# Abira Medical Laboratories, LLC v. CareSource

> District Court, S.D. Ohio · November 18, 2024

URL: https://www.frixlaw.com/law-library/cases/10743627

## Case

- **Court:** District Court, S.D. Ohio
- **Decided:** November 18, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10743627

## How later opinions describe it (automated extraction)

- holding no “clear and unambiguous promise” where party did not make a specific promise or statement about paying for a repair

## Opinion text

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON

ABIRA MEDICAL LABORATORIES, LLC,
Plaintiff, Case No. 3:24-cv-157

vs.

CARESOURCE, et al., District Judge Michael J. Newman
Magistrate Judge Peter B. Silvain, Jr.
Defendants.
____________________________________________________________________________

ORDER: (1) GRANTING IN PART AND DENYING IN PART DEFENDANT’S
MOTION TO DISMISS (Doc. No. 12); (2) DISMISSING COUNTS II AND III OF THE
AMENDED COMPLAINT (Doc. No. 11); (3) PERMITTING THE CASE TO PROCEED
WITH THE FOLLOWING CLAIMS: COUNTS I AND IV (BREACH OF CONTRACT
AND QUANTUM MERUIT/UNJUST ENRICHMENT) AGAINST DEFENDANT
CARESOURCE; AND (4) REFERRING THIS MATTER TO MAGISTRATE JUDGE
SILVAIN SO THAT A MEDIATION CONFERENCE CALL BETWEEN MAGISTRATE
JUDGE GENTRY AND COUNSEL FOR BOTH SIDES CAN PROMPTLY OCCUR
______________________________________________________________________________
This is a civil case, premised on the Court’s diversity jurisdiction,1 in which Abira Medical
Laboratories, LLC (“Abira”), doing business as Genesis Diagnostics, performed laboratory testing
services for Defendant CareSource’s insured members (“members”). Doc. No. 11 at PageID 65.
Abira alleges that “the requisitions of laboratory testing services” submitted on CareSource
members’ behalf included an assignment of benefits that created a contractual agreement requiring
CareSource to pay Abira for services and allowing Abira to sue for non-payment. Id. at PageID
65-66. As a result of the alleged assignment of benefits, Abira asserts that CareSource has failed
to pay (or has underpaid) Abira’s claims submitted to CareSource, totaling $665,518. Id. at PageID
68-69, 82.

1 Accordingly, Ohio law controls. Erie R. Co. v. Tompkins, 304 U.S. 64, 78 (1938).
The Court has already afforded Abria an opportunity to amend its complaint. Id. In Abira’s
Amended Complaint, it alleges seven state-law claims2 against CareSource: (1) breach of contract;
(2) breach of the implied covenant of good faith and fair dealing; (3) fraudulent misrepresentation;
(4) negligent misrepresentation; (5) equitable estoppel; (6) promissory estoppel; and (7) quantum

meruit/unjust enrichment. See generally id. CareSource filed a motion to dismiss pursuant to Fed.
R. Civ. P. 12(b)(6). Doc. No. 12. In response to the motion, Abira filed a memorandum in
opposition (Doc. No. 15), and CareSource replied. Doc. No. 17. Thus, the motion is ripe for
review.
I. Legal Standard
Rule 12(b)(6), like all other Federal Rules of Civil Procedure, “should be construed,
administered, and employed by the court and the parties to secure the just, speedy, and inexpensive
determination of every action and proceeding.” Fed. R. Civ. P. 1. A motion to dismiss filed
pursuant to Rule 12(b)(6) operates to test the sufficiency of the complaint and permits dismissal
for “failure to state a claim upon which relief can be granted.” To survive a Rule 12(b)(6) motion,
a plaintiff must satisfy the basic pleading requirements set forth in Rule 8(a). Under Rule 8(a)(2),

a complaint must contain a “short and plain statement of the claim showing that the pleader is
entitled to relief.” Fed. R. Civ. P. 8(a)(2).
A complaint will not suffice if it offers only “labels and conclusions or a formulaic
recitation of the elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Instead, “a complaint must
contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its
face.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). A plaintiff must plead “factual

2 Abira incorrectly pled four counts, but Count III is four separate state-law claims.
content that allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Id. “Where a complaint pleads facts that are ‘merely consistent with’ a
defendant’s liability, it ‘stops short of the line between possibility and plausibility of “entitlement
to relief.”’” Id. (quoting Twombly, 550 U.S. at 557).

II. Analysis
A. Count I: Breach of Contract
In Ohio, a plaintiff must establish four elements for a breach of contract claim: “(a) the
existence of a contract; (b) performance by the plaintiff; (c) breach by the defendant; and (d)
damage or loss to the plaintiff.” Thomas v. Publishers Clearing House, Inc., 29 Fed. App’x 319,
322 (6th Cir. 2002) (citing Doner v. Snapp, 649 N.E.2d 42, 44 (Ohio Ct. App. 1994)). Abira
adequately pleads performance and damages related to the alleged breach because Abira claims it
performed laboratory testing services for CareSource’s members worth $665,518, but Abira never
received payment or did not receive full payment. Doc. No. 11 at PageID 67-69, 77-82.
CareSource argues in favor of dismissing Abira’s breach of contract claim because Abira

has not properly alleged the existence of a contract (and by implication, CareSource did not breach
because there was no contract). See Doc. Nos. 12, 17. CareSource claims that Abira “does not
allege any specific contractual clauses authorizing the laboratory testing, specifying the price of
such testing, or requiring CareSource to pay for the testing.” Doc. No. 12 at PageID 91.
Abira’s allegations must be construed in the light most favorable to it and treated as true.
See Twombly, 550 U.S. at 555-56. Abira alleges that it performed approximately 192 laboratory
testing services for CareSource members, and CareSource did not pay (or has underpaid) for the
services. Doc. No. 11 at PageID 68-69, 71. Abira attached a spreadsheet to its Amended
Complaint alleging the date, amount billed, and accession number (a unique identifier) for each
test. Id. at PageID 77-82.
Abira further alleges after it performed each test, it sent a requisition for laboratory testing
services to CareSource where each member “executed an assignment of benefits with respect to

their original requisitions for services” and that created an assignment of contractual rights. Doc.
No. 11 at PageID 65-69. In other words, Abira and CareSource’s contractual relationship stems
from these documents because they purportedly assign the benefit of payments from CareSource
to Abira. As discussed above, Abira alleges it completed the tests in exchange for the promise of
the assigned payments.
Under Ohio law, “the assignee of a contract takes that contract with all rights of the assignor
and subject to all defenses that the obligor may have had against the assignor,” including the right
to any payment under the contract and the right to sue for breach. Citizens Fed. Bank, F.S.B. v.
Brickler, 683 N.E.2d 358, 364 (Ohio Ct. App. 1996). Here, Abira alleges that it received
requisition documents with assignments from approximately 192 laboratory testing services for

CareSource members. Doc. No. 11 at PageID 71, 77-82. At the current stage, Abira has plausibly
shown a contractual relationship existed with CareSource.
Therefore, the Court DENIES CareSource’s motion to dismiss Abira’s breach of contract
claim. Accordingly, this claim shall proceed to discovery.
B. Count II: Breach of the Implied Covenant of Good Faith and Fair Dealing
“In addition to a contract’s express terms, every contract imposes an implied duty of good
faith and fair dealing in its performance and enforcement.” Cincinnati Dev. III, LLC v. Cincinnati
Terrace Plaza, LLC, No. 22-3303, 2023 WL 2487348, at *8 (6th Cir. Mar. 14, 2023), reh’g denied,
No. 22-3303, 2023 WL 2747886 (6th Cir. Mar. 31, 2023) (quoting Lucarell v. Nationwide Mut.
Ins. Co., 97 N.E.3d 458, 469 (Ohio 2018)). Good faith requires a “compact reference to an implied
undertaking not to take opportunistic advantage in a way that could have not been contemplated
at the time of drafting, and which therefore was not resolved explicitly by the parties.” Id. (citation
and quotation omitted).

Ohio does not recognize an independent cause of action for breach of the implied duty of
good faith and fair dealing. Id. (citing Lucarell, 97 N.E.3d at 469). In other words, “there is no
violation of the implied duty unless there is a breach of a specific obligation imposed by the
contract, such as one that permits a party to exercise discretion in performing a contractual duty or
in rejecting the other party’s performance.” Id. (citing Lucarell, 97 N.E.3d at 469).
Accordingly, this claim merits dismissal. The Court GRANTS CareSource’s motion to
dismiss Abira’s breach of the implied covenant of good faith and fair dealing claim.
C. Count III: Fraudulent and Negligent Misrepresentation; Equitable and
Promissory Estoppel
Abira pled Count III as one claim, but it is actually four separate state-law claims. See
Hortman v. Miamisburg, 852 N.E.2d 716, 719 (Ohio 2006) (analyzing promissory and equitable
estoppel separately); Patel v. Univ. of Toledo, 95 N.E.3d 979, 986-90 (Ohio Ct. App. 2017)
(analyzing negligent misrepresentation and fraud separately). Accordingly, the Court will analyze
each claim separately.
1. Fraudulent Misrepresentation
Under Ohio law, the elements of common law fraudulent misrepresentation are:

(a) a representation or, where there is a duty to disclose, concealment of a fact, (b)
which is material to the transaction at hand, (c) made falsely, with knowledge of its
falsity, or with such utter disregard and recklessness as to whether it is true or false
that knowledge may be inferred, (d) with the intent of misleading another into
relying upon it, (e) justifiable reliance upon the representation or concealment, and
(f) a resulting injury proximately caused by the reliance.
Mikulski v. Centerior Energy Corp., 501 F.3d 555, 562 n.4 (6th Cir. 2007) (quoting Burr v. Stark
County Bd. of Comm’rs, 491 N.E.2d 1101, 1102 (Ohio 1986)). For the purposes of a fraud claim,
a representation of fact must be definite. Ullmo ex rel. Ullmo v. Gilmour Acad., 273 F.3d 671, 678
(6th Cir. 2001) (citing Friesner v. Mid American Nat’l Bank & Trust Co., No. WD 88–67, 1989

WL 111756, at *5 (Ohio Ct. App. Sept. 29, 1989)).
Under Fed. R. Civ. P. 9, when alleging fraudulent misrepresentation, the party “must state
with particularity the circumstances constituting fraud or mistake.” Fed. R. Civ. P. 9(b). To allege
fraud with particularity, Abira, at a minimum, must “‘allege the time, place, and content of the
alleged misrepresentation on which [they] relied . . . .’” Heinrich v. Waiting Angels Adoption
Servs., Inc., 668 F.3d 393, 403 (6th Cir. 2012) (quoting United States ex rel. Bledsoe v. Cmty.
Health Sys., Inc., 342 F.3d 634, 643 (6th Cir. 2003)).
In Abira’s response to the motion to dismiss, Abira points to an alleged omission by
Defendant. Abira states, “Abira also relied on the omission of Defendant to make definitive
statements that it would not pay an invoice even after being presented with one.” Doc. No. 15 at

PageID 118. An omission is not a definite statement. See Ullmo, 273 F.3d at 678. Accordingly,
Abira has not alleged the requirements necessary for fraudulent misrepresentation under Ohio law.
Further, Abira only vaguely refers to the content of the misrepresentation, saying an
unidentified CareSource “representative . . . represented to Plaintiff . . . that Defendant would pay
for services to be rendered by the Plaintiff to Defendant’s insureds.” Doc. No. 11 at PageID 71.
Abira’s allegation does not include the required time nor place of the alleged representation. See
Heinrich, 668 F.3d at 403. Thus, it is far from pleading the “what” of any representation with the
“particularity” required by Fed. R. Civ. P. 9(b). Cf. Gozion v. Cleveland Sch. of the Arts Bd. of
Trustees, --- N.E.3d ----, 2024 WL 2698171, at *4-5 (Ohio Ct. App. May 23, 2024), appeal not
allowed, 241 N.E.3d 221 (Table) (Ohio 2024).
Therefore, the Court GRANTS CareSource’s motion to dismiss Abira’s fraudulent
misrepresentation claim.

2. Negligent Misrepresentation
The elements of negligent misrepresentation require that a defendant “must (1) supply false
information; (2) for the guidance of others in their business transactions; (3) causing pecuniary
loss to the plaintiff; (4) while the plaintiff justifiably relied upon the information; (5) and while the
defendant failed to exercise reasonable care or competence in obtaining or communicating the
information.” Palmer-Donavin Mfg. Co. v. Rheem Sales Co., No. 2:14-CV-91, 2014 WL 2767665,
at *8 (S.D. Ohio June 18, 2014) (citing Delman v. City of Cleveland Heights, 534 N.E.2d 835, 838
(Ohio 1989)). A negligent misrepresentation claim requires a plaintiff to allege that the defendant
“made some ‘affirmative false statement’ to [plaintiff].” Pierre Invs., Inc. v. Fifth Third Bancorp,
No. 23-3269, 2023 WL 8373001, at *1 (6th Cir. Dec. 4, 2023) (citing Textron Fin. Corp. v.

Nationwide Mut. Ins. Co., 684 N.E.2d 1261, 1269 (Ohio Ct. App. 1996)). In other words, an
omission does not satisfy the elements for negligent misrepresentation. See id.
Ohio law further provides:
A core requirement in a claim for negligent misrepresentation is a special
relationship under which the defendant supplied information to the plaintiff for the
latter’s guidance in its business transaction. This relationship occurs only in
‘special’ circumstances. Usually the defendant is a professional (e.g., an
account[ant]) who is in the business of rendering opinions to others for their use in
guiding their business, and the plaintiff is a member of a limited class. This ‘special’
relationship does not exist in ordinary business transactions. Those who are in the
business of supplying information for the guidance of others typically include
attorneys, surveyors, abstractors of title and banks dealing with non-depositors’
checks.
Carter-Jones Lumber Co. v. Oro RB SPE Owner, LLC, No. 2:20-CV-04894, 2021 WL 2592531,
at *13 (S.D. Ohio June 24, 2021) (quotation omitted). As noted above, special relationships
include “attorneys, surveyors, abstractors of title, banks dealing with nondepositors’ checks, and
investment advisors.” Id. at *14.

CareSource—an insurance company—does not fall within the traditional groups who
create special relationships. See id. Nor has Abira has alleged any facts that the parties had a
special relationship like that of an accountant or an attorney. See generally Doc. No. 11. Abira
has not alleged any facts indicating that its relationship with CareSource was anything other than
an ordinary business transaction.
As discussed above, Abira alleges the misrepresentation was based on an omission of a
definitive statement. Doc. No. 15 at PageID 118. An omission is insufficient to plead a negligent
misrepresentation claim. See Pierre Invs., Inc., 2023 WL 8373001, at *1.
Accordingly, the Court GRANTS CareSource’s motion to dismiss Abira’s negligent
misrepresentation claim.

3. Equitable Estoppel
Under Ohio law, equitable estoppel “is a defense to a legal or equitable claim, not a cause
of action.” Peter D. Brown Tr. v. Shriver, No. 1:17-CV-280, 2018 WL 776365, at *2 (S.D. Ohio
Feb. 8, 2018) (citing Ohio State Bd. of Pharm. v. Franz, 555 N.E.2d 630, 663 (Ohio 1990)).
CareSource correctly points out equitable estoppel only applies as a defense and not as an
affirmative claim. Doc. No. 12 at PageID 95-96; Doc. No. 17 at PageID 136, n.4. Abira concedes
this point in its Response and states it “reserves the right to assert [equitable estoppel] in the
future.” Doc. No. 15 at PageID 119. Thus, the Court GRANTS CareSource’s motion to dismiss
Abira’s equitable estoppel claim.
4. Promissory Estoppel
Ohio law establishes the promissory estoppel doctrine as “a promise that the promisor
‘should reasonably expect to induce action or forbearance on the part of the promisee or a third
person and . . . [that] does induce such action or forbearance is binding’ if one can avoid injustice

only by enforcing the promise.” Andersons, Inc. v. Consol, Inc., 348 F.3d 496, 503 (6th Cir. 2003)
(quoting McCrosky v. Ohio, 456 N.E.2d 1204, 1205 (Ohio 1983)). The elements of promissory
estoppel are: “‘[1] a promise, clear and unambiguous in its terms; [2] reliance [on the promise] by
the party to whom the promise is made; [3] that the reliance was reasonable and foreseeable; and
[4] that the party claiming estoppel was injured by the reliance.’” Id. (quoting Rigby v. Fallsway
Equip. Co., Inc., 779 N.E.2d 1056, 1061 (Ohio Ct. App. 2002)).
A promise is a “a manifestation of intention to act or refrain from acting in a specified way,
so made as to justify a promisee in understanding that a commitment has been made.” Dailey v.
Craigmyle & Son Farms, L.L.C., 894 N.E.2d 1301, 1307 (Ohio Ct. App. 2008) (internal quotation
omitted). Promissory estoppel’s first element—a clear and unambiguous promise—“is not

satisfied by vague or ambiguous references.” Com. Benefits Grp., Inc. v. McKesson Corp., 326
Fed. App’x 369, 375 (6th Cir. 2009) (quoting Casillas v. Stinchcomb, No. E–04–041, 2005 WL
1845318, at *3 (Ohio Ct. App. July 8, 2005)).3
CareSource argues Abira has not met the clear and unambiguous promise element that
would support reasonable reliance and damages because Abira has not alleged any specific
instances where a CareSource employee promised to pay Abira for any specific service. Doc. No.

3 The Court also notes, under Ohio law, the presence of an enforceable contract between the parties
generally precludes a promissory estoppel claim regarding the contract. See O’Neill v. Kemper Ins. Cos.,
497 F.3d 578, 583 (6th Cir. 2007) (“In Ohio, [w]here the parties have an enforceable contract and merely
dispute its terms, scope, or effect, one party cannot recover for promissory estoppel . . . .” (alteration in
original) (internal quotation marks and citation omitted)). As discussed above, Plaintiff pleads a plausible
breach of contract claim.
12 at PageID 95-96. Abira argues that its promissory estoppel claim has merit because CareSource
engaged in a “course of conduct” paying some but not all claims over several years, and the “course
of conduct constituted a representation[.]” Doc. No. 11 at PageID 71; Doc. No. 15 at PageID 119.
CareSource is correct. Abira makes vague and ambiguous references and does not allege

that CareSource made any specific promises regarding reimbursement to satisfy the clear and
unambiguous promise element of promissory estoppel. See Dailey, 894 N.E.2d at 1308-9 (holding
no “clear and unambiguous promise” where party did not make a specific promise or statement
about paying for a repair); see also Farmers’ Ethanol LLC v. Bounty Mins., LLC, 666 Fed. App’x
421, 426-27 (6th Cir. 2016) (holding under Ohio law that plaintiff failed to plead promissory
estoppel where defendant’s conduct, including its silence, did not raise to the level of a clear and
unambiguous promise). The Court GRANTS CareSource’s motion to dismiss Abira’s promissory
estoppel claim.
D. Count IV: Quantum Meruit/Unjust Enrichment
Under Ohio law, unjust enrichment and quantum meruit claims, although separate and
distinct causes of action, share the same essential elements: “(1) the plaintiff conferred a benefit

on the defendant, (2) the defendant knew of the benefit, and (3) it would be unjust to permit the
defendant to retain the benefit without payment.” Grassi v. Grassi, No. 20-3358, 2021 WL
3355475, at *5 (6th Cir. Aug. 3, 2021) (citing Meyer v. Chieffo, 950 N.E.2d 1027, 1039-40 (Ohio
Ct. App. 2011); Hambleton v. R.G. Barry Corp., 465 N.E.2d 1298, 1302 (Ohio 1984)). Unjust
enrichment and quantum meruit claims differ regarding the damages calculation. See id.
(“Damages for an unjust enrichment claim are the amount of the defendant’s benefit, while
damages for a quantum meruit claim are the measure of the value of the plaintiff’s services, less
any damages incurred by the defendant”).
A plaintiff may not recover under a theory of unjust enrichment when an express contract
covers the same subject. Wuliger v. Mfrs. Life Ins. Co., 567 F.3d 787, 799 (6th Cir. 2009) (applying
Ohio law). However, when the parties dispute the existence or enforceability of a contract, a
plaintiff may argue these two claims in the alternative. Fed. R. Civ. P. 8(a)(3) (“A pleading that

states a claim for relief must contain . . . a demand for the relief sought, which may include relief
in the alternative or different types of relief”); Fed. R. Civ. P. 8(d)(3) (“A party may state as many
separate claims or defenses as it has, regardless of consistency”); see Miranda v. Xavier Univ., 594
F. Supp. 3d 961, 974 (S.D. Ohio 2022); Highman v. Gulfport Energy Corp., No. 2:20-cv-1056,
2020 WL 6204344, at *2-3 (S.D. Ohio Oct. 22, 2020) (applying Ohio law).
CareSource argues Abira’s unjust enrichment/quantum meruit claim should be dismissed
because a contract covers the parties’ relationship, but CareSource denies Abira has plausibly
plead the existence of a contract. Doc. No. 12 at PageID 97; Doc. No. 17 at PageID 136-37. Abira
argues that it claims unjust enrichment/quantum meruit in the alternative to its breach of contract
claim. Doc. No. 15 at PageID 120. At the motion to dismiss stage, a plaintiff may plead in the

alternative when there is a dispute about a contract’s existence and the scope of the contract can
be developed in discovery. See Miranda, 594 F. Supp. 3d at 974; Highman, 2020 WL 6204344,
at *2-3.
Abira alleges that it conferred a benefit upon CareSource when it performed laboratory
testing services, CareSource was aware of the benefits, and it was unjust for CareSource to “fail[]
and refus[e] to compensate Plaintiff” for its services. Doc. No. 11 at PageID 73-74. Accordingly,
Abira has plead all the required elements for unjust enrichment/quantum meruit. At this early
stage of the litigation, the Court DENIES CareSource’s motion to dismiss the unjust
enrichment/quantum meruit claim.
III. Conclusion
Based upon the foregoing, CareSource’s motion is GRANTED IN PART AND DENIED
IN PART. Doc. No. 12. Counts II and III of the Amended Complaint (Doc. No. 11) are
DISMISSED WITH PREJUDICE. Abira may pursue only its breach of contract and quantum

meruit/unjust enrichment claims against CareSource. The Court shall issue an order requiring the
parties to meet and confer, pursuant to Fed. R. Civ. P. 16, by separate entry. Discovery shall
proceed forthwith. This matter is REFERRED to Magistrate Judge Silvain, in his role as Dayton
mediation coordinator, to schedule a mediation conference call between Magistrate Judge Caroline
Gentry and counsel for both sides.
IT IS SO ORDERED.
November 18, 2024 s/Michael J. Newman
Hon. Michael J. Newman
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10743627. Public record. Not legal advice.