20 Fla. L. Weekly Supp. 804b
Online Reference: FLWSUPP 2008MOORInsurance — Personal injury protection — Affirmative defenses — Amendment — Motion to amend affirmative defenses to assert defense that medical provider’s claim is barred by settlement agreement in class action suit since neither provider nor insured opted out of class action is denied where insurer filed motion to amend three years after provider filed suit and six years after it knew about class action settlement and provider would be substantially prejudiced by amendment
FLORIDA MEDICAL & INJURY CENTER, INC., as assignee of JENNIFER MOOREHEAD, Plaintiff(s), v. USAA CASUALTY INSURANCE COMPANY, Defendant(s). County Court, 9th Judicial Circuit in and for Orange County. Case No. 2009-SC-9872. April 15, 2013. Honorable Andrew L. Cameron, Judge. Counsel: Aaryn Fuller, Bogin, Munns & Munns, P.A., Orlando, for Plaintiff. Wendy L. Pepper, Andrews & Manno, P.A., Tampa, for Defendant.
ORDER DENYING THE DEFENDANT’S AMENDEDMOTION FOR LEAVE TO AMEND ANSWERAND AFFIRMATIVE DEFENSES
THIS CAUSE coming to be heard upon the Defendant’s Amended Motion for Leave to Amend Answer and Affirmative Defenses, a hearing was held on February 7, 2013, and this Court having reviewed the filed, received case law, received additional documents, heard argument and considered the motion under advisement, it is hereby ORDERED and ADJUDGED that:
1. The Defendant’s Amended Motion for Leave to Amend Its Answer and Affirmative Defenses hereby DENIED.
2. The Court finds that the Defendant’s Eighth Affirmative Defense is untimely as the Defendant knew or should have known of this potential defense when the Defendant filed its original answer. Therefore; the Defendant has waived its right to assert this Defense.
3. The Court also finds that the Plaintiff would be substantially prejudiced by granting the Defendant’s Amended Motion For Leave to Amend Its Answer and Affirmative Defense.
RELEVANT BACKGROUND
A. Horton v. USAA
4. Horton v. USAA Casualty Insurance Company, United States District Court for the District of Arizona Case Number CV06-2810, is a class action lawsuit. Horton Class Action Settlement Agreement, page 1.
5. Horton v. USAA Casualty Insurance Company, hereinafter referred to as Horton, is governed by the Complaint filed on October 19, 2006. Horton Class Action Settlement Agreement page 3.
6. Horton, alleges that USAA failed to properly pay personal injury protection benefits. Horton Class Action Settlement Agreement, page 1.
7. Horton Class member were defined, in relevant part, as medical providers who had their bills submitted to USAA reduced based upon the application of a PPO or PPN agreement. Horton Class Action Settlement Agreement, page 4.
8. Horton class members were given until June 29, 2010 to opt out of the class. Amanda K. Horton, et al. v. USAA Casualty Insurance Company, 266 F.R.D. 360, 367 (U.S. Dist. Arizona, 2009).
B. Procedural History of the Instant Case
9. The Plaintiff filed its Complaint on 8/12/2009.
10. The Plaintiff’s complaint alleges that USAA Casualty Insurance Company, hereinafter referred to as USAA, improperly paid personally injury protection benefits.
11. Attached to the Plaintiff’s Complaint is a ledger that alleges payments made at less than the allowed amount.
12. On October 16, 2009, the Defendant filed its Answer and Affirmative Defenses.
13. The Defendant raised Seven Affirmative Defenses.
14. Defendant’s Third Affirmative Defense alleges that the Plaintiff’s charges were subject to a PPO agreement between USAA and the Plaintiff.
15. On August 8, 2011, the Defendant filed its first Motion for Leave to Amend its Answer and Affirmative Defenses.
16. The August 8, 2011 Motion for Leave seeks leave to add the Affirmative Defense that the case is barred by Horton. However the assignor referenced in the additional Affirmative Defense is not the assignor in the instant case.
17. On August 10, 2011, the Defendant sent the Plaintiff a 57.105 motion. The Defendant’s 57.105 motion was filed on September 10, 2012. The Defendant’s 57.105 motion alleges that the Plaintiff’s case is frivolous; because the case is barred pursuant to Horton.
18. On August 15, 2011, the Defendant sent the Plaintiff a Proposal for Settlement.
19. On September 10, 2012, the Defendant filed an Amended Motion for Leave to Amend its Answer and Affirmative Defense.
20. The Defendant’s Amended Motion for Leave to Amend its Answer and Affirmative Defense specifically requests leave to add the following Affirmative Defense:
Plaintiff’s claim is barred as neither Plaintiff, nor Jennifer Moorhead, opted out of the Federal Class Action lawsuit Horton vs. USAA pending in the District Court of Arizona, case number CV-06-2810. As such these claims are barred by the terms of the Final Settlement Order based upon the principle of res judicata.
LEGAL ANALYSIS
21. Motions for Leave to Amend should be freely given unless it appears that allowing the amendment would prejudice the opposing party, the privilege has been abused or the amendment would be futile. Carmen L. Rosario and Ruben C. Rosario v. Procacci Commercial Realty, Inc., 717 So.2d 148 (5th DCA, 1998) [23 Fla. L. Weekly D2108b].
22. When determining whether to grant a Motion for Leave to Amend, prejudice is the primary consideration for the Court. Affiliated Healthcare Center, Inc. a/a/o Joseph Mora v. United Automobile Insurance Company, 19 Fla. L. Weekly Supp. 143a (County Court, 17th Jud. Cir., August 2, 2011).
23. When evaluating prejudice, the Court must consider the timeliness of the Defendant’s Motion for Leave to Amend Answer. Affiliated Healthcare Center, Inc. a/a/o Joseph Mora v. United Automobile Insurance Company, 19 Fla. L. Weekly Supp. 143a (County Court, 17th Jud. Cir., August 2, 2011)
24. Motions for Leave to amend must be made promptly. Id.
25. In instances where the Defendant was aware of an Affirmative Defense, but waited over a year before filing a Motion for Leave to Amend its Answer and Affirmative Defenses, Courts have found that the request to amend was untimely and denied the Defendant’s Motion for Leave to Amend. See id. See also Orthopaedic Clinic of Daytona Beach, P.A., as assignee of Robert Frierson v. United Services Automobile Association, 19 Fla. L. Weekly Supp. 395a.
26. In the instant case, the Defendant knew or should have known about Horton since 2006, almost three years prior to the Plaintiff filing suit.
27. The Defendant knew or should have known that Horton may apply to the issues raised in the instant case.
28. Prior to suit being filed the Defendant sent Explanations of Benefits referencing a reduction based upon a PPO agreement.
29. The Defendant’s Third Affirmative Defense clearly references the type of PPO reduction used to define Horton class members.
30. The Defendant’s filing of its first Motion for Leave to Amend its Answer and Affirmative Defenses two years after the Plaintiff filed suit and 5 years after the Defendant knew or should have known about Horton is untimely and prejudices the Plaintiff.
31. The Defendant’s filing of its Amended Motion for Leave to Amend its Answer and Affirmative Defenses three years after the Plaintiff filed suit and 6 years after the Defendant knew or should have known about Horton is untimely and prejudices the Plaintiff.
32. The Plaintiff is also prejudiced by the fact that the Defendant did not seek to raise the Horton issue until after the Plaintiff’s opportunity to opt out or participate in the Horton settlement.
33. The Plaintiff is further prejudiced by the fact that the Defendant sent the Plaintiff a proposal for settlement and a 57.105 before the Horton issue became a properly pled Affirmative Defense.
34. Had the Defendant raised the Horton issue in its Answer and Affirmative Defenses, the Plaintiff would have considered the Horton issue when evaluating whether to accept the proposal for settlement case or dismiss its case during the safe harbor period. See Wellness Chiropractic Care Center, Inc. a/a/o Robinson Saint Flina v. First Acceptance Insurance Company, Inc., Case No. 10-CC-16776 (unpublished opinion by Judge Allen on Defendant’s Motion for Leave to File its Second Amended Answer and Affirmative Defenses, County Court of the Ninth Judicial Circuit, September 13, 2012)
35. By sitting on the Horton Affirmative Defense, the Defendant puts the Plaintiff in the position where it might be sanctioned or subject to paying the Defendant’s Attorney Fees and costs based upon an Affirmative Defense that did not exist at the time the Plaintiff could have accepted the proposal or dismissed its case. See id.
36. It would greatly prejudice the Plaintiff if the Defendant’s Amended Motion for Leave to Amend its Answer were granted.
37. The converse is not true. Denying the Defendant’s Motion does not prevent the Defendant from litigating that the Plaintiff’s charges were subject to a PPO agreement.
38. In addition to finding substantial prejudice, the record also supports a finding that the Defendant waived the right to raise the Horton issue.
39. The Florida Supreme Court defines waiver as, “the voluntary and intentional relinquishment of a known right or conduct which implies the voluntary and intentional relinquishment of a known right.” Raymond James Financial Services v. Steven W. Saldukas, 896 So. 2d 707 (Fla., 2005) [30 Fla. L. Weekly S115a].
40. The Defendant in the instant case is also the Defendant in the Horton case.
41. In its Explanation of Benefits, the Defendant made the same type of reductions that are the subject of Horton.
42. In the Defendant’s Third Affirmative Defense, the Defendant describes applying the PPO reduction that is the subject of Horton.
43. The Defendant knew or should have known that it could have raised Horton specifically in an Affirmative Defense.
44. By failing to assert Horton when the Defendant knew or should have known about the issue, the Defendant waived the right to raise Horton in the instant case.
45. The Defendant’s Amended Motion for Leave to Amend its Answer and Affirmative Defense is hereby DENIED.
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