Superior Court of Massachusetts, Suffolk, Business Litigation Session
Liberty Mutual Ins. Co.
Peoples Best Care Chiropractic and Rehabilitation, Inc. et al No. 136808
April 10, 2017
MEMORANDUM AND ORDER ALLOWING PLAINTIFF'S MOTION
FOR SUMMARY JUDGMENT
Kenneth W. Salinger, Justice of the Superior Court.
lawsuit concerns the rates that Liberty Mutual Insurance
Company pays to chiropractic clinics under Personal Injury
Protection (" PIP") benefit provisions in personal
automobile insurance policies. Liberty seeks a declaration
that an Illinois court's final judgment that approved the
settlement of a nationwide class action regarding these rates
is entitled to full faith and credit in Massachusetts and
binds the three Defendants, who did not opt out of the
Illinois proceeding and therefore are members of the
plaintiff class in that case. Defendant Raghubinder Bajwa,
M.D., P.C., was defaulted for failing to answer the
complaint. Defendants Peoples Best Chiropractic and
Rehabilitation, Inc. (" PBC") and Pleasant Valley
Chiropractic, LLC (" PVC") (collectively, the
remaining " Defendants") oppose Liberty's
request and assert counterclaims seeking to bar Liberty from
implementing the settlement.
Court concludes that Liberty is entitled to summary judgment
in its favor on all claims. With respect to Liberty's
affirmative claim, the Court concludes that there is an
actual controversy between the parties and that the Illinois
final order and judgment is entitled to full faith and credit
in Massachusetts courts. In addition, Liberty is entitled to
judgment as a matter of law on Defendants' counterclaims.
Defendants sought leave to conduct certain discovery before
the Court decided Liberty's summary judgment motion. The
Court denies this request because none of the discovery
sought by Defendants concerns any factual issue relevant to
whether Liberty is entitled to summary judgment.
was the defendant in a multi-state class action filed in
Illinois state court to challenge the way Liberty determines
what rates it will pay to chiropractors and other medical
care providers under the no-fault PIP provisions of personal
automobile insurance policies. The Illinois case was
captioned Lebanon Chiropractic Clinic, P.C. v. Liberty
Mutual Insurance Company and docketed as Illinois
Circuit Court for St. Clair County, no. 14-L-521.
compares billed charges for medical treatment to a database
of charges that Liberty believes are for similar services
provided in the same geographic area. Since 2011 Liberty has
done so using data maintained by a non-profit company called
FAIR Health, Inc. Liberty generally refuses to pay rates any
higher than the 80th percentile of similar charges according
to the FAIR Health data. The plaintiffs in the Illinois case
claimed that this practice was unlawful.
parties to the Illinois lawsuit entered into a Stipulation of
Settlement in October 2014 that would resolve all claims on
behalf of a proposed class. The " settlement class"
included subclasses of policyholders, claimants, and medical
providers in thirty-eight states, including Massachusetts.
The provider subclass consisted of medical care providers
that provided PIP-covered treatment from June 25, 2008,
through October 31, 2014, and had their requests for
reimbursement reduced by Liberty as a result of its use of a
essence of the proposed settlement was that the parties
agreed to the method that Liberty would use to determine the
reasonableness of charges for covered treatment during the
five years after October 31, 2014. The settlement agreement
provided that, if the class were certified and the settlement
were approved, then the class members would stipulate that
Liberty's determination of the reasonableness of charges
for future claims during this five-year period using the
agreed-upon method would be lawful, release all claims
arising from payments by Liberty made on or before October
31, 2014, and agree not to sue Liberty to contest its
determination of the reasonableness of future charges using
the agreed-upon method.
the Illinois court preliminarily approved the settlement, a
court-approved notice was sent to each potential class
member, including PBC and PVC. This notice was sent to
Defendants at the same addresses they used when billing
Liberty; it is undisputed that the notice was sent to the
correct addresses. Defendants had the opportunity to opt out
of the proposed class, but they did not do so.
final settlement hearing, Attorney Brian McNiff (who now
represents PBV and PVC in this case) objected to the
settlement on the grounds that it was unfair to Massachusetts
class members. The Illinois court overruled all objections,
certified the proposed class, and approved the settlement in
February 2015. That decision was affirmed on appeal in
is an actual controversy between the parties regarding the
enforceability of the Illinois final order that can be
resolved by declaring the rights of the parties in accord
with G.L.c. 231A.
the Illinois class action settlement was approved in February
2015, Defendants have brought more than thirty lawsuits
against Liberty in Massachusetts district courts in which
Defendants have challenged Liberty's payment of less than
the full face amount of a PIP charge. Liberty contends that
such claims are barred by the covenant not to sue in the
Illinois class action settlement, and that the final order by
the Illinois court is enforceable in Massachusetts under the
Full Faith and Credit clause of the United States
Constitution. Defendants ...