Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 1 of 67 Page ID #:20
`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 1 of 67 Page ID #:20
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`EXHIBIT “B”
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`EXHIBIT “B”
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`Electronically Filed by Superior Court of California, County of Orange, 01/19/2021 04:04:37 PM.
`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 2 of 67 Page ID #:21
`30-2021-01179856-CU-BC-CJC - ROA # 2 - DAVID H. YAMASAKI, Clerk of the Court By Hailey McMaster, Deputy Clerk.
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`CALLAHAN & BLAINE, APLC
`Daniel J. Callahan (Bar No. 91490)
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`dcallahan@callahan-law.com
`Edward Susolik (Bar No. 151081)
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`esusolik@callahan-law.com
`Richard T. Collins (Bar No. 166577)
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`rcollins@callahan-law.com
`Damon D. Eisenbrey (Bar No. 215927)
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`deisenbrey@callahan-law.com
`Adrian L. Canzoneri (Bar No. 265168)
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`acanzoneri@callahan-law.com
`3 Hutton Centre Drive, Ninth Floor
`Santa Ana, California 92707
`Telephone: (714) 241-4444
`Facsimile: (714) 241-4445
`Attorneys for Plaintiffs
`SUPERIOR COURT OF THE STATE OF CALIFORNIA
`COUNTY OF ORANGE
`
`
`Case No.:
`
`COMPLAINT FOR:
`
`1. CLAIMS FOR PLAN BENEFITS
`UNDER ERISA, 29 U.S.C.
`§1132(a)(1)(B)
`2. BREACH OF WRITTEN CONTRACT
`3. BREACH OF IMPLIED COVENANT
`OF GOOD FAITH AND FAIR
`DEALING
`4. BREACH OF IMPLIED CONTRACT
`5. BREACH OF ORAL CONTRACT
`6. PROMISSORY ESTOPPEL
`7. UNFAIR COMPETITION
`
`DEMAND FOR JURY TRIAL
`
`
`THE DISCOVERY HOUSE, LLC, a
`California limited liability company;
`DISCOVERY TRANSITIONS
`OUTPATIENT, INC., a California
`corporation; DHP HEIGHTS, LLC, doing
`business as CIRCLE OF HOPE, a California
`limited liability company; MT GOLDEN
`CORPORATION, doing business as
`ADJUSTMENTS FAMILY SERVICES, a
`California corporation; MT PROCESS LLC,
`doing business as DIVINE DETOX, a
`California limited liability company;
`Plaintiffs,
`
`v.
`ANTHEM BLUE CROSS LIFE AND
`HEALTH INSURANCE COMPANY, a
`California corporation;
`ANTHEM INC., an Indiana corporation doing
`business in California as ANTHEM
`HEALTH, INC.;
`THE ANTHEM COMPANIES OF
`CALIFORNIA, a California corporation;
`THE ANTHEM COMPANIES, INC., an
`Indiana corporation;
`ANTHEM INSURANCE COMPANIES,
`INC., an Indiana corporation;
`BLUE CROSS OF CALIFORNIA, a
`California corporation;
`BLUE CROSS AND BLUE SHIELD
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
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`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`- 1 -
`COMPLAINT
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`Assigned for All Purposes
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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 3 of 67 Page ID #:22
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`ASSOCIATION, an Illinois corporation;
`VIANT, INC., a Nevada corporation;
`MULTIPLAN, INC., a New York
`corporation; and
`DOES 1 through 100, inclusive,
` Defendants.
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`- 2 -
`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 4 of 67 Page ID #:23
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`Plaintiffs The Discovery House, LLC (“Discovery House”), Discovery Transitions
`Outpatient, Inc. (“Discovery Transitions”), DHP Heights, LLC doing business as Circle of Hope
`(“DHP Heights”), MT Golden Corporation doing business as Adjustments Family Services (“MT
`Golden”), and MT Process, LLC doing business as Divine Detox (“MT Process”) (collectively
`“Plaintiffs”) hereby allege against Defendants Anthem Blue Cross Life and Health Insurance
`Company, Anthem Inc., doing business in California as Anthem Health, Inc., The Anthem
`Companies of California, The Anthem Companies, Inc., Anthem Insurance Companies, Inc., Blue
`Cross of California, Blue Cross and Blue Shield Association, Viant, Inc., Multiplan, Inc., and
`Does 1 through 100, (collectively “Defendants”) as follows:
`THE PARTIES
`
`The Plaintiffs
`Discovery House (TIN 90-0852664) is, and at all relevant times herein mentioned
`1.
`was, a California limited liability company, qualified to do business in the State of California.
`Discovery House is, and at all relevant times herein was, a mental health and alcoholism and
`substance use disorder treatment provider with its principal place of business in Los Angeles
`County, California. Discovery House is in the profession of helping individuals recover from
`alcoholism and addiction and return to their families and communities as productive and
`contributing members of society. Discovery House is, and at all relevant times herein was,
`certified and/or licensed by the California Department of Health Care Services (“DHCS”) to
`operate alcoholism and substance use disorder residential and detoxification treatment programs,
`including to provide incidental medical services (“IMS”). Discovery House is, and at all relevant
`times herein was, accredited by The Joint Commission, Behavioral Health Care Accreditation
`Program (“JCAHO”), and has a Centers for Medicare and Medicaid Services (“CMS”), Clinical
`Laboratory Improvements Amendments (“CLIA”) certificate of waiver.
`Discovery Transitions (TIN 82-1366868) is, and at all relevant times herein
`2.
`mentioned was, a California corporation, qualified to do business in the State of California.
`Discovery Transitions is a substance use disorder treatment provider. Discovery Transitions is in
`the profession of helping individuals recover from alcoholism and addiction and return to their
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`- 3 -
`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 5 of 67 Page ID #:24
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`families and communities as productive and contributing members of society. Discovery
`Transitions is, and at all relevant times herein was, certified by the California Department of
`Health Care Services (“DHCS”) to operate a substance use disorder outpatient treatment program.
`Discovery Transitions is, and at all relevant times herein was, accredited by The Joint
`Commission, Behavioral Health Care Accreditation Program (“JCAHO”), and holds a Centers for
`Medicare and Medicaid Services (“CMS”), Clinical Laboratory Improvements Amendments
`(“CLIA”) certificate of waiver.
`DHP Heights (TIN 82-4178957) is, and at all relevant times herein mentioned was,
`3.
`a California limited liability company, qualified to do business in the State of California. DHP
`Heights is a substance use disorder treatment provider. DHP Heights is in the profession of
`helping individuals recover from alcoholism and addiction and return to their families and
`communities as productive and contributing members of society. DHP Heights is, and at all
`relevant times herein was, certified and/or licensed by the California Department of Health Care
`Services (“DHCS”) to operate substance use disorder inpatient and detoxification treatment
`programs, including to provide incidental medical services (“IMS”). DHP Heights is, and at all
`relevant times herein was, accredited by The Joint Commission, Behavioral Health Care
`Accreditation Program (“JCAHO”), and holds a Centers for Medicare and Medicaid Services
`(“CMS”), Clinical Laboratory Improvements Amendments (“CLIA”) certificate of waiver.
`MT Golden (TIN 82-4823403) is, and at all relevant times herein mentioned was, a
`4.
`California corporation, qualified to do business in the State of California. MT Golden is a
`substance use disorder treatment provider. MT Golden is in the profession of helping individuals
`recover from alcoholism and addiction and return to their families and communities as productive
`and contributing members of society. MT Golden is, and at all relevant times herein was, certified
`by the California Department of Health Care Services (“DHCS”) to operate a substance use
`disorder outpatient treatment program. MT Golden is, and at all relevant times herein was,
`accredited by The Joint Commission, Behavioral Health Care Accreditation Program (“JCAHO”),
`and holds a Centers for Medicare and Medicaid Services (“CMS”), Clinical Laboratory
`Improvements Amendments (“CLIA”) certificate of waiver.
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`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 6 of 67 Page ID #:25
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`MT Process (TIN 82-3902257) is, and at all relevant times herein mentioned was,
`5.
`a California limited liability company, qualified to do business in the State of California. MT
`Process is a substance use disorder treatment provider. MT Process is in the profession of helping
`individuals recover from alcoholism and addiction and return to their families and communities as
`productive and contributing members of society. MT Process is, and at all relevant times herein
`was, certified and/or licensed by the California Department of Health Care Services (“DHCS”) to
`operate substance use disorder inpatient and detoxification treatment programs, including to
`provide incidental medical services (“IMS”). MT Process is, and at all relevant times herein was,
`accredited by The Joint Commission, Behavioral Health Care Accreditation Program (“JCAHO”),
`and holds a Centers for Medicare and Medicaid Services (“CMS”), Clinical Laboratory
`Improvements Amendments (“CLIA”) certificate of waiver.
`The Defendants
`On information and belief, Defendant Anthem Blue Cross Life and Health
`6.
`Insurance Company (“Anthem Blue Cross”) is a California corporation which conducts
`insurance operations throughout California, representing to consumers that Anthem Blue Cross,
`together with its syndicate, association, subsidiaries and affiliates is a national health insurance
`organization.1 Anthem Blue Cross operates as and owns the trademark “Anthem Blue Cross.”
`On information and belief, Defendant Anthem Inc. is an Indiana corporation
`7.
`doing business and conducting insurance operations throughout California as Anthem Health, Inc.
`
` 1 In March 2020, the Ames, et al. v. Anthem Blue Cross Life & Health Insurance Company, et al.,
`Los Angeles Superior Court, Case No.: BC591623, class action settled. The settlement benefits
`individuals who were enrolled under an Anthem PPO health plan and who requested coverage for
`behavioral health treatment for a co-morbid diagnosis (substance use disorder and mental health)
`between August 18, 2011 and February 4, 2020. Included in the class are persons: (1) whose
`requests for authorization for substance use disorder treatment were denied because they had
`purportedly reached their plan’s benefit limit; (2) whose requests for authorization for substance
`use disorder treatment were denied for lack of medical necessity under Anthem’s criteria for
`assessing medical necessity of substance use disorders; and/or (3) who did not eek authorization of
`continued treatment because an Anthem representative or a provider told them that they had
`reached their plan’s benefit limit for treatment of a substance use disorder in a calendar year. See
`Calif. Anthem Blue Cross Treatment Denial Class Action, retrieved on April 15, 2020 from
`https://topclassactions.com/lawsuit-settlements/open-lawsuit-settlements/insurance/calif-anthem-
`blue-cross-treatment-denial-class-action-settlement/; see also, Ames v. Anthem Notice of
`Settlement, retrieved from https://amessettlement.com/Home/portalid/0?portalid=0, on April 30,
`2020.
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`- 5 -
`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 7 of 67 Page ID #:26
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`(“Anthem Inc.”).2
`On information and belief, Defendant The Anthem Companies of California
`8.
`(“The Anthem Companies”) is a California corporation that conducts insurance operations
`throughout California
`On information and belief, Defendant Anthem Insurance Companies, Inc.
`9.
`(“Anthem Insurance Companies”) is an Indiana corporation, doing business in Indiana as
`Anthem Blue Cross and Blue Shield of Indiana (“BCBS Indiana”). “Anthem”® is a registered
`trademark of Anthem Insurance Companies.
`On information and belief, Defendant Blue Cross of California (“BCC”) is a
`10.
`California corporation which conducts insurance operations throughout California. Anthem Blue
`Cross is the trade name of BCC.
`11.
`The Defendants identified in paragraphs 6 through 10 above are collectively
`referred to herein as the “Blue Cross Blue Shield Defendants.”
`12.
`On information and belief, the Blue Cross Blue Shield Defendants, and each of
`them, market and issue health insurance, and insure, issue, administer and make coverage and
`benefit determinations with respect to the health care plans at issue in this action; they develop and
`apply substance use disorder and mental health treatment and laboratory guidelines in making
`coverage and benefit determinations; they participate in the claims administration process related
`to plans insured, managed and/or administered by their wholly-owned and controlled subsidiaries,
`syndicates, associations, affiliates, controlled agents and undisclosed principals, including, but not
`limited to each of the other Blue Cross Blue Shield Defendants, and Defendants Viant, Inc. and
`Multiplan, Inc.; and they are licensed and regulated by the California Department of Insurance
`
` On March 27, 2020, Geoffrey S. Berman, the United States Attorney for the Southern District of
`New York, announced that the United States filed a Medicare fraud lawsuit against Anthem, Inc.,
`alleging that Anthem falsely certified certifying the accuracy of the diagnosis data it submitted to
`CMS, which enabled Anthem to obtain millions of dollars in Medicare funds to which it was not
`entitled. See Manhattan U.S. Attorney Files Civil Fraud Suit Against Anthem, Inc., For Falsely
`Certifying The Accuracy Of Its Diagnosis Data _ USAO-SDNY _ Department of Justice – Press
`Release Number: 20-100
`(March 27, 2020),
`retrieved on March 31, 2020
`from
`https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-files-civil-fraud-suit-against-anthem-
`inc-falsely-certifying; see also, pdf copy of the filed complaint (March, 26, 2020), retrieved on
`March 31, 2020 from https://www.justice.gov/usao-sdny/press-release/file/1262841/download.
`
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`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 8 of 67 Page ID #:27
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`(“CDI”) and the California Department of Managed Health Care (“CDMHC”) to transact the
`business of insurance in the State of California, are in fact transacting the business of insurance in
`the State of California, and are thereby subject to the laws and regulations of the State of
`California.
`On information and belief, Defendant Blue Cross and Blue Shield Association
`13.
`(the “Association”), is an Illinois corporation owned, controlled and funded by the Blue Cross
`Blue Shield Defendants, among other Blue Cross Blue Shield entities that operate under the Blue
`Cross and Blue Shield trademarks and trade names. The Association was created by the Blue
`Cross Blue Shield Defendants and the other Blue Cross Blue Shield entities, and operates as the
`licensor of the Blue Cross and Blue Shield trademarks and trade names. The Association exists
`solely for the benefit of the Blue Cross Blue Shield Defendants and the other Blue Cross Blue
`Shield entities and to facilitate their concerted activities.
`14.
` According to its website, the Association and the Blue Cross Blue Shield entities,
`including the Blue Cross Blue Shield Defendants, “understand and answer to the needs of local
`communities, while providing nationwide healthcare coverage that opens doors for more than 107
`million members in all 50 states, Washington, D.C., and Puerto Rico;” they contract nationwide
`with “more than 96 percent of hospitals and 95 percent of doctors and specialists contract with
`Blue Cross Blue Shield companies — more than any other insurer;” the Association “is a national
`association of 36 independent, community-based and locally operated Blue Cross Blue Shield
`companies;” “the Association owns and manages the Blue Cross and Blue Shield trademarks and
`names in more than 170 countries around the world;” and “the Association grants licenses to
`independent companies to use the trademarks and names in exclusive geographic areas.” See,
`https://www.bcbs.com/about-us/the-blue-cross-blue-shield-system (last visited August 22, 2020).
`15.
`The Association and the Blue Cross Blue Shield Defendants have agreed that they
`will not compete with the other Blue Cross Blue Shield entities in terms of their provider
`networks, and even when the Blue Cross Blue Shield Defendants and other Blue Cross Blue
`Shield entities have significant enrollees in another entity’s service area, they have an agreement
`that they will not contract with providers outside of their service areas except in limited
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`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 9 of 67 Page ID #:28
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`circumstances. In short, the Association exists solely for the benefit of the Blue Cross Blue Shield
`entities, including the Blue Cross Blue Shield Defendants, and to facilitate their concerted
`activities.
`16.
`In furtherance of these concerted activities, each of the Blue Cross Blue Shield
`Defendants has agreed to participate in the national programs adopted by the Blue Cross Blue
`Shield entities that operate under the Blue Cross and Blue Shield trademarks and trade names,
`including the Blue Card Program and the National Accounts Program. The Blue Card Program is
`a program that enables members of one Blue Cross Blue Shield (“BCBS”) plan to obtain health
`care services while traveling or living in another BCBS plan’s service area. Under this program,
`when a member of a BCBS plan obtains covered health care services in another state, the “local”
`or “host” BCBS plan (i.e., the plan located in the state where the services are provided) receives
`the claim(s) from the local provider and routes the claim information along with pricing data to the
`“home” BCBS plan. The “home” plan is the BCBS plan that issues, insures and/or administers the
`health plan for the member.3 The National Accounts Program functions in a similar manner and
`generally applies to employee benefit plans with insured members in multiple states. These
`programs have been established by a horizontal agreement between the Blues. The Blue Card
`Program is managed by a Committee of Blue Cross Blue Shield entities sitting on the Inter-Plan
`Programs Committee. These programs, among other national programs, lock in fixed, discounted
`reimbursement rates that each Blue Cross Blue Shield entity, including the Blue Cross Blue Shield
`Defendants, achieves through market dominance in its Service Area and makes subcompetitive
`rates available to all other Blue Cross Blue Shield entities without the need for negotiation or
`contracting. As many Blue Cross Blue Shield entities have large numbers of members outside of
`their service areas, and rather than forming competing networks of providers in the other service
`
` 3 Specifically, the mechanics of the Host/Home plan relationship operate as follows: The Host
`Plan collects initial claims data and forwards it to the Home plan for a determination as to whether
`the claim is covered under the policy issued by the Home Plan. The Host Plan does not make any
`determination regarding the scope of coverage or the Member’s eligibility for coverage. The
`Home Plan evaluates the data the data submitted by the Host Plan, determines whether and how
`much of the claim is allowable, and advises the Host Plan of its determination. The Host Plan
`then makes payment to the service provider and submits a claim to the Home Plan for
`reimbursement.
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`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 10 of 67 Page ID #:29
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`areas, the Blue Cross Blue Shield entities pay the Home Plan a kickback, called an Access Fee,
`and thereby share the excess profits they achieve through the sub-competitive prices that the Blue
`Cross Blue Shield entities, including the Blue Cross Blue Shield Defendants, pay to providers.
`On information and belief, Defendant Viant, Inc. (“Viant”) is a Nevada
`17.
`corporation which conducts insurance operations throughout California. Viant provides health
`care payment solutions and offers auditing and reimbursement of behavioral health and substance
`use disorder claims and costs, as well as prepayment services such as treatment facility bill review
`and professional negotiation, on plans at issue herein insured, managed and/or administered by
`Anthem Blue Cross and its syndicate, association, subsidiaries and affiliates. Plaintiffs are
`informed and believe, and based thereon alleges, that Viant is licensed and regulated by the CDI
`and the CDMHC to transact the business of insurance in the State of California, is in fact
`transacting the business of insurance in the State of California, and is thereby subject to the laws
`and regulations of the State of California.
`On information and belief, Defendant MultiPlan, Inc. (“MPI”) is a New York
`18.
`corporation which conducts insurance operations throughout California. MPI is a provider of
`healthcare cost management solutions, specializing in providing claim cost management solutions
`for controlling the financial risks associated with health care bills on plans at issue herein insured,
`managed and/or administered by Anthem Blue Cross and its syndicate, association, subsidiaries
`and affiliates. MPI also offers preferred provider organization network solutions for accessing
`hospitals, ancillary care facilities, treatment facilities, and health care professionals for the benefit
`and at the control and direction of Anthem Blue Cross and its syndicate, association, subsidiaries
`and affiliates. Plaintiffs are informed and believe, and based thereon alleges, that MPI is licensed
`and regulated by the CDI and the CDMHC to transact the business of insurance in the State of
`California, is in fact transacting the business of insurance in the State of California, and is thereby
`subject to the laws and regulations of the State of California.
`19.
`Plaintiffs do not know the true names and capacities of Defendants sued as Does 1
`through 60, inclusive, and therefore sue such Defendants with such fictitious names. Plaintiffs are
`informed and believe, however, that each of these named and fictitiously named Defendants are
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`- 9 -
`COMPLAINT
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`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 11 of 67 Page ID #:30
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`involved in and responsible for the events, transactions and occurrences alleged herein, as well as
`the herein alleged damages caused to Plaintiffs. Specifically, Plaintiffs anticipate discovering the
`identities of Blue Cross Blue Shield entities outside of California that issue or administer the plans
`for Plaintiffs’ patients (i.e. the Home Plans), notwithstanding the fact that claims for those patients
`were either denied or priced and paid by the Blue Cross Defendants. Plaintiffs will amend this
`Complaint to allege their true names and capacities once they have been ascertained. In any event,
`and in light of the concerted activities of the Association and all Blue Cross Blue Shield entities as
`described above, all currently named Defendants, and soon-to-be-named Doe defendants 1
`through 60, share in the responsibility for the collective wrongs committed against Plaintiffs and
`their patient insureds, and therefore must be held jointly and severally liable for the same.
`20.
`Plaintiffs do not know the true names and capacities of Defendants sued as Does 61
`through 100, inclusive, and therefore sue such Defendants with such fictitious names. Plaintiffs
`will amend this Complaint to allege their true names and capacities once they have been
`ascertained. Plaintiffs are informed and believe that each of the named and fictitiously named Doe
`Defendants 61 through 100 are involved in and responsible for the events, transactions and/or
`occurrences alleged in the Complaint, as well as the herein alleged damages caused to Plaintiffs.
`21.
`Plaintiffs are informed and believe that, at all relevant times, each of the
`Defendants was and is the agent, servant, representative, undisclosed principal and/or alter ego of
`each of the other Defendants, and in doing the things herein alleged, each of the Defendants was
`acting in the scope of its authority as such agent, servant, representative, undisclosed principal
`and/or alter ego, and with the permission and consent of each of the other Defendants.
`22.
`Plaintiffs are informed and believe that, at all relevant times, Defendants are the
`alter egos of the other Defendants, have comingled assets, have comingled business operations,
`have undercapitalized operations, have ignored corporate formalities, and have exercised such
`dominion and control over the operations of the other Defendants that it would be unjust to permit
`such Defendants to avoid individual liability. Plaintiffs are further informed and believe, that a
`unity of interest and ownership exists between Defendants, that any individuality and separateness
`between Defendants have ceased, and that Defendants are the alter egos of one another. On
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`- 10 -
`COMPLAINT
`
`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

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`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 12 of 67 Page ID #:31
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`information and belief, Plaintiffs understand and believe that Defendants share the same common
`ownership, places of business, managements, and operate as a single enterprise.
`23.
`Plaintiffs are informed and believe that, at all relevant times, each of the
`Defendants formed and operated a conspiracy with each of the other Defendants to perform the
`acts alleged herein, in furtherance of a common design to place profits over patients and damage
`substance use disorder treatment providers and laboratories, including Plaintiffs, and with
`knowledge that the conduct alleged herein of each of the Defendants constituted violations of law
`and provided substantial assistance or encouragement to each other to so act against insured
`patients and substance use disorder treatment providers and laboratories, including Plaintiffs.
`BRIEF STATEMENT OF THE CASE
`24.
`Plaintiffs are out-of-network substance use disorder treatment providers. Plaintiffs
`are in the profession of helping individuals recover from alcoholism and addiction and return to
`their families and communities as productive and contributing members of society. Plaintiffs
`provided medically necessary, verified, preauthorized and covered substance use disorder and
`mental health treatment to 513 individuals with health insurance that was sold, insured, managed
`and/or administered by Defendants. The treatment and services provided by Plaintiffs include
`residential detoxification and residential treatment (“RTC”), partial hospitalization/day treatment
`(“PHP”), intensive outpatient (“IOP”), outpatient (“OP”), treatment planning, counseling and
`behavioral therapies, individual, family and group therapy, medication management, laboratory
`services, and case management services. The treatments and services were provided by or under
`the direction of properly qualified behavioral health providers and/or medical and clinical
`professionals.
`25.
`Defendants’ health insurance plans, for each of the 513 insureds at issue, provide
`coverage for out-of-network substance use disorder treatment and related services. In this regard,
`the plans, and each of them, provide that out-of-network substance use disorder benefits include
`the following levels of care: RTC, PHP, IOP, and OP. The plans also provide that out-of-network
`covered substance use disorder services include: diagnostic evaluations, assessment and treatment
`planning, treatment and/or procedures, medication management and other associated treatment,
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`- 11 -
`COMPLAINT
`
`3 HUTTON CENTRE DRIVE, NINTH FLOOR
`
`A PROFESSIONAL LAW CORPORATION
`CALLAHAN & BLAINE
`
`SANTA ANA, CALIFORNIA 92707
`
`WWW.CALLAHAN-LAW.COM
`TELEPHONE: (714) 241-4444
`
`

`

`
`Case 2:21-cv-02330 Document 1-2 Filed 03/16/21 Page 13 of 67 Page ID #:32
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`psychological testing, referral services, individual, family and group therapy, provider-based case
`management services, and crisis intervention. The plans further provide coverage for out-of-
`network laboratory benefits, which include the facility charge and the charge for supplies and
`equipment, physician services for pathologists, and presumptive drug tests and definitive drug
`tests.
`
`26.
`Defendants’ health insurance plans, for each of the 513 insureds at issue, pay
`benefits for out-of-network substance use disorder treatment and laboratory services, including,
`but not limited to, RTC, PHP, IOP, OP, diagnostic evaluations, assessment and treatment
`planning, treatment and/or procedures, medication management and other associated treatment,
`psychological testing, referral services, individual, family and group therapy, provider-based case
`management services, crisis intervention, and laboratory services, at varying percentages of
`covered charges (between 50% to 80% of covered charges, with the majority of plans paying out-
`of-network benefits at 70% of covered charges (minus any outstanding insured cost-sharing
`amounts, which Defendants deduct from payments to Plaintiffs)) until the insured’s nominal
`annual out-of-pocket maximum is met at which time Defendants pay 100%. Plaintiffs are
`informed and believe, and based thereon allege, that each of the 513 insureds had already met their
`annual out-of-pocket maximum at the time they first received treatment or services from Plaintiffs,
`or shortly thereafter. The plans also pay 100% of covered charges in the event of a “network
`inadequacy” or “network gap” for the services received. Plaintiffs are informed and believes, and
`based thereon allege, that at all times relevant herein Defendants had an inadequate network of
`substance use disorder treatment providers and clinical laboratories. The exclusions, conditions
`and limitations in the plans do not apply to the treatments and services provided by Plaintiffs.
`27.
`Plaintiffs obtained written assignments of benefits from each of the insureds at
`issue, by which Defendants’ insureds intended to, and did, assign to Plaintiffs not only rights to
`payment of claims but to assert all rights and causes of action against Defendants in connection
`with such claims. In reliance on the assignments of benefits, Plaintiffs