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Arapahoe Surgery Ctr., LLC v. CIGNA Healthcare, Inc.

United States District Court, D. Colorado

February 20, 2015

ARAPAHOE SURGERY CENTER, LLC, CHERRY CREEK SURGERY CENTER, LLC, HAMPDEN SURGERY CENTER, LLC, KISSING CAMELS SURGERY CENTER, SURGCENTER OF BEL AIR, LLC, and WESTMINSTER SURGERY CENTER, LLC, Plaintiffs,
v.
CIGNA HEALTHCARE, INC., CONNECTICUT GENERAL LIFE INSURANCE COMPANY, CIGNA HEALTHCARE - MID-ATLANTIC, INC., and CIGNA HEALTHCARE OF COLORADO, INC., Defendants

For Arapahoe Surgery Center, LLC, Cherry Creek Surgery Center, LLC, Hampden Surgery Center, LLC, Kissing Camels Surgery Center, LLC, SurgCenter of Bel Air, LLC, Westminster Surgery Center, LLC, Plaintiffs, Counter Defendants: Joe Ramon Whatley, Jr., LEAD ATTORNEY, Whatley Kallas, LLP-Aspen, Aspen, CO; Deborah Jane Winegard, Whatley Kallas, LLC-Atlanta, Atlanta, GA; Edith M. Kallas, Whatley Kallas, LLC-New York, New York, NY; Henry C. Quillen, Whatley Kallas, LLC-Portsmouth, Portsmouth, NH; William Tucker Brown, Whatley Kallas, LLC-Birmingham, Birmingham, AL.

For CIGNA Healthcare, Inc., Connecticut General Life Insurance Company, CIGNA Healthcare - Mid-Atlantic, Inc., CIGNA Healthcare of Colorado, Inc., Defendants, Counter Claimants: Edwin Packard Aro, LEAD ATTORNEY, Timothy Robert Macdonald, Arnold & Porter LLP-Denver, Denver, CO; Joshua Simon, Ryan Daniel McEnroe, Warren Haskel, Kirkland & Ellis, LLP-New York, New York, NY.

For Cigna Health and Life Insurance Company, Counter Claimant: Edwin Packard Aro, LEAD ATTORNEY, Timothy Robert Macdonald, Arnold & Porter LLP-Denver, Denver, CO; Joshua Simon, Ryan Daniel McEnroe, Warren Haskel, Kirkland & Ellis, LLP-New York, New York, NY.

For Surgical Center Development Inc., doing business as SurgCenter Development, Counter Defendant: Joe Ramon Whatley, Jr., LEAD ATTORNEY, Whatley Kallas, LLP-Aspen, Aspen, CO; Deborah Jane Winegard, Whatley Kallas, LLC-Atlanta, Atlanta, GA; Henry C. Quillen, Whatley Kallas, LLC-Portsmouth, Portsmouth, NH.

ORDER DENYING DEFENDANTS' MOTION TO DISMISS

William J. Martí nez, United States District Judge.

Plaintiffs Arapahoe Surgery Center, LLC, Cherry Creek Surgery Center, LLC, Hampden Surgery Center, LLC, Kissing Camels Surgery Center, LLC, SurgCenter of Bel Air, LLC, and Westminster Surgery Center, LLC (collectively " Plaintiffs" ) bring this action alleging claims under the Sherman Act, 15 U.S.C. § § 1 et seq., and the Colorado Antitrust Act, Colo. Rev. Stat. § § 6-4-101 et seq., against Defendants Cigna Healthcare, Inc., Connecticut General Life Insurance Co., Cigna Healthcare--Mid-Atlantic, Inc., and Cigna Healthcare of Colorado, Inc. (collectively " Defendants" or " Cigna" ).[1] (Second Am. Compl. (" SAC" ) (ECF No. 60) at 62-64.) Before the Court is Cigna's Motion to Dismiss Counts VI and VII of Plaintiffs' Second Amended Complaint (" Motion" ). (ECF No. 61.) For the reasons set forth below, the Motion is denied.

I. LEGAL STANDARD

Under Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss a claim in a complaint for " failure to state a claim upon which relief can be granted." In evaluating such a motion, a court must " assume the truth of the plaintiff's well-pleaded factual allegations and view them in the light most favorable to the plaintiff." Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007). In ruling on such a motion, the dispositive inquiry is " whether the complaint contains 'enough facts to state a claim to relief that is plausible on its face.'" Id. (quoting Bell A. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). Granting a motion to dismiss " is a harsh remedy which must be cautiously studied, not only to effectuate the spirit of the liberal rules of pleading but also to protect the interests of justice." Dias v. City & Cnty. of Denver, 567 F.3d 1169, 1178 (10th Cir. 2009) (quotation marks omitted). " Thus, 'a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely.'" Id. (quoting Twombly, 550 U.S. at 556).

II. BACKGROUND

The relevant allegations, as pled in the SAC, are as follows.

Plaintiffs are ambulatory surgery centers performing surgical procedures and treatments in a non-hospital environment. (SAC ¶ 1.) Defendants are entities providing health insurance benefits under the trade name " Cigna" . ( Id. pp. 1-2.) Plaintiffs allege that Cigna violated the antitrust laws by conspiring with two hospital systems, HCA-HealthONE (" HCA" ), and Centura Health Corporation (" Centura" ) (together " Hospitals" ), as well as a trade association and the other dominant health insurers in the market, to damage Plaintiffs' businesses and drive them out of the market for surgical procedures not requiring hospitalization. ( Id. ¶ 16.)

Beginning in 2010, Centura and HCA conspired to reduce competition for ambulatory surgery services by using their market power to compel physicians and insurers not to do business with Plaintiffs, and to convince insurers to join the conspiracy and take similar actions against physicians referring patients to Plaintiffs. ( Id. ¶ ¶ 162-66.) Cigna agreed to do so, and in December 2011, threatened its contracted physicians with termination of their relationships with Cigna due to their practice of referring patients to Plaintiffs. ( Id. ¶ ¶ 166-69.)

On May 18, 2012, Cigna representatives were present at a telephonic meeting of the co-conspirator trade association at which actions against Plaintiffs were discussed. ( Id. ¶ 173.) In emails sent in July 2012, HCA executives discussed the actions to be taken against physicians referring patients to Plaintiffs in order to quell the competitive threat Plaintiffs posed, and reported that Cigna had agreed to participate in such actions and report back to HCA. ( Id. ¶ ¶ 174-75.) On August 29, 2012, at a trade association meeting, representatives of both Hospitals, Cigna, and the other insurers were present, and all expressed their mutual desire to stop the flow of dollars to Plaintiffs, creating a group boycott. ( Id. ¶ 176.)

In furtherance of the agreement, on January 16, 2013, Cigna sent two medical providers contract termination letters that falsely accused them of breaching their contracts with Cigna by referring patients to Plaintiffs. ( Id. ¶ ¶ 180-81.) On November 8, 2013, Cigna sent contract termination letters with similar false accusations to twelve additional medical providers. ( Id. ¶ ¶ 182-93.) Plaintiffs allege that these physicians' practices of referring patients to Plaintiffs was not a breach of their contracts with Cigna, and thus Cigna's alleged reasons ...


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