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Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 1 of 10
`
`ECHO HEALTH, INC.,
`810 Sharon Drive
`Westlake, Ohio 44145
`
`Plaintiff,
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF KANSAS
`AT KANSAS CITY
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`vs.
`4M HEALTHCARE, LLC,
`15110 Glenwood Ave.
`Overland Park, Kansas 66223
`
`Defendant.
`
`Case No.
`
`COMPLAINT
`
`For its Complaint against 4M Healthcare, LLC (“4M”), ECHO Health, Inc. (“ECHO”)
`
`alleges and states as follows:
`
`1.
`
`This is an action against 4M to recover over $544,000 in payments 4M received
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`from ECHO in error which 4M knew it was not entitled to and had no right to keep. Despite
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`acknowledging it has been receiving funds intended for another medical provider and despite
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`ECHO’s repeated demands, 4M has refused to return the payments to ECHO. Instead, 4M
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`continues to improperly assert control and dominion over the funds. ECHO brings this action to
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`recover the funds and prevent 4M from absconding with or dissipating them.
`
`2.
`
`3.
`
`ECHO is an Ohio corporation with its principal place of business in Westlake, Ohio.
`
`4M is a Kansas limited liability company with its principal place of business in
`
`Overland Park, Kansas.
`
`4.
`
`Jerred Mann is the sole member of 4M. Jerred Mann resides in Overland Park,
`
`Kansas and is a resident of Kansas.
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 2 of 10
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`5.
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`The Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332 as the
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`citizenship of the parties is diverse and the amount in controversy, as set forth below, exceeds
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`$75,000.00.
`
`6.
`
`Venue is appropriate in this district pursuant to 28 U.S.C. § 1391(b)(1) as 4M
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`resides in the district, and under 28 U.S.C. § 1391(b)(2) as a substantial part of the events or
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`omissions giving rise to the claim occurred in the district.
`
`PARTIES
`
`7.
`
`ECHO is in the business of, among other things, consolidating health care claims
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`approved for payment by third party administrators (“TPAs”) and facilitating payment of those
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`claims to medical care givers (“providers”) who rendered the services. In 2020, ECHO health
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`facilitated payments to providers for over 200 million health care claims.
`
`8.
`
`ECHO contracts with TPAs to, among other things, consolidate multiple claims
`
`across plans and insurers and to deliver a single payment for those claims, along with Electronic
`
`Remittance Advice (“ERAs”) which include explanations of provider payments (“EPPs”), to the
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`providers. ECHO offers different delivery methods, including electronic funds transfers (“EFTs”),
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`for the payments.
`
`9.
`
`The TPAs entrust the monies to ECHO to pay the providers for the services
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`rendered by the providers.
`
`10.
`
`Providers, like 4M, enroll in ECHO’s payment programs to receive the funds using
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`the provider’s preferred method and to obtain ERAs and other related forms that are associated
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`with the payments. The ERAs show the provider, among other things, which of its services are
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`being paid via the payment ECHO sends it.
`
`2
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 3 of 10
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`11.
`
`Upon information and belief, 4M provides drug testing and other medical testing
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`services in the health care industry.
`
`FACTUAL BACKGROUND
`
`12.
`
`On or about February 21, 2020, 4M sent its first enrollment form to ECHO to enroll
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`in ECHO’s Direct Payer program. A copy of the redacted enrollment form 4M submitted in
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`connection with adjudicated claims from that TPA is attached as Exhibit A.
`
`13.
`
`4M subsequently submitted additional enrollment forms that are associated with
`
`other TPAs. The substance of the forms are all the same and 4M has a copy of all of them, so they
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`are not being attached here.
`
`14.
`
`On or about March 16, 2020, ECHO accepted the enrollment forms 4M had
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`submitted and entered 4M into ECHO’s Direct Payer Program, which allowed 4M to receive health
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`care payments via an EFT, along with ERAs related to those payments.
`
`15.
`
`4M elected to receive ERAs and to have ECHO send 4M payments for its services
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`via EFT through the Direct Payer program.
`
`16.
`
`The Direct Payer program only authorized 4M to receive deposit payments for
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`medical services 4M actually provided.
`
`17.
`
`Between May 4, 2020, and October 20, 2021, 4M received $139,310.67 for services
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`that it actually did provide. The majority of these payments were small. Of the 167 payments
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`made to 4M over that period, 22 were less than $100.00; 108 were between $100.00 and $1,000.00;
`
`34 were between $1,000.00 and $4,000.00; 2 were between $5,000.00 and $10,000.00; and only 1
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`was between $15,000.00 and $20,000.00 (collectively, the “Correct Payments”).
`
`3
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 4 of 10
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`18.
`
`ERAs identifying the services being paid were sent with each of these Correct
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`Payments, so 4M could associate those payments with the particular services it had rendered and
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`account for the amounts actually owed to 4M.
`
`19.
`
`Starting on or about March 20, 2020, 4M began receiving mistaken payments for
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`services it did not perform (the “Mistaken Payments”); the Mistaken Payments were for services
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`rendered by another provider and were meant to be sent via EFT to that other provider.
`
`20.
`
`The Mistaken Payments made to 4M through October 20, 2021, totaled
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`$544,412.97.
`
`21.
`
`The Mistaken Payments resulted from a mapping error when 4M’s account
`
`information was inputted into ECHO’s system. The system took the tax identification number of
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`a different provider and correlated it to 4M’s account in connection with payments originating
`
`from certain TPAs, despite the existence of procedures and technical safeguards to prevent and
`
`preclude such mis-association of accounts.
`
`22.
`
`Unlike the Correct Payments, 4M received over 75 Mistaken Payments that
`
`exceeded $1,000.00, and 16 that exceeded $10,000.00, including one on October 22, 2020 that
`
`exceeded $34,000.00. 4M never received any single payment from ECHO remotely in the
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`$30,000.00 range for its healthcare services.
`
`23.
`
`Further unlike the Correct Payments 4M received, no ERAs, EPPs, or other
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`explanation of payment was provided to 4M with the Mistaken Payments.
`
`24.
`
`4M knew the payments were for services it did not render. 4M could not reconcile
`
`those Mistaken Payments with its actual services as the Mistaken Payments did not match the
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`services 4M had actually provided. Moreover, 4M had ERAs for the Correct Payments showing
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`that 4M had already received the funds from ECHO for the services it did render.
`
`4
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 5 of 10
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`25.
`
`Given the Mistaken Payments did not correlate to the services 4M actually rendered
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`and for which it had been paid combined with the number and dollar amounts of the Mistaken
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`Payments during this period, 4M knew the Mistaken Payments were made in error and did not
`
`belong to 4M.
`
`26.
`
`Not until October 20, 2021, however, did 4M contact ECHO about the Mistaken
`
`Payments.
`
`27.
`
`On October 20, 2021, Sherry Langrehr, Operations Director of 4M, contacted
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`ECHO’s customer service center by telephone to advise ECHO that 4M had received an erroneous
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`payment in an amount over $30,000.00.
`
`28.
`
`This was the first notice ECHO had received of any potential issue with mistaken
`
`payments going to 4M.
`
`29.
`
`During the call, Ms. Langrehr stated that 4M had been continuing to receive
`
`incorrect payments that did not correlate to any services that 4M had rendered.
`
`30. Ms. Langrehr read from EFT transaction detail information showing the Mistaken
`
`Payments were for a different entity. In fact, she was able to identify the specific provider by name
`
`to whom the payments should have been sent.
`
`31.
`
`4M did not provide any explanation why it notified ECHO of the erroneous
`
`$31,880.74 payment made on October 12, 2021, but not of the numerous other Mistaken Payments
`
`it had received since March 20, 2020 which did not correlate to its services and which it knew did
`
`not belong to 4M.
`
`32.
`
`Because the October 12, 2021, $31,880.74 EFT payment had been made more than
`
`a week prior to 4M calling ECHO, it could not be reversed.
`
`5
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 6 of 10
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`33.
`
`As this was the first time ECHO had heard of a payment sent in error, it advised
`
`4M it would analyze the issue and get back to 4M.
`
`34.
`
`On October 27, 2021, ECHO sent 4M a letter via electronic mail and overnight mail
`
`identifying each of the Mistaken Payments, confirming they belonged to another provider, and
`
`demanding their return. A true and accurate copy of this correspondence is attached as Exhibit B.
`
`35.
`
`ECHO provided a spreadsheet to 4M detailing both the Mistaken Payments and the
`
`Correct Payments 4M had received by bank, EFT number, dollar amount and effective date. The
`
`spreadsheet is not attached as an exhibit because of the EFT numbers it contains, but 4M has a
`
`copy of it.
`
`36.
`
`ECHO requested that 4M contact ECHO to arrange for the return of the Mistaken
`
`Payments.
`
`37.
`
`38.
`
`4M did not respond to this request.
`
`On November 1, 2021, ECHO’s CFO called 4M to discuss the return of the
`
`payments. When ECHO’s CFO asked to speak to Jerred Mann, 4M’s president, the 4M person
`
`who answered the phone said he was in the office and she would locate him. However, after a brief
`
`hold, Sherry Langrehr took the call and stated Mr. Mann was not in the office, that he had “engaged
`
`resources” to respond to ECHO, and that 4M would provide ECHO with a written response that
`
`week. Ms. Langrehr, again, named the provider to whom the payments should have been sent in
`
`that call, acknowledging, yet again, that the Mistaken Payments did not belong to 4M.
`
`39.
`
`40.
`
`Despite 4M’s promise to send a response to ECHO that week, nothing was sent.
`
`ECHO’s CFO called 4M again on Friday, November 5, 2021, to make arrangements
`
`for the return of the money. Rather than cooperate with ECHO on the return of the Mistaken
`
`6
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 7 of 10
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`Payments, Ms. Langrehr told ECHO that 4M had engaged counsel and its counsel would provide
`
`a response by the end of the day.
`
`41.
`
`Despite its promise, no response was sent by 4M or its purported counsel on Friday,
`
`November 5, 2021.
`
`42.
`
`On Monday, November 8, 2021, ECHO’s CFO contacted 4M again by telephone
`
`asking for the return of the funds. Contrary to her prior promises, Ms. Langrehr then advised
`
`ECHO it would take “a long time” to respond to ECHO as 4M had to “go through everything,”
`
`despite knowing the Mistaken Payments did not belong to 4M and despite having a spreadsheet
`
`identifying each of the Mistaken Payments.
`
`43.
`
`ECHO asked for the name and contact information of 4M’s counsel. Ms. Langrehr
`
`advised that she was “not permitted to provide that information” to ECHO.
`
`44.
`
`ECHO then sent 4M ECHO’s counsel’s information so 4M could have its counsel
`
`contact ECHO’s counsel.
`
`45.
`
`46.
`
`Again, 4M never responded nor had its counsel respond.
`
`ECHO’s counsel then contacted Ms. Langrehr on November 10, 2021 via email
`
`requesting 4M’s counsel’s information and demanding that 4M segregate and preserve the
`
`Mistaken Payments and preserve all documents concerning the matter to avoid any spoliation of
`
`evidence. A true and accurate copy of that email is attached as Exhibit C.
`
`47.
`
`48.
`
`Again, 4M never provided the requested information.
`
`Neither ECHO nor its counsel has received a response to any of ECHO’s demands
`
`for the return of the funds or for 4M’s counsel’s information as of the filing of this Complaint.
`
`49.
`
`To date, 4M has not refunded any of the Mistaken Payments despite ECHO’s
`
`demand that it do so.
`
`7
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 8 of 10
`
`50.
`
`As of the filing of this Complaint, ECHO will begin withholding payments to 4M
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`that otherwise would be payable to it but for the Mistaken Payments.
`
`COUNT ONE
`UNJUST ENRICHMENT
`
`51.
`
`ECHO reincorporates the allegations of the preceding paragraphs by reference as if
`
`fully rewritten here.
`
`52.
`
`ECHO conferred a benefit on 4M by making the Mistaken Payments for services
`
`4M did not provide.
`
`53.
`
`54.
`
`4M knew or should have known that the Mistaken Payments were made in error.
`
`4M has knowledge of the benefit conferred by ECHO and further knew that it had
`
`provided nothing for that benefit.
`
`55.
`
`56.
`
`The value of the benefit conferred is at least $544,412.97.
`
`4M has no legal right and no valid claim to the Mistaken Payments yet has refused
`
`to return the Payments to ECHO.
`
`57.
`
`In retaining the Mistaken Payments, 4M has knowingly and unjustly enriched itself
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`at ECHO’s expense.
`
`58.
`
`Under the circumstances it would be inequitable to allow 4M to retain the Mistaken
`
`Payments without payment of their full value.
`
`59.
`
`ECHO is entitled to a full refund in the amount of the Mistaken Payments.
`
`COUNT TWO
`CONVERSION
`
`60.
`
`ECHO reincorporates the allegations of the preceding paragraphs by reference as if
`
`fully rewritten here.
`
`8
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 9 of 10
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`61.
`
`Because the Mistaken Payments were made by accident and 4M has no legal right
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`to the Payments, the Mistaken Payments remain the property of ECHO.
`
`62.
`
`4M knows and has tacitly admitted it is not entitled to the Mistaken Payments and
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`that the Mistaken Payments remain ECHO’s property.
`
`63.
`
`4M’s refusal to return the Mistaken Payments to ECHO excludes ECHO from its
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`property rights in the Mistaken Payments.
`
`64.
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`4M’s knowing failure and refusal to return the Mistaken Payments after demand
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`for their return is an intentional, malicious, willful, and wrongful conversion of ECHO’s property
`
`in the specific and identifiable amount of $544,412.97.
`
`65.
`
`66.
`
`ECHO is entitled to recover the full amount that 4M has wrongfully converted.
`
`ECHO is also entitled to punitive damages for 4M’s intentional, malicious, and
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`willful conversion of ECHO’s property.
`
`WHEREFORE, ECHO respectfully requests that the Court order judgment in its favor and
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`against 4M on all Counts as follows:
`
`1.
`
`As to Count One, judgment in ECHO’s favor in an amount not less than
`
`$544,412.97 plus interest;
`
`2.
`
`As to Count Two, judgment in ECHO’s favor in the amount of $544,412.97, plus
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`punitive damages in an amount to be determined at trial and attorneys’ fees;
`
`3.
`
`For all other relief the Court deems just and proper.
`
`9
`
`

`

`Case 2:21-cv-02537-TC-JPO Document 1 Filed 11/18/21 Page 10 of 10
`
`Dated this 18th day of November, 2021.
`
`Respectfully submitted,
`
`/s/ Kara T. Stubbs
`KS # 15805
`Kara T. Stubbs
`KS # 25636
`
`Nicholas S. Ruble
`BAKER STERCHI COWDEN & RICE LLC
`2400 Pershing Road, Suite 500
`Kansas City, MO 64108
`Telephone:
`(816) 471-2121
`Facsimile:
`(816) 472-0288
`stubbs@bscr-law.com
`nruble@bscr-law.com
`
`Colleen C. Murnane (Pro hac vice to be filed)
`Gregory R. Farkas (Pro hac vice to be filed)
`FRANTZ WARD LLP
`200 Public Square, Suite 3000
`Cleveland, OH 44114
`Telephone:
`(216) 515-1660
`Facsimile:
`(216) 515-1650
`cmurnane@frantzward.com
`gfarkas@frantzward.com
`
`ATTORNEYS FOR PLAINTIFF
`ECHO HEALTH, INC.
`
`10
`
`

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