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Krukas v. AARP, Inc.

United States District Court, District of Columbia

March 17, 2019

HELEN KRUKAS, Plaintiff,
AARP, Inc., et al., Defendants.



         The plaintiff, Helen Krukas, individually, and on behalf of all others similarly situated (except for individuals residing in California), as well as the general public, brings this putative class action against the defendants, AARP Inc., (“AARP”), AARP Services Inc. (“ASI”), and AARP Insurance Plan (“AARP Trust”) (collectively referred to as “AARP”), alleging a violation of the Washington D.C. Consumer Protection Procedures Act (“CPPA”), D.C. Code § 28-3901 et seq., as well as common law violations of conversion, unjust enrichment, and fraudulent concealment, based on her purchase of a Medicare supplemental health insurance policy, also known as a “Medigap” policy, administered by AARP. See Compl. ¶¶ 1, 16, 17, 88, ECF No. 1. These statutory and common law claims are predicated on the plaintiff's allegations that she was “fooled into paying AARP an undisclosed 4.95% commission” when purchasing her Medigap policy and, since “AARP is not licensed as an insurance broker or agent, ” the defendants “may not legally collect these commissions.” Id. ¶ 1. Pending before the Court is the defendants' Motion to Dismiss for failure to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6). See Defs.' Mot. to Dismiss & Mem. in Supp. (“Defs.' Mem.”), ECF No. 8.[1] For the reasons set forth below, the defendants' motion is denied.[2]

         I. BACKGROUND

         The plaintiff challenges AARP's role in soliciting, marketing, and administering Medigap policies, a state-regulated form of health insurance to supplement Medicare. Since at least 1997, AARP has held, in its name, group Medigap policies underwritten by UnitedHealth Group and UnitedHealthcare Insurance Company (collectively, “UnitedHealth”) and offered participation in those group policies to individual AARP members and the general public. See Compl. ¶¶ 22, 37, 51. The plaintiff alleges that AARP's administration and provision of other services in support of these group Medigap policies amounted to acting as an unlicensed insurance agent, that the “royalties” paid to AARP as a percentage of premiums constituted illegal commissions, and that AARP materially misrepresented the nature and source of the “royalties, ” causing consumers to pay more for AARP Medigap policies than they otherwise would. See Compl. ¶¶ 4-15. The following discussion provides a general overview of Medigap policies and summarizes the plaintiff's allegations, claims against AARP, and desired relief.

         A. Medigap Policies Generally

         A Medigap policy is insurance offered by a private insurer to help pay for certain “gaps” in Medicare coverage. See United States v. Blue Cross & Blue Shield of Md., Inc., 989 F.2d 718, 721 (4th Cir. 1993) (citing Pub. L. No. 96-265, § 507, 94 Stat. 441, 476 (codified as amended at 42 U.S.C. § 1395ss)). The Centers for Medicare and Medicaid Services has described a Medigap policy as “health insurance [sold by private insurance companies that] can help pay some of the health care costs that Original Medicare doesn't cover, like coinsurance, copayments, or deductibles.” Ctrs. for Medicare & Medicaid Servs., Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare 5 (2019), [hereinafter “CMS Medigap Guide]; see also Compl. ¶ 29 (“Medigap plans offer extra coverage to Medicare beneficiaries . . . such as first-dollar coverage and reduced co-payment and deductibles.”).[3]“Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. Cost is usually the only difference between [standardized] Medigap policies . . . sold by different insurance companies, ” CMS Medigap Guide at 9, because “[d]ifferent insurance companies may charge different premiums for the same exact policy, ” id. at 13. Indeed, “big differences” may occur “in the premiums that different insurance companies charge for exactly the same coverage.” Id. at 19. Age, where a person lives, medical underwriting, and discounts may affect an insurance company's choice of what premium to charge. Id. at 17.

         B. AARP's Alleged Role in Administering UnitedHealth's Medigap Policies

         The plaintiff, currently a resident of Boca Raton, Florida, originally purchased a UnitedHealth Medigap policy from AARP in Louisiana in 2012, and continuously maintained this coverage by paying her monthly premium to AARP until November 2016. See Compl. ¶ 20; Pl.'s Mem. in Opp'n to Mot. to Dismiss (“Pl.'s Opp'n”) at 16, ECF No. 13. Her most recent renewal of her AARP Medigap policy coverage occurred when she resided in Florida. See Compl. ¶ 20; Pl.'s Opp'n at 16. She alleges that “[b]ut for Defendants' deceptive and unlawful acts . . . [she] would not have agreed to pay an additional 4.95% above the premium for an AARP Medigap policy, and would have sought out other, cheaper and lawful Medigap insurance.” Compl. ¶ 20.

         Defendant AARP is a non-profit membership organization for seniors aged 50 years or older, with reportedly over 40 million members, about half of whom are over the age of 65. See Id. ¶¶ 2, 21, 25. The organization is organized under the laws of the District of Columbia and maintains its national headquarters and primary place of business in Washington, D.C., id. ¶ 21, which is where AARP establishes its “corporate policies and practices, including those for AARP Medigap policies, ” id. Defendant ASI is a wholly owned subsidiary of AARP, organized under the laws of Delaware, with its primary place of business in Washington, D.C. Id. ¶ 22. As AARP's taxable, “for-profit” division, ASI “negotiates, oversees, and manages lucrative contracts with AARP's insurance business partners.” Id. AARP created ASI in 1999 pursuant to a settlement agreement with the U.S. Internal Revenue Service (IRS), following an IRS investigation into the income that AARP earned through endorsement deals. See Id. ¶¶ 22, 36. Defendant AARP Trust is a grantor trust organized by AARP under the laws of Washington, D.C., where the Trust maintains its primary place of business. Id. ¶ 22.

         AARP is not a licensed insurance broker or agent. Id. ¶ 8. Rather, AARP, through AARP Trust, serves as the group policy holder for Medigap coverage underwritten by UnitedHealth. See Id. ¶ 22. In this role, AARP Trust maintains depository accounts to collect insurance premiums from individual purchasers of Medigap policies through AARP's group plan and, as part of that premium, AARP Trust also collects the challenged 4.95% “royalty” charge assessed on every Medigap policy sold or renewed. See Id. ¶¶ 22, 52, 54. AARP Trust remits premiums to UnitedHealth, and transfers the money collected as a 4.95% “royalty” to AARP and ASI. Id. ¶¶ 22, 56, 57; see also Id. ¶ 52 (“In accordance with the agreement [with UnitedHealth] . . . collections [of premiums] are remitted to third-party insurance carriers . . ., net of the contractual royalty payments that are due to AARP, Inc., which are reported as royalties.”) (quoting AARP's 2016 Audited Financial Statement) (emphasis added).

         A joint venture agreement (“Agreement”), first entered in 1997, governs AARP and UnitedHealth's relationship with respect to Medigap insurance. Id. ¶ 37; see also Defs.' Mem., Ex. 1 (Agreement), ECF No. 8-1.[4] The Complaint provides detail on the evolution of the Agreement over time, most notably that AARP was initially entitled to an “allowance, ” which was renamed a “royalty” after AARP's 1999 settlement with the IRS. Compl. ¶¶ 39, 40. Under the Agreement, AARP agrees to: (1) market, solicit, sell and renew AARP Medigap policies with UnitedHealth; (2) collect and remit premium payments on behalf of UnitedHealth; (3) generally administer the AARP Medigap program; and (4) otherwise act as UnitedHealth's agent. Id. ¶ 38. The Agreement makes clear that AARP owns all solicitation materials related to the Medigap program. Id. ¶ 47 (citing Agreement Subsection 7.2, “Member Communications”). “[I]n exchange for AARP's administering of the insurance program and its marketing, soliciting, and selling or renewing of AARP Medigap policies on behalf of UnitedHealth, as well as its collecting and remitting insurance premiums on behalf of UnitedHealth, AARP earns a 4.95% commission-disguised as a ‘royalty'-on each policy sold or renewed.” Id. ¶ 45. In 2016, AARP generated $880 million in revenues from “royalties, ” of which 68% came from UnitedHealth insurance products, including Medigap Policies and other insurance products. See Id. ¶¶ 28, 32, 33, 37. The $880 million in royalty revenue equated to over 54% of AARP's 2016 total operating revenue. Id. ¶ 32.

         The nature of the 4.95% charge, and AARP's representations to consumers regarding this charge, are the focus of the plaintiff's claims. While the defendants describe the 4.95% charge as a royalty compensating AARP for UnitedHealth's use of its intellectual property, see Id. ¶¶ 40-45, the plaintiff alleges, relying on a Ninth Circuit case for support, that the 4.95% charge is an illegal and not properly disclosed commission compensating AARP for agreeing to act as UnitedHealth's agent in connection with the marketing, solicitation, sale, and administration of Medigap policies. See Id. ¶¶ 49, 62-68; see also Id. ¶ 6 (citing Friedman v. AARP, Inc., 855 F.3d 1047, 1052-53 (9th Cir. 2017) (finding that the plaintiff had sufficiently alleged that AARP's royalty fits California's definition of “commission wages” as “compensation paid to any person for services rendered in the sale of such employer's property or services and based proportionately upon the amount or value thereof” and holding that AARP's retention of this commission could plausibly violate California law). The plaintiff suggests that AARP characterizes its “commission” as a “royalty” to avoid oversight by insurance regulators and to avoid paying taxes on the income generated through insurance sales, whereas other associations “do the right thing and acquire a license to act as an agent.” Compl. ¶ 8 & n.1 (citing example of the automobile club AAA, which is licensed to sell insurance).

         According to the plaintiff, “AARP and UnitedHealth, together and through their respective subsidiaries, have orchestrated an elaborate scheme where AARP, as the de facto agent of UnitedHealth, helps market, solicit, and sell or renew AARP Medigap policies and generally administers the AARP Medigap program for UnitedHealth, in exchange for an undisclosed and illegal 4.95% commission that AARP collects from” plaintiff and other consumers when they pay AARP for their Medigap policies. Id. ¶ 4. The plaintiff further complains that “[d]espite the fact that AARP is not licensed as an insurance agent, ” id. ¶ 8, AARP received “a 4.95% commission from every policy sold or renewed, ” id, which “constitutes an illegal kickback, ” id. Set against the local statutory bar prohibiting unlicensed entities from engaging in the solicitation of insurance or accepting a commission for the sale or renewal of an insurance policy, id. ¶¶ 8, 74 (citing D.C. Code §§ 31-1131.13(b); 31-2502.31; 31-1131.03), the plaintiff bolsters her allegation that AARP has acted as an unlicensed insurance agent or broker by pointing to AARP's marketing materials, which are owned by AARP under the Agreement, id. ¶¶ 47, 72, and explicitly state “[t]his is a solicitation of insurance, ” id. ¶ 51 (citing AARP sponsored websites, and, as well as AARP's television, Internet, and print advertisements).

         The plaintiff identifies certain harms resulting from AARP's actions, alleging that “[h]ad AARP disclosed the fact that the ‘member contribution amount' that [she] paid monthly to AARP included an embedded 4.95% commission payment to AARP, [she] would have sought out another Medigap policy offering the same services for a lower rate. . . . [or] if Defendants had acted within the bounds of the law, AARP would not have been able to collect” the 4.95% charge.” Id. ¶ 11; see also Id. ¶¶ 12, 77, 79, 81, 82. The plaintiff avers that “[b]ut for Defendants' deceptive and unlawful acts, [she] would not have agreed to pay the 4.95% illegal insurance commission, ” id. ¶ 14 and that she was injured both by paying this commission and by being denied information that would have prompted her to seek out and purchase another Medigap policy for a lower price, id. ¶ 15. The plaintiff notes that “[o]ther Medigap policies offered without the highly regarded ‘AARP Brand' provide identical benefits, often at a lower cost in part because those insurers do not secretly charge consumers unlawful insurance-agent commissions on top of the premiums assessed.” Id. ¶ 78.

         Based on the foregoing, the plaintiff alleges that AARP collects an illegal commission, acts as an unlicensed insurance agent, and materially misrepresents information about the 4.95% charge, all of which constitute violations of the CPPA and common law.

         C. Claims Against AARP

         The plaintiff brings four claims, asserting, in Count One, that AARP violated the CPPA, D.C. Code § 28-3901 et seq., by engaging in an unlawful trade practice by misrepresenting material facts concerning the 4.95% payment and the fact that AARP is not a licensed insurance broker or agent in its solicitation materials, letters to prospective consumers, billing statements, renewal letters, and website. Compl. ¶¶ 5, 92-103. The plaintiff alleges financial harm from these unlawful trade practices and being “deprived of truthful information regarding [her] choice” of Medigap policies, id. ¶ 100, because she would have sought a different Medigap policy that did not incorporate a 4.95% “commission that AARP is not legally entitled to, ” id. ¶ 97. For these alleged violations of the CPPA, the plaintiff seeks damages and injunctive relief. Id. ¶ 101.

         In Count Two, the plaintiff claims the defendants' conversion of her “ownership right to the 4.95% of [her] payments that was wrongfully charged and illegally diverted to AARP as a commission, ” id. ¶¶ 104-06, resulted in damages in the amount of the premium for which she was wrongfully charged, id. ¶ 107.

         In Count Three, the plaintiff alleges unjust enrichment, based on her conferral of a benefit to the defendants “in the form of the hidden 4.95% charge on top of [her] monthly premium payments that [was] unlawfully and deceptively charged and illegally diverted to AARP as a commission.” Id. ¶ 109. The defendants “voluntarily accepted and retained this benefit, ” id. ¶ 110, which was “collected without proper disclosure and amounted to a commission in violation of” District of Columbia law, id. ¶ 111, such that the defendants' retention of this benefit without paying its value to the plaintiff would be “inequitable, ” id.

         Finally, in Count Four, the plaintiff alleges fraudulent concealment stemming from AARP's “conceal[ing] or fail[ing] to disclose [the] material fact” that AARP was collecting a 4.95% commission, id. ¶ 113, that AARP “knew or should have known that this material fact should be disclosed or not concealed, ” id. ¶ 114, that it concealed the fact “in bad faith, ” id. ¶ 115, in spite of its “duty to speak, ” id. ¶ 118, and that it thereby “induced [the plaintiff] to act by purchasing an AARP-endorsed Medigap plan, ” id. ¶ 116. The plaintiff alleges that she suffered damages as a result of this fraudulent concealment, id. ¶ 117.

         As relief, the plaintiff seeks orders: (1) requiring AARP to restore all money or other property taken by means of unlawful acts or practices, id. at 30; (2) requiring the disgorgement of all sums taken from consumers by means of deceptive practices, together with all proceeds, interest, income, and accessions, id.; (3) certifying a proposed class of “[a]ll persons in the United States, excluding California, who purchased or renewed an AARP Medigap Policy, ” id. ¶ 84, with plaintiff as Class Representative and her counsel as Class Counsel, id. at 30; and (4) awarding court costs and reasonable attorneys' fees and any other relief the Court deems just and proper, id.


         To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the “complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Wood v. Moss, 572 U.S. 744, 757-58 (2014) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim is facially plausible when the plaintiff pleads factual content that is more than “‘merely consistent with' a defendant's liability, ” and “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)); see also Rudder v. Williams, 666 F.3d 790, 794 (D.C. Cir. 2012). Although “detailed factual allegations” are not required to withstand a Rule 12(b)(6) motion, a complaint must offer “more than labels and conclusions[] and a formulaic recitation of the elements of a cause of action” to provide “grounds” for “entitle[ment] to relief, ” Twombly, 550 U.S. at 555 (internal quotation marks omitted; alteration in original), and “nudge[] [the] claims across the line from conceivable to plausible, ” id. at 570; see Banneker Ventures, LLC v. Graham, 798 F.3d 1119, 1129 (D.C. Cir. 2015) (“Plausibility requires more than a sheer possibility that a defendant has acted unlawfully.”) (internal quotation marks omitted). Thus, “a complaint [does not] suffice if it tenders ‘naked assertion[s]' devoid of ‘further factual enhancement.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557) (second alteration in original).

         In considering a motion to dismiss for failure to plead a claim for which relief can be granted, the court must consider the complaint in its entirety, accepting all factual allegations in the complaint as true, “even if doubtful in fact, ” and construe all reasonable inferences in favor of the plaintiff. See Twombly, 550 U.S. at 555; Nurriddin v. Bolden, 818 F.3d 751, 756 (D.C. Cir. 2016) (per curiam) (“We assume the truth of all well-pleaded factual allegations and construe reasonable inferences from those allegations in the plaintiff's favor.”) (citing Sissel v. U.S. Dep't of Health & Human Servs., 760 F.3d 1, 4 (D.C. Cir. 2014)). The court, however, “is not required to accept the plaintiff's legal conclusions as correct, ” Sissel, 760 F.3d at 4, nor is it required to “accept inferences drawn by [a] plaintiff[] if such inferences are unsupported by the facts set out in the complaint.” Nurriddin, 818 F.3d at 756 (alterations in original) (quoting Kowal v. MCI Commc'ns Corp., 16 F.3d 1271, 1276 (D.C. Cir. 1994)).


         The defendants raise, under Federal Rule of Civil Procedure 12(b)(6), several threshold issues challenging the justiciability of the plaintiff's claims, as well as the sufficiency of the plaintiff's factual allegations to support the plausibility of her claims. Specifically, the defendants argue that the Complaint must be dismissed due to: (1) the primary jurisdiction doctrine; (2) the filed-rate doctrine; and (3) operation of the applicable statute of limitations.[5] In addition, the defendants raise choice-of-law issues as to whether Florida, Louisiana, or District of Columbia law applies to this action.[6] These threshold issues-none of which warrants dismissal-are addressed, before turning to consideration of whether the plaintiff has plausibly stated a claim.

         A. The Primary Jurisdiction Doctrine Does Not Bar The Instant Claims

         The defendants seek a stay or dismissal of this action under the primary jurisdiction doctrine. See Defs.' Mem. at 50-51. The primary jurisdiction doctrine applies where a court has jurisdiction over a claim or set of claims, but adjudication of those claims “requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its views.” United States v. W. Pac. R.R. Co., 352 U.S. 59, 63-64 (1956); see also Reiter v. Cooper, 507 U.S. 258, 268 (1993) (describing primary jurisdiction doctrine as “specifically applicable to claims properly cognizable in court that contain some issue within the special competence of an administrative agency” to which “referral” may be made, “staying further proceedings so as to give the parties reasonable opportunity to seek an administrative ruling”); Am. Ass'n of Cruise Passengers v. Cunard Line, Ltd., 31 F.3d 1184, 1186 (D.C. Cir. 1994) (explaining that the primary jurisdiction doctrine may be invoked when the agency is “best suited to make the initial decision on the issues in dispute, even though the district court has subject-matter jurisdiction”); Lawlor v. District of Columbia, 758 A.2d 964, 973 (D.C. 2000) (explaining that the primary jurisdiction doctrine “comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body” (quoting Drayton v. Poretsky Mgmt., Inc., 462 A.2d 1115, 1118 (D.C. 1983))).

         Noting that state regulatory agencies comprehensively regulate virtually all aspects of the Medigap market, including approval for rates and advertising, and that the plaintiff already has this mechanism for raising her concerns, the defendants urge that this case be stayed while the plaintiff pursues relief before a state regulatory agency. See Defs.' Mem. at 37. For example, in the District of Columbia, AARP's Medigap program is regulated by the District of Columbia Department of Insurance, Securities and Banking (“DISB”), pursuant to D.C. Code § 31-3701 et seq. and D.C. Mun. Regs. tit. 26-A, § 2200 et seq. UnitedHealth must file proposed rates with DISB, which reviews the rates to ensure that they are reasonable, see D.C. Code § 31-3704, and further requires at least 75% of aggregate group policy Medigap premiums to be paid toward benefit claims, see D.C. Mun. Regs. tit. 26-A, § 2212.1(a). If a Medigap policy fails to meet this loss ratio standard, insurers must rebate excess revenue. Id. §§ 2213.2, 2213.4. DISB also enforces prohibitions against misleading advertising, see Id. §§ 2224.1, 2224.2, and, to this end, insurers are required to submit advertisements to DISB for review, see id., § 2223.1; D.C. Code § 31-3708. DISB also limits compensation and commission arrangements. See D.C. Mun. Regs. tit. 26-A, § 2217. The defendants suggest that due to this comprehensive regulation, primary jurisdiction rests with DISB or insurance regulators in Florida or Louisiana, rather than with this Court.

         Four factors are relevant to determining whether to apply the primary jurisdiction doctrine: “(1) whether the issue is within the conventional expertise of judges; (2) whether the issue lies within the agency's discretion or requires the exercise of agency expertise; (3) whether there is a substantial danger of inconsistent rulings; and (4) whether a prior application to the agency has been made.” APCC Servs., Inc. v. WorldCom, Inc., 305 F.Supp.2d 1, 13 (D.D.C. 2001); see also United States v. Philip Morris USA Inc., 686 F.3d 832, 837 (D.C. Cir. 2012) (noting that “no fixed formula exists” but that “some principles emerge from our precedents, ” including a “concern for uniform outcomes, ” the “advantages of allowing an agency to apply its expert judgment, ” and whether the question is “within the particular competence of an agency” (internal alterations and citations omitted)). Consideration of these factors demonstrates that no stay is necessary to permit DISB or any other state insurance agency the first opportunity to opine on the merits of the plaintiff's instant claims.

         The plaintiff has not made a prior application to DISB, or to any other state insurance agency that regulates Medigap insurance, and thus no apparent danger of inconsistent rulings between this Court and a state insurance agency is presented that, as a matter of comity, would warrant this Court abstaining. While mindful that DISB has the authority to review rates and even advertising related to Medigap insurance, and that nothing prevents a consumer troubled by the 4.95% charge from alerting DISB to her concerns rather than pursuing a nationwide class action, the mere availability of regulatory review is not sufficient reason to apply the primary jurisdiction doctrine. Simply put, DISB has no exclusive jurisdiction over the claims at issue here.

         Moreover, rather than requiring agency expertise, the claims at issue here-whether advertising is deceptive or misleading, and related common law claims of conversion, unjust enrichment and fraudulent concealment-are regularly subject to judicial review and therefore fall squarely within the conventional expertise of the courts. The Supreme Court's decision in Nader v. Allegheny Airlines, 426 U.S. 290, 292 (1976), well illustrates this point. There, the Court declined the defendant's request to stay the plaintiff's common law tort suit for fraudulent misrepresentation stemming from the airline's overbooking policy and refer the claim to the Civil Aeronautics Board. Noting that the plaintiff was not challenging the airline's tariff and that the Board's authority to ban deceptive practices did not displace the tort suit, the Court held that the tort suit was “within the conventional competence of the courts, . . . the judgment of a technically expert body was not likely to be helpful in the application of the [tort] standards.” Id. 304-06. See also Philip Morris USA Inc., 686 F.3d at 838 (observing that “courts consistently have refused to invoke the primary jurisdiction doctrine for ‘claims based upon fraud or deceit'-claims that are “within the conventional competence of courts” (citing Dana Corp. v. Blue Cross & Blue Shield Mut. of N. Ohio, 900 F.2d 882, 889 (6th Cir. 1990) and In re Long Distance Telecomms. Litig., 831 F.2d 627, 633-34 (6th Cir. 1987))). Likewise, here, the plaintiff does not directly challenge the reasonableness of the insurance rates charged and has chosen to pursue in this Court her CPPA and common law claims. These statutory and tort claims may be resolved without the need for “an informed evaluation of the economics or technology of the regulated industry.” Nader, 426 U.S. at 305. Thus, the expertise vested in a specialized regulatory agency, which expertise might make the agency the preferred forum in some instances, is not necessary to resolve the claims at issue here. Accordingly, the primary jurisdiction doctrine does not bar this suit.

         B. The Filed-Rate Doctrine Does Not Bar The Instant Claims

         Following a brief review of the purpose and scope of the filed-rate doctrine, the defendants' arguments urging application of this doctrine are considered. The Court concludes the filed-rate doctrine does not apply here.

         1. The Filed-Rate Doctrine Generally

         The parties spill much ink disputing whether the judicially created filed-rate doctrine (also known as the “filed-tariff” doctrine) requires dismissal of this case. The filed-rate doctrine “forbids a regulated entity to charge rates for its services other than those properly filed with the appropriate federal regulatory entity.” Ark. La. Gas Co. v. Hall, 453 U.S. 571, 577 (1981). The filed[-]rate doctrine has its origins in [the Supreme] Court's cases interpreting the Interstate Commerce Act [“ICA”], . . . and has been extended across the spectrum of regulated utilities.” Id. (internal citations omitted). One of those originating cases was Keogh v. Chicago & Northwestern Railway Co., 260 U.S. 156 (1922), in which the Supreme Court rejected antitrust challenges to rates that had been filed with and approved as reasonable by the Interstate Commerce Commission. Regardless of the regulated industry involved, “[t]he considerations underlying the doctrine are preservation of the agency's primary jurisdiction over reasonableness of rates and the need to [e]nsure that regulated companies charge only those rates of which the agency has been made cognizant.” Ark. La. Gas Co., 453 U.S. at 577-78 (internal quotation marks and alterations omitted). The Second Circuit has termed these interests as “two ‘companion principles'-(1) preventing carriers from engaging in price discrimination as between ratepayers (the ‘nondiscrimination strand') and (2) preserving the exclusive role of federal agencies in approving rates . . . that are ‘reasonable' by keeping courts out of the rate-making process (the ‘nonjusticiability strand').” Marcus v. AT&T Corp., 138 F.3d 46, 58 (2d Cir. 1998).

         A corollary of the filed-rate doctrine is that regulatory agencies have the sole authority to decide whether rates are reasonable and “[n]o court may substitute its own judgment on reasonableness for the judgment” of the regulatory agency. Ark. La. Gas Co., 453 U.S. at 577. This principle typically has a statutory basis and has been expressed, for example, in Federal Energy Regulatory Commission (FERC) cases, due to provisions in the Natural Gas Act, 15 U.S.C. § 717c et seq., that require regulated entities to file their rates and deem such rates are lawful only if they are “just and reasonable” as determined by the Commission. See Ark. La. Gas Co., 453 U.S. at 577 (“The authority to decide whether the rates are reasonable is vested by [15 U.S.C. § 717c(a)] of the [Natural Gas] Act solely in the Commission.”). In telecommunications cases, the corollary is derived from the tariff-filing provisions of the Federal Communications Act (“FCA”), 47 U.S.C. § 203(a). See Marcus, 138 F.3d at 58. In ICA cases, the corollary reflects the Interstate Commerce Commission's authority to determine that filed rates are “reasonable and non-discriminatory.” See Square D Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S. 409, 411, 415 (1986) (citing Keogh, 260 U.S. at 161; 49 U.S.C. § 10101 et seq.).

         In the FCA, FERC and ICA contexts, the filed-rate doctrine supports the supremacy of federal regulation over certain federal as well as state and common law claims. Thus, when plaintiffs attempt to evade the filed-rate doctrine by bringing claims seeking relief that would affect the approved rates charged by the entities subject to the regulatory regimes of the ICA, FERC or FCA, the claims have been dismissed. See, e.g., AT&T Co. v. Cent. Office Tel., Inc., 524 U.S. 214, 222 (1998) (stating, in the context of a case seeking to apply state law claims to a federally regulated telecommunications carrier, that “even if a carrier intentionally misrepresents its rate and a customer relies on the misrepresentation, the carrier cannot be held to the promised rate if it conflicts with the published tariff”); id. at 223-24 (refusing to hold the filed-rate doctrine inapplicable to claims regarding the “provisioning of services and billing, ” and noting that “[a]ny claim for excessive rates can be couched as a claim for inadequate services and vice versa” (internal quotation marks omitted)); Ark. La. Gas Co., 453 U.S. at 580 (“[W]hen [C]ongress has established an exclusive form of regulation, ‘there can be no divided authority over interstate commerce.'” (quoting Mo. Pac. R.R. Co. v. Stroud, 267 U.S. 404, 408 (1925))); S. Union Co. v. FERC, 857 F.2d 812, 817 (D.C. Cir. 1988) (“[T]he preemptive effect of the [Natural Gas Act] is not . . . limited to state actions that directly and expressly relate to the price term of sale transactions. The test is instead whether state law conflicts or interferes with attainment of federal law objectives.”); City of Moundridge v. Exxon Mobil Corp., 471 F.Supp.2d 20, 45 (D.D.C. 2007) (“The filed[-]rate doctrine ‘provides that state law, and some federal law (e.g. antitrust law), may not be used to invalidate a filed rate or to assume a rate would be charged other than the rate adopted by the federal agency in question.' . . . when ‘the relief sought by plaintiff would require the court to set damages by assuming a hypothetical rate,' it violates the filed[-]rate doctrine.” (internal alterations, brackets, and citations omitted)).

         Notwithstanding that the filed-rate doctrine preempts “those suits that seek to alter the terms and conditions provided for in the tariff, ” this doctrine “does not serve as a shield against all actions based in state law.” Cent. Office Tel., 524 U.S. at 229-31 (Rehnquist, C.J., concurring) (“The tariff does not govern . . . the entirety of the relationship between the common carrier and its customers.”). Where a claim does not seek to alter the terms and conditions of a tariff, “[t]here is no direct relationship [to the filed-rate doctrine] at all and it is simply not the case that any action which might arguably and coincidentally implicate rates, much less those determined by a state, rather than a federal agency, is governed by the doctrine.” Arroyo-Melecio v. Puerto Rican Am. Ins. Co., 398 F.3d 56, 73 (1st Cir. 2005). Similarly, in the preemption context, courts have recognized that federal regulatory regimes do not necessarily preempt state law actions prohibiting deceptive business practices, false advertisement, or common law fraud. See Marcus, 138 F.3d at 54. Indeed, “states may have an equal or greater interest in preventing [a carrier from misrepresenting the nature of its rates] as manifested by state consumer protection laws.” Id.

         Thus, the filed-rate doctrine operates to bar only claims, which, if successful, would undermine the critical policies underlying the filed-rate doctrine in the first place: nondiscrimination among customers and nonjusticiability as to the reasonableness of a rate. See Id. at 59 (“[T]he focus for determining whether the filed[-]rate doctrine applies is the impact the court's decision will have on agency procedures and rate determinations.” (internal quotation marks omitted) (quoting H.J. Inc. v. Nw. Bell Tel. Co., 954 F.2d 485, 489 (8th Cir. 1992)). In other words, the filed-rate doctrine bars claims that would require a regulated entity to charge more or less than the rate approved by the federal regulatory authority but does not reach those claims for which the remedy would leave the regulated entity in compliance with the approved rate.

         Consequently, when a claim seeks to vindicate rights or tortious harms without disturbing a properly filed rate-for example, by seeking prospective injunctive relief against the regulated entity-the filed-rate doctrine poses no obstacle. See, e.g., Square D, 476 U.S. at 417, 422 & n.28 (explaining that filed-rate doctrine barred antitrust price-fixing claims for treble damages against regulated entities for their rates fixed by ICC since “rights as defined by the tariff cannot be varied or enlarged by either contract or tort of the carrier, ” but injunctive antitrust actions are permitted); Marcus, 138 F.3d at 62-63 (affirming dismissal of common law fraud and negligent misrepresentation claims and state false advertising claims for damages against telecommunications company for its billing policies, because the regulated entity was required to charge the rates on file, but explaining that “a suit for injunctive relief appears not to interfere with the nondiscrimination policy underlying the filed rate doctrine”); cf. Alicke v. MCI Commc'ns Corp., 111 F.3d 909, 913 (D.C. Cir. 1997) (affirming dismissal of fraud claims against a telecommunications company on grounds other than filed-rate doctrine, without addressing “whether the district court correctly held that the filed[-]tariff doctrine bars all the claims made in the complaint. As such, we leave for another day the question whether there are any circumstances in which injunctive relief may be based upon a billing practice disclosed in a filed tariff”).

         Contrary to the defendants' contention, this case does not fall neatly into the body of cases in which the filed-rate doctrine has been found to apply. The plaintiff raises no challenge to the setting or reasonableness of the Medigap insurance rates, asserts no claims against the regulated entity responsible for filing, and obtaining approval for, those rates, and thus seeks no damages from a regulated entity or even a third-party that would vary or enlarge the approved rate. Instead, the plaintiff challenges the conduct of a third-party doing business with the regulated entity and seeks relief that may be awarded without any alteration in the approved premiums collected by the regulated entity. As discussed further below, and as other courts have found, this makes a difference. See, e.g., Williams v. Duke Energy Int'l, Inc., 681 F.3d 788, 796- 98 (6th Cir. 2012) (reversing district court's holding on preclusive effect of filed-rate doctrine and holding that the doctrine is inapplicable to claims challenging “side-agreements” made by utility's affiliate for rebates to favored customers allowing those customers to pay lower rates than plaintiffs since a “ruling by this court will have no effect on the filed tariff or rate” (internal quotation marks and citation omitted)); Alston v. Countrywide Fin. Corp., 585 F.3d 753, 764-65 (3d Cir. 2009) (finding that “[t]he filed-rate doctrine bars suit from” plaintiffs who “think that the price they paid . . . was unfair, ” but not claims “alleg[ing] a violation of fair business practices through the use of illegal kickback payments” (internal citation omitted)); Alpert v. Nationstar Mortg. LLC, 243 F.Supp.3d 1176, 1182 (W.D. Wash. 2017) (collecting cases challenging kickbacks and concluding that the filed-rate doctrine “will bar kickback claims as long as they upset the principles set forth in Keogh, ” but does not serve as a bar where the plaintiffs do not challenge the filed rates); Jackson v. U.S. Bank, N.A., 44 F.Supp.3d 1210, 1216-17 (S.D. Fla. 2014) (holding the filed-rate doctrine “unavailable as a defense” where defendants “are not insurers subject to the relevant regulatory regime” (internal quotation marks and citation omitted)); Maloney v. Indymac Mortg. Servs., No. CV 13-04781 DDP (AGRx), 2014 WL 6453777, at *4 (C.D. Cal. Nov. 17, 2014) (drawing a distinction between a challenge to the defendants' conduct in an alleged kickback scheme and a challenge to the rates themselves, and noting that the regulated entity's conduct with respect to third parties “is not dependent upon or made pursuant to any ratemaking authority”); Valdez v. Saxon Mortg. Servs., Inc., No. 2:14-cv-03595-CAS(MANx), 2014 WL 7968109, at *10-11 (C.D. Cal. Sept. 29, 2014) (same); Cannon v. Wells Fargo Bank N.A., 917 F.Supp.2d 1025, 1036-38 (N.D. Cal. 2013) (acknowledging contrary authority but permitting plaintiffs to maintain a lawsuit challenging kickbacks rather than the cost of insurance).

         2. Assuming The Filed-Rate Doctrine Applies To State-Regulated Insurance Rates, Plaintiff's Claims Are Not Barred

         At the outset, the parties do not dispute but assume, without analysis, that the filed-rate doctrine extends beyond comprehensive federal regulatory regimes, which have specific statutory provisions granting a regulatory agency some exclusivity regarding the setting of reasonable rates or tariffs as well as the constitutional underpinning of the Supremacy Clause. The Court makes the same assumption that the filed-rate doctrine applies in a case raising state-law claims implicating state-regulated insurance rates. See In re N.J. Title Ins. Litig., No. 08-1425, 2009 WL 3233529, at *3 (D.N.J. Oct. 5, 2009) (noting that “a number of courts have recognized that the filed[-]rate doctrine applies in the context of private suits challenging insurance rates approved by state regulatory agencies”) (collecting cases).[7] The parties disagree whether the filed-rate doctrine bars the plaintiff's claims.

         The defendants argue that because Medigap policies are extensively regulated in each state, and because the plaintiff was charged precisely the premium filed with, and approved by, the state regulatory agencies in Florida and Louisiana, she is barred from challenging those rates except by bringing appropriate action before those state regulatory agencies. See Defs.' Mem. at 23-28. Otherwise, the defendants contend, the plaintiff would violate the nonjusticiability principle of the filed-rate doctrine because her claim attacks the rate that insurance regulators have already approved, and would violate the nondiscrimination principle because she seeks damages that, if paid, would reduce the rate below the rate on file with state regulators. Id. at 26-27 (“[B]y seeking a refund of the portion of the rate she claims is improper (i.e., the royalty), Plaintiff seeks to effectively pay a lower rate than the filed rate paid by other insureds under the Policy. That claim is exactly the type of collateral attack barred by the filed rate doctrine.”).

         The plaintiff counters that the filed-rate doctrine does not bar her suit because she challenges neither the setting of the rates nor their reasonableness, or even the collection by the regulated entity, UnitedHealth, of the Medigap insurance premiums. See Pl.'s Opp'n at 16-18, (acknowledging that filed-rate doctrine “generally bars suits asserting that the filed rate was unreasonable” but highlighting that “Plaintiff does not seek a refund for or challenge the appropriateness, reasonableness, or legality of the premiums UnitedHealth received for AARP Medigap coverage”). Instead, she claims damages only from the defendants' misrepresentations and deceitful tactics that prevented consumers from making informed decisions about the undisclosed and unlawful “commission” the defendants collected. Compl. ¶ 83; see also Id. ¶¶ 59, 60 (quoting AARP's own executives' statements before Congress in 2011 that the royalties- what the plaintiff challenges-have “nothing to do” with premiums). In this way, the “Court is being asked to rule on the misleading and deceitful nature of Defendants' conduct when it solicits its members to purchase AARP Medigap, ” but is “not [being asked] to alter the rate or make a determination of the rate's reasonableness.” Pl.'s Opp'n at 18. As the plaintiff points out, UnitedHealth is not a defendant in this action and would not be liable for any refund she seeks. See id.

         The defendants urge wholesale rejection of the plaintiff's theory that the filed-rate doctrine is inapplicable when the plaintiff challenges only the conduct by a third-party in charging an allegedly illegal commission “to consumers on top of the premiums.” Compl. ¶ 58 (emphasis omitted). The defendants point to UnitedHealth and AARP's Agreement, which expressly states that the royalty is paid out of the premium rate approved by state regulators, and to UnitedHealth's public rate filings in Florida, which indicate the same. Defs.' Mem. at 27-28. The defendants also note that, as to the claim of allegedly misleading advertising, the Florida Insurance Commissioner already has the authority to determine whether an insurance advertisement has a capacity or tendency to mislead or deceive. Id. at 26. As noted above, DISB has this authority as well. See supra Section III.A.

         For the reasons that follow, this Court holds that the filed-rate doctrine cannot be used as a shield to bar review of claims predicated on fraudulent misrepresentation against a third-party doing business with a regulated entity just because those claims have some relation to filed rates for state insurance coverage. First, at the motion-to-dismiss stage, without a full record regarding the information UnitedHealth filed concerning its rates and the precise role of the payments to AARP in each state in question, concluding that this suit “seek[s] to alter the terms and conditions provided for in the tariff, ” Central Office Telephone, 524 U.S. at 229 (Rehnquist, C.J., concurring), would be premature. Although the defendants attached a number of exhibits to their motion to dismiss, including copies of UnitedHealth's rate filings in Louisiana and Florida (but not the District of Columbia), the defendants did not seek to, and the Court declines to, convert their dismissal motion to one for summary judgment. See Fed. R. Civ. P. 12(d) (requiring, “[i]f, on a motion under Rule 12(b), . . . matters outside the pleadings are presented to and not excluded by the court, ” that motion “be treated as one for summary judgment under Rule 56”). Thus, the Court looks only to the plaintiff's Complaint, which alleges that consumers are not informed that expenses charged to them as part of a premium include a 4.95% royalty UnitedHealth is contractually obligated to pay AARP. Importantly, the plaintiff does not seek to “enforce agreements to provide services on terms different from those listed in the tariff, ” which “is all that the tariff governs, ” Central Office Telephone, 524 U.S. at 229, but rather to hold AARP responsible for violating state laws banning unfair and deceptive trade practices and related common law claims, see Id. at 230 (the filed-rate doctrine “does not affect whatever duties state law might impose” on the regulated entity).

         Second, the plaintiff's claims focus on her relationship with AARP and its affiliates, not with UnitedHealth, the regulated entity responsible for filing rates. This fact underscores that the plaintiff challenges behavior independent of the terms and conditions of the filed rate. The plaintiff alleges that, through unfair and deceptive trade practices, the defendants collect and retain a commission to which they are not legally entitled. Should the plaintiff prevail on these claims to require AARP to stop collecting that “commission” on extant terms, no change to UnitedHealth's rates would necessarily follow. Indeed, nothing about the plaintiff's claims against AARP and its affiliates prevents UnitedHealth from continuing to collect precisely the approved rates. Any follow-on disruption to UnitedHealth and AARP's side agreement regarding the “royalty” payment and whether, as a result of this disruption, UnitedHealth will decide to change the rates filed going forward is irrelevant to an analysis of whether the filed-rate doctrine bars plaintiff's claims against AARP now. As the Second Circuit held, “the focus for determining whether the filed[-]rate doctrine applies is the impact the court's decision will have on agency procedures and rate determinations.” Marcus, 138 F.3d at 59 (internal quotation marks and citation omitted); see also Medco Energi US, L.L.C. v. Sea Robin Pipeline Co., L.L.C., 729 F.3d 394, 399 (5th Cir. 2013) (per curiam) (explaining that filed-rate cases “ask this question: when the plaintiff's claims-at least on their face-do not attempt to challenge a filed rate, do the claims implicate the parties' rights and liabilities under that rate?”) (internal quotation marks, alterations, and citation omitted). Any decision that AARP's advertising practices violate District of Columbia consumer protection laws or related common law claims has no effect on agency procedures and rate determinations and does not affect plaintiff or UnitedHealth's rights and liabilities under that rate. Therefore, the filed-rate doctrine is not implicated.

         A recent case, challenging as unlawful the commissions paid by a telephone service provider to a Sheriff's Office for inmate telephone calls when state law allegedly did not authorize such commission payments, illustrates why the plaintiff's claims here are independent of a challenge to the rates UnitedHealth files. In Pearson v. Hodgson, the Court held that the filed-rate doctrine posed no bar to the plaintiffs' claim that the telephone provider's commission payments violated state law and helped the Sherriff's Office to “circumvent state law.” No. 18- cv-11130-IT, 2018 WL 6697682, at *9 (D. Mass. Dec. 20, 2018). The court reasoned that the claim “stands independent of any challenges to the specific rates charged, ” id., and “is enough to survive a motion to dismiss, ” id. Acknowledging that parts of the complaint “may implicate the cost of” the inmate call services, id., the Pearson Court nonetheless found that the plaintiffs were not “alleging that a contractual rate . . . differed from the [filed] rates, ” id., but only that “what [the telephone provider] is doing with the revenue that it receives from the telephone calls” may violate state law, “and the filed[-]rate doctrine does not shield [the telephone provider] from claims of unfair or deceptive acts relating to their use of these funds, ” id.

         Just as the Pearson Court reasoned that challenging allegedly unfair and deceptive practices in payments by the provider to the Sherriff's Office of unlawful commissions was “independent of any challenges to the specific rates charged, ” id., so too here: so long as the claims challenge the deceptive and misleading statements and acts concerning the collection of allegedly unlawful payments, without seeking any change to the rate-and where the rate-filer is not even a defendant-the filed-rate doctrine is no obstacle.[8]

         Although the defendants rely on several decisions from the Second, Fifth and Eleventh Circuits that have applied the filed-rate doctrine to bar actions for common law fraud or claims seeking relief under state consumer protection statutes, those cases are distinguishable on their facts. See Defs.' Mem. at 23-28 (citing Medco Energi, 729 F.3d 394; Hill v. BellSouth Telecomms., Inc., 364 F.3d 1308, 1315 (11th Cir. 2004); Marcus, 138 F.3d 46; Wegoland Ltd. v. NYNEX Corp., 27 F.3d 17, 18 (2d Cir. 1994)); Defs.' Reply Supp. of Mot. to Dismiss (“Defs.' Reply”) at 10-14, ECF No. 15 (citing Patel v. Specialized Loan Servicing, LLC, 904 F.3d 1314 (11th Cir. 2018)).

         The defendants rely in particular on Patel, where the Eleventh Circuit held that the filed-rate doctrine barred the plaintiffs' state and federal claims, including for breach of contract, tortious interference, and unjust enrichment, against a regulated insurance company and mortgage service providers, which had an exclusive arrangement to place the insurance company's hazard insurance. Patel, 904 F.3d at 1317. In that case, the plaintiffs expressly challenged the premium insurance rates they were charged for hazard insurance required to be maintained on real property securing the plaintiffs' mortgage loans (“force-placed insurance”), which premiums were allegedly “artificially inflated” to cover the cost of the insurance company's alleged “kickback” to mortgage loan servicers. Id. at 1317, 1326. In reaching this conclusion, the Eleventh Circuit focused on “[t]he most obvious basis, ” id. at 1325, namely, “the fact that the plaintiffs repeatedly state that they are challenging [the insurance company's] premiums, ” id. at 1325-26, using language targeting “artificially inflated premiums, ” “unreasonably high force-placed insurance premiums, ” and “amounts charged for insurance coverage, ” id. at 1326, such that “[t]he plain language of the complaints therefore shows that the plaintiffs are challenging the reasonableness of [the insurance company's] premiums; and since these ...

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