5th Cir.: In Aetna’s $8.4M Fight, Hon. Judge Hughes Abused His Discretion - ERISAclaim.com Demystifies

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On April 2, 2015, 5th Cir. Court ruled Hon. Judge Hughes’s decision was an abuse of discretion and vacated the district order in favor of Aetna by prohibiting defendant from transferring funds. ERISAclaim.com demystifies the importance of the appeals court order for all providers.

Apparently, a provider in this case has only two options, file for a bankruptcy or appeal a reversible decision to an appeals court. One defendant took the first choice, but the second took another one”, explains Dr. Zhou,

On April 2, 2015, the 5th Cir. Court ruled that Hon. Judge Hughes’ decision was an abuse of discretion and vacated the district orders in favor of Aetna by prohibiting a defendant from transferring funds. Immediately after Judge Hughes’s order that “Aetna Life Insurance Co. will take $8,412,116.01” from the defendants, the receiver for another defendant filed a “suggestion of bankruptcy”. ERISAclaim.com demystifies the importance of this appeals court order for all providers. This 5th Cir. Court decision may also save another provider from another possible bankruptcy if we understand when and how a federal district court judge may abuse his or her discretion and authority.

ERISAclaim.com closely follows and demystifies the most important national landmark managed care lawsuits. On April 2, 2015, it announced a case special brainstorming and training program for this dramatic development in managed-care litigation as well as litigation support services to healthcare providers and healthcare attorneys.

Case info:

In re: 2920 ER, L.L.C., doing business as Trinity Healthcare Network, Petition for a Writ of Mandamus to the United States District Court for the Southern District of Texas, U.S.D.C. No. 4:12-CV-2451, Case No. 14-20734, in the United States Court of Appeals for the Fifth Circuit, filed on April 2, 2015. http://www.ca5.uscourts.gov/opinions/unpub/14/14-20734.0.pdf

“It is an unprecedented but extraordinary necessity today for healthcare providers to understand the importance of federal laws in managed-care litigation, in order to avoid seemingly inevitable but preventable bankruptcies when a federal judge abused his discretion or authority,” says Dr. Jin Zhou, president of ERISAclaim.com, a national expert on ERISA appeals and compliance.

“Apparently, a provider in this case has only two options, file for a bankruptcy or appeal a reversible decision to an appeals court. One defendant took the first choice, but the second took another one”, explains Dr. Zhou, for the reasons why ERISAclaim.com announced this unique service at this particular time.

ERISAclaim.com’s new program demystifies this landmark case by evaluating and focusing on the following key elements, to the extent of the appellate court order to vacate the District Court Judge Hughes’s orders only relevant in abuse of discretion:

I.    A court order link to the court website is provided for all interested providers and attorneys to completely research this important development:
http://www.ca5.uscourts.gov/opinions/unpub/14/14-20734.0.pdf

II.    On August 20, 2014, the district court entered an “opinion on partial judgment”: “The court ordered that ‘Aetna Life Insurance Co. will take $8,412,116.01’ from the defendants.” according to the court document.

III.    “After the district court entered its order granting ‘partial judgment’, the Receiver for Cleveland Imaging filed a ‘suggestion of bankruptcy’ to notify the court of Cleveland Imaging’s voluntary petition for Chapter 11 bankruptcy.” according to the court document.

IV.    “Meanwhile, 2920 filed a motion asking the district court to certify its “partial judgment” as “final and appealable” under Federal Rule of Civil Procedure 54(b) and 28 U.S.C. § 1292(b). The district court denied the motions to certify partial judgment for interlocutory appeal without explanation two days later.” according to the court document.

V.    “The district court also granted Aetna’s motion for “postjudgment discovery” in a very brief order that same day without explanation.” according to the court document.

VI.    “The district court then essentially ordered an asset freeze from the bench. The court ordered: “No payments to Spring Klein until some explanation has been made of what they’re for, no transfers that are not in response to a purchase order or some other objective commercial transaction.” according to the court document.

VII.    Fifth Circuit found Judge Hughes abused his discretion: “Because the district court did not have authority to freeze assets before judgment without following the requirements of Rule 65, the decision was an abuse of discretion that we must vacate.” according to the court document.

VIII.    The 5th Circuit Court Orders and Concludes: “For the foregoing reasons, the petition for mandamus relief is DENIED, and the district court’s order signed on November 13, 2014, prohibiting 2920 from transferring funds is VACATED, as are its orders compelling “postjudgment discovery”—except to the extent that such discovery is reasonably necessary to investigate pending claims under Rule 26. We REMAND to the district court for further proceedings consistent with this opinion.” according to the court document.

Petitioner, 2920 ER LLC, is represented by Lawrence Duncan Thompson, Lorance & Thompson, Houston, TX. Respondent, Aetna, is represented by John Bruce Shely, Andrews Kurth LLP, Houston, TX

To find out more about PPACA Claims and Appeals Compliance Services from ERISAclaim.com: http://www.erisaclaim.com/products.htm

Located in a Chicago suburb in Illinois, for over 15 years, ERISAclaim.com is the only ERISA & PPACA consulting, publishing and website resource for healthcare providers in the country. ERISAclaim.com offers free webinars, basic and advanced educational seminars and on-site claims specialist certification programs for doctors, hospitals and commercial companies, as well as numerous pending national ERISA class action litigation support. Dr. Jin Zhou is regarded as the industry “Godfather of ERISA claims” for healthcare providers.

For any questions, please contact Dr. Jin Zhou, president of ERISAclaim.com, at 630-808-7237.

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ERISAclaim.com
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