United States District Court, D. Massachusetts
GOVERNMENT EMPLOYEES INSURANCE CO., et al. Plaintiffs,
BARRON CHIROPRACTIC & REHABILITATION, P.C., et al., Defendants.
MEMORANDUM AND ORDER ON MOTIONS TO DISMISS
ALLISON D. BURROUGHS U.S. DISTRICT JUDGE
April 1, 2016, Plaintiffs Government Employees Insurance
Company, GEICO General Insurance Company, and GEICO Indemnity
Company (collectively, “GEICO”) initiated this
medical provider fraud action against Defendants Barron
Chiropractic & Rehabilitation, Phillip C. Barron, Gilbert
Weiner, and Brian Farrell (collectively,
“Barron”) under Massachusetts state law. [ECF No.
1]. The Court has jurisdiction over the case pursuant to 28
U.S.C. § 1332(a)(1). Currently pending before the Court
are Barron's (1) special motion to dismiss under the
Massachusetts Strategic Litigation Against Public
Participation (“Anti-SLAPP”) statute, Mass. Gen.
Laws ch. 231, § 59H [ECF No. 21] and (2) motion to
dismiss for failure to state a claim [ECF No. 19]. GEICO
opposes both motions [ECF Nos. 25, 26]. The parties also
filed replies and sur-replies in connection with each motion.
[ECF Nos. 31, 32, 35, 36]. For the reasons explained below,
the special motion to dismiss pursuant to the Anti-SLAPP
statute is DENIED, and the motion to dismiss for
failure to state a claim is GRANTED IN PART AND DENIED IN
ALLEGATIONS IN THE COMPLAINT
the length of the complaint (98 pages long, 500 pages with
exhibits, and 626 paragraphs) [ECF No. 1 (hereinafter,
“Compl.”)], the following is a summary of only
the most salient facts. In essence, GEICO alleges that Barron
engaged in an exploitative scheme to induce GEICO to pay or
settle false and/or inflated medical insurance claims. Compl.
¶ 43. The individual defendants are each employed as
chiropractors at Defendant Company Barron Chiropractic &
Rehabilitation (“the Barron chiropractors”).
Id. ¶¶ 23, 26, 31.
the Massachusetts No-Fault Personal Injury Protection
(“PIP”) statute, auto insurers in Massachusetts
must provide PIP coverage to their insureds. Id.
¶¶ 41-43. This coverage ensures that persons
involved in automobile accidents have their medical expenses
covered, regardless of who is liable for the accident.
Id. ¶¶ 41-43. As an insurance company
providing this mandatory coverage to its insureds, GEICO pays
these PIP benefits directly to healthcare providers, such as
Barron. Id. ¶¶ 41-43.
alleges that Barron took advantage of the PIP statutory
framework by engaging in several different types of
fraudulent behavior in an effort to obtain higher payments
from GEICO. First, GEICO alleges that the Barron
chiropractors consistently determined that every motor
vehicle accident patient required chiropractic treatment,
prescribed uniform treatments without regard to individual
patients' needs, and used boilerplate protocols in order
to maximize the amount of treatment rendered and the PIP
benefits received from GEICO. Id. ¶¶
64-67. These treatment protocols included certain types of
in-office treatment (electrical stimulation and hot pack
application) that GEICO asserts could and should have been
prescribed as home treatment, which would not have been
billable. Id. ¶¶ 72-77. The Barron
chiropractors also purportedly only prescribed certain
expensive treatments to patients with PIP benefits (like
GEICO-insured patients), but not to patients who paid in cash
or through regular healthcare insurance, even when those
patients had substantially similar injuries. Id.
¶¶ 81, 84-86. GEICO submits that the sole
determinant used by Barron for deciding the appropriate
protocol for an individual patient was whether the invoice
for their services would be submitted to an insurer or a
federal entity like Medicare. Id. ¶ 88.
GEICO alleges that Barron fabricated complaints from patients
to substantiate the treatment and billing, as evidenced by
the fact that, for example, the records for
non-English-speaking patients listed specific, subjective
complaints despite the fact that Barron does not have
translators at its offices. Id. ¶¶ 101-04.
Moreover, Barron submitted template billing forms, without
corresponding or supporting medical records, which GEICO
argues is in violation of chiropractic regulations.
Id. ¶¶ 109-12.
GEICO alleges that Barron submitted invoices certifying that
billed services were rendered by a treating chiropractor,
despite the fact that many of the services were actually
rendered by unlicensed persons with no formal training,
sometimes in a separate physical therapy office also owned by
Barron, id. ¶ 129-31, 138-41, and that Barron
engaged in this misleading billing practice for the purpose
of seeing more patients, billing for more services, and
receiving increased payments, id. ¶¶ 148,
159, 164-66, 176-78.
GEICO claims that Barron charged GEICO-insured patients and
billed GEICO for spinal decompression treatments that it
publicly advertised as free for all new patients.
Id. ¶¶ 151-54.
GEICO alleges that Barron made a myriad of false and
misleading statements concerning the services they provided
to GEICO-insured patients in both the medical records
themselves and the billing invoices, including, inter
alia, misidentifying which individual rendered each
treatment, misusing Current Procedure Terminology or
“CPT” codes created by the American Medical
Association (“AMA”) to miscategorize the medical
services rendered and invoiced for reimbursement, and
submitting invoices and records using a Health Insurance
Claim Form that falsely certified that the statements on the
forms were accurate and not misleading. Id.
¶¶ 158, 160-76, 191-92.
GEICO submits that Barron engaged in deceptive
“up-coding” techniques that allowed them to bill
at a higher rate than that of the service actually performed,
including, for example, by claiming that certain
GEICO-insured patients were “new patients, ” even
if they had previously been seen by Barron, in order to
charge GEICO for the more expensive “new patient”
visit. Id. ¶¶ 215-16, 221-27.
also asserts that this is not the first time Barron has been
disciplined for failing to accurately document services or
billing for services that were never actually rendered,
claiming that, in July 2009, the Massachusetts Board of
Registered Chiropractors executed a Consent Agreement with
Barron, disciplining them for the precise types of conduct
documented in the complaint. Id. ¶¶
the complaint further alleges that Barron defrauded GEICO by
engaging in an unlawful and improper referral scheme by
exclusively referring GEICO-insured patients being treated at
Dr. Barron's physical therapy clinic, Be Pain Free, to
the chiropractic office also owned by Dr. Barron, including
patients who did not necessarily need chiropractic care, for
the purpose of deriving additional billing. Id.
¶¶ 243-44, 246, 254, 258.
GEICO claims that Barron, in violation of Massage Therapy
regulations, provided massage therapy services without proper
licensure by advertising and providing massage therapy
services, despite the fact that it did not have the license
required by statute and did not fall into any licensure
exception. Id. ¶¶ 262-67.
support of its general allegations, GEICO specifically
identifies twelve “exemplar” claims, which it
claims are illustrative of Barron's widespread deceitful
and fraudulent conduct. Id. ¶¶ 270-580.
GEICO also references transcripts of sworn statements by
Barron's GEICO-insured patients, which corroborate many
of the allegations made throughout the complaint, Compl. Exs.
20-23, 33, 35, 38, 42, 44, 46, including that unqualified
personnel administered patients' treatment, see,
eg., Compl. ¶ 282, that patients were left
unsupervised while doing therapeutic exercises, see,
eg., id. ¶ 290, and that, despite
corresponding records which list specific medical complaints
purportedly made by patients, non-English-speaking patients
were seen without translators, see, e.g.,
id. ¶¶ 506-07. In addition to these
“exemplar” claims, GEICO asserts that
additional insurance claims were submitted as part of
Barron's fraudulent scheme. See Compl. Ex. 3.
on these factual allegations, GEICO asserts the following
state law causes of action: common law fraud (Count I); civil
conspiracy (Count II); money had and received (Count III);
violations of Massachusetts General Laws Chapter 93A (Count
IV); breach of contract (Count V); and intentional
interference with advantageous business relationships (Count
VI). As relief, GEICO requests damages, costs and interest,
reasonable attorneys' fees, and an injunction.
MOTION TO DISMISS PURSUANT TO THE ANTI-SLAPP STATUTE
Massachusetts Anti-SLAPP statute permits a party to bring a
special motion to dismiss when the allegations against it
“are based on said party's exercise of its right of
petition under the constitution of the United States or of
the commonwealth.” Mass. Gen. Laws ch. 231, § 59H.
The statute further provides that:
The court shall grant such special motion, unless the party
against whom such special motion is made shows that: (1) the
moving party's exercise of its right to petition was
devoid of any reasonable factual support or any arguable
basis in law and (2) the moving party's acts caused
actual injury to the responding party. In making its
determination, the court shall consider the pleadings and
supporting and opposing affidavits stating the facts upon
which the liability or defense is based.
Massachusetts Supreme Judicial Court has laid out a two-step
burden-shifting procedure for such special motions to
At the first stage, a special movant must demonstrate that
the nonmoving party's claims are solely based on its own
petitioning activities . . . At the second stage, if the
special movant meets this initial burden, the burden will
shift . . . to the nonmoving party. The nonmoving party may
still prevail . . . by demonstrating that the special
movant's petitioning activities upon which the challenged
claim is based lack a reasonable basis in fact or law, i.e.
constitute sham petitioning, and that the petitioning
activities at issue caused it injury. If it cannot make this
showing, however, the nonmoving party may . . . [also] meet
its second-stage burden and defeat the special motion to
dismiss by demonstrating in the alternative that each
challenged claim . . . was not primarily brought to chill the
special movant's legitimate petitioning activities.
Blanchard v. Steward Carney Hosp., Inc., 75 N.E.3d
21, 38 (Mass. 2017). “In this inquiry, courts consider
pleadings and affidavits without indulging inferences in
favor of the non-moving party.” Bargantine v.
Mechs. Co-op. Bank, No. 13-11132-NMG, 2013 WL 6211845,
at *2 (D. Mass. Nov. 26, 2013). The standard of review under
the anti-SLAPP framework is “fundamentally different
from a Rule 12 motion” because it “incorporates
additional fact-finding beyond the facts alleged in the
pleadings.” S. Middlesex Opportunity Council, Inc.
v. Town of Framingham, No. 07-12018-DPW, 2008 WL
4595369, at *10 (D. Mass. Sept. 30, 2008).
to GEICO filing the instant lawsuit, Barron Chiropractic
initiated at least four lawsuits in state court against GEICO
in an effort to recover unpaid PIP benefits. Barron argues
that the instant complaint must be dismissed because it is
based on these state court suits, which are considered
protected petitioning activity within the meaning of the
Anti-SLAPP statute. The “employment of legal
mechanisms, ” including filing a claim with a judicial
body, “plainly constitute[s] petitioning activity under
the anti-SLAPP statute.” SMS Fin. V, LLC v.
Conti, 865 N.E.2d 1142, 1149 (Mass. App. Ct. 2007). To
prevail on this special motion to dismiss, however, Barron
“must make a threshold showing through pleadings and
affidavits that the claims against it are based on the
petitioning activities alone and have no substantial basis
other than or in addition to the petitioning
activities.” Blanchard, 75 N.E.3d at 29
(quoting Fustolo v. Hollander, 920 N.E.2d 837, 840
(Mass. 2010)) (further internal quotations
has failed to meet its burden. In determining whether
GEICO's claims have any substantial basis other than the
petitioning activity, “the focus solely is on the
conduct complained of” in the complaint. See
Demoulas Super Mts., Inc. v. Ryan, 873 N.E.2d 1168, 1172
(Mass. App. Ct. 2007) (quoting One Office, Inc. v.
Lopez, 769 N.E.2d 749, 757 (Mass. 2002)). Here, the
complaint is largely based on allegations of Barron's
widespread fraudulent billing scheme, and not on Barron's
petitioning activity in state court. See Keystone Freight
Corp. v. Bartlett Consol., Inc., 930 N.E.2d 744, 752-53
(Mass. App. Ct. 2010) (holding that plaintiff's
“counts for deceit, negligent misrepresentation, and
violation of G.L. c. 93A are grounded in [plaintiff's]
alleged billing misconduct and not in the fact that [the
defendant] sued for payment”). The fact that some of
the bills in the state court litigation are at issue in the
instant litigation does not turn this into a SLAPP suit, as
GEICO is complaining about the allegedly fraudulent activity
underlying those bills, not the fact that Barron engaged in
that Barron cannot meet its threshold burden of showing that
this lawsuit is based solely on Barron's protected
petitioning activity, the analysis ends here. See
Keystone, 930 N.E.2d at 753 n.12; see also Steinmetz
v. Coyle & Caron, Inc., No. 15-cv-13594-DJC, 2016 WL
4074135, at *5 (D. Mass. July 29, 2016) (denying anti-SLAPP
motion before analyzing alternative 12(b)(6) grounds for
MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM
motion to dismiss for failure to state a claim pursuant to
Federal Rule of Civil Procedure 12(b)(6), the Court must
accept as true all well-pleaded facts, analyze those facts in
the light most hospitable to the plaintiff's theory, and
draw all reasonable inferences from those facts in favor of
the plaintiff. U.S. ex rel. Hutcheson v. Blackstone Med.
Inc., 647 F.3d 377, 383 (1st Cir. 2011). In ruling on a
motion under Rule 12(b)(6), the Court “must consider
the complaint, documents annexed to it, and other materials
fairly incorporated within it, ” which “sometimes
includes documents referred to in the complaint but not
annexed to it” and “matters that are susceptible
to judicial notice.” Rodi v. S. New Eng. Sch. of
L., 389 F.3d 5, 12 (1st Cir. 2004).
detailed factual allegations are not required, a complaint
must set forth “more than labels and
conclusions.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007). A “formulaic recitation of the
elements of a cause of action” is not enough.
Id. To avoid dismissal, a complaint must set forth
“factual allegations, either direct or inferential,
respecting each material element necessary to sustain
recovery under some actionable legal theory.”
Gagliardi v. Sullivan, 513 F.3d 301, 305 (1st Cir.
2008) (internal quotations and citation omitted).
the facts alleged, when taken together, must be sufficient to
“state a claim to relief that is plausible on its
face.” A.G. ex rel. Maddox v. Elsevier, Inc.,
732 F.3d 77, 80 (1st Cir. 2013) (quoting Twombly,
550 U.S. at 570). “The plausibility standard invites a
two-step pavane.” Id. (quoting Grajales v.
P.R. Ports Auth., 682 F.3d 40, 45 (1st Cir. 2012)).
“At the first step, the court ‘must separate the
complaint's factual allegations (which must be accepted
as true) from its conclusory legal allegations (which need
not be credited).'” Id. (quoting
Morales-Cruz v. Univ. of P.R., 676 F.3d 220, 224
(1st Cir. 2012)). “At the second step, the court must
determine whether the remaining factual content allows a
‘reasonable inference that the defendant is liable for
the misconduct alleged.'” Id. (quoting
Morales-Cruz, 676 F.3d at 224). “Although not
equivalent to a probability requirement, the plausibility
standard asks for more than a sheer possibility that a
defendant has acted unlawfully.” Boroian v.
Mueller, 616 F.3d 60, 65 (1st Cir. 2010) (internal
citations and quotations omitted). “The make-or-break
standard . . . is that the combined allegations, taken as
true, must state a plausible, not a merely conceivable, case
for relief.” Sepulveda-Villarini v. Dep't of
Educ. of P.R., 628 F.3d 25, 29 (1st Cir. 2010) (quoting
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).
Massachusetts' No-Fault Automobile Insurance and
Mandatory PIP Coverage
created a no-fault automobile insurance scheme in an effort
“to reduce the number of small motor vehicle tort cases
being entered in the courts of the Commonwealth, to provide a
prompt, inexpensive means of reimbursing claimants for
out-of-pocket expenses, and to address the high cost of motor
vehicle insurance in the Commonwealth.” Estrada v.
Progressive Direct Ins. Co., 53 F.Supp.3d 484, 486 (D.
Mass. 2014) (quoting Flanagan v. Liberty Mut. Ins.
Co., 417 N.E.2d 1216, 1219 (Mass. 1981)). As part of the
no-fault statutory scheme, Massachusetts requires that
automobile insurers provide personal injury ...