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Allen v. Logisicare Solutions, LLC

United States District Court, E.D. Louisiana

August 16, 2017

KATHY ALLEN, ET AL
v.
LOGISICARE SOLUTIONS, LLC, ET AL

         SECTION “B” (4)

          ORDER AND REASONS

         Before the court are “LogistiCare Solutions LLC's Motion to Dismiss for Lack of Subject Matter Jurisdiction” (Rec. Doc. 11), “Plaintiffs' Opposition to Motion to Dismiss” (Rec. Doc. 19), “LogistiCare Solutions LLC's Reply Memorandum in Support of Motion to Dismiss for Lack of Subject Matter Jurisdiction” (Rec. Doc. 25), “Defendant First Transit, Inc.'s Motion to Dismiss or, Alternatively, for More Definite Statement” (Rec. Doc. 27), “Plaintiffs' Opposition to First Transit's Motion to Dismiss or, Alternatively, for More Definite Statement” (Rec. Doc. 29) and “First Transit, Inc.'s Reply Memorandum in Support of Motion to Dismiss or, Alternatively, for More Definite Statement” (Rec. Doc. 33), For the reasons set forth below, IT IS ORDERED that the Defendants' Motions to Dismiss are GRANTED.

         FACTS AND PROCEDURAL HISTORY

         Plaintiffs filed the instant suit against LogistiCare Solutions, LLC (“LogistiCare”), Frist Transit, Inc. (“First Transit”) and Southeastrans, Inc. (Rec. Doc. 1). Defendants Logisticare and First Transit have filed Motions to Dismiss.

         LogistiCare and First Transit are brokers of Medicaid transportation in Louisiana (Rec. Doc. 1). The complaint names twenty-three (23) individual plaintiffs and twenty-two (22) Business Entity plaintiffs (Rec. Docs. 1 and 24). Plaintiffs allege that Defendants LogistiCare and First Transit breached their contracts when they used discretion over transportation routes in their roles as brokers facilitating transportation services to Medicaid beneficiaries (Rec. Doc. 1). Plaintiffs allege that in particular the Defendants breached their contracts by (1) not assigning trips properly to Plaintiffs; (2) retributively taking away trips from Plaintiffs after they complained about the Defendants business practices; and (3) ignoring the freedom of choice of patients' rights when selecting transportation providers.

         FACTUAL AND LEGAL FINDINGS

         A. Defendant LogistiCare's Motion to Dismiss

         Under Federal Rule of Civil Procedure 12 (b)(1) a district court must dismiss a case if it lacks subject matter jurisdiction over a Plaintiff's claim. Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). The Court must grant a motion to dismiss for lack of subject matter jurisdiction when it lacks the statutory or constitutional power to adjudicate the case. See Home Builders Ass'n of Miss., Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998). The party who invokes federal court jurisdiction bears the burden of showing that jurisdiction is proper. Dow Agrosciences LLC v. Bates, 332 F.3d 323, 326 (5th Cir. 2003).

         “In ruling on a motion to dismiss for lack of subject matter jurisdiction, a court may evaluate (1) the complaint alone, (2) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts, or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Den Norske Stats v. HereMac Vof, 241 F.3d 420, 424; Barrera-Montenegro v. United States, 74 F.3d 657, 659 (5th Cir. 1996).

         Defendant LogistiCare contends that the individual Plaintiffs do not have standing to bring a lawsuit against it. As this Court has explained “standing is an absolute requirement for federal jurisdiction, and without standing a plaintiff's claim may not proceed.” Mayes v. PTP Invs., LLC, Case No.:13-5474, 2014 U.S. Dist. LEXIS 70369, at*2 (E.D. La. May 21, 2014). Defendant provides evidence that LogistiCare does not contract with individuals, but only corporate entities (Rec. Doc. 11-1). Plaintiffs cite one declaration from a sole proprietor that contracted with LogistiCare (Rec. Doc. 19-1). However this declaration does not demonstrate that Plaintiffs can establish privity with LogistiCare. There is no indication that the individuals listed in Plaintiffs' complaint have contractual privity with LogistiCare. Given that this relationship is the basis for subject matter jurisdiction, it is Plaintiffs burden to demonstrate the existence of this privity. Bates, 332 F.3d at 326. Plaintiffs do not demonstrate this in their opposition or present an alternative source of subject matter jurisdiction. Furthermore, the corporate entities that Plaintiffs added to their complaint do not bestow standing upon the individually named Plaintiffs (Rec. Doc. 24). Under Louisiana law only a corporation, not its members, may sue to recover any damages it has sustained. Skannal v. Bamburg, 33 So.3d 227, 240 (La.App. 2 Cir. 01/27/10). Plaintiffs in their opposition do not provide any citations that will allow them to establish standing for their individual Plaintiffs (Rec. Doc. 19). Plaintiffs ask this Court to deny the motion because this Court should not look at the merits when evaluating a Rule 12 (b)(1) motion (Rec. Doc. 19). Establishing subject matter jurisdiction is a threshold question for this Court and does not rely on a merit based analysis. Ramming v. United States, 281 F.3d at 161. This Court finds that Defendant's Motion to Dismiss is appropriate and all claims by individual plaintiffs should be dismissed.

         B. Defendant First Transit's Motion to Dismiss

         As an initial matter, the Courts analysis regarding lack of standing for the individual Plaintiffs against LogistiCare is instructive for First Transit's 12 (b)(1) contentions. This Court lacks subject matter jurisdiction over individual Plaintiffs La'Dette's and Angel's claims against First Transit because there is no contractual privity between these two Plaintiffs and First Transit (Rec. Doc. 27-5). Plaintiffs do not proffer any evidence or cite any authority that establishes subject matter jurisdiction under these circumstances. The individual Plaintiffs La'Dette and Angel and their claims should be dismissed.

         The remaining portion of First Transit's motion falls under Rule 12 (b)(6). Rule 12(b)(6) of the Federal Rules of Civil Procedure allows a party to move for dismissal of a complaint for failure to state a claim upon which relief can be granted. Such a motion is rarely granted because it is viewed with disfavor. See Lowrey v. Tex. A & M Univ. Sys., 117 F.3d 242, 247 (5th Cir.1997) (quoting Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982)).

         When reviewing a motion to dismiss, courts must accept all well-pleaded facts as true and view them in the light most favorable to the non-moving party. Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996). However, “[f]actual allegations must be enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Gonzales v. Kay, 577 F.3d 600, 603 (5th Cir. 2009)(quoting Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009))(internal quotation marks omitted). The Supreme Court in Iqbal explained that Twombly promulgated a “two-pronged approach” to determine whether a complaint states a plausible claim for relief. Iqbal, 129 S.Ct. at 1950. First, courts must identify those pleadings that, “because they are no more than conclusions, are not entitled ...


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