`
`No.
`In the Supreme Court of the United States
`
`
`
`NORTH CYPRESS MEDICAL CENTER OPERATING COM-
`PANY, LTD., ET AL., PETITIONERS
`
`
`v.
`
`
`CIGNA HEALTHCARE, ET AL.
`
`
`
`
`ON PETITION FOR A WRIT OF CERTIORARI
`TO THE UNITED STATES COURT OF APPEALS
`FOR THE FIFTH CIRCUIT
`
`
`PETITION FOR A WRIT OF CERTIORARI
`
`
`
`DANIEL L. GEYSER
`Counsel of Record
`ALEXANDER DUBOSE &
`JEFFERSON LLP
`Walnut Glen Tower
`8144 Walnut Hill Lane, Ste. 1000
`Dallas, TX 75231
`(214) 396-0441
`dgeyser@adjtlaw.com
`
`
`
`J. DOUGLAS SUTTER
`SUTTER & KENDRICK, P.C.
`3050 Post Oak Blvd., Ste. 200
`Houston, TX 77056
`
`
`
`
`
`
`
`
`
`
`

`

`QUESTION PRESENTED
`This case raises an important and recurring question
`under the Employee Retirement Income Security Act of
`1974 (ERISA), Pub. L. No. 93-406, 88 Stat. 829 (29 U.S.C.
`1001 et seq.). In reviewing whether an ERISA administra-
`tor abused its discretion in denying a benefits claim, this
`Court has instructed lower courts to apply a “combina-
`tion-of-factors” analysis. Under that analysis, reviewing
`courts “must” consider all relevant “case-specific” factors
`and weigh them together.
`In the decision below, the Fifth Circuit abandoned
`that totality analysis and replaced it with a per se rule:
`According to the Fifth Circuit, an administrator automat-
`ically wins so long as “two other courts,” right or wrong,
`endorsed the administrator’s plan interpretation in the
`past—rendering it “immaterial” whether the administra-
`tor’s reading was legally correct, infected by conflicts of
`interest, motivated by bad faith, or applied unevenly to
`other participants. This mechanical new rule conflicts
`with the prevailing standard applied by this Court and
`other circuits—where all factors “must” be considered be-
`fore deciding if a benefits denial can stand.
`The question presented is:
`Whether, in reviewing an ERISA administrator’s ben-
`efits denial, it is automatically dispositive that “two other
`courts” upheld the administrator’s interpretation (as the
`Fifth Circuit held below, rendering “immaterial” the tra-
`ditional “abuse-of-discretion inquiry”), or whether a re-
`viewing court must consider all the traditional factors re-
`quired in this Court’s “combination-of-factors” analysis
`(as required by multiple courts of appeals and this Court).
`
`(I)
`
`

`

`II
`
`PARTIES TO THE PROCEEDING BELOW AND
`RULE 29.6 STATEMENT
`Petitioners are North Cypress Medical Center Oper-
`ating Company, Ltd.; and North Cypress Medical Center
`Operating Company GP, LLC.
`Respondents are Cigna Healthcare; Connecticut Gen-
`eral Life Insurance Company; and Cigna Healthcare of
`Texas, Inc.
`North Cypress Medical Center Operating Company,
`Ltd., and North Cypress Medical Center Operating Com-
`pany GP, LLC, have no parent corporations, and no pub-
`licly held company owns 10% or more of their stock.
`
`
`
`

`

`III
`
`RELATED PROCEEDINGS
`United States District Court (S.D. Tex.):
`North Cypress Med. Ctr. Operating Co., Ltd., et al. v.
`Cigna Healthcare, et al., Civ. No. 09-2556 (Dec. 12,
`2012) (initial final judgment)
`
`
`North Cypress Med. Ctr. Operating Co., Ltd., et al. v.
`Cigna Healthcare, et al., Civ. No. 09-2556 (Sept. 3,
`2013) (amended final judgment)
`
`
`North Cypress Med. Ctr. Operating Co., Ltd., et al. v.
`Cigna Healthcare, et al., Civ. No. 09-2556 (Aug. 16,
`2018) (final judgment on remand from the Fifth Cir-
`cuit in No. 12-20695)
`
`
`United States Court of Appeals (5th Cir.):
`North Cypress Med. Ctr. Operating Co., Ltd., et al. v.
`Cigna Healthcare, et al., No. 12-20695 (Mar. 10,
`2015) (initial appeal)
`
`
`North Cypress Med. Ctr. Operating Co., Ltd., et al. v.
`Cigna Healthcare, et al., No. 18-20576 (Mar. 19,
`2020)
`
`
`
`
`
`

`

`IV
`
`TABLE OF CONTENTS
`
`Page
`Opinions below ................................................................................ 1
`Jurisdiction ...................................................................................... 2
`Statutory provisions involved ....................................................... 2
`Introduction ..................................................................................... 3
`Statement ......................................................................................... 5
`A. Statutory background ....................................................... 5
`B. Facts and procedural history ........................................... 8
`Reasons for granting the petition ............................................... 13
`A. The Fifth Circuit’s decision creates a clear
`and obvious conflict with decisions of this
`Court and other circuits ................................................. 13
`B. The decision below is incorrect ...................................... 21
`C. The question presented is important and
`recurring and warrants review in this case ................. 24
`Conclusion ...................................................................................... 27
`Appendix A — Court of appeals opinion (Mar. 19, 2020) ........ 1a
`Appendix B — District court order on summary judgment
` (Sept. 28, 2016) ................................................. 17a
`Appendix C — District court order on reconsideration
` (Feb. 6, 2017) .................................................... 48a
`Appendix D — District court order on findings of fact and
` conclusions of law (Aug. 7, 2018) ................... 63a
`Appendix E — District court final judgment
` (Aug. 16, 2018) ................................................ 104a
`Appendix F — Court of appeals order (Apr. 21, 2020) ........ 106a
`
`
`TABLE OF AUTHORITIES
`
`Cases: 
`Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350
`(11th Cir. 2011) .................................................................. 15
`
`

`

`V
`
`Page
`
`Cases—continued: 
`
`Clarke v. Fed. Ins. Co., 823 F. Supp. 2d 1213
`(W.D. Okla. 2011) .............................................................. 17
`Colby v. Union Sec. Ins. Co. & Mgmt. Co. for
`Merrimack Anesthesia Assocs. Long Term
`Disability Plan, 705 F.3d 58 (1st Cir. 2013) ................. 15
`Conkright v. Frommert, 559 U.S. 506 (2010) ......... 5, 7, 8, 14
`Connecticut Gen. Life Ins. Co. v. Humble Surgical
`Hosp., LLC, 878 F.3d 478 (5th Cir. 2017) ............. passim
`Connecticut Gen. Life Ins. Co. v. Humble
`Surgical Hosp., LLC, No. 13-3291,
`2016 WL 3077405 (S.D. Tex. June 1, 2016) ............. 10, 26
`Creno v. Metro. Life Ins., No. CV-12-1642,
`2014 WL 4053410 (D. Ariz. Aug. 15, 2014) .................... 17
`Ctr. for Restorative Breast Surgery, L.L.C. v. Blue Cross
`Blue Shield of La., No. 11-806, 2016 WL 9439243
`(E.D. La. Sept. 19, 2016) .................................................. 23
`Darvell v. Life Ins. Co. of N. Am., 597 F.3d 929
`(8th Cir. 2010) .................................................................... 16
`Dragus v. Reliance Standard Life Ins. Co.,
`882 F.3d 667 (7th Cir. 2018) ............................................. 15
`Egelhoff v. Egelhoff, 532 U.S. 141 (2001) ............................ 24
`Ehrensaft v. Dimension Works Inc. Long Term
`Disability Plan, 33 F. App’x 908 (9th Cir. 2002) .......... 17
`Firestone Tire & Rubber Co. v. Bruch,
`489 U.S. 101 (1989) ........................................................ 5, 14
`Fitzgerald v. Colonial Life & Ins. Co., No. JFM-12-38,
`2012 WL 1030261 (D. Md. Mar. 26, 2012) ................ 18, 19
`Gallo v. Madera, 136 F.3d 326 (2d Cir. 1998) ..................... 17
`Harris Methodist Fort Worth v. Sales Support
`Servs. Inc. Employee Health Care Plan,
`426 F.3d 330 (5th Cir. 2005) ............................................... 7
`Hinkle ex rel. Estate of Hinkle v. Assurant, Inc.,
`390 F. App’x 105 (3d Cir. 2010) ................................. 18, 19
`Jones v. Allen, No. 2:11-cv-380, 2013 WL 5728344
`(S.D. Ohio Oct. 22, 2013) .................................................. 17
`
`

`

`VI
`
`Page
`
`Cases—continued: 
`
`Kennedy v. Conn. Gen. Life Ins. Co., 924 F.2d 698
`(7th Cir. 1991) .................................................................... 22
`Marcin v. Reliance Standard Life Ins. Co.,
`861 F.3d 254 (D.C. Cir. 2017) .......................................... 15
`McGuffie v. Anderson Tully Co., No. 3:13-cv-888,
`2014 WL 4658971 (S.D. Miss. Sept. 17, 2014) ......... 18, 20
`Metropolitan Life Ins. Co. v. Glenn,
`554 U.S. 105 (2008) ................................................... passim
`Montour v. Hartford Life & Accident Ins.,
`588 F.3d 623 (9th Cir. 2009) ............................................. 15
`Moran v. Aetna Life Ins. Co., 872 F.2d 296
`(9th Cir. 1989) .................................................................... 24
`N. Cypress Med. Ctr. Operating Co., Ltd. v. Cigna
`Healthcare, 781 F.3d 182 (5th Cir. 2015) .............. passim
`N. Jersey Brain & Spine Ctr. v. Aetna, Inc.,
`801 F.3d 369 (3d Cir. 2015) ................................................ 7
`Osborne v. Hartford Life & Accident Ins.,
`465 F.3d 296 (6th Cir. 2006) ............................................. 17
`Pettit v. UnumProvident Corp., 774 F. Supp. 2d 970
`(S.D. Iowa 2011) ................................................................ 17
`Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41 (1987) .............. 7
`Roganti v. Metro. Life Ins. Co., 786 F.3d 201
`(2d Cir. 2015) ..................................................................... 15
`Rush Prudential HMO, Inc. v. Moran,
`536 U.S. 355 (2002) ............................................................ 24
`Wiggins v. Smith, 539 U.S. 510 (2003) ................................ 22
`Xitronix Corp. v. KLA-Tencor Corp., 916 F.3d 429
`(5th Cir. 2019) .................................................................... 22
`
`Statutes: 
`28 U.S.C. 1254(1) ...................................................................... 2
`28 U.S.C. 2254(d)(1) ............................................................... 22
`
`
`
`

`

`VII
`
`Page
`
`Statutes—continued: 
`
`Employee Retirement Income Security Act of 1974
`(ERISA), Pub. L. No. 93-406, 88 Stat. 829 (29 U.S.C.
`1001 et seq.) ............................................................... passim
`29 U.S.C. 1001(b) ................................................................. 5
`29 U.S.C. 1102(a)(1) ............................................................ 6
`29 U.S.C. 1104(a)(1) .................................................. 2, 6, 23
`29 U.S.C. 1132 ................................................................. 3, 6
`29 U.S.C. 1132(a)(1)(B) ...................................................... 6
`29 U.S.C. 1133 ..................................................................... 6
`
`
`
`
`
`
`
`
`
`
`

`

`In the Supreme Court of the United States
`
`
`
`No.
`
`NORTH CYPRESS MEDICAL CENTER OPERATING COM-
`PANY, LTD., ET AL., PETITIONERS
`
`
`v.
`
`
`CIGNA HEALTHCARE, ET AL.
`
`
`ON PETITION FOR A WRIT OF CERTIORARI
`TO THE UNITED STATES COURT OF APPEALS
`FOR THE FIFTH CIRCUIT
`
`
`PETITION FOR A WRIT OF CERTIORARI
`
`
`North Cypress Medical Center Operating Company,
`Ltd., and North Cypress Medical Center Operating Com-
`pany GP, LLC, respectfully petition for a writ of certio-
`rari to review the judgment of the United States Court of
`Appeals for the Fifth Circuit in this case.
`OPINIONS BELOW
`The opinion of the court of appeals (App., infra, 1a-
`16a) is reported at 952 F.3d 708. The order of the district
`court (App., infra, 17a-47a) on summary judgment is un-
`reported but available at 2016 WL 9330500. The order of
`the district court (App., infra, 48a-62a) denying reconsid-
`eration is unreported but available at 2017 WL 484108.
`The order of the district court (App., infra, 63a-103a) en-
`tering findings of fact and conclusions of law is unreported
`
`(1)
`
`

`

`2
`
`but available at 2018 WL 3738086. The final judgment of
`the district court (App., infra, 104a-105a) is unreported.
`JURISDICTION
`The judgment of the court of appeals was entered on
`March 19, 2020. A petition for rehearing was denied on
`April 21, 2020 (App., infra, 106a-107a). On March 19, 2020,
`the Court extended the time within which to file a petition
`for a writ of certiorari due on or after the order’s date to
`150 days from “the date of the lower court judgment
`* * * or order denying a timely petition for rehearing”;
`that order had the effect of extending the deadline to file
`this petition to September 18, 2020. The jurisdiction of
`this Court is invoked under 28 U.S.C. 1254(1).
`STATUTORY PROVISIONS INVOLVED
`Section 404 of the Employee Retirement Income Se-
`curity Act of 1974 (ERISA), 29 U.S.C. 1104(a)(1), provides
`in pertinent part:
`Fiduciary duties
`(a) Prudent man standard of care
` (1) Subject to sections 1103(c) and (d), 1342, and 1344
`of this title, a fiduciary shall discharge his duties with
`respect to a plan solely in the interest of the partici-
`pants and beneficiaries and—
` (A) for the exclusive purpose of:
` (i) providing benefits to participants and their
`beneficiaries; and
` (ii) defraying reasonable expenses of administer-
`ing the plan;
` (B) with the care, skill, prudence, and diligence un-
`der the circumstances then prevailing that a prudent
`
`

`

`3
`
`man acting in a like capacity and familiar with such
`matters would use in the conduct of an enterprise of
`a like character and with like aims; [and]
`* * * * *
` (D) in accordance with the documents and instru-
`ments governing the plan insofar as such documents
`and instruments are consistent with the provisions
`of this subchapter and subchapter III.
`
`
` Section 502 of ERISA, 29 U.S.C. 1132, provides in
`pertinent part:
`Civil enforcement
`(a) Persons empowered to bring a civil action
` A civil action may be brought—
` (1) by a participant or beneficiary—
`* * * * *
` (B) to recover benefits due to him under the
`terms of his plan, to enforce his rights under the
`terms of the plan, or to clarify his rights to future
`benefits under the terms of the plan * * * .
`* * * * *
`INTRODUCTION
`This case presents a clear and intractable conflict over
`an important question under ERISA.
`In a series of decisions, this Court outlined the proper
`standard of review for denied ERISA benefits claims.
`When a plan administrator is vested with discretionary
`authority, courts review the administrator’s decision for
`abuse of discretion—and, critically here, this requires
`courts to assess the administrator’s decision “by taking
`account of several different, often case-specific, factors,
`
`

`

`4
`
`reaching a result by weighing all together.” Metropolitan
`Life Ins. Co. v. Glenn, 554 U.S. 105, 117 (2008). This Court
`stated unequivocally that reviewing courts must consider
`certain factors in this “combination-of-factors” analysis,
`including whether the administrator has impermissible
`conflicts or acted in bad faith. Id. at 116, 118.
`In applying this standard, most circuits have under-
`stood this Court to mean what it said. These circuits duti-
`fully examine all the relevant factors before deferring to
`the administrator. And these circuits perform that totality
`analysis, as required, even when prior case law supports
`the administrator’s reading of the plan.
`The Fifth Circuit, however, has disregarded these di-
`rectives and adopted its own standard. According to the
`Fifth Circuit, when “two other courts” support the admin-
`istrator’s interpretation, it becomes unnecessary to re-
`view any of the “abuse of discretion factors” considered in
`the traditional totality analysis. App., infra, 11a & n.7. As
`the Fifth Circuit held, those factors become “immaterial,”
`and “the abuse-of-discretion inquiry [i]s obviated by the
`existence of prior legal authority supporting [the admin-
`istrator’s] interpretation.” Id. at 11a. In reviewing the
`$40-million denied claim here, the court accordingly re-
`fused to consider any issues of bad faith, conflicts of inter-
`est, arbitrary and disparate treatment, or even the fact
`that the administrator misread the plan—the traditional
`factors that this Court and other circuits say “must” be
`included in the analysis. Instead, because at least two
`courts endorsed the administrator’s reading, the Fifth
`Circuit held that the administrator’s decision automati-
`cally was not “‘an abuse of discretion.’” Id. at 11a-13a.
`The Fifth Circuit’s outlier position creates a direct
`conflict with decisions of this Court and other circuits. It
`endorses an approach that will excuse improper adminis-
`trator actions, and override the totality analysis that is
`
`

`

`5
`
`necessary to root out fiduciary misconduct. Its mechanical
`standard is also baseless on its own terms: in every anal-
`ogous area, prior rulings are not automatic proxies for
`reasonableness; lower courts do get things wrong, and de-
`cisions are frequently rejected for being objectively un-
`reasonable, clear error, and (of course) an abuse of discre-
`tion. Had this case arisen in any other circuit, petitioners
`would have had an opportunity to expose the flaws and
`deficiencies in the administrator’s decision. It instead lost
`under the Fifth Circuit’s per se rule based on simple head-
`counting.
`This conflict is clear and intolerable. It has obvious sig-
`nificance for both participants and plans, and it distorts
`the appropriate standard for reviewing plan interpreta-
`tions, a subject demanding uniform treatment nationwide.
`Because this case is an ideal vehicle for resolving a ques-
`tion of great legal and practical importance, the petition
`should be granted.
`
`STATEMENT
`A. Statutory Background
`1. Congress enacted ERISA “‘to promote the interests
`of employees and their beneficiaries in employee benefit
`plans,’” and “‘to protect contractually defined benefits.’”
`Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 113
`(1989). While employers have no obligation to establish
`plans, ERISA “ensure[s]” that employees “receive
`[earned] benefits” when plans are established. Conkright
`v. Frommert, 559 U.S. 506, 516 (2010). To that end,
`ERISA imposes a variety of obligations on plan adminis-
`trators and fiduciaries (e.g., 29 U.S.C. 1001(b)), while
`“provid[ing] ‘a panoply of remedial devices’ for partici-
`pants and beneficiaries” to enforce those obligations.
`Firestone, 489 U.S. at 108.
`
`

`

`6
`
`Every ERISA plan is “maintained pursuant to a writ-
`ten instrument,” which must identify one or more fiduci-
`aries to administer the plan. 29 U.S.C. 1102(a)(1). That fi-
`duciary is required to “discharge [its] duties with respect
`to a plan solely in the interest of the participants and ben-
`eficiaries.” 29 U.S.C. 1104(a)(1). In many instances, how-
`ever, “the entity that administers the plan, such as an em-
`ployer or an
`insurance company, both determines
`whether an employee is eligible for benefits and pays ben-
`efits out of its own pocket”—meaning that every denied
`claim generates direct savings for the administrator. Met-
`ropolitan Life Ins. Co. v. Glenn, 554 U.S. 105, 108 (2008).
`This creates the potential for an impermissible conflict of
`interest. See, e.g., id. at 112, 114 (explaining that adminis-
`trators, including insurance companies acting as adminis-
`trators, are conflicted when they “both evaluate[] claims
`for benefits and pay[] benefits claims”).
`2. a. When disputes arise between administrators and
`beneficiaries, ERISA authorizes judicial review to re-
`cover improperly denied benefits and to establish benefi-
`ciaries’ rights. 29 U.S.C. 1132(a)(1)(B); see Glenn, 554
`U.S. at 115.1 Section 1132(a) entitles a plan participant to
`sue “to recover benefits due to him under the terms of his
`plan, to enforce his rights under the terms of the plan, or
`to clarify his rights to future benefits.” 29 U.S.C.
`1132(a)(1)(B). This right may be transferred to healthcare
`providers, who can “obtain standing to sue derivatively to
`enforce an ERISA plan beneficiary’s claim.” Harris
`
`
`1 A plan separately must establish a claims procedure regarding
`benefit denials. This procedure must “provide adequate notice” of the
`denial to the participant or beneficiary, “set[] forth the specific rea-
`sons for such denial,” and allow “a full and fair review.” 29 U.S.C.
`1133. The full-and-fair-review requirement “underscores the particu-
`lar importance of accurate claims processing.” Glenn, 554 U.S. at 115.
`
`

`

`7
`
`Methodist Fort Worth v. Sales Support Servs. Inc. Em-
`ployee Health Care Plan, 426 F.3d 330, 333-334 (5th Cir.
`2005); see also, e.g., N. Jersey Brain & Spine Ctr. v.
`Aetna, Inc., 801 F.3d 369, 373 (3d Cir. 2015) (same for
`“[e]very United States Court of Appeals to have consid-
`ered this question”). Section 1132(a)’s enforcement
`scheme “is one of the essential tools for accomplishing the
`stated purposes of ERISA.” Pilot Life Ins. Co. v. De-
`deaux, 481 U.S. 41, 52 (1987).
`b. Critically here, because ERISA’s text does not dic-
`tate how to review benefit denials, this Court borrowed
`principles of trust law to fill the gaps. Under this frame-
`work, when a plan grants its administrator “discretionary
`authority to determine eligibility for benefits or to con-
`strue the terms of the plan,” a court evaluates any benefit
`denial under an abuse-of-discretion standard. Firestone,
`489 U.S. at 115. As this Court has long established, that
`standard requires a totality analysis—courts “must” con-
`sider “several different, often case-specific, factors, reach-
`ing a result by weighing all together.” Glenn, 554 U.S. at
`116, 118. In devising that standard, the Court explicitly
`rejected the use of “‘rigid and inflexible requirement[s].’”
`Conkright, 559 U.S. at 522. A “combination-of-factors
`method of review” is necessary because benefit decisions
`“arise in too many contexts” and “concern too many cir-
`cumstances” to develop “a one-size-fits-all procedural sys-
`tem that is likely to promote fair and accurate review.”
`Glenn, 544 U.S. at 116, 119.
`Thus, put simply, wooden and bright-line rules are for-
`bidden, and reviewing courts are required to consider the
`“many” relevant factors under a “combination-of-factors”
`analysis. Glenn, 554 U.S. at 116, 118. Those factors include
`things like correctness of the administrator’s plan inter-
`pretation, bad faith, inconsistent treatment of beneficiar-
`ies or providers, and conflicts of interest. See id. at 108
`
`

`

`8
`
`(confirming, for example, that when a conflict is present,
`“a reviewing court should consider that conflict as a factor
`in determining whether the plan administrator has
`abused its discretion”). Although not every factor will
`prove “important” in every case, the reduced weight re-
`sults from “inherent or case-specific” circumstances, not
`any categorical rule. Id. at 117-118.
`B. Facts And Procedural History
`1. This case involves a dispute under ERISA for “un-
`derpayment of more than $40 million in benefit claims.”
`App., infra, 2a. Petitioners operate a “general acute care
`hospital” in Texas. Id. at 65a. After opening, the parties
`attempted to negotiate an in-network contract, but were
`unable to reach an agreement. North Cypress Med. Ctr.
`Operating Co., Ltd. v. Cigna Healthcare, 781 F.3d 182,
`188 (5th Cir. 2015). During the relevant periods here, pe-
`titioners instead provided services on an out-of-network
`basis to members of respondents’ ERISA plans. Id. at
`187-188; see also App., infra, 69a.
`Petitioners “created a program called the Prompt Pay
`Discount” for its patients. App., infra, 69a. Under the pro-
`gram, patients would receive steep discounts—often
`roughly approximating in-network rates—by paying coin-
`surance amounts within 120 days of a charge; if the pa-
`tient satisfied the charge on time, he or she would not be
`obligated to pay the full amount. Id. at 69a-70a; see also
`id. at 3a n.1 (“in-network coinsurance obligations are typ-
`ically 20% of the covered service, while patients must pay
`40% of fees to out-of-network providers”).
`Respondents soon objected to petitioners’ discount
`program. Respondents maintained that any discounts
`amounted to “‘fee forgiveness,’” which they asserted fit
`within a specific exclusion from plan coverage: “‘Charges
`for which you are not obligated to pay or for which you are
`not billed or would not have been billed except that you
`
`

`

`9
`
`were covered under this Agreement.’” Id. at 3a-4a. Peti-
`tioners objected that its “Prompt Pay Discount” did “‘not
`waive any portion of [petitioners’] charges for a service’”
`(id. at 73a), but respondents invoked the exclusion any-
`way. By “interpret[ing] this language to mean that pa-
`tients had no insurance coverage for medical procedures
`for which the patient was not billed,” respondents “imple-
`mented a Fee-Forgiving Protocol under which it drasti-
`cally reduced its payment of claims to [petitioners].” Id. at
`18a.
`2. a. As relevant here, petitioners responded by filing
`suit seeking benefits under ERISA. App., infra, 18a. In
`addition to claiming respondents’ plan construction was
`incorrect, petitioners asserted that respondents adopted
`that construction in bad faith, applied the plan unevenly
`to different providers, and were motivated by an inherent
`conflict of interest—because respondents both adminis-
`tered and paid claims for certain plans, every dollar re-
`spondents refused to pay petitioners was a dollar of sav-
`ings going directly into respondents’ pocket. See, e.g.,
`App., infra, 27a-28a.2
`After an initial trip back and forth to the Fifth Circuit,
`petitioners sought and obtained partial summary judg-
`ment on their ERISA claims. App., infra, 27a-33a. Ac-
`cording to the district court, respondents “abused [their]
`discretion” in interpreting the plan language. Id. at 27a.
`After recognizing disputed facts on the conflicts-of-inter-
`est factor, the court found “strong inferences that [re-
`spondents] did not act in good faith.” Id. at 30a, 31a-33a
`(citing, for example, “a great deal of evidence that [re-
`spondents’] primary motivation was not to root out fee
`
`
`2 Petitioners also explained that, even for plans funded by plan
`sponsors, respondents still “collected contingency fees when it re-
`duced payments to [petitioners].” App., infra, 28a.
`
`

`

`10
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`forgiveness, but instead to pressure [petitioners] into ne-
`gotiating an in-network contract”). The court ordered fur-
`ther proceedings on certain issues and damages.
`b. In response to cross-motions from the parties, the
`district court later denied reconsideration on certain is-
`sues, upholding its findings that (i) respondents’ “inter-
`pretation of the plan was not legally correct,” and (ii) re-
`spondents abused their discretion by adopting their posi-
`tion in bad faith. App., infra, 51a-54a; see also id. at 54a
`(“The fact that [respondents] had other, legitimate moti-
`vations does not change the Court’s finding that [respond-
`ents] acted in bad faith by attempting to drive contract
`negotiations through a program ostensibly aimed at cur-
`tailing fee-forgiving.”).
`c. Before the district court could dispose of all the
`claims, the Fifth Circuit issued its decision in Connecticut
`Gen. Life Ins. Co. v. Humble Surgical Hosp., LLC, 878
`F.3d 478 (5th Cir. 2017). That case involved effectively the
`same administrator’s construction of the same plan lan-
`guage based on similar activity. In earlier proceedings in
`Humble, the district court ruled that Cigna misread the
`plan, and was impaired by both conflicts of interest and
`bad faith. See Connecticut Gen. Life Ins. Co. v. Humble
`Surgical Hosp., LLC, No. 13-3291, 2016 WL 3077405, at
`*24-*25 (S.D. Tex. June 1, 2016). But the Fifth Circuit ul-
`timately reversed.
`First, the Fifth Circuit declined to decide whether
`Cigna’s plan interpretation was legally correct. 878 F.3d
`at 484. It did, however, note that the court “has previously
`suggested (without deciding) that [Cigna’s] reading might
`be legally incorrect.” Ibid. (citing N. Cypress Med. Ctr.
`Operating Co., Ltd. v. Cigna Healthcare, 781 F.3d 182,
`196 (5th Cir. 2015)).
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`11
`
`It then held that Cigna’s interpretation nevertheless
`“fell within its broad discretion.” 878 F.3d at 484. In mak-
`ing that determination, the court expressly refused to con-
`sider whether Cigna “‘had a conflict of interest,’” “‘lack of
`good faith,’” applied the plan “‘consisten[tly],’” or fell
`short under any other totality factor. Id. at 484-485 (de-
`claring “[w]e need not review these factors”). The court
`instead found a single fact “dispositive”: “where an admin-
`istrator’s interpretation is supported by prior case law, it
`cannot be an abuse of discretion.” Id. at 485.
`According to the Fifth Circuit, “[a]t least two other
`courts have effectively or explicitly concluded that the
`provision at issue here was legally correct.” 878 F.3d at
`485 (citing a 1991 Seventh Circuit decision and the re-
`versed district court decision in this case). “In these cir-
`cumstances,” the court held, “‘the fact that two courts
`have found [Cigna’s] interpretation of the policy language
`reasonable itself establishes that the interpretation does
`not constitute an abuse of discretion.’” Ibid. Put simply:
`“‘the fact that [at least] two courts have upheld interpre-
`tations similar to that of [Cigna] is dispositive of the is-
`sue.’” Ibid. The court accordingly upheld Cigna’s inter-
`pretation without confronting the extensive findings from
`a nine-day bench trial that Cigna had indeed abused its
`discretion.
`d. After Humble was issued, the district court held a
`bench trial. App., infra, 64a. Notwithstanding twice
`reaching the opposite conclusion (on summary judgment
`and reconsideration), the district court reversed itself and
`ruled that respondents had not abused their discretion.
`Id. at 94a-103a.
`The court’s discussion focused heavily on Humble,
`noting, explicitly, that its conclusion was partly “[i]n the
`interest of uniformity of decisions.” Id. at 97a-98a. It fol-
`lowed that conclusion with a single numbered paragraph
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`

`

`12
`
`(id. at 98a-101a) dedicated to “the traditional abuse of dis-
`cretion factors.” Id. at 98a.
`3. a. The Fifth Circuit affirmed. App., infra, 1a-16a.
`As relevant here, the Fifth Circuit batted aside peti-
`tioners’ arguments that “the district court erred in its
`evaluation of the conflicts of interest and inferences of
`lack of good faith.” App., infra, 11a. “Under Humble,” the
`court explained, “the abuse-of-discretion inquiry was ob-
`viated by the existence of prior legal authority supporting
`[respondents’] interpretation of identical or nearly identi-
`cal language concerning insureds’ coinsurance obliga-
`tions.” Ibid. That necessarily “moot[ed]” and rendered
`“immaterial” any “alleged conflicting interests and lack of
`good faith.” Id. at 9a, 11a. As Humble concluded, “‘where
`an administrator’s interpretation is supported by prior
`case law, it cannot be an abuse of discretion—even if the
`interpretation is legally incorrect.’” Ibid. (quoting Hum-
`ble, 878 F.3d at 484).
`In sum, the Fifth Circuit held, respondents’ “interpre-
`tation, having relevant legal support, could not in these
`circumstances be an abuse of discretion.” App., infra, 13a.
`That “pretermit[ted] further discussion” of “the abuse of
`discretion factors.” Id. at 11a n.7; see also id. at 14a (again
`declaring that respondents’ “alleged conflicts of interest
`and lack of good faith” were “immaterial”).
`b. The Fifth Circuit denied a petition for rehearing en
`banc without any member of the court requesting a vote.
`App., infra, 106a-107a.
`
`
`
`
`
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`13
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`REASONS FOR GRANTING THE PETITION
`A. The Fifth Circuit’s Decision Creates A Clear And
`Obvious Conflict With Decisions Of This Court
`And Other Circuits
`According to the Fifth Circuit, when “two other
`courts” support the administrator’s interpretation, it be-
`comes unnecessary to review any of the “abuse of discre-
`tion factors” considered in the traditional totality analysis.
`App., infra, 11a-12a & n.7. In other words, the totality
`analysis is “obviated” whenever any two courts, at any
`level, happen to support the administrator’s reading—no
`matter how wrong or unreasonable those courts might
`have been, and no matter what evidence exists in the rec-
`ord that the administrator was in fact conflicted or acting
`in bad faith. Ibid. Every factor (including those factors
`this Court said lower courts “must” consider) becomes
`“immaterial” because the administrator’s view has prior
`legal support—even if that legal support is wrong. Id. at
`11a, 14a.
`The Fifth Circuit’s holding directly conflicts with the
`decisions of this Court and multiple courts of appeals.
`Those courts do not find prior case law dispositive, but in-
`stead examine all relevant factors in reviewing the admin-
`istrator’