Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 1 of 8
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF PUERTO RICO
`
`
`CARLOS A. CARRERO
`
`Plaintiff
`
`V.S.
`
`CIVIL NO.:
`
`
`
`
`
`DECLARATORY JUDGMENT
`
`
`
`
`MOLINA HEALTHCARE OF PUERTO
`RICO, INC.
`
`
`Defendant
`
`TO THE HONORABLE COURT:
`
`
`COMPLAINT
`
`
`
`
`COMES now plaintiff through the undersigned attorney and very respectfully,
`
`SETS FORTH and PRAYS:
`
`I.
`
`JURISDICTION AND VENUE
`
`
`
`1.1.
`
`This Honorable Court has subject matter jurisdiction over the instant matter
`
`pursuant to 28 U.S.C. § 1332 as there is complete diversity among the parties and the
`
`contractual rights upon which declaratory judgment is sought exceed the jurisdictional
`
`amount of $75,000.001. As in any other federal action for declaratory judgment, relief is
`
`sought pursuant to 28 U.S.C. § 2201.
`
`
`
`1.2.
`
`The District of Puerto Rico is the proper venue in which to hear the instant
`
`matter, pursuant to 28 U.S.C. § 1391, all of the relevant facts occurred within that
`
`jurisdiction.
`
`
`1 Of course, its hornbook law that “[i]n actions seeking declaratory or injunctive relief, it is well established
`that the amount in controversy is measured by the value of the object of the litigation”. Hunt v. Washington
`State Apple Advertising Commission, 432 U.S. 333, 347 (1977).
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF PUERTO RICO
`
`
`CARLOS A. CARRERO
`
`Plaintiff
`
`V.S.
`
`CIVIL NO.:
`
`
`
`
`
`DECLARATORY JUDGMENT
`
`
`
`
`MOLINA HEALTHCARE OF PUERTO
`RICO, INC.
`
`
`Defendant
`
`TO THE HONORABLE COURT:
`
`
`COMPLAINT
`
`
`
`
`COMES now plaintiff through the undersigned attorney and very respectfully,
`
`SETS FORTH and PRAYS:
`
`I.
`
`JURISDICTION AND VENUE
`
`
`
`1.1.
`
`This Honorable Court has subject matter jurisdiction over the instant matter
`
`pursuant to 28 U.S.C. § 1332 as there is complete diversity among the parties and the
`
`contractual rights upon which declaratory judgment is sought exceed the jurisdictional
`
`amount of $75,000.001. As in any other federal action for declaratory judgment, relief is
`
`sought pursuant to 28 U.S.C. § 2201.
`
`
`
`1.2.
`
`The District of Puerto Rico is the proper venue in which to hear the instant
`
`matter, pursuant to 28 U.S.C. § 1391, all of the relevant facts occurred within that
`
`jurisdiction.
`
`
`1 Of course, its hornbook law that “[i]n actions seeking declaratory or injunctive relief, it is well established
`that the amount in controversy is measured by the value of the object of the litigation”. Hunt v. Washington
`State Apple Advertising Commission, 432 U.S. 333, 347 (1977).
`
`
`
`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 2 of 8
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`II.
`
`THE PARTIES
`
`2.1.
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`Plaintiff, Carlos Antonio Carrero, is of legal age, married, an insurance
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`business executive, and, at the time of filing, a resident of Oviedo, Florida.
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`2.2. Defendant, Molina Healthcare of Puerto Rico, Inc. (hereinafter referred to
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`as “Molina”) is a domestic, for-profit corporation chartered under the laws
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`of the Commonwealth of Puerto Rico, with its principal offices located in
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`San Juan, Puerto Rico. Defendant is a subsidiary of Molina Healthcare, Inc.,
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`a for-profit corporation chartered in the state of Delaware with principal
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`offices located in Long Beach, California2.
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`III. THE FACTS AND THE REMEDY SOUGHT
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`3.1.
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`Both Molina and its parent company are engaged in the health insurance
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`industry.
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`3.2. Defendant was chartered on February 28, 2014 and shortly thereafter
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`became a major provider for Puerto Rico’s “Mi Salud” publicly-funded3
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`health insurance plan which was later renamed “Vital” by virtue of a
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`contract with the Puerto Rico Administration of Health Insurance Services
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`(hereinafter referred to as “ASES” for its Spanish language acronym).
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`3.3.
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`The contractual relationship with ASES was the only business venture in
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`which Molina incurred in Puerto Rico as it kept away from the private and
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`individual health insurance policy markets.
`
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`2 On May 2015, the Commonwealth’s Department of State issued an authorization for this company to do
`business in Puerto Rico.
`3 The plan is funded by a combination of Medicaid funds with contributions by the Commonwealth and
`by the 78 municipal governments.
`
`
`
`2
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`
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 3 of 8
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`3.4.
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`Plaintiff herein has over 40 years of experience in the health services
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`industry during which he has steadfastly received stellar reviews from
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`former employers.
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`3.5.
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`In early 2017, defendant began efforts to recruit plaintiff into its
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`organization
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`3.6. After a thorough recruitment process, on March 17, 2017, defendant
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`notified plaintiff of a written employment officer for the position of Chief
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`Executive Officer (hereinafter referred to as “CEO”) with a base salary of
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`$270,000.00 per year with an additional compensation package that
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`included medical insurance, life/disability insurance, performance and
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`participation in what the employer dubbed as the “Employee Stock
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`Purchase Plan”, which entailed the assignment of stock in defendant’s
`
`parent company.
`
`3.7.
`
`Plaintiff accepted defendants offer and began working for it on April 3,
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`2017.
`
`3.8.
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`Plaintiff’s execution of his duties as Molina’s CEO were always undertaken
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`in an exemplary matter, earning no disciplinary actions or adverse
`
`evaluations from his employer.
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`3.9. On or around the summer of 2020 Molina advised ASES that it would cease
`
`providing services for the Vital program, which essentially meant that
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`Molina was ending its business activities in Puerto Rico by August 2021.
`
`
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`3
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 4 of 8
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`3.10. Upon returning from sick leave, plaintiff was engaged by his employer in
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`the negotiation of a paid severance agreement.
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`3.11. During the negotiation process, plaintiff was led to believe that, as of the
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`termination date that was being discussed at the time, he would lose his
`
`employment no matter what and defendant would not fill his position
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`during the few months between that date and the close of operations.
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`3.12.
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`It was reasonable for plaintiff to believe defendants representations as,
`
`during that period he was charged with performing tasks directly leading
`
`to a cease of operations such as, inter alia, negotiating the termination of
`
`lease agreements, closing out vendor/supplier accounts and handling
`
`pending claims.
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`3.13. Between late May and early June 2020, plaintiff received from his employer
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`a draft “Waiver and Release Agreement” which included incentives for
`
`plaintiff to resign with a termination date that was left blank in the copy of
`
`the document that was signed by plaintiff (simultaneous execution was not
`
`required), with the understanding that plaintiff would work until February
`
`2021, although the third “whereas” contained a blank termination date.
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`3.14.
`
` The termination date was crucial as, had plaintiff made it to March 1, 2021,
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`he would have been entitled to collect on his 2021 Employee Stock Purchase
`
`Plan.
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`3.15. Plaintiff was led by defendants’ misrepresentations to believe that the
`
`February 2021 termination date was set in stone and therefore, the
`
`
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`4
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 5 of 8
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`incentivized resignation that was being offered at the time was the best deal
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`that he could possibly hope for.
`
`3.16. Based on the above, plaintiff signed the Waiver and Release Agreement in
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`June 2020 but he was never given copy of the fully-executed document,
`
`with all blanks filled out.
`
`3.17. On January 2, 2021, Molina prepared a letter addressed to plaintiff in
`
`compliance with the “Worker Adjustment and Retraining Notification
`
`Act”, advising him of his termination on March 1, 2021.
`
`3.18. The above notwithstanding, an amendment to the Waiver and Release
`
`Agreement was signed on February 14 and 15, 2021 (again, simultaneous
`
`execution was not required) to add $15,000.00 of additional compensation,
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`a document that did state a concrete February 28, 2021 termination date.
`
`3.19. Plaintiff indeed worked until February 28, 2021.
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`3.20. To plaintiff’s utter surprise and dismay, on March 29, 2021 Molina
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`announced that Ms. Zivany García was being appointed to his former CEO
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`position.
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`3.21. Had plaintiff known that defendant would have employed a CEO beyond
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`February 2021, he would have not agreed to the proposed Waiver and
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`Release Agreement, as he would have made it past March 1, 2021 and
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`consequently he would have received the agreed amount of shares in
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`Molina’s parent company which, as he had done in past years, he would
`
`have immediately sold at market price (we are talking about a solid,
`
`
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`5
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 6 of 8
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`publicly traded entity), which would have represented a windfall of
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`approximately $205,000.00.
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`3.22. The only reason why plaintiff entered into the Waiver and Release
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`Agreement was because he was purposefully misled by the defendant into
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`thinking that his position would be eliminated from to March 2021 onward,
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`never to be refilled, which was done for the improper purpose of denying
`
`plaintiff from collecting the stock options that he was due as per his
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`compensation agreement.
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`3.23. The consent given by plaintiff was inexorably tainted by defendant’s deceit,
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`and thus the Waiver and Release Agreement is null and void.
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`3.24. Puerto Rico’s civil law on contracts, which is applicable to the Waiver and
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`Release Agreement, provides that the consent of a contracting party
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`obtained through deceit voids the contract, as observed by the late Puerto
`
`Rican Judge, Hon. Juan V. Torruella, speaking for the U.S. Court of Appeals
`
`for the First Circuit:
`
`Under Puerto Rico contract law, "[t]here is deceit when by
`words or insidious machinations on the part of one of the
`contracting parties the other is induced to execute a contract
`which without them he would not have made. P.R. Laws
`Ann. tit. 31, § 3408. Deceit, or dolo, can exist either "in the
`'formation' of a contract where a party obtains the consent of
`another through deceptive means," or "in the 'performance' of
`a contractual obligation where a party knowingly and
`intentionally, through deceitful means, avoids complying
`with its contractual obligation." Generadora de Electricidad
`del Caribe, Inc. v. Foster Wheeler Corp., 92 F. Supp. 2d 8, 18
`(D.P.R. 2000) (first citing P.R. Laws Ann. tit. 31, §§ 3404-3409
`then citing P.R. Laws Ann.
`tit. 31, §§ 3018-3019).
`"Furthermore, dolo can be considered either 'substantial'
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`
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`6
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 7 of 8
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`('grave'), when it determines the consent of a party, or
`'incidental' when it merely influences the consent." Burk v.
`Paulen, 100 F. Supp. 3d 126, 134 (D.P.R. 2015) (quoting P.R.
`Laws Ann. tit. 31, § 3409 and P.C.M.E., 952 F. Supp. at 92).
`Substantial dolo nullifies the contract.
`
`Feliciano-Muñoz v. Rebarber-Ocasio, 970 F.3d 53, 62 (1st Cir. 2020)
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`3.25. Once the appointment of Ms. García to plaintiff’s former position was
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`effective, it became clear that said party had been duped, plaintiff
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`attempted to resolve the matter with Molina through extra-judicial means
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`and was rebuffed with a threatening response.
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`3.26. Upon a decree of nullity, Puerto Rico law requires the parties to return
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`things to their state prior to the null agreement, which in this case means
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`plaintiff reimbursing his incentivized termination benefits and defendant
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`retroactively reinstating plaintiff to his former position with backpay and
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`the disbursement of the stock that was due on 2021.
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`3.27. The back pay owed to plaintiff from March 1, 2021 until the present day or
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`until Ms Garcia is terminated. She is still working (defendant’s announced
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`official date of closing of all operations on the island) is estimated at
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`$135,000.00 and the value of the performance stock Grants that plaintiff
`
`would have been eligible to and would had redeemed and sold
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`immediately as he was accustomed to doing, are valued at approximately
`
`$300,000.00 (this takes into account that the performance stock grants were
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`paid out quarterly and plaintiff would have been entitled to 2 quarter of
`
`said benefits).
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`7
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`Case 3:21-cv-01605 Document 1 Filed 12/14/21 Page 8 of 8
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`3.28. The above stated attitude constitutes blatant temerity and left plaintiff no
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`recourse other than filing the instant action, which warrants that plaintiff
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`be taxed with a reasonable amount in attorney’s fees pursuant to Puerto
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`Rico’s Rule 44.1(d) of Civil Procedure, 32 P.R. Laws Ann. Ap. V, R. 44.1(d).
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`WHEREFORE it is respectfully requested from this Honorable Court that the relief
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`requested in the instant action be hereby GRANTED.
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`
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`In San Juan, Puerto Rico this 14th day of December 2021.
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`RESPECTFULLY SUBMITTED,
`
`M.L. & R.E. LAW FIRM
`Cobian’s Plaza – Suite 404
`1607 Ponce De León Ave.
`San Juan, Puerto Rico 00909
`Tel (787) 999-2972
`
`S/Jorge Martínez-Luciano
`JORGE MARTÍNEZ-LUCIANO
`USDC-PR Number 216312
`e-mail: jorge@mlrelaw.com
`
`S/Emil Rodríguez-Escudero
`EMIL RODRÍGUEZ-ESCUDERO
`USDC-PR Number 224312
`e-mail: emil@mlrelaw.com
`
`
`
`8
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