Empire Healthchoice Assurance, Inc. vs. McVeigh

From Judgepedia

Judge Sonia Sotomayor (Sotomayor en Español)
Potential Obama nominees
Second Circuit Court of Appeals
Notable cases of Sonia Sotomayor
Coverage of confirmation hearing

Empire Healthchoice Assurance, Inc. vs. McVeigh (547 U.S. 677 (2006)) is a Supreme Court case deciding whether a contractual dispute between a large insurance company and a beneficiary should be heard at the state level or federal level. Affirming a decision by Sonia Sotomayor of the Second Circuit, the Supreme Court, in a 5-4 vote, held that the dispute should be heard at the state level.^[1]

Case participants

The case involved Denise McVeigh and Empire HealthChoice Assurance. Mrs. McVeigh is the administrix of the Estate of Joseph McVeigh, a Federal employee who was injured in a car accident and eventually died from sustained injuries^[1]. Empire HealthChoice Assurance is the trade name in New York State for Blue Cross Blue Shield^[1].

Background

In 2005 Sotomayor, along with two other judges, ruled against Empire Health Choice Assurance when the New York-based health insurance company sued the estate of a Joseph McVeigh for a recovery of $157,000 in insurance benefits as the result of an injury^[2]. Mr. McVeigh was injured and later recovered over $3 million in damages from a third party. His treatement, amounting to $157,000, was covered by Empire.^[3] The contract between Empire and Mr. McVeigh, however, required a repayment of medical expenses in the event that Mr. McVeigh recovered damages from a third party, which he did.

Empire argued that reimbursement actions implicate "uniquely federal interests" because the outcome of these cases directly affect the United States Treasury and because Congress expressed interest in maintaining uniformity among the states with respect to federal employees' health benefits^[2]. The Second Circuit affirmed the lower court ruling, finding no federal subject matter jurisdiction because Empire failed to show that New York state law "significantly conflicts" with federal interests. While Mrs. McVeigh might raise a state law defense that might conflict with federal interests, but that this possibility was insufficient for Empire to invoke federal question jurisdiction. On this point of law, the Second Circuit reached a different conclusion than a similar ruling in the Fourth Circuit^[2].

Supreme Court ruling

When the Supreme Court affirmed Sotomayor's decision, it ruled that under the Federal Employees Health Benefits Act of 1959 (FEHBA) state courts, not federal courts, are the proper forum for a contracts lawsuit by a plan administrator seeking reimbursement for medical costs^[4]. Empire, the Court ruled, had not demonstrated a "significant conflict...between an identifiable federal policy or interest and the operation of state law."^[5] This allowed for the Supreme Court to affirm Sotomayor's ruling^[4].

Madam Associate Justice Ruth Bader Ginsburg wrote the majority opinion, joined by Chief Justice John G. Roberts, John Paul Stevens, Antonin Scalia, and Clarence Thomas to affirm the opinion.

Leading the dissenting opinion was Associate Justice Stephen Breyer, who ruled that the dispute should have been deliberated at the federal level because, in party, "[t]here is litte about this case that is not federal."^[6] He was joined by Anthony M. Kennedy, David Souter, and Samuel Alito.

External links

• Text of Empire Healthchoice Assurance, Inc. vs. McVeigh courtesy of Cornell Law
• Annoucement of Ruling in Empire Healthchoice Assurance, Inc. vs. McVeigh
• Text of Second Circuit Court of Appeals Decision on Empire HealthChoice Assurance v. McVeigh

References

1. ↑ ^{1.0 1.1 1.2} [1]
2. ↑ ^{2.0 2.1 2.2} "Duke Law" Case summary of Empire Healthchoice Assurance, Inc. vs. McVeigh, May 28, 2009
3. ↑ [2]
4. ↑ ^{4.0 4.1} "Global Information Legal Network" Summary of Empire Healthchoice Assurance, Inc. vs. McVeigh, May 27, 2009
5. ↑ [3]
6. ↑ [4]

	v • d • e Notable cases of Judge Sonia Sotomayor
1997	Bartlett v. New York State Bd. of Law Examiners (reversed)
2001	U.S. v. Falcone • New York Times, Inc. v. Tasini (reversed) • Correctional Servs. Corp. v. Malesko (reversed)
2002	Jarvis v. Ford Motor Co.
2005	The European Community vs. RJR Nabisco (Supreme Court remanded back to the Second Circuit)
2006	U.S. v. Giordano • Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Dabit (reversed) • Empire Healthchoice Assurance, Inc. vs. McVeigh
2007	Riverkeeper, Inc. vs. EPA (reversed)
2008	Ricci v. DeStefano (reversed)