Sabatino v. HMO Missouri, Inc.

129 F. Supp. 3d 887, 2015 U.S. Dist. LEXIS 120916, 2015 WL 5265686
CourtDistrict Court, N.D. California
DecidedSeptember 9, 2015
DocketCase Nos. 15-MD-02617-LHK, 15-CV-2873-LHK
StatusPublished
Cited by7 cases

This text of 129 F. Supp. 3d 887 (Sabatino v. HMO Missouri, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sabatino v. HMO Missouri, Inc., 129 F. Supp. 3d 887, 2015 U.S. Dist. LEXIS 120916, 2015 WL 5265686 (N.D. Cal. 2015).

Opinion

ORDER GRANTING MOTION TO REMAND

LUCY H. KOH, District Judge

Plaintiffs Monica Sabatino and Michael Sabatino (collectively, “Plaintiffs”) bring a putative class action against defendants HMO Missouri, Inc. and Healthy Alliance Life Insurance Company (collectively, “Defendants”) arising out of a cyberattack on the computer system of Defendants’ parent company, Anthem, Inc. (“Anthem”), Before the Court is Plaintiffs’ motion to remand the case to the Circuit Court of St. Louis City, 22d Judicial Circuit, in the State of Missouri. ECF No. 15.1

Having considered the submissions of the parties, the relevant law, and the record in this case, the Court GRANTS Plaintiffs’ motion to remand the case to the Circuit Court of St. Louis City, Missouri.

I. BACKGROUND

A. Factual Background

Defendants are affiliates of Anthem, an Indiana corporation that is one of the largest health benefits companies in the United States. ECF No. 1, Notice of Removal (“Removal Notice”) ¶ 5. Through its affiliated health plans, Anthem delivers health benefit products and plans to tens of millions of members across the country. Id.

On February 4, 2015, Anthem announced that cyberattackers had gained unauthorized access to its data systems on or about December 10, 2014. ECF No. 1-1, Class Action Petition (“Pet.”) ¶¶8-9. As a result of this breach, Plaintiffs allege that the personally identifiable information of up to 80 million current and former Anthem members was compromised. Id. ¶¶ 10-12. The allegedly compromised information includes members’ names, birthdays, medical identification numbers, social security numbers, street addresses, email addresses, and employment information, including income data. Id. ¶ 10.

Plaintiffs are “adult residents of Saint Louis County, Missouri” who have been Anthem members since April 2014. Pet. ¶¶ 1, 21. Plaintiffs claim that their personal information was compromised as a result of the Anthem data breach. Id. ¶¶ 21-24. “By virtue of their membership in Anthem,” Plaintiffs allege, “the company obtained their sensitive medical records, personal information, including their birthdays, social security numbers, address, and employment information.” Id. ¶ 21. As a result of the data breach, Plaintiffs claim they “are at a heightened risk for future identity theft.” Id. ¶ 23. Plaintiffs claim further that they “have been harmed in that they (1) paid more for insurance record privacy protections than they otherwise would have, and (2) paid for insurance record privacy protections that they did not receive.” Id. ¶ 24.

[891]*891B. Procedural History

On February 16, 2015 — twelve days after Anthem announced the data breach— Plaintiffs filed the instant putative class action in the Circuit Court of St. Louis City, Missouri. Removal Notice ¶ 1. A copy of the class action petition was served on Defendants on March 6, 2015. Id. ¶ 2. In the petition, Plaintiffs, asserted four, causes of action under Missouri law: (1) violation of the Missouri Merchandising Practices Act (“MMPA”), Mo. Rev. Stat. § 407.010 et seq., Pet. ¶¶ 35-45; (2) breach of fiduciary duty, id. ¶¶ 46-52; (3) breach of contract, id. ¶¶ 53-57; and (4) negligence, id. ¶¶58-63. Plaintiffs brought these four.causes of action on behalf of themselves and a statewide class of similarly situated individuals, defined as follows:

Missouri residents whose personal information was compromised as a result of the data breach announced in February 2015 and are (1) current-and former members of a health insurance plan administered by Defendants, and/or (2) current and former Anthem'employees.

Id. ¶ 26 (emphasis added). “The precise number of Class members;” according to Plaintiffs, “can be obtained from information and records in Defendants’ possession and control.” Id. ¶ 29. Defendants estimate that the proposed class comprises at least 750,000 individuals. See Removal Notice ¶ 12.

On April 3, 2015, Defendants removed this action to the United States District Court for the Eastern District of Missouri. See Removal Notice. . Defendants proffered two independent bases for subject matter jurisdiction in federal court: (1) diversity jurisdiction under the Class Action Fairness Act of 2005 (“CAFA”), 28 U.S.C. § 1332(d); and (2) federal question jurisdiction under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), 42 U.S.C. § 1320d et seq. See Removal Notice ¶¶ 10-23.

On April 10, 2015, Plaintiffs filed the instant motion to remand. ECF No. 15 (“Mot.”). Pursuant to a stipulation by the parties, see ECF Nos. 18, 19, Defendants opposed the motion on May 1, 2015, ECF No. 22 (“Opp.”). Plaintiffs replied on May 14, 2015. ECF Ño. 28 (“Reply”).

On May 14, 2015 — the same day Plaintiffs filed their reply — Plaintiffs also filed a first amended complaint. ECF No. 27, First Amended Complaint (“FAC”). In the FAC, Plaintiffs clarified that they “are citizens of Saint . Louis County, Missouri,” not just “residents.” Id. ¶ 1., Plaintiffs also amended the class definition, replacing the word “residents” with ,“[c]itizens.” Id. ¶ 25. The class definition now reads:

Citizens of Missouri whose personal information was compromised as a result of the data breach announced in February 2015 and are (1) current and former members of a health insurance plan administered by Defendants, and/or (2) current and former Anthem employees.

Id. (emphasis added). In all other respects, Plaintiffs’ FAC is materially the same as the original class action petition. For example, Plaintiffs continue to assert four causes of action under Missouri law:

(1) violation of the MMPA,' id'. ¶¶ 34-44;

(2) breach of fiduciary duty, id. ¶¶ 45-51;

(3) breach of contract, id. ¶¶ 52-56; and

(4) negligence, id. ¶¶ 57-62.

On May 18, 2015, in response to Plaintiffs’ FAC, Defendants filed a motion for leave to file a sur-reply. ECF No. 30. The district court granted the motion the next day. ECF No. 31. On May 28, 2015, Defendants filed their sur-reply, ECF No. 33, which argued that Plaintiffs’ “last-ditch effort to avoid federal court” by amending their complaint was unavailing because the district court should only consider “what [892]*892was pleaded at the time of removal,” id. at 1-2.

On June 8, 2015, the Judicial Panel on Multidistrict Litigation (“JPML”) issued a transfer order pursuant to 28 U.S.C. § 1407 selecting the undersigned judge as the transferee court for “coordinated or consolidated pretrial proceedings” in the multidistrict litigation (“MDL”) arising out of the Anthem data breach “that allegedly occurred sometime between December 10, 2014, and February 4, 2015.” Case No. 15-MD-02617-LHK, ECF No. at 1-3.

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Bluebook (online)
129 F. Supp. 3d 887, 2015 U.S. Dist. LEXIS 120916, 2015 WL 5265686, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sabatino-v-hmo-missouri-inc-cand-2015.