Learn About the Law
Get help with your legal needs
FindLaw’s Learn About the Law features thousands of informational articles to help you understand your options. And if you’re ready to hire an attorney, find one in your area who can help.
The TRAVELERS INDEMNITY COMPANY and its Property Casualty Affiliates and Subsidiaries, Plaintiff, v. Jules Francois PARISIEN M.D., Defendant.
Upon the reading and filing of the following papers in this matter: (1) Notice of Motion by plaintiffs dated September 16, 2019 and supporting papers; (2) Affirmation In Opposition by defendant dated October 14, 2019; (3) Reply Affirmation by plaintiffs dated October 18, 2019; (4) Amended Exhibits 18 and 20 to plaintiff's Notice of Motion submitted by plaintiff's letter dated November 15, 2019; (5) Post Summary Judge Motion Brief by plaintiffs dated February 19, 2020; (6) Post-Motion Brief by defendant dated February 24, 2020; (7) Post Summary Judgment Motion Additional Brief by plaintiffs dated March 17, 2020 and (8) oral argument before the court on January 23, 2020 and February 26, 2020 it is
ORDERED that the plaintiffs' motion, pursuant to CPLR 3001, for a declaratory judgment is denied, and the action is dismissed, for the reasons stated below; and it is further
ORDERED that plaintiffs' motion for summary judgment pursuant to CPLR 3212 is denied as moot.
Although couched in the singular in their attorney-verified complaint, this is an action by nine insurance companies—the Travelers Indemnity Company and eight of subsidiary insurance entities: Travelers Personal Insurance Company, Travelers Home And Marine Insurance Company, Travelers Personal Security Insurance Company, St. Paul Protective Insurance Company, The Standard Fire Insurance Company, Travelers Property Casualty Company Of America, Travelers Property Casualty Insurance Company and The Automobile Insurance Company Of Hartford, Connecticut—seeking a declaratory judgment. According to the complaint and its exhibits, thirteen individuals who were injured in various automobile accidents made claims for personal injury protection—“PIP” or “no-fault”—benefits, pursuant to the Comprehensive Motor Vehicle Insurance Reparations Act (New York Insurance Law §§ 5101, et seq.) (the “no-fault law”), under automobile insurance policies underwritten by the plaintiffs. None of those claimants is named as a party to the current proceeding. Rather, the sole defendant is a health service provider who allegedly treated each of these individuals and was assigned the right to collect no-fault reimbursement on their behalf. As an assignee, he submitted no-fault billings to one or more plaintiffs for reimbursement. Plaintiffs allege in the complaint that defendant failed to appear for scheduled examinations under oath (“AEUOs”), thereby breaching a condition precedent to coverage under the no-fault regulations. Plaintiffs seek an order (1) declaring that defendant does not have a right to receive reimbursement for any of the subject no-fault billings; (2) permanently staying all no-fault law suits and arbitrations brought by defendant pending the outcome of this action and (3) ordering reimbursement to plaintiffs of disbursements associated with the prosecution of this action.
Plaintiffs move for summary judgment and for an order, based upon the doctrine of res judicata, pursuant to CPLR 3211[a]. In support of the motion, plaintiffs proffer, inter alia, bills from defendant, EUO notices and affirmations, correspondence, verification requests, a decision and order in Budget Truck Rental, LLC v. Molo (Gerald Lebovits, J.) and the decision of the Appellate Division, Second Department affirming that decision, affidavits by Raumert C. Hubert, Lorraine Couvaris, Mary Googe and Duane Frankson, and a chart of the status of pending litigation related to the billings that are also the subject of this action.
Plaintiffs allege that they duly and timely requested defendant to appear for EUOs in connection with the various claim reimbursements at issue under 11 NYCRR §§ 65-3.5[b] and 65-3.8[a], but defendant failed to appear for each of the scheduled EUOs. Raumert Hubert, a medical investigator for plaintiffs, in his affidavit submitted by plaintiffs in support of the current motion, details an ongoing investigation by plaintiffs of defendant. Hubert describes an analysis of various claims made by defendant and EUOs of certain no-fault benefit claimants, none of whose no-fault benefit claims is the subject of the current lawsuit. Hubert avers that during the course of his investigation, he “uncovered” Justice Lebovits's decision in Budget Truck Rental, LLC v. Mollo, affirmed at 173 AD3d 439, 99 NYS3d 765 [1st Dept 2019]), in which the court determined that the defendants in that action, including Dr. Parisien, had engaged in various practices that violated the New York Public Health Law, the New York Business Corporation Law, the New York Limited Liability Company Law and the New York Education Law. Accordingly, plaintiffs sought the EUOs at issue in this action to determine whether defendant was ineligible to collect no-fault benefits under the subject policies and no-fault regulations, specifically, (1) whether ownership, control and operation of defendant's medical practice is in compliance with New York State licensing requirements; (2) whether the claimed services had in actuality been provided to the injured parties; (3) whether the services rendered were misrepresented and/or billed inaccurately; (4) whether the services rendered were provided by an independent contractor and not by the billing provider and/or defendant; and (5) whether the services provided to plaintiffs' insureds were medically necessary or provided in adherence to a pre-determined protocol in order to maximize defendant's profits.
Defendant opposes the motion on the grounds that plaintiffs have not made out a prima facie case of entitlement to summary judgment in that, among other things, they have failed to prove that plaintiffs' denials of payment and requests for EUOs were timely and to provide the requisite justification to support the use of EUOs pursuant to 11 NYCRR § 65-3.5, and on the further ground that the motion is premature as there had been no discovery conducted when the motion was made.
At the court's direction pursuant to CPLR 3212[f], the parties engaged in documentary discovery. Defendant indicated to the court that defendant's demands were satisfied, and plaintiffs indicated that they required further discovery in order to prosecute the case but would reserve their right to obtaining such further discovery pending the outcome of their motion.
At oral argument, the court questioned the propriety, vel non, of the current declaratory judgment action, which would have the effect of circumventing the procedures that, pursuant to the no-fault law and the regulations promulgated thereunder, govern no-fault reimbursement claim submission, denial and recovery by providers, as well as the reporting, investigation and sanctioning of the types of violations plaintiffs allege (see, e.g., Insurance Law §§ 5108 and 5109) and directed the parties to submit briefs on this issue. On this point, plaintiffs argue that by consolidating all of the claims made by defendant in a single declaratory judgment action, the plaintiffs are providing the court with a “broader picture” of what plaintiffs maintain is defendant's pattern of failing to submit to EUOs in order to thwart plaintiffs' investigation of his practices. Plaintiffs argue that the current action serves the interests of judicial economy and that there is precedent for the successful prosecution of similar actions. Defendant alleges that there are individual fact questions and claim analysis as to each of the claims that are subsumed by the allegations of the complaint and which are reserved for arbitration proceedings or civil court actions under the no-fault law and regulations. Defendant argues that plaintiffs are seeking what is essentially an advisory opinion that they can use as a shield in civil court actions or in arbitration proceedings and urges the court to exercise its discretion to decline to render a declaratory judgment pursuant to CPLR 3001.
Pursuant to CPLR 3001, the granting of a declaratory judgment is left to the court's discretion (see CPLR 3001). The court “may decline to hear the matter if there are other adequate remedies available and it must dismiss the action if there is already pending between the parties another action in which all the issues can be determined” (Morgenthau v. Erlbaum, 59 NY2d 143, 148, 464 NYS2d 392 , citing Woollard v. Schaffer Stores Co., 272 NY 304, 311 ). The applicable statutory scheme provides that “[a] claimant may either file suit seeking payment of the claim, or, pursuant to Insurance Law § 5106[b], submit the dispute to arbitration, pursuant to simplified procedures promulgated by the Insurance Department” (Hospital for Joint Diseases v. Allstate Ins. Co., 5 AD3d 441, 442, 773 NYS2d 427 [2d Dept 2004]). In response to the court's inquiry, plaintiff averred that, of defendant's sixty-five billings that are the subject of this action, there has been no litigation as to five, litigation as to two were settled, and the rest are all in suits filed in civil court by plaintiff (see generally CPLR 3211[a]).
Ultimately, in the guise of convenience, plaintiffs are, in effect, seeking to circumvent the statutorily prescribed procedures that govern disputes between no-fault insurers and no-fault health services providers over the validity of reimbursement claims and the health services provider's eligibility, as well as the statutorily prescribed procedures for sanctioning and disqualifying providers who violate the conditions and requirements imposed upon them by the no-fault law and its regulations. Certainly, if plaintiffs have been defrauded by defendant, they can assert that in defense of reimbursement claims brought by the defendant, and they can assert defenses related to defendant's alleged licensing ineligibility without showing fraud if they can prove a “ ‘willful and material failure to abide by’ licensing and incorporation statutes” (Andrew Carothers, M.D., P.C. v. Progressive Ins. Co., 33 NY3d 389, 405 , quoting State Farm Mut. Auto. Ins. Co. v. Robert Mallela, 4 NY3d 313, 321 ; see 11 NYCRR 65-3.16 (a) (12). Or they can bring a separate lawsuit for fraud, and they will not be time-barred by the statutory requirement that an insurer pay or deny a claim within thirty days of receipt (see Insurance Law § 5106[b]); Cambridge Medical, P.C. v. Allstate Ins. Co., 899 FSupp2d 227, 233 [EDNY 2012], citing State Farm Mut. Auto. Inc. Co. v. James M. Liguori, M.D., P.C., 589 FSupp2d 221, 229 [EDNY 2008]; Allstate Ins. Co. v. Valley Physical Medicine & Rehabilitation, PC, 555 FSupp2d 335, 339-40 [EDNY 2008]; State Farm Mut. Auto. Ins. Co. v. CPT Med. Servs., PC., 2008 WL 4146190 *6-7 [EDNY 2008]; State Farm Mut. Auto. Ins. Co. v. Valery Kalika, 2006 WL 6176152 *4 [EDNY 2006]. Further, Sections 5108 and 5109 of the Insurance Law and the corresponding regulations provide administrative mechanisms for the reporting, investigation and sanctioning, including suspension and removal of authorization, of no-fault health services providers who engage in the very forms of conduct violative of the requirements and conditions of the no-fault law that plaintiffs allege the defendant has engaged in. Moreover, if plaintiffs believe that defendant is engaging in fraudulent practices that rise to the level of criminality, then it may make a criminal complaint to the prosecuting authority which has jurisdiction over defendant.
In the court's view, by bringing this action, plaintiffs are circumventing the regime established by statute and regulation for the handling and judicial, or arbitral, review of health services provider reimbursement claims, as well as the statutorily prescribed procedures for disqualifying and sanctioning health services providers who engage in false or otherwise unlawful treatment and/or billing practices or who violate the eligibility requirements and restrictions imposed by the no-fault law. Plaintiffs have other fully adequate, legislatively mandated remedies available to them; indeed, they acknowledge that the majority of the reimbursement claims they cite in this action are currently in various stages of litigation in civil court. Accordingly, and for all of the foregoing reasons, the court declines to entertain plaintiffs' application for declaratory relief, and the current action is dismissed, without prejudice to plaintiffs' pursuit of the other remedies that are available to it. Accordingly, plaintiffs' motion for summary judgment is denied as moot.
The court has considered the remaining contentions of the parties and finds that they do not require discussion or alter the determination herein.
The foregoing constitutes the decision and order of the court.
Sanford Neil Berland, J.
Response sent, thank you
A free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes visit FindLaw's Learn About the Law.
Docket No: 622751/2018
Decided: December 29, 2020
Court: Supreme Court, Suffolk County, New York.
Search our directory by legal issue
Enter information in one or both fields (Required)
FindLaw for Legal Professionals
Search our directory by legal issue
Enter information in one or both fields (Required)