Gloria Vallare v. Ville Platte Medical Center

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

14-261

GLORIA VALLARE, INDIVIDUALLY AND
ON BEHALF OF ALL OTHERS
SIMILARLY SITUATED

VERSUS

VILLE PLATTE MEDICAL CENTER, LLC AND
LOUISIANA HEALTH SERVICE AND
INDEMNITY COMPANY D/B/A BLUE CROSS
AND BLUE SHIELD OF LOUISIANA

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APPEAL FROM THE
THIRTEENTH JUDICIAL DISTRICT COURT
PARISH OF EVANGELINE, NO. 72711-A
HONORABLE J. LARRY VIDRINE, DISTRICT JUDGE

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J. DAVID PAINTER
JUDGE

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Court composed of J. David Painter, James T. Genovese, and Phyllis M. Keaty,
Judges.

AFFIRMED AS AMENDED.

Kurt S. Blankenship
Robert I. Baudouin
Blue Williams, L.L.P.
3421 North Causeway Blvd., Ninth Floor
Metairie, LA 70002
(504) 830-4938
COUNSEL FOR DEFENDANT-APPELLANT:
Ville Platte Medical Center

Scott Bickford
Lawrence J. Centola, III
Jason Z. Landry
Martzell & Bickford
338 Lafayette Street
New Orleans, LA 70130
(504) 581-9065
COUNSEL FOR PLAINTIFF-APPELLEE:
Gloria Vallare

Derrick G. Earles
The Laborde Law Firm
306 North Washington Street
Marksville, LA 71351
(318) 777-7777
COUNSEL FOR PLAINTIFF-APPELLEE:
Gloria Vallare

J. Lee Hoffoss, Jr.
Claude P. Devall
Donald W. McKnight
Hoffoss Devall, LLC
3205 Ryan Street
Lake Charles, LA 70601
(337) 433-2053
COUNSEL FOR PLAINTIFF-APPELLEE:
Gloria Vallare

J. Clemille Simon
Simon Law Offices
122 Representative Row
Lafayette, LA 70505
(337) 232-2000
COUNSEL FOR PLAINTIFF-APPELLEE:
Gloria Vallare

Charles A. O’Brien
5525 Reitz Avenue
Baton Rouge, LA 70890
(225) 295-2454
COUNSEL FOR DEFENDANT:
Blue Cross and Blue Shield

PAINTER, Judge.

Defendant, Ville Platte Medical Center, LLC (VPMC), appeals the trial

court’s certification of a class action in a suit involving allegations of unlawful

billing practices. For the reasons that follow, we amend the class certification and

affirm the trial court’s ruling as amended.

FACTS AND PROCEDURAL HISTORY

Gloria Vallare was involved in a car accident and received treatment for

injuries received therein at Acadian Medical Center in Eunice, Louisiana. Acadian

Medical Center is a “branch campus” of VPMC. The bill for her treatment was

$3,424.00. Vallare alleges that she had health insurance through Louisiana Health

Service and Indemnity Company d/b/a Blue Cross and Blue Shield of Louisiana

(Blue Cross) but that instead of billing her insurance carrier, VPMC sent a notice

of lien to Farm Bureau Insurance, the insurer of the other party involved in the car

accident. Pursuant to the lien, Farm Bureau issued a check made payable to

Vallare and the hospital. Vallare took the position that the hospital was in

violation of its agreement with Blue Cross by demanding an amount in excess of

the contracted reimbursement rate set forth in the provider agreement. Vallare,

individually and on behalf of all others similarly situated (Plaintiffs), filed suit

against VPMC for violations of La.R.S 22:187. Blue Cross was also made a

defendant, and the claims against it were based on allegations that it did not

enforce its provider agreement with VPMC.

In due course, Plaintiffs sought to have the class certified. The trial court

held an evidentiary hearing and granted the motion to certify the class. The class

was defined as follows:

All persons from January 1, 2004[,] to June 18, 2013[,] who received
“covered health care services” as defined by La. R.S. 22:1874(8)
provided by Eunice Community Medical Center/Acadian Medical

Center and all persons since April 1, 2010[,] who received “covered
health care services” as defined by La.R.S. 22:1874(8) from VILLE
PLATTE MEDICAL CENTER and its predecessors (“VPMC[”]); and
at the time of the covered health care services had “Health Insurance
Coverage” as defined by La. R.S. 22:1874(18); and from whom
VPMC attempted to recover any amount in excess of the “contracted
reimbursement rate” as defined by La. R.S. 22:1874(7) and/or who
paid VPMC in any manner including but not limited to liability
insurance proceeds and/or from proceeds of a settlement or judgment,
an amount in excess of the “contracted reimbursement rate” either
directly and/or through their attorney and/or through a liability
insurance carrier and/or any third party.

This class is composed of the following subclasses:

“Attempt to Recover” subclass: A subclass of persons who received
covered health care services, and who had health insurance coverage,
and from whom VPMC attempted to recover any amount in excess of
the “contracted reimbursement rate” from January 1, 2004 [,] through
June 18, 2013.

Payor subclass: A subclass of persons who received covered health
care services, and who had health insurance coverage, and/or who
paid VPMC in any manner including but not limited to liability
insurance proceeds and/or from proceeds of a settlement or judgment,
an amount in excess of the “contracted reimbursement rate” either
directly and/or through their attorney and/or through a liability
insurance carrier and/or any third party, from January 1, 2004[,]
through June 18, 2013.

VPMC now appeals, 1 asserting that THE trial court erred in granting

Plaintiff’s motion to certify class because she is not an appropriate class

representative because she fits only within the definition of one of the two

subclasses certified by the court and because she cannot represent individuals

treated at a completely different hospital under completely different ownership.

VPMC further asserts that the trial court erred in certifying the class where

Plaintiff failed to establish numerosity and predominance. Finally, VPMC urges us

to follow the second circuit’s recent decision in Baker v. PHC-Minden, LP, 49,122

1
While Blue Cross also opposed the motion to certify the class, Blue Cross has not
appealed the granting of that motion.
2

(La.App. 2 Cir. 8/13/14), 146 So.3d 921, wherein that court ruled that it should

deny class certification when presented with novel and untested legal theories.

DISCUSSION

This court has previously set forth the applicable standard of review as

follows:

On review of the class certification, we are mindful that an
appellate court considers the trial court’s factual findings under the
manifest error standard of review, and the trial court’s ultimate
decision as to whether to certify a class under the abuse of discretion
standard. Additionally, the appellate court considers de novo whether
the trial court applied the correct legal standard.

Desselle v. Acadian Ambulance Serv., Inc., 11-742, p. 8 (La.App. 3 Cir. 2/1/12), 83

So.3d 1243, 1250, writ denied, 12-518 (La. 4/13/12), 85 So.3d 1253 (citations

omitted).

The prerequisites to maintaining a class action are set forth in La.Code

Civ.P. art. 591:

A. One or more members of a class may sue or be sued as
representative parties on behalf of all, only if:

(1) The class is so numerous that joinder of all members
is impracticable.

(2) There are questions of law or fact common to the
class.

(3) The claims or defenses of the representative parties
are typical of the claims or defenses of the class.

(4) The representative parties will fairly and adequately
protect the interests of the class.

(5) The class is or may be defined objectively in terms of
ascertainable criteria, such that the court may determine the
constituency of the class for purposes of the conclusiveness of
any judgment that may be rendered in the case. This
prerequisite shall not be satisfied if it is necessary for the court
to inquire into the merits of each potential class member's cause
of action to determine whether an individual falls within the
defined class.

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B. An action may be maintained as a class action only if all of
the prerequisites of Paragraph A of this Article are satisfied, and in
addition:

(1) The prosecution of separate actions by or against
individual members of the class would create a risk of:

(a) Inconsistent or varying adjudications with respect to
individual members of the class which would establish
incompatible standards of conduct for the party opposing the
class, or

(b) Adjudications with respect to individual members of
the class which would as a practical matter be dispositive of the
interests of the other members not parties to the adjudications
or substantially impair or impede their ability to protect their
interests; or

(2) The party opposing the class has acted or refused to
act on grounds generally applicable to the class, thereby making
appropriate final injunctive relief or corresponding declaratory
relief with respect to the class as a whole; or

(3) The court finds that the questions of law or fact
common to the members of the class predominate over any
questions affecting only individual members, and that a class
action is superior to other available methods for the fair and
efficient adjudication of the controversy. The matters pertinent
to these findings include:

(a) The interest of the members of the class in
individually controlling the prosecution or defense of separate
actions;

(b) The extent and nature of any litigation concerning the
controversy already commenced by or against members of the
class;

(c) The desirability or undesirability of concentrating the
litigation in the particular forum;

(d) The difficulties likely to be encountered in the
management of a class action;

(e) The practical ability of individual class members to
pursue their claims without class certification;

(f) The extent to which the relief plausibly demanded on
behalf of or against the class, including the vindication of such
public policies or legal rights as may be implicated, justifies the
costs and burdens of class litigation; or
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(4) The parties to a settlement request certification under
Subparagraph B(3) for purposes of settlement, even though the
requirements of Subparagraph B(3) might not otherwise be met.

C. Certification shall not be for the purpose of adjudicating
claims or defenses dependent for their resolution on proof individual
to a member of the class. However, following certification, the court
shall retain jurisdiction over claims or defenses dependent for their
resolution on proof individual to a member of the class.

The party who wants the class certified bears the burden of establishing that

the relevant criteria have been met. Duhe v. Texaco, Inc., 99-2002 (La.App. 3 Cir.

2/7/01), 779 So.2d 1070, writ denied, 01-637 (La. 4/27/01), 791 So.2d 637.

VPMC asserts that the named plaintiff does not fit the definition of the payor sub-

class, that the named plaintiff cannot represent patients from another hospital, that

the named plaintiff cannot represent patients insured by another health insurer, that

numerosity is not established, that typicality is not established, that there is no

identifiability of class members, that predominance has not been established, and

that class actions are not appropriate for novel/untested liability claims.

In Desselle, 83 So.3d 1243, this court certified a class action where the claim

concerned Acadian Ambulance’s policy of attempting to recover its full rate for

services from the patients’ settlement or judgment with the tortfeasor rather than

attempting to recover the discounted rate contracted for between itself and the

patient’s health insurer. The class definition used in this case is very similar to that

approved by this court in Desselle.

VPMC asserts that the named plaintiff is not a proper class representative

because she does not fit within the definition of the payor subclass and cannot

represent patients from another hospital or insured by someone other than Blue

Cross. We agree with Plaintiffs that the subclasses do not represent different

issues. The only difference is that one class is seeking reimbursement for sums

paid. There is one issue: whether the billing practice violated La.R.S. 22:1874.
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However, we recognize that while Plaintiff represents the overall class, she is not a

member of both subclasses. The Louisiana Supreme Court has stated “that any

errors to be made in deciding class action issues should be in favor of and not

against the maintenance of the class action, because a class certification is ‘always’

subject to modification or decertification ‘if later developments during the course

of the trial so require.’” Dupree v. Lafayette Ins. Co., 09-2602, p. 7 (La. 11/30/10),

51 So.3d 673, 679 (quoting Castano v. American Tobacco Co., 84 F.3d 734, 744

(5th Cir.1996)). Thus, we uphold the certification of the class but amend the

definition to delete the subclasses. There is no claim that the class representative is

attempting to represent persons treated at facilities other than those owned and

operated by VPMC.

Tracey Young, the Business Office Director for Acadian Medical Center at

the relevant time, testified at the hearing on class certification. She testified that it

was “standard practice” to consider liability insurance, if any, as the primary payor

and health insurance as secondary such that full payment was sought and that if the

liability insurer did not pay, the health insurance would then be billed for the

contractual reimbursement amount. Young also testified that the lien against the

liability insurer would not be cancelled even if the health insurer paid the charges.

Young’s testimony also established that it did not matter whether an insurer other

than Blue Cross was involved; the practice was the same. Young also testified that

more than one hundred patients involved in car accidents per facility were billed

this way during the years 2004 to 2010 and 2010 to 2012.

The numerosity requirement does not have a strict numbers threshold, rather

it is based on the facts and circumstances of each case and requires a showing that

“joinder is impractical and there is a definable group of aggrieved persons.” Doe

v. Southern Gyms, LLC, 12-1566, p. 12 (La. 3/19/13) 112 So.3d 822, 831. In this
6

case, the testimony and evidence show that the class is easily definable and that its

members are easily identifiable and that there are a sufficient number of aggrieved

parties such that joinder is impractical.

[T]he predominance requirement is more demanding than the
commonality requirement, because it “entails identifying the
substantive issues that will control the outcome, assessing which
issues will predominate, and then determining whether the issues are
common to the class,” a process that ultimately “prevents the class
from degenerating into a series of individual trials.”

Dupree, 51 So.3d at 683 (quoting Brooks v. Union Pac. R. Co., 08-2035, p. 19

(La.5/22/09), 13 So.3d 546, 560)). In Price v. Martin, 11-853, p. 21 (La. 12/6/11),

79 So.3d 960, 975 (quoting Wal-Mart Stores, Inc. v. Dukes, ___ U.S. ___, 131

S.Ct. 2541, 2551 (2011)), the Louisiana Supreme Court held that in order for a

case to proceed as a class action, “there must be ‘significant proof,’ subject to

‘rigorous analysis,’ of a common question--one where the ‘determination of its

truth or falsity will resolve an issue that is central to the validity of each one of the

claims in one stroke.’” In this case, the predominance requirement is

unquestionably met because there is but one question as to all of the claimants:

whether the billing practice violated La.R.S. 22:1874.

The typicality requirement “is satisfied if the class representative[’s] claims

arise out of the same event, practice, or course of conduct giving rise to the claims

of the other class members[,] and those claims arise from the same legal theory.”

Desselle, 83 So.3d at 1251. As in Desselle, we recognize that the “straightforward

and succinct nature of the questioning and testimony” of the witness in the case at

bar “revealed the consistency of the application of the policy.” Id. Therefore, we

find no manifest error in the trial court’s finding that the typicality requirement is

met.

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Finally, VPMC urges us to follow the reasoning of the second circuit in

Baker, 146 So.3d 921. In that case, the second circuit reversed the trial court’s

certification of a class in a situation similar to the case at bar. The plaintiffs in

Baker alleged that Minden Medical Center had a policy “for billing insured

patients involved in motor vehicle accidents where a third party is liable for the

crash” such that even if the hospital received payment from the injured party’s

insurance, it still “attempted to collect the full rate from the patient’s settlement

through the patient’s attorney and the liability insurer using medical liens filed

pursuant to La.R.S. 9:4752.” Id. at 922. The second circuit noted that Desselle, 83

So.2d 1243, was “rendered prior to an understanding of whether a plaintiff even

had a private right of action under the Act” and found that certification of the class

was improper because “novel and untested legal theories” were involved. Baker,

146 So.3d 921, 929.

We respectfully disagree with the second circuit’s assertion that “novel and

untested legal theories” are involved in the determination of whether a billing

practice violates La.R.S. 22:1874. Desselle, from our own circuit, deals with a

similar issue and is a two-year-old case in which the Louisiana Supreme Court has

denied writs. In fact, the Baker case itself recognizes that “plaintiffs have armed

themselves with this language and have brought lawsuits all across this State

against hospitals such as MMC, alleging violations under the Act.” Id. at ___.

Thus, the issue is hardly novel. Accordingly, we decline to follow Baker2 and find

that VPMC’s argument in this regard is without merit.

For the foregoing reasons, we find no error in the trial court’s granting of

Plaintiffs’ motion to certify class in this case.

2
Under the “law of the circuit” rule, this second circuit decision is neither binding upon
this court nor controlling authority in this case, but rather is persuasive only. See Hagan v.
Hagan, 10-1432 (La.App. 3 Cir. 7/27/11), 70 So.3d 1081.
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DECREE

We hereby affirm the trial court’s certification of the class but amend the

definition to delete the subclasses. As amended, the judgment of the trial court is

affirmed. All costs of this proceeding are assessed to the appellant, Ville Platte

Medical Center.

AFFIRMED AS AMENDED.

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