EUO objections *may* be futile

Eagle Surgical Supply, Inc. v Allstate Ins. Co., 2014 NY Slip Op 51798(U)(App. Term 2d Dept. 2014)

“On appeal, plaintiff contends that the EUO scheduling letters were defective because they did not adequately advise plaintiff as to why the EUO was being requested. However, since plaintiff does not claim to have responded in any way to the EUO requests, its objections regarding the EUO requests will not now be heard (see Viviane Etienne Med. Care, P.C. v State Farm Mut. Auto. Ins. Co., 35 Misc 3d 127[A], 2012 NY Slip Op 50579[U] [App Term, 2d, 11th & 13th Jud Dists 2012]; Crescent Radiology, PLLC v American Tr. Ins. Co., 31 Misc 3d 134[A], 2011 NY Slip Op 50622[U] [App Term, 9th & 10th Jud Dists 2011]). In any event, plaintiff’s contention lacks merit since the EUO scheduling letters advised that the EUO would concern, among other things, plaintiff’s eligibility to be reimbursed for assigned no-fault benefits (see also 2006 Ops Ins Dept No. 06-12-16 []).”

My curiosity involves whether this “response” puts an end to the objection analysis, provided the EUO letters are appropriate in time, date and comply with the dictates of the DFS opinion, stating that only a provider corporation (not an individual) may be named for an EUO.

EUO no-show defense sustained

Natural Therapy Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co., 2014 NY Slip Op 51310(U)(App. Term 2d Dept. 2014)

I often feel like this Plaintiff attorney is seeking to reinvent the wheel.  It is just amazing how many times he appeals the SAME issues and (surprisingly) receives the SAME results.  And each decision comments on one more subtle defect in this particular attorneys arguments.  This is how bad law is made.

“In appeal, plaintiff argues that defendant failed to prove that it had mailed its EUO scheduling letters and denial of claim forms or that plaintiff had failed to appear for the EUOs; that defendant lacked justification for its EUO requests; and that defendant’s motion should have been denied pursuant to CPLR 3212 (f), as plaintiff had not received discovery regarding the reasonableness of defendant’s EUO requests.”

(1) “EUO scheduling letters and the denial of claim forms had been timely mailed in accordance with defendant’s standard office practices and procedures”

(2) “the affirmation submitted by defendant’s attorney, who was present in his office to conduct plaintiff’s EUO on the scheduled dates, was sufficient to establish that plaintiff had failed to appear.”

(3) “Furthermore, since plaintiff does not claim to have responded in any way to the EUO requests, its objections regarding the EUO requests will not now be heard ”

(4) “Consequently, discovery relevant to the reasonableness of the EUO requests was not necessary for plaintiff to oppose defendant’s motion”

So what did the Second Department mean?

Interboro Ins. Co. v Clennon, 2014 NY Slip Op 00092 (2d Dept. 2014)

While of course I am happy to have won, and, in addition, I can say I have written more IME/EUO no show briefs than I could ever imagine, this case leaves me with a “where are we going” feeling.  I wrote the brief, argued the appeal and know the record, so this opinion – how it was written – was unexpected.

Should I now start filing in Nassau again? Well, it is across the street from my office and the filing rules are a lot more convenient than what I encounter at a Motion Support Part, Room 130.  The clerks are nice there.  For instance, a clerk in Supreme Queens told me today that there was no such thing as a hybrid Article 78/Dec action and started crossing out “Plaintiff” (next to petitioner) and “Defendant” (next to respondent) on my papers.  I decided that I would file my memorandum of law on the return date in the Central Motion Part courtroom.  I shrugged my shoulder since that was not the fight to pick.

So what did Clennon say:

Part One

“The failure to comply with the provision of an insurance policy requiring the insured to submit to an examination under oath . . . is a material breach of the policy, precluding recovery of the policy proceeds” (Argento v Aetna Casualty & Surety Co., 184 AD2d 487, 487-488; see Unitrin Advantage Ins. Co. v Bayshore Physical Therapy, PLLC, 82 AD3d 559).”

Argento does not mention preclusion.  It solely states that failing to attend an EUO is fatal to the Claimant’s right of recovery under the policy.  Then Unitrin is mentioned, which is what started this whole coverage storm.  And Unitrin and all of the First Department cases I won that cite to it state that timeliness is irrelevant.

What was not mentioned?  Westchester v. Lincoln.  The court was well aware of that decision as it was in Appellant’s brief and mentioned during argument.  This omission was no accident by the way.

Then the Court states this in one sentence: “Here, the plaintiff insurer established as a matter of law that it twice duly demanded an examination under oath from the appellants’ assignor, who had allegedly been injured in a motor vehicle accident, that the assignor twice failed to appear, and that the plaintiff issued a timely denial of the claims arising from the appellants’ treatment of the assignor.

Was the “timeliness” issue dicta?  In other words, mention it so that way the Court did not have to unequivocally reach the Unitrin issue?  I suspect this is what happened, and I truly believe that through arguing this case.  I think the court passed the buck to the Appellate Term, Second Department, to see what they will do.

By analogy, do any of you remember when the Appellate Term, First Department in 2006 said: “Even assuming, without deciding, that a peer review report may suffice, without more, to establish a prima facie showing of lack of medical necessity” (Vladimir Zlatnick, M.D., P.C. v Travelers Indem. Co., 12 Misc.3d 128(A))?  Now, Plaintiffs in the First Department on appeal depending on the case have to jump through hoops  to beat back summary judgment on the issue of lack of medical necessity.  I think this could be the beginning of the tide change, a slow one at that.

The only problem with my hypothesis is that inasmuch as so few failure to comply cases make it to the Appellate Division, Second Department, it will be many years before my hypothesis is proven correctly or incorrectly.

Part Two

A few more tidbits.  The Court accepted the same affidavit of mailing and no show that was accepted in Ortho Prods. & Equip., Inc. v Interboro Ins. Co., 41 Misc.3d 143(A) and Quality Psychological Servs., P.C. v Interboro Mut. Indem. Ins. Co., 36 Misc 3d 146(A).  This is similar to American Transit v. Lucas, where the Appellate Division, First Department, accepted a no-show affidavit that was between “I was there and he did not show” and the conclusory “I am a partner and I know he did not show”.  So, Alrof is dead but W&Z is not revived.  Something in the middle is the law.  In addition, Defendant argued vigorously that my affidavit was not Alrof compliant, so the issue was squarely before the Court.

The court also found persuasive the argument that discovery was waived since there was no challenge to the propriety of the EUO notices during the claims verification sta ge.

I wish I could say there would be more of these cases being appealed to this Court, but this was my only Second Department case (from my 2010 inventory) and I was Respondent.  I think Progressive files a lot of no-show DJ’s in Nassau?

Mutual rescheduling prior to the first no-show

Five Boro Psychological Servs., P.C. v Utica Mut. Ins. Co., 2013 NY Slip Op 52005(U)(App. Term 2d Dept. 2013)

“Defendant denied the claim at issue based upon the alleged failure by plaintiff’s assignor to appear at duly scheduled examinations under oath (EUOs). However, according to the affirmation submitted by defendant’s counsel, the initial EUO had been rescheduled by mutual agreement, prior to the date it was to occur. A mutual rescheduling, which occurs prior to the date of the scheduled EUO, does not constitute a failure to appear

The mutual rescheduling trap.  It is alright to reschedule prior to the no-show date, but make sure you afford the EIP a third attempt to attend the EUO/IME

Proof of objective standards are waived if EUO demand is not responded to

Flatbush Chiropractic, P.C. v State Farm Mut. Auto. Ins. Co., 2013 NY Slip Op 51880(U)(App. Term 2d Dept. 2013)

“On appeal, plaintiff argues that defendant failed to prove that it had mailed its EUO scheduling letters and denial of claim forms, that defendant lacked justification for its EUO requests, and that defendant’s motion should have been denied pursuant to CPLR 3212 (f), as plaintiff had not received discovery regarding the reasonableness of defendant’s EUO requests.”

“Furthermore, since plaintiff does not claim to have responded in any way to the EUO requests, its objections regarding the EUO requests will not now be heard”

This case is significant because now proof of “objective standards” will be deemed waived if a provider or EIP does not respond to EUO demands.  In District Nassau, my research has divined that those judges  requires”objective standards” as part of a prima facie showing.  That hopefully will end.

EUO letter did not toll time to pay or deny

Right Aid Med. Supply Corp. v Nationwide Ins., 2013 NY Slip Op 51746(U)(App. Term 2d Dept. 2013)

“Defendant demonstrated that, on November 19, 2009, prior to its receipt of the claim forms at issue, it had mailed a letter scheduling an EUO for December 4, 2009 to plaintiff’s assignor. (It is noted defendant has established that all mailings in this case were done in accordance with its standard office practices and procedures [see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 (2008); Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 (App Term, 2d & 11th Jud Dists 2007)]). Consequently, a toll of defendant’s time to pay or deny the claims at issue went into effect at the time they were submitted.”

“However, defendant was also required, at the same time it mailed its final EUO scheduling letter, to inform plaintiff of the reasons why the claim was delayed “by identifying in writing the missing verification and the party from whom it was requested” (Insurance Department Regulations [*2][NYCRR] § 65-3.6 [b]). As argued by plaintiff on appeal, defendant’s December 11, 2009 letter to plaintiff failed to specifically identify the party from whom the EUO had been requested. Since defendant failed to demonstrate that it had complied with Insurance Department Regulations (NYCRR) § 65-3.6 (b), it lost the benefit of the toll. As a result, defendant failed to demonstrate that its denial of claim form had been timely mailed, and it was therefore not entitled to summary judgment dismissing the complaint.”

The Court is holding that 65-3.6(b) contains a more rigorous standard in requiring that the verification request to the provider state in the letter the person who the carrier is seeking to depose.  Otherwise, the EUO toll is invalid.

EUO no-show DJ survives numerous “you did not do that” arguments

Praetorian  v. Mercado, Index #: 303993/12 (Sup. Ct. Bx. Co. 2013)

In this declaratory judgment action, an Alrof argument was made; an electronic signature argument was made; a “you cannot file a DJ argument” was made; the you did not prove you mailed it argument was made; and an EUO provision was not in the policy argument was made.  Missing was an argument that there was no justiciable controversy (which is always denied) and that discovery was outstanding (which is usually denied).

The objections to the DJ’s are getting longer as the days are getting shorter.  The common denominator of what is missing is: a non-conclusory affidavit from the EIP that he never received the EUO’/IME notices (See American Transit Ins. Co. v. Bachus) or an affidavit from the EIP that (s)he attended the EUO/IME.

DJ based upon EUO no-shows granted over vigorous opposition

American Transit v. Chedister , Index #:  301921/12 (Sup. Ct. Bronx Co. 2013)

Supreme Court could not be anymore emphatic that it is not impressed with the Alrof v. Safeco argument that provider attorneys throw around when trying to get around an EUO no-show case.  Personal knowledge is not as personal as some want it to mean.

Mr. Five Boro took another dive – this time with the sharks

Mr. Five Boro took at dive in the IME no-show DJ matter of American Transit Ins. Co. v. Beltre, under Bronx Co. Index #: 310468/11 (Sup. Ct. Bronx Co. 2012 [Suarez, J.S.C.])

The failure to respond to an EUO letter non-suits another DME provider

Leica Supply, Inc. v Encompass Indem. Co., 2012 NY Slip Op 50890(U)(App. Term 2nd Dept. 2012)

Plaintiff’s argument that its assignor’s failure to appear for the duly scheduled EUOs permitted only the denial of pending claims is without merit (see ARCO Med. NY, P.C. v Lancer Ins. Co., 34 Misc 3d 134[A], 2011 NY Slip Op 52382[U] [App Term, 2d, 11th & 13th Jud Dists 2011]). Moreover, plaintiff does not claim to have responded to the EUO requests; therefore, plaintiff’s objection on appeal regarding those requests will not be heard

The next issue to be tackled: What happens when Plaintiff responds to the EUO demands and still fails to attend the EUO?  Do we finally reach a reasonableness analysis?  I would say I can hardly wait, but it is the lack of certainty that makes reading these decisions interesting.  As each gap gets filled, this sometimes becomes an exercise in who can cite the most principles of law.