Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

In this COVID-19 pandemic-related case, the Seventh Circuit vacated in part the judgment of the district court granting Loyola University of Chicago's motion to dismiss this complaint brought by Plaintiffs, three undergraduate students, for breach of contract and unjust enrichment, holding that Plaintiffs pled enough to withstand dismissal for failure to state a claim and that Plaintiffs were entitled to leave to amend to save their alternative claim for unjust enrichment.As a result of the pandemic, Loyola suspended all in-person instruction during the Spring 2020 semester, curtailed access to campus facilities, and moved all instruction online. Plaintiffs brought a putative class action lawsuit against Loyola, arguing that the decision to shut down Loyola's campus deprived them of promised services, such as in-person instruction and access to on-campus facilities, in exchange for tuition and fees. The district court granted Loyola's motion to dismiss for failure to state a claim. The Seventh Circuit reversed in part, holding (1) Plaintiffs sufficiently pled a claim for breach of an implied contract under Illinois law; and (2) Plaintiffs adequately pled an unjust enrichment claim in the alternative. View "Gociman v. Loyola University of Chicago" on Justia Law

Bloomington, Indiana (population 90,000) is in a metropolitan statistical area with a population near 200,000. From Bloomington, one can drive an hour and ten minutes to Indianapolis (population 865,000); two hours to Evansville (population 120,000); two hours to Louisville (population 620,000); or two and a half hours to Cincinnati, (population 300,000). Dr. Vasquez arrived in Bloomington in 2006, opened an independent vascular‐surgery practice, and obtained admitting privileges at Bloomington Hospital, Monroe Hospital, and the Indiana Specialty Surgery Center. He performed more than 95% of his inpatient procedures at Bloomington Hospital. In 2010, IU Health acquired Bloomington Hospital. In 2017, IU Health acquired Premier Healthcare, an independent physician group based in Bloomington. Vasquez alleges that, because of the acquisition, IU Health employs 97% of primary care providers (PCPs) in Bloomington and over 80% of PCPs in the region. Vasquez’s alleged that IU Health launched “a systematic and targeted scheme” to ruin his reputation and practice because of Vasquez’s commitment to independent practice. IU Health's employees cast aspersions on his reputation. IU Health revoked Vasquez’s Bloomington admitting privileges.Vasquez brought claims under Sherman Act, 15 U.S.C. 2, and Clayton Act, section 18. The Seventh Circuit reversed the dismissal of his suit. Vasquez’s accounts of how a hypothetical monopolist could dominate Bloomington’s vascular‐ surgery market suffice for the pleading stage; the complaint presents a plausible account under which his suit is timely. View "Vasquez v. Indiana University Health, Inc" on Justia Law

Jody arrived at the Indiana University Health emergency room with severe abdominal pain. Doctors determined she needed emergency surgery to remove a dying portion of her intestine. Because they believed (incorrectly) that the problem stemmed from earlier gastric bypass surgery, they transferred her to another facility to be operated on by the bariatric surgeon who had performed the bypass. Jody died two days later. Her husband sued, alleging that IU’s failure to operate on Jody violated its obligation under the federal Emergency Medical Treatment and Labor Act to “stabilize” Jody when it decided to transfer her without first performing the laparotomy and removing the ischemic portions of her intestine, 42 U.S.C. 1395dd(b)(1)(A).The Seventh Circuit affirmed the summary judgment rejection of the suit. The Act authorizes pre-stabilization transfer where one of two triggering conditions is satisfied and the transfer is “appropriate.” No reasonable jury could conclude that IU did not satisfy both requirements. A physician certified that “[b]ased upon the information available to [him] at the time of transfer, … the medical benefits reasonably expected from the provision of appropriate medical treatment at another facility outweigh the increased risks to [Jody] … from undertaking the transfer.” The court cited the “Treatment Act’s narrow purpose as an anti-dumping law rather than a federal cause of action for medical malpractice.” View "Martindale v. Indiana University Health Bloomington, Inc." on Justia Law

Illinois moved its Medicaid program from a fee‐for‐service model, where a state agency pays providers’ medical bills, to one dominated by managed care, where private insurers pay medical bills. Most patients of Saint Anthony Hospital are covered by Medicaid, so Saint Anthony depends on Medicaid payments. Over the last four years, it has lost roughly 98% of its cash reserves, allegedly because managed‐care organizations have repeatedly and systematically delayed and reduced Medicaid payments to it. Saint Anthony sued, arguing that Illinois officials owe it a duty under the Medicaid Act to remedy the late and short payments.The Seventh Circuit reversed the dismissal of the suit, concluding that Saint Anthony has alleged a viable claim for relief under 42 U.S.C. 1396u‐ 2(f) and may seek injunctive relief under 42 U.S.C. 1983 against the state official who administers the Medicaid program in Illinois. Illinois has tools available to remedy systemic slow payment problems—problems alleged to be so serious that they threaten the viability of a major hospital and even of the managed‐care Medicaid program as administered in Illinois. If Saint Anthony can prove its claims, the chief state official could be ordered to use some of those tools to remedy systemic problems that threaten this literally vital health care program. View "Saint Anthony Hospital v. Eagleson" on Justia Law

The Board, a private, nonprofit provider of medical certifications to radiologists, is dominant in the market for radiology certifications. All states permit physicians who are not Board-certified to practice medicine, provided they possess a valid state medical license. Siva, a Board-certified radiologist, says that most insurers will not grant in-network status to physicians who are not Board-certified; uncertified physicians are often shut out from meaningful employment opportunities. When the Board began selling certifications in 1934, radiologists who passed the examination would remain certified for life. The Board later shifted to “initial certification” and “maintenance of certification” (MOC). Radiologists who wish to remain Board-certified must participate in and pay for the MOC program annually, which requires continuing education credits from third parties, completing “practice improvement” activities, and passing Board-administered examinations.The Seventh Circuit affirmed the dismissal of Siva’s antitrust suit. Siva argued that MOC should be thought of not as part of the Board’s certification product but as a unique product in its own right and that the Board’s decision to revoke the certification of radiologists who refuse to participate in the MOC program reflects not a benign product redesign but rather an illegal tying arrangement that violates the Sherman Act, 15 U.S.C. 1. Siva cannot identify a distinct product market in which it is efficient to offer MOC separately from certification. View "Siva v. American Board of Radiology" on Justia Law

St. Vincent Hospital adopted a COVID-19 vaccine requirement. Employees had until November 12, 2021 to get vaccinated unless they received a medical or religious exemption. In reviewing exemption requests, St. Vincent considered the employee’s position and amount of contact with others, the current health and safety risk posed by COVID, and the cost and effectiveness of other safety protocols. Dr. Halczenko treated gravely ill children, including those suffering from or at risk of organ failure.St. Vincent denied Halczenko’s request for religious accommodation on the ground that “providing an exemption to a Pediatric Intensivist working with acutely ill pediatric patients poses more than a de minim[i]s burden to the hospital because the vaccine provides an additional level of protection in mitigating the risk associated with COVID.” Halczenko and four other St. Vincent employees filed an EEOC complaint. The others—a nurse practitioner and three nurses, including two in the pediatric ICU—were granted religious accommodations. St. Vincent terminated Halczenko’s employment. Halczenko attributes his lack of success in finding new work to his non-compete agreement with St. Vincent, his preference not to move his family, and the limited demand for an unvaccinated physician in his specialty. In a purported class action, the Seventh Circuit affirmed the denial of preliminary relief, concluding that Halczenko had shown neither irreparable harm nor an inadequate remedy at law. View "Halczenko v. Ascension Health, Inc." on Justia Law

Lash, a 60-year-old, obese man with a remote history of smoking and high blood pressure, was traveling when he experienced shortness of breath and chest discomfort. He went to Sparta hospital. An EKG, blood work, and a chest x-ray revealed no signs of a previous heart attack, but his white blood cells and blood sugar were slightly elevated, suggesting a cardiac event. Dr. Panico identified mild congestive failure and an enlarged right hilum, a part of the lung. He recommended a CT scan to rule out a mass. Dr. Motwani, the main physician responsible for treating Lash, diagnosed an “anxiety reaction” and prescribed medications. Lash was not informed of his congestive heart failure nor that an enlarged right hilum could mean heart failure or cancer. One nurse mentioned only that Lash was seen for an “anxiety reaction.” The next evening, Lash went into cardiac arrest. He was taken to the emergency room, where he was pronounced dead.In a malpractice suit by Lash’s estate, the district court granted Sparta hospital summary judgment. Motwani settled the case and was dismissed from the lawsuit. The Seventh Circuit affirmed. . The Illinois Tort Immunity Act provides that “a local public entity,” such as Sparta, is not liable for an employee’s negligent “diagnosis.” Lash never received any treatment, so no doctor could have failed to disclose information that might have changed his decisions. View "Lash v. Sparta Community Hospital" on Justia Law

Tinimbang invested $811,400, founding Donnarich Home Health in 2005 with his then-wife Josephine and their children. In 2006-2007, the others forced him out of management; Tinimbang maintained his equity position. Josephine and their son, Richard, later incorporated two healthcare businesses: Josdan and Patient Home; some of the funding came from Donnarich’s assets. Tinimbang later asserted that he was not compensated for those asset transfers or for his removal as Donnarich’s president.Josephine and others were charged with conspiracy to commit healthcare fraud (18 U.S.C. 1349) and conspiracy to launder the proceeds of healthcare fraud and unlawful payments for patient referrals (18 U.S.C. 1956(h)) by using Donnarich and Josdan to fraudulently bill Medicare and creating shell companies to deposit checks. The government sought the forfeiture of assets involved in or traceable to the conspiracies. Josephine fled. Guerrero, an employee, pled guilty and agreed to forfeit assets. The district court entered a preliminary order of forfeiture.Tinimbang asserted a claim to the assets by instituting ancillary proceedings, citing his investment in Donnarich, his removal without compensation, and the allegedly improper transfers from Donnarich to Josdan and Patient. Tinimbang did not provide any financial tracing. The government “reviewed the movement of funds” and did not trace any of Tinimbang’s investment to the forfeiture assets. The Seventh Circuit affirmed summary judgment in favor of the government. Tinimbang had not carried his burden to show a vested or superior interest in the forfeited assets at the time of the criminal acts. View "United States v. Tinimbang" on Justia Law

During the COVID-19 pandemic, Illinois Governor J. B. Pritzker issued a series of executive orders that first required Illinois residents to shelter in place at their residences, compelled “non-essential” businesses temporarily to cease or reduce their operations and prohibited gatherings of more than 10 people (later increased to 50 people). Believing that these orders violated numerous provisions of the U.S. Constitution, several individuals joined with some Illinois businesses and sued the Governor in his official capacity. After granting the plaintiffs one opportunity to amend their complaint, the district court found that they lacked standing to sue. The court also concluded that it would be futile to allow a second amendment because, even if it had erred about the existence of a justiciable case or controversy, the plaintiffs could not state a claim upon which relief could be granted.The Seventh Circuit affirmed the dismissal of the complaint. With respect to five out of six counts, the plaintiffs have not satisfied the criteria for Article III standing to sue. The remaining count attempts to state a claim under the Takings Clause. The business plaintiffs “may have squeaked by the standing bar” for that theory but have not stated a claim upon which relief can be granted. View "Nowlin v. Pritzker" on Justia Law

Illinois Insurance Guaranty Fund is a state-created insolvency insurer; when a member insurer becomes insolvent, the Fund pays covered claims. In cases involving insolvent health insurance, many claims are for patients who are eligible for both Medicare benefits and private health insurance. The Fund sought a determination that it is not subject to reporting requirements under section 111 of the 2007 Medicare, Medicaid, and SCHIP Extension Act, 42 U.S.C. 1395y(b)(7) & (b)(8), which is intended to cut Medicare spending by placing financial responsibility for medical costs with available primary plans first. Because time may be of the essence in medical treatment, the government may make conditionally cover medical expenses for Medicare beneficiaries insured by a primary plan, subject to later reimbursement from a primary plan. Section 111 imposes reporting requirements so that the government can identify the primary plan responsible for payment. The Fund believes that it is not an “applicable plan.”The district court dismissed for lack of subject-matter jurisdiction, reasoning the government had not made a final decision through its administrative processes. The Seventh Circuit affirmed. The Fund can obtain judicial review of its claim in a federal court only by channeling its appeal through the administrative process provided under 42 U.S.C. 405(g). The usually-waivable defense of failure to exhaust administrative remedies is a jurisdictional bar here. View "Illinois Insurance Guaranty Fund v. Becerra" on Justia Law