Louisiana Supreme Court Rules in Favor of Louisiana, Texas and Oklahoma Creditors in AmCare HMO Case
On April 1, 2011, a unanimous Louisiana Supreme Court issued a 197 page opinion in favor of the Louisiana Commissioner of Insurance, Jim Donelon, and against Health Net, Inc., one of the nation's largest HMOs, that should allow all healthcare providers and members of the AmCare Louisiana HMO as well as its creditors to be made whole. The ruling, which includes claims made by insurance Receivers in Louisiana, Oklahoma and Texas, totals more than $180 million with legal interest to date. "The Louisiana Department of Insurance is very pleased with this result," said Commissioner Donelon, "and we anticipate that the healthcare providers and policyholders of the Louisiana, Oklahoma, and Texas HMO’s will now be reimbursed for their losses caused by Health Net's conduct."
In June 2005, following a ten day trial against Health Net in Baton Rouge state court before Judge Janice Clark, a unanimous, twelve person jury rendered a verdict in favor of the Texas plaintiffs for compensatory and punitive damages totaling approximately $100 million. Following post-trial motions in November 2005, Judge Clark rendered similar verdicts against Health Net and awarded additional damages of approximately $30 million to the Louisiana and Oklahoma plaintiffs. After a lengthy appeal process, a three-judge panel of the First Circuit Court of Appeal reversed the trial verdicts entirely in December 2008 in a lengthy opinion. The Louisiana Supreme Court granted writs in December 2009 and last Friday the highest court in Louisiana unanimously reversed the Appeals Court ruling and reinstated the rulings of the Baton Rouge jury. "In light of the Louisiana Supreme Court’s ruling," observed the court-appointed Louisiana Receiver involved in this case, Marlon Harrison, "We remain very hopeful that all of the victims of Health Net's conduct will ultimately be compensated."
“It has been a long, hard fought battle for recovery,” said the lead attorney for the Louisiana and Oklahoma claimants, J.E. Cullens, "but all of the victims of Health Net’s scheme should finally be reimbursed for their considerable losses.” When Health Net will pay the more than $180 million owed to the claimants in Louisiana, Oklahoma, and Texas, remains uncertain, but this litigation, which began in 2003, is nearing its end. “Although it has taken many years and a lot of hard work to get to this point,” said Cullens, “everyone involved is extremely happy with the Louisiana Supreme Court’s ruling and that justice has prevailed.”