Aetna accused of judge shopping in $120M illegal kickbacks suit

Defendants caught up in a fraudulent billing case brought by Aetna Life Insurance are seeking to dismiss the suit, arguing Aetna only filed the claim to circumvent a federal judge’s ruling.

As previously reported, Aetna filed suit against North Cypress Medical Center and its CEO, Dr. Robert Behar, on Feb. 23 in the U.S. District Court for Southern Texas, Houston Division.

Aetna charges the defendants of engaging in a fraudulent kickback scheme, which includes: paying illegal kickbacks to physicians in exchange for patient referrals disguised as ownership interests in North Cypress; charging grossly excessive fees; implementing improper billing techniques; and forgiving members’ financial responsibility in order to make the scheme work.

Aetna alleges that Dr. Behar’s “out-of-network” business scheme has caused the company to overpay North Cypress as much as $120 million since Jan. 1, 2009.

However, on Monday, March 9, North Cypress fired back, filing a motion to dismiss under the “First-to-File Rule.”

The rule applies when two similar suits brought by the same parties are filed in two different courts of proper jurisdiction. The court that first acquires jurisdiction usually retains the suit.

North Cypress maintains it brought suit against Aetna first on Feb. 12, 2013, in Koening, et al v. Aetna et al, in order to collect unpaid payments from the insurance provider.

In the Koening case, Aetna filed a counterclaim, seeking reimbursement of alleged overpayments, court records show.

Following two years of heated discovery, Aetna filed a motion for leave to file first amended counterclaim, which mirrored the same allegations contained in Aetna’s recently filed lawsuit.

However, Aetna’s motion was denied on Jan. 27. A month later, Aetna filed the suit in question, court records show.

“North Cypress has filed this Motion to Dismiss only pursuant to the ‘First to File

Rule’ … because it is obvious that Aetna is ‘judge shopping’ in an effort to maintain an identical, parallel lawsuit to the Koenig Case,” states North Cypress’ motion to dismiss.

“Aetna is using this suit as a tactic to expand procedural rights it would not have otherwise enjoyed such as the ability to amend its counterclaims previously denied, include North Cypress’ Chief Executive Officer, Dr. Robert A. Behar, M.D., as a party Defendant for purposes of obtaining a vehicle to advance civil RICO claims, to obviously pressure North Cypress into an advantageous settlement and/or an in network contract advantageous to Aetna and to demand a trial by jury.”

North Cypress is asking the court to dismiss the suit, or in the alternative, transfer the case to the first court.

On top of actual damages in the amount of $120 million, Aetna seeks recovery of treble, consequential and incidental damages, plus attorney’s fees.

Aetna is represented in part by Andrews Kurth LLP.

North Cypress is represented by Douglas Sutter, attorney for the Houston firm Kelly, Sutter & Kendrick.

Case No. 4:15-cv-00491