
Observation services with a duration of less than eight hours rendered from November 30, 2020
through December 14, 2023, remain unpaid by Defendants. Dkt. No. 2 at ¶ 31; 	see also 	Dkt. No.
22-2 at 5, ¶ 14. 	Plaintiff alleges that payment has been demanded from Defendants for these
services, but that the unpaid claims for reimbursement total $4,079,387.03. Dkt. No. 2 at ¶ 32.
D. 	Plaintiff’s Legal Claims
Based on these factual allegations, Plaintiff asserts four state law claims: (i) breach of the
Contracts, 	id. 	at ¶¶ 33-39; (ii) unjust enrichment, 	id. 	at ¶¶ 40-45; (iii) declaratory judgment
pursuant to N.Y. C.P.L.R. § 3001, 	id. 	at ¶¶ 46-51; and (iv) interest and collection fees in connection
with a debt owed to New York State pursuant to N.Y. State Fin. Law § 18, 	id. 	at ¶¶ 52-56.
E. 	Procedural History
On December 5, 2024, Plaintiff commenced this action in New York State Supreme Court,
Albany County (“State Court”). Dkt. No. 2. On 	December 17, 2024, Plaintiff effected service on
Defendants. 	Dkt. No. 1-1 at 15-17. 	On January 16, 2025, Defendants filed a joint notice of
removal. 	Dkt. No. 1 (“Notice”). 	Following several Court-approved extensions of time for
Defendants to respond to the Complaint, Dkt. Nos. 11, 16, 21, Plaintiff moved to remand the case
on April 29, 2025, Dkt. No. 22, and Defendants moved to dismiss the Complaint on May 2, 2025,
Dkt. No. 25.
In response to Plaintiff’s 	Motion, Defendants requested the opportunity to conduct
jurisdictional discovery. Dkt. No. 26. Defendants proposed that each side select ten insureds with
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at-issue claims, and then produce certain documentation in connection with the resulting twenty
claims. 	Id. 	at 3-4, 5. 	Plaintiff opposed this request as unnecessary. 	See generally 	Dkt. No. 29.
Plaintiff contended that Defendants had not satisfied any of the multiple requirements for federal
subject matter jurisdiction in this particular case, 	see infra 	Section IV.B, and that discovery would
not remedy this deficiency. 	Dkt. No. 29 at 2-3. 	After hearing from the parties, United States
Magistrate Judge Daniel J. Stewart granted Defendants’ request. 	Dkt. No. 38. 	In discovery,
Defendants produced documentation relating to the ERISA plans for the twenty insureds, while
Plaintiff produced documentation relating to claims and assignments for these same individuals.
See, e.g., 	Dkt. No. 45 at 19; Dkt. No. 47-1 at ¶ 5. Following the completion of this discovery in
September 2025, the parties fully briefed the Motion. Dkt. Nos. 43-45, 47.
III. 	STANDARD OF REVIEW
In general, “any civil action brought in a State court of which the district courts of the
United States have original jurisdiction, may be removed by the defendant or the defendants, to
the district court of the United States for the district and division embracing the place where such
action is pending.” 28 U.S.C. § 1441(a); 	see also Link Motion Inc. v. DLA Piper LLP, 103 F.4th
905, 912 (2d Cir. 2024). A district court’s original jurisdiction includes “all civil 	actions arising
under the Constitution, laws, or treaties of the 	United States,” 28 U.S.C. § 1331, and “all civil
actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest
and costs, and is between . . . citizens of different States[,]” 28 U.S.C. § 1332(a)(1). 	The party
seeking removal must establish federal jurisdiction. 	See, e.g., Platinum-Montaur Life Scis., LLC
v. Navidea Biopharms., Inc., 943 F.3d 613, 617 (2d Cir. 2019) (“‘It 	is well-settled that the party
asserting federal jurisdiction bears the burden of establishing jurisdiction,’ and it must prove
jurisdiction by a ‘preponderance of evidence.’”) (first quoting 	Blockbuster, Inc. v. Galeno, 472
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F.3d 53, 57 (2d Cir. 2006); and then quoting 	Liranzo v. United States, 690 F.3d 78, 84 (2d Cir.
2012)).
The removing party must also comply with procedural requirements set forth in statute.
See Link Motion Inc., 103 F.4th at 911-12 (stating that federal courts are “mindful that (1) the
removing party . . . ‘bears the burden of demonstrating the propriety of removal,’ (2) ‘statutory
procedures for removal are to be strictly construed’; and (3) we must ‘resolve any doubts against
removability’”) (first quoting 	O’Donnell v. AXA Equitable Life Ins. Co., 887 F.3d 124, 128 (2d
Cir. 2018); and then quoting 	Taylor v. Medtronic, Inc., 15 F.4th 148, 150 (2d Cir. 2021)). These
requirements include filing a notice of removal “containing a short and plain statement of the
grounds for removal, together with a copy of all process, pleadings, and orders served upon such
defendant or defendants in such action.” 28 U.S.C. § 1446(a); 	see also 	28 U.S.C. § 1446(d). “The
general removal statute delineates two 30-day periods during 	which removal may occur.” 	Cutrone
v. Mortg. Elec. Registration Sys., Inc., 749 F.3d 137, 142 (2d Cir. 2014) (citing 28 U.S.C.
§ 1446(b)).
A party who opposes removal may move to remand the case back to state court. 	See, e.g.,
Shapiro v. Logistec USA, Inc., 412 F.3d 307, 310 (2d Cir. 2005). 	“A motion to remand the case
on the basis of any defect other than lack of subject matter jurisdiction must be made within 30
days after the filing of 	the notice of removal[.]” 	28 U.S.C. 	§ 1447(c). 	As for subject matter
jurisdiction, “[i]f at any time before final judgment it appears that the district court lacks subject
matter jurisdiction, the case 	shall be remanded.” 	Id.; 	see also Platinum-Montaur, 943 F.3d at 616
(“‘It is a fundamental precept that federal courts are courts of limited jurisdiction’ and lack the
power to disregard such limits as have been 	imposed by the Constitution or Congress.”) (quoting
Durant, Nichols, Houston, Hodgson & Cortese-Costa P.C. v. Dupont, 565 F.3d 56, 62 (2d Cir.
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2009)). Finally, “[o]n a motion to 	remand, the party seeking to sustain the removal, not the party
seeking remand, bears the burden of demonstrating that removal was proper.” 	Hodges v.
Demchuk, 866 F. Supp. 730, 732 (S.D.N.Y. 1994) (Sotomayor, J.) (citations omitted).
IV. 	DISCUSSION
A. 	Procedural Requirements
Defendants contend that they timely and jointly filed the Notice within thirty days of
service and included therein copies of all pleadings and process served in State Court. Dkt. No. 1
at 1 & ¶¶ 29-31; 	see also 	28 U.S.C. § 1446(b); 	Pietrangelo v. Alvas Corp., 686 F.3d 62, 66 (2d
Cir. 2012). Plaintiff does not argue that Defendants failed to satisfy these or any other procedural
requirement for removal. 	See generally 	Dkt. No. 22-3. The Court therefore finds that there is no
procedural bar to removal.
B. 	Subject Matter Jurisdiction
Defendants assert that original jurisdiction exists because Plaintiff’s 	state law claims arise
from at least some health insurance plans governed by ERISA, and are thus completely preempted
by federal law. 	See generally 	Dkt. No. 1. 	Plaintiff contends that this Court lacks jurisdiction
because Plaintiff’s state law claims instead relate to the Contracts and are not completely
preempted by ERISA. 	See generally 	Dkt. No. 22-3.
In general, “the determination of jurisdiction is based only on the allegations in the
plaintiff’s ‘well-pleaded complaint’—not 	on any issue the defendant may raise.” 	Royal Canin
U.S.A., Inc. v. Wullschleger, 604 U.S. 22, 26 (2025) (citation omitted). As a result, “a defendant
may not ordinarily ‘remove a case to federal court unless the plaintiff’s complaint establishes that
the case arises under federal law[.]’” 	Trs. of N.Y. State Nurses Ass’n Pension Plan v. White Oak
Glob. Advisors, LLC, 102 F.4th 572, 605 (2d Cir. 2024) (quoting 	Aetna Health Inc. v. Davila, 542
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U.S. 200, 207 (2004)). However, a 	“‘corollary of the well-pleaded complaint rule’ provides that
‘Congress may so completely pre-empt a particular area [of law] that any civil complaint raising
this select group of claims is necessarily federal in character.’” 	Montefiore, 642 F.3d at 327
(alteration in original) (first quoting 	Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987); and
then citing 	In re WTC Disaster Site, 414 F.3d 352, 372-73 (2d Cir. 2005)); 	see also City of New
York v. Exxon Mobil Corp., 154 F.4th 36, 41 (2d Cir. 2025) (discussing exceptions to the well-
pleaded complaint rule). When applicable, “complete preemption permits removal where a federal
statute ‘wholly displaces the state-law cause of action,’ such that the claim, ‘even if pleaded in
terms of state law, is in reality based on federal law.’” 	White Oak, 102 F.4th at 605 (quoting
Davila, 542 U.S. at 207-08).
As the Supreme Court and Second Circuit have 	made clear, “the ERISA civil enforcement
mechanism is one of those provisions with such extraordinary pre-emptive power that . . . causes
of action within the scope of the civil enforcement provisions of [ERISA] § 502(a) are removable
to federal court under the complete preemption doctrine.” 	Id. 	at 606 (alterations in original)
(quotations omitted) (quoting 	Davila, 542 U.S. at 209). Under the test established by the Supreme
Court in 	Davila, a “suit falls ‘within the scope of’ ERISA § 	502(a)(1)(B). . . . [1] if an individual,
at some point in time, could have brought his claim under ERISA § 502(a)(1)(B), and [2] where
these is no other independent legal duty that 	is implicated by a defendant’s actions[.]” 	Davila, 542
U.S. at 210 (quoting 	Metro. Life, 481 U.S. at 66); 	see also White Oak, 102 F.4th at 606 n.18.
Because the 	Davila 	test is conjunctive, state law claims are completely preempted only if both
prongs are satisfied. 	See, e.g., Wurtz v. Rawlings Co., LLC, 761 F.3d 232, 241 (2d Cir. 2014).
1. 	Davila 	Prong One
The Second Circuit has disaggregated the first prong of the 	Davila 	test to consider “(1)
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whether the plaintiff is the 	type 	of party that can bring a claim pursuant to § 502(a)(1)(B) and also
(2) whether the 	actual claim 	that the plaintiff asserts can be construed as a colorable claim for
benefits pursuant to § 502(a)(1)(B).” 	McCulloch Orthopaedic Surgical Servs., PLLC v. Aetna Inc.,
857 F.3d 141, 146 (2d Cir. 2017) (quoting 	Montefiore, 642 F.3d at 328). 	“Pursuant to ERISA
§ 502(a)(1)(B), [1] a participant or beneficiary may bring an action 	[2] ‘to recover benefits due to
him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his
rights to future benefits under the terms of the plan.’” 	Id. 	at 145 (citation omitted).
a. 	Prong One, Part One – Type of Party
With respect to whether Stony Brook, as a healthcare provider, is the type of party that can
bring an ERISA claim, the parties do not dispute that Stony Brook is neither a participant nor a
beneficiary. 	See, e.g., 	Dkt. No. 22-3 at 12-13; Dkt. No. 45 at 16-17; 	Rojas, 793 F.3d at 256, 257
(“As relevant here, Section 502 is narrowly construed to authorize only two categories of persons
to sue directly to enforce their rights under the plan: participants and beneficiaries. . . .
‘Beneficiary,’ as it is used in ERISA, does 	not without more encompass healthcare providers.”)
(citations omitted).
Defendants instead contend that Stony Brook has “derivative standing,” Dkt. No. 1 at ¶ 18,
under a narrow exception articulated by the Second Circuit. 	See, e.g., McCulloch, 857 F.3d at 146
(“Although § 502(a) is narrowly construed to permit 	only the enumerated parties to sue directly
for relief, we have carv[ed] out a narrow exception to the ERISA standing requirements to grant
standing to healthcare providers to whom a beneficiary has assigned his claim in exchange for
health care.”) (alteration in original) (quotations omitted) (quoting 	Montefiore, 642 F.3d at 329);
see also Am. Psychiatric Ass’n v. Anthem Health Plans, Inc., 821 F.3d 352, 361 (2d Cir. 2016)
(“[W]e have allowed physicians to bring claims 	under § 502(a) based on a valid assignment from
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a patient. However, ‘[t]his narrow exception grants 	standing only to healthcare providers to whom
a beneficiary has assigned his claim in exchange 	for health care benefits.’”) (second alteration in
original) (citations omitted).
Defendants asserted in the Notice that various of their insureds assigned ERISA claims to
Stony Brook in exchange for healthcare services, Dkt. No. 1 at ¶¶ 11-12, 19, and that these insureds
“were contractually permitted to assign” their claims to Stony Brook, 	id. 	at ¶ 20. Plaintiff’s Motion
argues that the Notice identifies only a single insured and that Defendants have failed to establish
that any such assignment was valid. 	Dkt. No. 22-3 at 14-15. 	Defendants respond that the
jurisdictional discovery the parties undertook establishes that removal is proper. 	Dkt. No. 45 at
19-20; 	see also 	Section II.E.
According to Defendants, ten of the twenty insureds selected by the parties sought to
assign their claims and the applicable ERISA plans (“Plans”) did not prohibit the insureds’
assignment.5 	Dkt. No. 45 at 19; 	see also 	Dkt. No. 45-24; 	Montefiore, 642 F.3d at 331 n.11 (“[W]e
need only locate a single preempted claim to establish a basis for the exercise of federal subject
matter jurisdiction.”).
To support this contention, Defendants have submitted (i) excerpts of materials purporting
to reflect assignments by Defendants’ insureds to Stony Brook, and (ii) excerpts of materials
relating to the ten Plans. 	See, e.g., 	Dkt. No. 45-24 (summary of excerpts relating to nine of ten
Plans); Dkt. Nos. 45-8, 45-18, 45-33 (excerpts relating to tenth Plan). Even if the former excerpts
establish that all ten insureds purported to assign ERISA claims to Stony Brook in exchange for
5 	Defendants concede that the applicable ERISA plans for nine additional insureds prohibited such
assignment. 	Dkt. No. 45 at 19 (stating that 	even though “19 exemplar 	members assigned their
ERISA” claims to Stony Brook, “for 	ten claims, the applicable benefit plans did not prohibit the
members’ assignment”); 	see also 	Dkt. No. 47-1 at ¶ 5; 	McCulloch, 857 F.3d at 148.
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healthcare benefits, the latter excerpts fail to establish that any such assignment was valid under
the Plans. 	See, e.g., McCulloch, 857 F.3d at 148 (“‘[A]bsent a 	valid 	assignment of a claim, . . . .
non-enumerated parties lack statutory standing to bring suit under [ERISA] even if they have a
direct stake in the outcome of 	the litigation.’ . . . [W]hile the 	patient attempted to assign [the
provider] the right to payment for the surgeries that [the provider] performed, this assignment was
prohibited under the terms of the patient’s health care plan. [As a 	result,] Aetna . . . has failed to
establish 	that 	[the 	provider] 	is 	the 	‘type 	of 	party’ 	who 	may 	bring 	claims 	pursuant 	to
§ 502(a)(1)(B).”) (second and third 	alterations in original) (quoting 	Connecticut v. Physicians
Health Servs. of Conn., Inc., 857 F.3d 141, 148 (2d Cir. 2002); and then citing 	Am. Psychiatric,
821 F.3d at 361).
As detailed below, Defendants do not appear to have submitted complete documents, the
relevant documents, or even excerpts from the versions of documents applicable at the time of the
parties’ dispute. 	Moreover, the excerpts Defendants have submitted either contradict or do not
support a number of Defendants’ characterizations.
For example, in both the Notice and Defendants’ opposition to the Motion, Defendants
claim to have submitted the Plans themselves. 	See, e.g., 	Dkt. No. 1 at ¶ 11 (stating that “several
of these Customer Benefit Plans are in fact ERISA-governed benefit plans (‘ERISA Plans’). 	A
sample such an [sic] ERISA Plan is attached 	as Exhibit A”); Dkt. No. 45 at 10 (“The plans
submitted in support of this Opposition Brief demonstrate that . . . .”); Dkt. No. 45-24 at 1
(appendix detailing “Benefit Plan[s] and Relevant Terms”). 	But the excerpts Defendants have
submitted do not support their claim.
The excerpts relating to nine of the ten Plans are drawn only from so-called summary plan
descriptions (each, an “SPD”). 	See 	Dkt. No. 45-24 at 2-8, 10; Dkt. Nos. 45-29, 45-30, 45-31, 45-
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32, 45-33, 45-34, 45-35, 45-36, 45-37. Defendants have not established that these SPDs constitute
the terms of the underlying ERISA plan. 	See, e.g., CIGNA Corp. v. Amara, 563 U.S. 421, 438
(2011) 	(“[W]e 	conclude 	that 	the 	summary 	documents, 	important 	as 	they 	are, 	provide
communication with beneficiaries 	about 	the plan, but that their statements do not constitute the
terms 	of the plan for purposes of § 502(a)(1)(B).”); 	Tocker v. Philip Morris Cos., Inc., 470 F.3d
481, 488 (2d Cir. 2006) (observing that “the summary plan description is intended to be a
summary, not a full recitation of the terms of the plan”) (citation omitted); 	cf. Nathaniel L. Tindel,
M.D., LLC v. Excellus Blue Cross Blue Shield, No. 22-cv-971, 2023 WL 3318489, at *2-3
(N.D.N.Y. May 9, 2023) (declining to consider SPD given dispute regarding terms of underlying
ERISA plan). 	Indeed, various SPD excerpts submitted by Defendants indicate that 	other
documents govern the terms of the Plan. 	See, e.g.,Dkt. No. 45-29 at 6 (“This [SPD] represents an
overview of your Benefits. In the event there is a discrepancy between the SPD and the official
plan document, the plan document will govern.”); 	Dkt. No. 45-34 at 6 (same); Dkt. No. 45-30 at 6
(stating that an insured’s ERISA rights include the right to obtain “copies 	of documents governing
the operation of the Plan, including” documents other than the SPD); Dkt. No. 45-35 at 10 (stating
that an insured’s ERISA rights include the right to “obtain copies of all 	Plan documents and other
Plan information, including” documents other than the SPD).6 	And Defendants have not submitted
any of these other documents for the nine Plans.
For the tenth Plan, Defendants do not rely on an SPD. Instead, Defendants submit excerpts
from a different document, one that again references various other documents that Defendants
have not provided. Dkt. No. 45-38 at 3 (“This 	Certificate of Coverage (Certificate) 	is part of the
6 	Other SPD excerpts provided by Defendants do not appear to include provisions addressing
which documents govern the Plan. 	See, e.g., 	Dkt. Nos. 45-31, 45-32.
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Policy. . . . In addition to this 	Certificate, the Policy includes: [ ] The 	Schedule of Benefits. [ ] The
Group’s 	Application. [ ] Riders, including the 	Outpatient Drug Rider. [ ] Amendments.”); 	id. 	at
9 (right to obtain “copies of documents governing the operation of the plan, including” documents
other than the certificate of coverage).
Notably, Plaintiff indicates that Defendants produced in jurisdictional discovery the
underlying documents for a number of other Plans. Dkt. No. 47-1 at ¶¶ 7-9. As Plaintiff notes, 	id.
at ¶ 10, each of these underlying documents contains express anti-assignment provisions. 	See,
e.g., 	Dkt. No. 47-4 at 2 (“Enclosed is an original 	copy of your Group Policy, which outlines the
plan design specifics and the terms and conditions for your Oxford product coverage.”); 	id. 	at 3
(listing “General Provisions,” including an anti-assignment provision); Dkt. No. 47-5 at 2, 3
(same); Dkt. No. 47-6 at 2, 3 (same). In contrast, Defendants have not submitted 	a “Group Policy”
document for any of the ten Plans on which they rely. 	See 	Dkt. Nos. 45-29, 45-30, 45-31, 45-32,
45-33, 45-34, 45-35, 45-36, 45-37, 45-38. For all of these reasons, the Court finds that Defendants
have not established that the documents they have excerpted govern, or contain the relevant terms,
for the ten Plans on which they rely.
Even if Defendants had established this, Defendants have still failed to support the
assertion in the Notice that they have derivative standing because their insureds were contractually
permitted to assign their benefits to Stony Brook. Dkt. No. 1 at ¶¶ 19-20. Tellingly, Defendants
no longer argue that the excerpted language they submit explicitly permits such assignment.
Instead, Defendants now argue that the excerpted language does not prohibit such assignment.
See, e.g., 	Dkt. No. 45 at 19 (arguing that, “for ten exemplar claims, the applicable benefits plans
did not prohibit the [insureds]’ assignments” to Stony Brook); 	id. 	at 20 (arguing that, for these ten
Plans, 	“[n]one 	prohibit 	assignment 	to 	an 	in-network 	provider”) 	(citations 	omitted). 	But
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Defendants have also failed to support that assertion.
Foremost, the excerpts that Defendants have submitted are very limited, and seemingly
inconsistent, portions of much larger documents. 	See, e.g., 	Dkt. No. 45-29 (twelve-page excerpt
of document with pagination indicating at least 152 pages); Dkt. No. 45-37 (seven-page excerpt of
document with pagination indicating at least 152 pages); Dkt. No. 45-36 (nine-page excerpt of
document with pagination indicating at least 116 pages); Dkt. No. 45-35 (nine-page excerpt of
document with pagination indicating at least 164 pages); Dkt. No. 45-38 (ten-page excerpt of
document with pagination indicating at least 76 pages). 	As noted earlier, even these limited
excerpts make clear that other documents govern the Plans. As a result, the Court cannot conclude
that the hundreds of pages Defendants have not provided contain no provisions relevant to
analyzing the validity of assignment to an in-network provider.
That is in large part because Defendants appear to misread at least one of the limited
excerpts that they do provide.7 	In their appendix detailing “Benefit Plan[s] and Relevant Terms,”
7 	There are additional reasons that the Court finds 	Defendants’ position unsupported by the
documents they have submitted. 	See also infra 	n.8; 	infra 	Section IV.C. For example, it appears
that for half of the Plans on which they rely, Defendants have submitted excerpts relating to years
during which Stony Brook is not seeking reimbursement for its provision of Observation services
to the corresponding insured, including excerpts from one SPD dated more than a decade ago. 	See
generally 	Dkt. No. 45-24; 	compare 	Dkt. No. 45-30 at 2-9 (SPD dated “January 1, 2015”), 	with
Dkt. No. 45-9 at 3 (indicating corresponding insured received Observation services from Stony
Brook in January 2021); 	compare 	Dkt. No. 45-29 at 2 (SPD stating “Effective: January 1, 2020”),
with 	Dkt. No. 45-7 at 3 (indicating corresponding insured received Observation services from
Stony Brook in February 2021); 	compare 	Dkt. No. 45-32 at 2 (SPD stating “Effective: January 1,
2020”), 	with 	Dkt. No. 45-4 at 3 (indicating corresponding insured received Observation services
from Stony Brook in July 2021); 	compare 	Dkt. No. 45-34 at 2 (SPD stating “Effective: 	January 1,
2020”), 	with 	Dkt. No. 45-5 at 3 (indicating corresponding insured received Observation services
from Stony Brook in May 2021); 	compare 	Dkt. No. 45-37 at 2 (SPD stating “Effective: June 1,
2020”), 	with 	Dkt. No. 45-6 at 3 (indicating corresponding insured received Observation services
from Stony Brook in January 2021). 	Only three of the excerpts Defendants submit appear to
include a definition of “Plan Year” and, for each, that period begins 	and ends in the same calendar
year. 	See 	Dkt. No. 45-34 at 12 (“Plan Year: January 1 - December 31”); Dkt. No. 45-35 at 10
(same); Dkt. No. 45-38 at 11 (“Plan Year: January 1 through December 1”). 	Excerpts from
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Defendants contend that one Plan “[e]xplicitly permits assignments with written authorization
from the [insured].” Dkt. No. 45-24 at 9 (citing 	Dkt. No. 45-38 at 5-6). But the cited portion of
the excerpt indicates that it relates to out-of-network providers, not in-network providers like Stony
Brook. 	See 	Dkt. No. 45-38 at 5-6 (“How Are Covered Health Care Services from an Out-of-
Network Provider Paid?”). 	And a separate three-sentence provision relating to in-network
providers does not address assignment at all. 	Id. 	at 5 (“How Are Covered Health Care Services
from Network Providers Paid?”).
Defendants’ most precise characterization of the limited excerpts that they have submitted
appears only in their ancillary papers, where they acknowledge that the balance of these excerpts
either “do[ ] not address . . . assignments to in-network providers,” Dkt. No. 45-24 at 2-5, 7, 10,
or contain “[n]o provisions addressing assignment,” 	id. 	at 8. The Court agrees that the handful of
pages Defendants have submitted do not contain provisions addressing assignment to in-network
providers. 	But these limited excerpts do not establish that any of the underlying Plans
“permitted[,]” Dkt. No. 1 at ¶ 20, or “did not prohibit[,]” Dkt. No. 45 at 19, the assignment of
ERISA claims to in-network providers at times relevant to Plaintiff’s claims. 	The Court thus
agrees with Plaintiff that Defendants have not established a valid assignment from any of their
insureds to Stony Brook. Dkt. No. 47 at 3-5; 	see also Murphy Med. Assocs., LLC v. Yale Univ.,
120 F.4th 1107, 1113 (2d Cir. 2024) (“W[e] have made 	clear that providers cannot bring claims
against ERISA health plans pursuant to this exception ‘[a]bsent a 	valid 	assignment of claim,’ ‘even
if they have a direct stake in the outcome of the litigation.’”) (quoting 	McCulloch, 857 F.3d at
another Plan appear to relate to services that are outside of the date 	range of the parties’ dispute.
Dkt. No. 45-8 at (indicating that Stony Brook provided services to Defendants’ insured in May
2020 and billed Defendants for reimbursement in June 2020). 	As a result, Defendants have not
established that most of the excerpts they submit 	are applicable to the “exemplar claims” on which
they rely. Dkt. No. 45 at 19.
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148); 	Montefiore, 642 F.3d at 327 (“A party seeking removal bears the burden of showing that
federal jurisdiction is proper.”) (citation omitted).
Further, as the Second Circuit has explained:
In 	Montefiore Medical Center v. Teamsters Local 272, an “in-network” hospital
brought state-law claims against a union’s employee benefit plan that was governed
by ERISA. 	The hospital sought reimbursement for medical services that it had
provided to beneficiaries of the plan. We found that the 	hospital’s state-law claims
were completely preempted by ERISA because, among other things, the hospital
had received a valid assignment of the beneficiaries’ right to 	payment and it was,
therefore, the type of party that could bring its claim regarding benefits pursuant to
§ 502(a)(1)(B).
McCulloch, 857 F.3d at 146-47 (citing 	Montefiore, 642 F.3d at 324-25, 325-26, 328, 333). 	In
determining that the assignments at issue were valid, the 	Montefiore 	panel examined the two
contracts 	under 	which 	the 	plaintiff 	hospital 	provided 	in-network 	medical 	services 	to 	the
defendant’s insureds. 	Montefiore, 642 F.3d at 330. 	The first contract expressly permitted the
hospital “to obtain payment (by billing or, if necessary, by suit) directly from patients in the event
that [the plaintiff hospital] does not receive payment from the [defendant].” 	Id. 	The second
contract was “silent as to whether [the plaintiff 	hospital] can seek full reimbursement directly from
patients[.]” 	Id. 	As a result, the panel noted that “[w]e need not consider the question of whether
a beneficiary can make a valid assignment to his in-network health care provider in the
hypothetical situation in which the provider has expressly contracted 	not 	to seek full payment from
the beneficiary.” 	Id. 	at 330 n.9. The panel then declined to find either contract rendered invalid
the assignments by defendant’s insureds to the plaintiff hospital. 	Id. 	at 330. 	And the panel again
clarified that, “[t]o be clear, our holding applies where a provider’s contract with a PPO or ERISA
benefit plan is silent regarding the question of whether the provider can hold the patient liable for
unmet obligations, as in the case of [the second contract].” 	Id. 	at 330, n.10.
The contracts at issue here, however, are not silent. 	Instead, the Contracts appear to
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expressly prohibit Stony Brook from seeking to hold a patient liable for unmet obligations. Indeed,
the “Customer ‘Hold Harmless’” section of the United Contract states that 	“[Stony Brook] will not
bill or collect payment from the Customer, or seek to impose a lien, for the difference between the
amount paid under this Agreement and [Stony Brook]’s 	billed charge or Customary Charge, or for
any amounts denied or not paid under this Agreement due to:” 	inter alia 	“Payment Policies[.]”
Dkt. No. 47-10 at 12, § 6.8. Section 6.8 further states 	that “[t]his obligation to refrain from billing
Customers applies even in those cases in which [Stony Brook] believes that United or Payer has
made an incorrect determination. 	In such cases, [Stony Brook] may pursue remedies under this
Agreement against United or Payer, as applicable, but must still hold 	the Customer harmless.”8
Dkt. No. 47-10 at 12, § 6.8. Because the Contracts9 	expressly limit Stony Brook’s ability to seek
reimbursement from Defendants’ insureds, the Court agrees with Plaintiff that this provides an
additional reason why Defendants have not established that prong one, part one of 	Davila 	is
satisfied. Dkt. No. 47 at 4-5; 	see also Montefiore, 642 F.3d at 327.
As a result, the Court also agrees with Plaintiff that Defendants have failed to establish that
Plaintiff’s state law claims are completely 	preempted by ERISA. Dkt. No. 47 at 5; 	see also Plastic
Surgery Grp., P.C. v. United Healthcare Ins. Co. of N.Y., Inc., 64 F. Supp. 3d 459, 465 (E.D.N.Y.
2014) (“Where both of 	Davila’s factors are satisfied—including the two sub-parts to 	Davila’s first
prong—ERISA will preempt the state law claim.”) (Bianco, J.) (citing 	Arditi v. Lighthouse Int’l,
8 	As discussed in further detail below, Defendants omitted this portion of Section 6.8 from the
excerpt of the United Contract that they submitted. 	Compare 	Dkt. No. 45-27 at 9, § 6.8, 	with 	Dkt.
No. 47-10 at 12, § 6.8; 	see also infra 	Section IV.C. This is an additional reason the Court is not
persuaded that Defendants’ 	excerpts constitute the relevant documentation.
9 	None of the excerpts submitted by Defendants indicate that they relate to a Plan administered by
or insured by Oxford. Dkt. Nos. 45-29, 45-30, 45-31, 45-32, 45-33, 45-34, 45-35, 45-36, 45-37,
45-38. 	To the extent that the Oxford Contract is nonetheless relevant, it contains pertinent
provisions similar to the United Contract, as detailed earlier. 	See supra 	Section II.B.
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676 F.3d 294, 299 (2d Cir. 2012)). For the avoidance of doubt, however, the Court nonetheless
proceeds with the 	Davila 	analysis.
b. 	Prong One, Part Two – Actual Claim
Part two requires that the Court determine “whether the 	actual claim 	that the plaintiff
asserts can be construed as a colorable claim for benefits pursuant to § 502(a)(1)(B).” 	McCulloch,
857 F.3d at 146 (quoting 	Montefiore, 642 F.3d at 328). 	“A colorable ERISA claim exists when
the claim ‘implicates coverage and benefit determinations as set forth by the terms of the ERISA
benefit plan.’” 	Id. 	at 149 (quoting 	Montefiore, 642 F.3d at 325). Further, as the 	Montefiore 	panel
made clear:
[There is] a common distinction in the case law between claims involving the “right
to payment” and claims involving the “amount of payment”—that is, on the one
hand, claims that implicate coverage and benefits established by the terms of the
ERISA benefit plan, and, on the other hand, claims regarding the computation of
contract payments or the correct execution of such payments. The former are said
to constitute claims for benefits that can be brought pursuant to § 502(a)(1)(B),
while the latter are typically construed as independent contractual obligations
between the provider and the PPO or the benefit plan.
Montefiore, 642 F.3d at 331 (collecting cases).
Plaintiff alleges, and the parties’ submissions confirm, that 	this is a billing dispute relating
to the amount of reimbursement due under the Contracts. 	See, e.g., 	Dkt. No. 2 at ¶ 29 (Complaint
alleging that “Defendants made a policy decision, beginning November 30, 2020, to not pay claims
submitted for Observation services for stays of a duration of less than eight hours, despite the
language in the Contracts requiring payment regardless of the 	length of stay.”); 	Dkt. No. 45 at
(Defendants arguing that (“[I]n or around October 1, 2020, United implemented a reimbursement
policy called the [Policy]. . . . This Policy provides that Observation services must be reported
with HCPCS code G0378 or G0379 on a single claim line with units that represent the hours in
observation care[.]”); Dkt. No. 45-26 at 2, 3, 4 (Policy stating “This reimbursement policy is
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intended to ensure that you are reimbursed based on the code or codes that correctly describe the
health care services provided. . . . Observation services must be reported by facilities utilizing the
following guidelines: . . . . Observation service code G0378 will only be considered for
reimbursement when the observation period meets or exceeds 8 hours.”) (emphasis added); Dkt.
No. 22-1 at 121 (June 2023 correspondence stating that Defendants 	“implemented” the Policy and
that “[c]laims for observation that do not align with the Observation Policy will be denied. The
Provider has the option to resubmit the denied claim according to the terms of the Facility
Participation Agreement between us (the ‘Agreement’) . . . . With the implementation of the
Observation Policy, UnitedHealthcare is adopting certain CMS coding guidelines related to
observation services, including that observation service code GO378 will only be considered for
reimbursement when the observation period meets or exceeds 8 hours. . . . Denials of claims that
don’t meet the 8-hour requirement are consistent with Stony Brook’s Agreement and applicable
Payment 	Appendices, 	as 	well 	as 	support 	existing 	contractual 	obligations 	to 	code 	claims
correctly.”); Dkt. No. 22-2 at 13 (September 2024 correspondence stating that “United is writing
to confirm that, between December 15, 2023 and December 15, 2026, Stony Brook [ ] will not be
subject to the eight-hour requirement with respect to the following Payment Policy: Outpatient
Hospital Observation Policy, Facility. 	Claims that have previously been processed as subject to
this requirement shall be reprocessed by United.”). 	Simply put, Plaintiff’s claims concern “the
computation of contract payments or the correct execution of such 	payments” and the “independent
contractual obligations” between 	Stony Brook and Defendants. 	Montefiore, 642 F.3d at 331; 	see
also Platinum-Montaur, 943 F.3d at 617.
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Defendants nonetheless contend that that the purportedly assigned claims at issue10
implicate ERISA benefits and thus the right to payment. 	See, e.g., 	Dkt. No. 1 at ¶¶ 22-24; Dkt.
No. 45 at 20-26. Defendants claim that because the Plans purportedly permitted them to implement
the Policy, any denial of reimbursement to Stony Brook pursuant to the Policy effectively
constituted a denial of insurance benefits to the insured under the applicable Plan. 	See, e.g., 	Dkt.
No. 45 at 22 (“Because the [ ] Plan gave United 	discretion to apply reimbursement policies . . . a
claim line for an observation service of less than eight hours is 	not covered under the [P]lan.”); 	see
also id. 	at 10-11. The Court is not persuaded.
As an initial matter, the Court reiterates that the limited excerpts Defendants submit do not
permit meaningful analysis of the documents from which they are taken, let alone the terms of the
underlying Plans. 	See supra 	Section IV.B.1.a. 	For example, Defendants characterize the legal
significance of various defined terms in these excerpts. 	See, e.g., 	Dkt. No. 45 at 22 (discussing
Dkt. Nos. 45-29, 45-34). But these terms appear to be defined in significant portions of the SPDs
that Defendants have not provided. 	Compare, e.g., 	Dkt. No. 45-29 at 10, 12 (glossary indicating
that “Covered Health Services” are, 	inter alia, those “[d]escribed as a 	Covered Health Service in
this SPD under Section 5, 	Plan Highlights 	and 6, 	Additional Coverage Details” and that “Eligible
Expenses” are, 	inter alia, “as detailed in Section 3, 	How the Plan Works”), 	with id. 	at 3 (including
a single page from one of the three referenced sections).
And even the limited excerpts Defendants have submitted do not support their position.
Fundamentally, Defendants conflate whether a particular service is covered under a Plan with the
correct reimbursement amount for a particular service under the Contracts. 	See, e.g., 	Dkt. No. 45-
10 	As detailed above, of the nineteen purported assignments by 	Defendants’ insureds, Defendants
concede that nine are invalid and have failed to establish that any of the remaining ten are valid.
See supra 	Section IV.B.1.a & n.5.
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29 at 3 (“When Covered Health Services are received from a Network provider, Eligible Expenses
are UnitedHealthcare’s contracted fee(s) with that provider.”); 	Dkt. No. 45-32 at 3 (same); Dkt.
No. 45-34 at 3 (same); Dkt. No. 45-30 at 10 (“When Covered Health Services are received from
In-Network Providers, Eligible Expenses are the contracted fee(s) 	with that Provider.”); Dkt. No.
45-31 at 3 (“When Covered Health Services are received from a Designated Network and Network
provider, Eligible Expenses are UnitedHealthcare’s contracted fee(s) with that provider.”); Dkt.
No. 45-37 at 3 (same); Dkt. No. 45-36 at 4 (“When 	Covered Health Services are received from a
Network provider, Eligible Expenses are the Claims 	Administrators’ contracted fee(s) with that
provider”). 	As such language makes clear, Plaintiff’s allegations relate to the computation of
“contracted fee(s)” under the Contracts, and thus the amount of payment, and not a determination
of benefits under the Plans that implicates the right to payment. 	Montefiore, 642 F.3d at 331.
With respect to the latter, Defendants nonetheless submit a number of heavily excerpted
so-called provider remittance advice forms (each, a “PRA”). But 	none of the excerpts Defendants
submit “demonstrate[s that] Defendants denied payment for at least nine Observation services,
billed through claim lines using code G0378, because the Observation services were not covered
under the [P]lans.” Dkt. No. 45 at 24 (citing Dkt. No. 45-24). For example, Defendants contend
that “United determined 	that [a particular 	insured]’s claim was not covered under the [P]lan.” 	Id.
at 22 (citing Dkt. No. 45-24 at 6). Defendants submit three heavily redacted pages to support its
position that “United denied any right to payment for the claim line” for this insured. 	Id. 	But the
claim line that is visible indicates that the sole “CLM ADJ RSN CD” for adjusting Stony Brook’s
claim for reimbursement was United’s determination that six 	hours of Observation services
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constituted “CONTRACTUAL OBLIGATIONS - NON-COVERED CHARGES.”11 	Dkt. No. 45-
53 at 2, 4. In any event, this is one of the instances discussed above, where the SPD excerpt on
which Defendants rely appears to relate to a different calendar year than the one in which Stony
Brook provided services to the insured. 	See supra 	n.7; 	compare 	Dkt. No. 45-29 at 2 (SPD effective
January 2020), 	with 	Dkt. No. 45-53 at 2 (services provided to corresponding insured in February
2021).
Defendants’ discussion of a second insured suffers from the same issues. Dkt. No. 45 at
22. The claim line visible in the four heavily redacted pages Defendants submit also indicates that
the sole “CLM ADJ RSN CD” for adjusting Plaintiff’s claim for reimbursement was United’s
determination 	that 	three 	hours 	of 	Observation 	services 	constituted 	“CONTRACTUAL
OBLIGATIONS - NON-COVERED CHARGE(S).”12 	Dkt. No. 45-52 at 2, 4. 	And the SPD
excerpt on which Defendants rely again appears to relate to a different calendar year than the one
in which Stony Brook provided services to the insured. 	See supra 	n.7; 	compare 	Dkt. No. 45-34 at
2 (SPD effective January 2020), 	with 	Dkt. No. 45-52 at 2 (services provided to corresponding
insured in May 2021).
Claim lines visible on the balance of the PRAs on which Defendants rely list the same
adjustment reason code. 	Dkt. No. 45-45 at 2, 7; Dkt. No. 45-46 at 3, 5; Dkt. No. 45-47 at 2, 3;
Dkt. No. 45-48 at 2, 6; Dkt. No. 45-49 at 2, 4; Dkt. No. 45-50 at 2, 4; Dkt. No. 45-51 at 2, 6.
These 	documents 	thus 	indicate 	that 	Defendants 	adjusted 	Plaintiff’s 	claims 	for
11 	This excerpt’s pagination indicates that it is 	taken from a larger document with at least 248
pages. 	See generally 	Dkt. No. 45-53. 	The coding in the separate “REMARK/NOTES” column
on which Defendants rely similarly indicates “Not Eligible Charge.” 	Id. 	45-53 at 2, 4.
12 	This excerpt’s pagination indicates that it is 	taken from a larger document with at least 218
pages. 	See generally 	Dkt. No. 45-52. 	The coding in the separate “REMARK/NOTES” column
on which Defendants rely similarly indicates “Not Eligible Charge.” 	Id. 	at 2, 4.
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reimbursement based on Defendants’ interpretation of the Contracts, and not because Defendants
had denied ERISA benefits to individuals being treated in Stony Brook’s emergency room.
Accordingly, the Court finds that Defendants have not established that the claims at issue involve
the denial of ERISA benefits, as opposed to the amount of reimbursement due under the Contracts.
Montefiore, 642 F.3d at 331. As noted earlier, the parties’ prelitigation correspondence similarly
indicates that interpretation of the Contracts, and not any Plan, was at issue. 	See supra 	Section
II.C.
Defendants also argue that benefit determinations are at issue because the Contracts only
provide for reimbursement of services that are covered under a Plan, which thus requires
interpretation of that Plan. 	See, e.g., 	Dkt. No. 1 at ¶¶ 22-23; Dkt. No. 45 at 21-22. 	As just
discussed, however, Defendants have failed to establish that coverage for emergency room
Observation services was actually denied under any Plan.
For all of these reasons, the Court agrees with 	Plaintiff that “the basis for the Defendants’
liability does not involve a coverage or benefits determination, and it is not derived from the terms
of the plan documents [and does not] call upon the Court to construe or apply plan provisions.”
Dkt. No. 22-3 at 22. Because Defendants have not demonstrated that prong one, part two of 	Davila
is satisfied, this provides an independent reason why Defendants have failed to establish that
Plaintiff’s state law claims are completely preempted by ERISA. 	United Healthcare, 64 F. Supp.
3d at 465. For the avoidance of doubt, however, the Court nonetheless proceeds with the 	Davila
analysis.
2. 	Davila 	Prong Two – Other Independent Legal Duty
Under the second prong of 	Davila, “a claim is completely preempted only if ‘there is no
other independent legal duty that is 	implicated by [the] defendant’s actions.’ The key words here
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are ‘other’ and ‘independent.’” 	McCulloch, 857 F.3d at 150 (alteration in original) (first quoting
Montefiore, 642 F.3d at 332; and then citing 	id. 	at 328).
Plaintiff’s primary argument is that its claims arise from Defendants’ obligations under the
Contracts and state law, and not from any Plan. Dkt. No. 22-3 at 23-24. Defendants concede that
“at least some of Plaintiff’s claims implicate [an] independent legal duty” and go on to argue that
“[t]he Court should exercise supplemental jurisdiction over all claims that do not themselves meet
the requirements of the 	Davila 	test.” 	Dkt. No. 45 at 28 (citations omitted). 	The two causes of
action that Defendants do not explicitly address in their opposition to the Motion are based on New
York state statutes. 	Compare 	Dkt. No. 2 at ¶¶ 46-56 (Plaintiff’s 	third and fourth statutory causes
of action), 	with 	Dkt. No. 45 at 26-27 (discussing Plaintiff’s first and second common law causes
of action). Based on Defendants’ concession, the Court finds that they have failed to demonstrate
that prong two of 	Davila 	is satisfied.
Even without this concession, 	Defendants’ arguments on this 	prong largely rely on their
earlier arguments, and fail for similar reasons. 	See generally 	Dkt. No. 45 at 26-27. As previously
discussed, Defendants have not established that any 	“exemplar claim” involves the denial of
ERISA benefits to Defendants’ insureds. 	See supra 	Section IV.B.1.b. 	Moreover, the parties’
submissions support Plaintiff’s contentions that 	Defendants adjusted the amount of reimbursement
due to Stony Brook as a result of the Policy, and not any Plan. 	Id.
For purposes of removal, the Court finds that 	all of Plaintiff’s claims implicate legal duties
other and independent from the Plans, including legal duties arising under the Contracts. Because
Defendants have not demonstrated that prong two of 	Davila 	is satisfied, this provides another
independent reason why Defendants have failed to establish that 	any of Plaintiff’s state law claims
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are completely preempted by ERISA.13 	Wurtz, 761 F.3d at 243 (finding that plaintiff’s claims
under New York state statute did not satisfy prong two of 	Davila).
C. 	Just Costs and Actual Expenses
Pursuant to Section 1447(c), “[a]n order remanding the case may require payment of just
costs and actual expenses, including attorney fees, incurred as a result of 	the removal.” 28 U.S.C.
§ 1447(c). The Second Circuit has noted the 	Supreme Court’s guidance on this issue:
Absent unusual circumstances, courts may 	award attorney’s fees under § 1447(c)
only where the removing party lacked an objectively reasonable basis for seeking
removal. Conversely, when an objectively reasonable basis exists, fees should be
denied. In applying this rule, 	district courts retain discretion to consider whether
unusual circumstances warrant a departure from the rule in a given case.
City of New York, 154 F.4th at 46-47 (quoting 	Martin v. Franklin Cap. Corp., 546 U.S. 132, 141
(2005)). Accordingly, “a district court retains discretion to award fees in 	‘unusual circumstances,’
even where an objectively reasonable basis for removal existed.” 	Id. 	at 47. As the Second Circuit
has further explained, a district 	court’s “reasons for departing 	from the general rule should be
‘faithful to the purposes’ of awarding fees under § 1447(c).” 	Id. 	(quoting 	Martin, 546 U.S. at 141).
And with respect to these purposes:
Congress thought fee shifting appropriate in some cases. The process of removing
a case to federal court and then having it remanded back to state court delays
resolution of the case, imposes additional costs on both parties, and wastes judicial
resources. 	Assessing costs and fees on remand reduces the attractiveness of
removal as a method for delaying litigation and imposing costs on the plaintiff. The
appropriate test for awarding fees under § 1447(c) should recognize the desire to
deter removals sought for the purpose of prolonging litigation and imposing costs
on the opposing party, while not undermining 	Congress’ basic decision to afford
defendants a right to remove as a general matter, when statutory criteria are
satisfied.
13 	Defendants’ untimely request to file a lengthy sur-reply, Dkt. No. 48, is denied, both under the
Local Rules, 	see 	N.D.N.Y. L.R. 7.1(a), and for numerous reasons set forth by Plaintiff, 	see
generally 	Dkt. No. 49.
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Id. 	(quoting 	Martin, 546 U.S. at 140).
Plaintiff requests just costs and actual expenses, including attorney’s fees. Dkt. No. 22 at
1; Dkt. No. 22-3 at 24. Defendants oppose, based on 	“their reasonable decision to remove the case
to federal court based on 	complete ERISA preemption”14 	and because “[a]s cited in Defendants’
Notice of Removal and in this brief, there are many examples of courts in this District exercising
jurisdiction in similar circumstances[.]” Dkt. No. 45 at 28.
Defendants’ second argument fails. Defendants cite no cases from this District at all, let
alone any presenting purportedly 	“similar circumstances.” 	See generally 	Dkt. Nos. 1, 45.
Defendants’ first argument also 	fails. Whether Defendants are correct that they had some
unspecified “reasonable basis” for removal, neither their Notice nor their arguments since provide
any “objectively reasonable basis” for doing so. 	See Tamm Consulting v. Cincinnati Ins. Co., No.
18-cv-11415, 2020 WL 1144713, at *4 (S.D.N.Y. Mar. 9, 2020) (“A basis for removal is
objectively reasonable if the removing party had 	a colorable argument that removal was proper.”)
(citation omitted).
Defendants’ Notice does not provide a colorable argument that all portions of 	Davila 	are
satisfied. 	Wurtz, 761 F.3d at 241. Therein, Defendants acknowledged that “Plaintiff’s Complaint
does not cite or reference 	a single 	Customer Benefit Plan,” but claimed that “United has been able
to identify a subset of these plans.” Dkt. No. 1 at ¶¶ 9-10. Defendants represented that “[a] sample
such an [sic] ERISA Plan is attached[.]” 	Id. 	at ¶ 11. For the same reasons as those detailed above,
Defendants have not established that these limited excerpts constitute the Plan or its relevant terms,
in part because these excerpts explicitly reference numerous other documents that Defendants have
14 	Consistent with Defendants’ argument, the Court notes that the Notice articulates no basis for
federal jurisdiction other than complete preemption under ERISA. 	See generally 	Dkt. No. 1.
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not provided. 	See supra 	Section IV.B.1.a; 	see also 	Dkt. No. 1-3.
Based on these excerpts, the Notice nonetheless 	claimed that Defendants’ insureds “were
contractually permitted to assign their benefits to SBUH” and that the excerpts Defendants
submitted provided one example of such express permission. 	Dkt. No. 1 at ¶ 20. 	As detailed
above, however, the language Defendants cite15 	indicates that it relates to out-of-network
providers, not in-network providers like Stony Brook. 	See supra 	Section IV.B.1.a. 	The Notice
further represented that “[w]ith this contractual 	authorization, ERISA Plan Participants under this
plan and others, did in fact assign their ERISA 	benefits to SBUH.” 	Dkt. No. 1 at ¶ 20. 	But
Defendants have still not established that any Plan, including 	this one, “contractually permitted”
assignment. 	See supra 	Section IV.B.1.a. In fact, Defendants 	now argue only that the Plans “did
not prohibit” such assignment. 	Dkt. No. 45 at 19. 	For all the reasons stated previously, that
assertion remains unsupported. 	See supra 	Section IV.B.1.a. 	As a result, the Court finds that
Defendants’ Notice (as well as their arguments since) have failed to provide a colorable argument
that prong one, part one, of 	Davila 	could be satisfied.
As to prong one, part two, the Notice contended only that:
[ ] Some courts in this Circuit have further assessed 	Davila 	Prong 1 by
examining the plaintiff’s 	standing to pursue an ERISA claim and inquiring
whether the assigned claims are the type of claim that can be pursued under
§ 502(a)(1)(B). “A right to payment 	claim is a colorable ERISA claim and
exists when the claim ‘implicate[s] coverage and benefit determinations as
set forth by the terms of the ERISA benefit plan.’[”] . . . .
[ ] Although this inquiry into standing is not necessary or appropriate under
Davila, 	here, 	the 	Action 	will 	significantly 	focus 	on 	coverage
determinations, specifically, whether Observations lasting less than eight
hours constituted ‘Covered Services’ under the applicable Customer Benefit
Plans, including the ERISA Plans.
15 	While the excerpt Defendants attached to their Notice contain fewer pages than the excerpt
attached to their opposition to the Motion, both versions include this language. 	Compare 	Dkt. No.
1-3 at 4-5, 	with 	Dkt. No. 45-38 at 5-6.
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[ ] 	Therefore, 	Davila 	Prong 1 is satisfied, and the analysis proceeds to
Davila 	Prong 2.
Id. 	at ¶¶ 22-24 (second alteration in original) (citations omitted). 	Defendants’ contention that
assessing part two of prong one “is not necessary or appropriate under 	Davila” is wrong as a legal
matter. Indeed, as Defendants acknowledge in their opposition to the Motion:
Under binding precedent, ERISA completely preempts a provider’s claims for
payment when (1) the provider has obtained valid assignments from patients for
claims governed by ERISA benefit plans, 	(2) the claims involve the right to
payment, rather than the amount of payment, 	and (3) the provider has no other,
independent source of rights.
Dkt. No. 45 at 6-7 (emphasis added) (first citing 	Montefiore, 642 F.3d at 328-29; and then citing
Davila, 542 U.S. at 210); 	see also McCulloch, 857 F.3d at 149.
The Notice’s misstatement of law is compounded by the fact that the Notice did not argue
that any of the supposedly relevant “coverage determinations” actually resulted in the denial of
ERISA benefits to Defendants’ insureds. 	See generally 	Dkt. No. 1. Defendants asserted that their
investigation had identified a Plan relevant to 	the parties’ dispute and 	a purported assignment of
ERISA benefits under that Plan by a specific insured, and attached excepts purportedly related to
each. 	Id. 	at ¶¶ 10-12; Dkt. Nos. 1-3, 1-4. But Defendants did not attach any denial of benefits to
that insured, nor did they argue that the insured (or any other insured) had been denied ERISA
benefits. 	See generally 	Dkt. No. 1. As for the heavily redacted materials Defendants have since
submitted, these indicate that Defendants adjusted Plaintiff’s claims for reimbursement pursuant
to the Policy, not that Defendants denied benefits to any of their insureds who were evaluated in
the emergency room for admission to Stony Brook. 	See supra 	Section IV.B.1.b; 	see also 	Dkt. No.
45 at 8. 	As a result, the Court finds that Defendants’ Notice (as well as their arguments since)
failed to provide a colorable argument that prong one, part two, of 	Davila 	could be satisfied.
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With respect to prong two, the Court finds the 	arguments in Defendants’ 	Notice, and since,
similarly deficient. 	See also supra 	Section IV.B.2.
For each of these reasons, the Court finds that Defendants had no objective basis for
removing this action, and that just costs and actual expenses are appropriate under Section 1447(c).
City of New York, 154 F.4th at 46-47; 	see also McCulloch, 857 F.3d at 146 (“The 	Davila 	test is
conjunctive—a state-law claim is completely preempted by ERISA only if both prongs of the test
are satisfied.”) (citing 	Montefiore, 642 F.3d at 328).
In the alternative, the Court finds that the unusual circumstances of this case support the
award of just costs and actual expenses under Section 1447(c).
As the Court has noted, Defendants have repeatedly submitted selective excerpts and
inaccurately characterized many of those excerpts to support their arguments. 	See supra 	Section
IV.B. 	Notably, while Plaintiff’s central allegation is that Defendants’ denied reimbursement in
breach of the United Contract and the Oxford Contract, Defendants did not attach any portion of
the Contracts to the Notice. 	See generally 	Dkt. No. 1. Several months later, Defendants submitted
limited excerpts of the Contracts in connection with another motion. 	Dkt. Nos. 23-2, 23-3.
Plaintiff objected to the submission of only these limited excerpts, stating:
[T]he original full and complete Contracts should be submitted for review instead
of the excerpts of said Contracts to provide the Court with the full context of said
Contracts. . . . Plaintiff intends . . . to cite other sections of the Contracts that are
relevant . . . . [and] the Court will need to examine additional provisions that the
Defendants have opted to exclude from their exhibits.
. . . .
. . . Plaintiff requested that Defendants voluntarily agree to replace the excerpted
versions of the Contracts with the original full and complete Contracts. Defendants
have refused, citing vague 	“confidentiality concerns”.
. . . .
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. . . Defendants have not provided any explanation as to why sealing the complete
Contracts, instead of excerpts, would raise “confidentiality concerns” or how the
“confidentiality concerns” would be contrary to the need to seal the documents.
Dkt. No. 34 at ¶¶ 5, 7, 8. Defendants responded 	that “Defendants oppose Plaintiff’s request that
Defendants be ordered to supplement their . . . exhibits to include additional pages from the
Network Contracts. 	If Plaintiff deems it necessary to provide additional pages of the Network
Contracts to the Court, Plaintiff should attach those pages to its [briefing.]” Dkt. No. 35 at 2.
Several months later, Defendants resubmitted with the Motion similarly limited excerpts
from the United Contract and the Oxford Contract. Dkt. No. 45-27 (thirteen-page excerpt); Dkt.
No. 45-28 (five-page excerpt). Plaintiff then resubmitted complete versions of each Contract. Dkt.
No. 47-9 at ¶ 3; Dkt. No. 47-10 (seventy-page document); Dkt. No. 47-11 (sixty-four-page
document). As described above, the Contracts contain provisions relevant to the resolution of the
issues before the Court. 	See supra 	Sections II.B, IV.B.1.a. 	Moreover, the format of the United
Contract that Plaintiff submits suggests that Defendants provided excerpts from a version of that
Contract with different formatting, different text at the bottom of the pages, different pagination,
and different page breaks. 	Compare 	Dkt. No. 45-27 at 2-14, 	with 	Dkt. No. 47-10 at 2-20. As a
result, the excerpts Defendants submitted do not contain the entirety of Section 6.8, including
portions cited above. 	See supra 	Sections II.B, IV.B.1.a.
Finally, the Court notes the relatively narrow factual universe central to this dispute:
Plaintiff’s reimbursement request 	for a few hundred claims for a single type of healthcare service
that an emergency room provider, in the same 	state as Defendants, provided to Defendants’
insureds between November 30, 2020 and December 14, 2023. 	See generally 	Dkt. No. 2. In short,
investigation of the relevant facts here appears relatively straightforward and, in any event,
Defendants had ample time to conduct such an investigation prior to filing a notice of removal in
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January 2025. 	Dkt. No. 1 at ¶¶ 1, 10-12. 	Indeed, back in 2023, Plaintiff and Defendants
corresponded regarding disputed reimbursement claims, apparently with the result that Defendants
“reprocessed” approximately 	nine months of reimbursement claims “that have previously been
processed as subject to” “the eight-hour requirement with respect to 	the [Policy].” Dkt. No. 22-2
at 13. The parties have now spent more than a year litigating in federal court, during which time
Defendants requested jurisdictional discovery in response to Plaintiff’s Motion. 	See supra 	Section
II.E. 	But the key documents here—the Contracts and Plans—were already in Defendants’
possession prior to any discovery, as Plaintiff has noted. 	Dkt. No. 47-1 at ¶ 5 (stating that
“Defendants were 	in possession 	of the policy and coverage information” prior to discovery).
Substantial time and additional costs have nonetheless been spent litigating the factual basis for
Defendants’ position, which remains unsupported. 	See generally 	Dkt. No. 1.
Moreover, Defendants have requested numerous extensions of time during the pendency
of this litigation. 	See, e.g., 	Dkt. Nos. 8, 15, 19, 27. Defendants have also forced Plaintiff to litigate
numerous unnecessary issues, including jurisdictional discovery, 	see, e.g., 	Dkt. No. 29 at 2
(“[T]here is no colorable ERISA claim because 	the case does not implicate coverage and benefit
determinations as set forth by the terms of the ERISA benefit plan, and resultingly, Defendants
cannot meet one of the required elements of the test for ERISA preemption set forth in [Davila].
Defendants seek jurisdictional discovery pertinent to a separate prong of the 	Davila 	test, to
determine whether [Plaintiff] is a proper party to bring a direct claim pursuant to ERISA.
However, Defendants’ failure to meet one prong 	of the test makes remand proper because all of
the prongs of the 	Davila 	test must be met for the claims to be preempted. . . . As a result,
Defendants’ requested discovery is not necessary and should be denied.”) (citing 	Wurtz, 761 F.3d
at 243); whether complete versions of relevant documents should be submitted for a court’s review,
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Dkt. No. 34 at ¶¶ 5-10; and whether a sur-reply should be permitted, 	see supra 	n.13.
As a result, the Court finds that the unusual circumstances of this particular case also weigh
in favor of awarding Plaintiff costs and expenses. 	See, e.g., 	City of New York, 154 F.4th at 47
(“The process of removing a case 	to federal court and then having it remanded back to state court
delays resolution of the case, imposes additional costs on both parties, and wastes judicial
resources. Assessing costs and fees on remand reduces the attractiveness of removal as a method
for delaying litigation and imposing costs on the 	plaintiff.”) (quoting 	Martin, 546 U.S. at 140).
For all of these reasons, the Court grants Plaintiff’s request for costs and actual expenses,
including attorney’s fees, pursuant to 28 U.S.C. § 1447(c).
V. 	CONCLUSION
The Court grants the Motion and remands this action to New York State Supreme Court,
Albany County, pursuant to 28 U.S.C. § 1447(c) for lack of subject matter jurisdiction.16
Accordingly, the Court hereby
ORDERS 	that Defendants’ motions to seal, Dkt. Nos. 24, Dkt. No. 46, are 	GRANTED;
and the Court further
ORDERS 	that Defendants’ motion to file 	a sur-reply, Dkt. No. 48, is 	DENIED; and the
Court further
ORDERS 	that Plaintiff’s motion to remand, Dkt. No. 22 is 	GRANTED; and the Court
further
ORDERS 	that this action is 	REMANDED 	to New York State Supreme Court, Albany
County; and the Court further
ORDERS 	that 	the 	parties 	remaining 	pending 	motions, 	Dkt. 	Nos. 	23, 	29, 	are
16 	All pending motions not explicitly addressed herein are terminated as moot. Dkt. Nos. 23, 29.
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TERMINATED; and the Court further
ORDERS 	that the Clerk serve a copy of this Memorandum-Decision and Order on the
parties in accordance with the Local Rules, and close this case.
IT IS SO ORDERED.
Dated: March 31, 2026
Albany, New York
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