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Opelousas General Hospital Authority v. Louisiana Health Service & Indemnity Co.

Court of Appeals of Louisiana, Third Circuit

November 12, 2019

OPELOUSAS GENERAL HOSPITAL AUTHORITY, A PUBLIC TRUST, D/B/A OPELOUSAS GENERAL HEALTH SYSTEM
v.
LOUISIANA HEALTH SERVICE & INDEMNITY COMPANY D/B/A BLUE CROSS/BLUE SHIELD OF LOUISIANA

          APPEAL FROM THE TWENTY-SEVENTH JUDICIAL DISTRICT COURT PARISH OF ST. LANDRY, DOCKET NO. 16-C-3647-C HONORABLE ALONZO HARRIS, PRESIDING

          Thomas A. Filo Cox, Cox, Filo, Camel & Wilson, L.L.C. COUNSEL FOR PLAINTIFF/APPELLEE: Opelousas General Hospital Authority, et al.

          Patrick C. Morrow James P. Ryan Morrow, Morrow, Ryan, Bassett & Haik COUNSEL FOR PLAINTIFF/APPELLEE: Opelousas General Hospital Authority, et al.

          Stephen B. Murray Stephen B. Murray, Jr. Arthur M. Murray Murray Law Firm COUNSEL FOR PLAINTIFF/APPELLEE: Opelousas General Hospital Authority, et al.

          Mark A. Cunningham Michael C. Drew Jones Walker LLP COUNSEL FOR DEFENDANT/APPELLANT: Louisiana Health Service & Indemnity Company d/b/a Blue Cross and Blue Shield of Louisiana

          Pride J. Doran Doran & Cawthorne, L.L.C. COUNSEL FOR DEFENDANT/APPELLANT: Louisiana Health Service & Indemnity Company d/b/a Blue Cross and Blue Shield of Louisiana

          Court composed of Sylvia R. Cooks, John E. Conery, and Candyce G. Perret, Judges.

          SYLVIA R. COOKS, JUDGE

         Defendant, Louisiana Health Service & Indemnity Company d/b/a Blue Cross Blue Shield of Louisiana (hereafter BCBS-LA), appeals the judgment of the trial court certifying a class of Louisiana healthcare providers sought by Plaintiff, Opelousas General Hospital Authority, a Public Trust d/b/a Opelousas General Health System (hereafter OGHA). Finding no abuse of the trial court's discretion in certifying the class, we affirm the lower court judgment.

         OGHA alleged that BCBS-LA's uniform contracting practices amounted to anticompetitive conduct that was in violation of the Louisiana Anti-Trust Statute. La.R.S. 51:122 et seq. Specifically, OGHA alleged these unfair contracting practices prohibited Louisiana Blue Cross providers from contracting for reimbursement rates with any other out-of-state Blue Cross insurer, required that Louisiana Blue Cross providers accept Louisiana Blue Cross contracted rates from any other Blue Cross insurer, and excluded any other Blue Cross insurer from entering the Louisiana health insurance marker or contracting for its own reimbursement rates with Louisiana Blue Cross providers. OGHA maintains this results in a monopolistic market share for BCBS-LA and violates anti-trust law under La.R.S. 51:122 and/or 51:123.

         Since the filing of this suit on August 24, 2016, there have been several motions in both state and federal court that significantly delayed the proceedings. Although originally set for hearing on June 29, 2017, due to the numerous motions filed by BCBS-LA and the Blue Cross Blue Shield Association, the class certification was not heard until nearly two years later on May 30, 2019. After the hearing on the class certification and filing of post-hearing memoranda by both parties, the trial court rendered judgment certifying the statewide class sought by OGHA on July 29, 2019.

         On appeal, BCBS-LA contends the trial court erred in certifying the class because OGHA did not offer any common evidence to satisfy the elements of a violation of Louisiana's antitrust law on a class-wide basis. BCBS-LA also maintains one of OGHA's lead lawyers has an irreconcilable conflict of interest due to his service on the Board of Trustees of OGHA.

         ANALYSIS

         In Baker v. PHC-Minden, L.P., 14-2243, p. 1 (La. 5/15/15), 167 So.3d 528, 538, the supreme court set forth the analysis for appellate review of the class certification procedure in Louisiana:

A class action is "a nontraditional litigation procedure that permits a representative with typical claims to sue or defend on behalf of, and stand in judgment for, a class of similarly situated persons when the question is one of common interest to persons so numerous as to make it impracticable to bring them all before the court." Ford v. Murphy Oil U.S.A., Inc., 96-2913 (La.9/9/97), 703 So.2d 542, 544. Its purpose and intent is to adjudicate and obtain res judicata effect on all common issues applicable to persons who bring the action, as well as to all others similarly situated. Brooks v. Union Pacific R. Co., 08-2035, p. 10 (La.05/22/09), 13 So.3d 546, 554.
The only issue to be considered by the trial court when ruling on certification, and by this Court on review, is whether the case at bar is one in which the procedural device is appropriate. In determining the propriety of such action, the court is not concerned with whether the plaintiffs have stated a cause of action or the likelihood they ultimately will prevail on the merits, but whether the statutory requirements have been met. Eisen v. Carlisle and Jacquelin, 417 U.S. 156, 178, 94 S.Ct. 2140, 2153, 40 L.Ed.2d 732 (1974).
This determination of whether a class action meets the requirements imposed by law involves a rigorous analysis in which the trial court "must evaluate, quantify, and weigh [the relevant factors] to determine to what extent the class action would in each instance promote or detract from the goals of effectuating substantive law, judicial efficiency, and individual fairness." McCastle v. Rollins Environmental Services of Louisiana, Inc., 456 So.2d 612, 618 (La.1984). Doing so, the trial court must actively inquire into every aspect of the case and not hesitate to require showings beyond the pleadings. Brooks, 08-2035 at p. 10, 13 So.3d at 554. "Going beyond the pleadings is necessary, as a court must understand the claims, defenses, relevant facts, and applicable substantive law in order to make a meaningful determination of the certification issues." Dupree v. Lafayette Ins. Co., 09-2602, p. 7 (La. 11/30/10), 51 So.3d 673, 680.
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 order is always subject to modification or decertification, "if later developments during the course of the trial so require." McCastle, 456 So.2d at 620. To that end, La.Code. Civ. Proc. art. 592(A)(3)(d) provides the trial court "may alter, amend, or recall its initial ruling on certification and may enlarge, restrict, or otherwise redefine the constituency of the class or the issues to be maintained in the class action." La.Code. Civ. Proc. art. 592(A)(3)(d). Nonetheless, the trial court should evaluate the case closely before certifying the class in light of the consequent burdens of giving notice and additional discovery. See Dupree, 09-2602 at p. 7, 51 So.3d at 680.
A trial court has wide discretion in deciding whether to certify a class. Brooks, 08-2035 at p. 10, 13 So.3d at 554. Subject to the manifest error standard, its factual findings can only be reversed upon finding, based on the entire record, no reasonable factual basis for the factual finding and the factfinder is clearly wrong. Stobart v. State, through Department of Transp. and Development, 617 So.2d 880, 882 (La. 1993). However, we review its ultimate decision of whether or not to certify the class under the abuse of discretion standard. Dupree, 09-2602 at p. 7, 51 So.3d at 680. Implicit therein "is recognition of the essentially factual basis of the certification inquiry and of the district court's inherent power to manage and control pending litigation." Brooks, 08-2035 at p. 11, 13 So.3d at 554.

         In Louisiana, the requirements for class certification are set forth in La.Code Civ.P. art. 591. Article 591(A) provides five threshold requirements for certification of a class:

A. One or more members of a class may sue or be sued as representative parties on ...

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