Laurel Hill Mgmt. Servs., Inc v. La-Z-Boy Inc.

Court of Appeals for the Sixth Circuit·Decided August 19, 2026·No. 25-1727·Published

Opinion

RECOMMENDED FOR PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b)

File Name: 26a0237p.06

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

LAUREL HILL MANAGEMENT SERVICES, INC.;

MINIMALLY INVASIVE SURGICAL ASSOCIATES;

ADVANCED WEIGHT LOSS SURGICAL ASSOCIATES, │

Plaintiffs-Appellants, > No. 25-1727 │ │

v. │ │

LA-Z-BOY INC.; DOES 1–10; BLUE CROSS BLUE SHIELD │ OF MICHIGAN, │ Defendants-Appellees. │ ┘

Appeal from the United States District Court for the Eastern District of Michigan at Detroit.

No. 2:24-cv-13230—David M. Lawson, District Judge.

Argued: June 4, 2026

Decided and Filed: August 19, 2026

Before: GIBBONS, MURPHY, and HERMANDORFER, Circuit Judges.

COUNSEL

ARGUED: Jonathan A. Stieglitz, LAW OFFICE OF JONATHAN A. STIEGLITZ LAW, Los Angeles, California, for Appellants. Matthew G. Mrkonic, HONIGMAN LLP, Detroit, Michigan, for Appellee La-Z-Boy Inc. Nathan S. Scherbarth, ZAUSMER, PC, Farmington Hills, Michigan, for Appellee Blue Cross Blue Shield of Michigan. ON BRIEF: Jonathan A. Stieglitz, LAW OFFICE OF JONATHAN A. STIEGLITZ LAW, Los Angeles, California, for Appellants. Matthew G. Mrkonic, HONIGMAN LLP, Detroit, Michigan, for Appellee La-Z- Boy Inc. Nathan S. Scherbarth, ZAUSMER, PC, Farmington Hills, Michigan, for Appellee Blue Cross Blue Shield of Michigan.

HERMANDORFER, J., delivered the opinion of the court in which GIBBONS and MURPHY, JJ., concurred. MURPHY, J. (pp. 16–21), delivered a separate concurring opinion.

No. 25-1727 Laurel Hill Mgmt. Servs., Inc, et al. Page 2 v. La-Z-Boy Inc., et al.

OPINION

HERMANDORFER, Circuit Judge. Like many companies, La-Z-Boy sponsors an employee health benefit plan. That plan covers someone the parties call “Patient AA.” A few years ago, Patient AA sought healthcare treatment from several medical providers. Before agreeing to treat Patient AA, the medical providers wanted to confirm the reimbursement rate for their services. So the providers contacted the plan administrator, Blue Cross Blue Shield of Michigan, about the reimbursement terms under Patient AA’s health benefit plan. Blue Cross employees orally represented that plan reimbursement would be calculated at the usual, customary, and reasonable rate—a familiar standard across industry plans. Relying only on those oral representations, the medical providers then treated Patient AA.

When the medical providers eventually sought reimbursement, however, Blue Cross paid an amount far below the promised rate. The medical providers responded by suing La-Z-Boy and Blue Cross. They pressed state-law claims of negligent misrepresentation and promissory estoppel based upon Blue Cross’s misstatements about the reimbursement rate. Those claims triggered a dispute about preemption under the Employee Retirement Income Security Act of 1974 (ERISA), which governs the plan. ERISA’s express-preemption provision displaces parties’ ability to pursue state-law claims that “relate to” an ERISA plan. 29 U.S.C. § 1144(a). Applying this Court’s decision in Cromwell v. Equicor-Equitable HCA Corp., 944 F.2d 1272 (6th Cir. 1991), the district court determined that the medical providers’ claims were preempted. It then ordered dismissal on that basis.

We agree that Cromwell dictates dismissal of the providers’ particular claims in this case.

Under Cromwell, ERISA preempts negligent-misrepresentation and promissory-estoppel claims that depend upon a plan administrator’s misstatements about the coverage or reimbursement terms of an employer’s ERISA plan. And the medical providers’ claims, as pled, turn on assertions about the reimbursement terms of La-Z-Boy’s ERISA plan. We therefore affirm the district court’s application of ERISA preemption.

No. 25-1727 Laurel Hill Mgmt. Servs., Inc, et al. Page 3 v. La-Z-Boy Inc., et al.

I

A

Because this appeal arises from the dismissal of a complaint, we accept the complaint’s well-pled factual allegations as true. Ream v. U.S. Dep’t of the Treasury, 174 F.4th 480, 484 (6th Cir. 2026).

La-Z-Boy sponsors an ERISA-regulated health benefit plan for its employees. Among the plan’s participants is “Patient AA.” Sometime in early 2022, Patient AA sought services and procedures from several out-of-network medical providers. We refer to those entities and their assignees collectively as the Medical Providers.

Before agreeing to perform the procedures, the Medical Providers contacted Blue Cross—the administrator of La-Z-Boy’s plan—to determine the “Patient’s responsibility versus [La-Z-Boy’s] responsibility for paying for medical services[.]” Am. Compl., R.11, ¶ 26. The Medical Providers directed their query to Blue Cross because they “underst[ood]” that Blue Cross “is and was [La-Z-Boy’s] agent and representative in connection with stating the manner of payment for medical services and providing other administrative services relating to the Patient’s and [La-Z-Boy’s] health plan.” Id. ¶ 7.

The discussion that followed featured oral “promises and representations” from Blue Cross about the terms of La-Z-Boy’s ERISA plan. Id. ¶ 10. Blue Cross representatives recited the amount of Patient AA’s deductible and maximum out-of-pocket expense. They also explained that Blue Cross would reimburse the Medical Providers at the usual, customary, and reasonable (UCR) rate for the specific procedures Patient AA sought. The UCR rate is “based on what providers in the area usually charge for the same or similar medical service,” and Blue Cross calculates the UCR rate by utilizing a third-party “medical bill database.” Id. ¶¶ 17, 20 (citation omitted). According to the Medical Providers, plan administrators across the industry use the UCR rate to set a “limit on the amount [a] health plan will pay.” Id. ¶ 20 n.3 (citation omitted).

No. 25-1727 Laurel Hill Mgmt. Servs., Inc, et al. Page 4 v. La-Z-Boy Inc., et al.

Relying on Blue Cross’s statements about the rate of reimbursement, the Medical Providers rendered treatment to Patient AA. The Medical Providers allege that Blue Cross never advised them that Patient AA’s “policy” was “subject to certain exclusions, limitations, or qualifications” that could “result in denial of coverage, limitation of payment or any other method of payment unrelated to the UCR rate.” Id. ¶ 33. Blue Cross also did not “make reference to any other portion” of the “plan” that would have put the Medical Providers “on notice of any reduction in the originally stated payment percentage.” Id. ¶ 34. Nor did the Medical Providers receive a copy of the plan before providing treatment.

The Medical Providers then “submitted their claims” directly to Blue Cross in the amount of $342,296. Id. ¶¶ 40, 41. But Blue Cross paid the Medical Providers only $1,598.40; that amount was “based on Medicare,” not the UCR rate that the Medical Providers expected. Id. ¶¶ 41, 42.

B

In March 2024, the Medical Providers sued La-Z-Boy and unnamed individual defendants in California state court. After the case was removed to federal court and transferred to the Eastern District of Michigan, the Medical Providers amended their complaint to add Blue Cross as a defendant.

The Medical Providers’ suit contends that Blue Cross made misrepresentations regarding the rate at which Patient AA’s plan would reimburse them and that the Medical Providers relied on those misrepresentations to render treatment to Patient AA. The Medical Providers asserted state-law negligent-misrepresentation and promissory-estoppel claims against the defendants. For relief, they sought “payment at the UCR rate and not based on Medicare.” Id. ¶ 52.

La-Z-Boy and Blue Cross each moved to dismiss the complaint for failure to state a claim. Relevant here, they argued that ERISA’s express-preemption provision barred the Medical Providers’ claims. See 29 U.S.C. § 1144(a). The Medical Providers opposed dismissal and, in a single sentence at the end of their opposition brief, requested leave to file a second amended complaint in the event the district court agreed with the defendants’ preemption

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Laurel Hill Mgmt. Servs., Inc v. La-Z-Boy Inc., (6th Cir. 2026).

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