Anatomic and Clinical Laboratory Associates, P.C. v. CIGNA Health and Life Insurance Company

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

ANATOMIC AND CLINICAL : CIVIL ACTION

LABORATORY ASSOCIATES, P.C., et :

al. : No. 23-3834

:

v. :

:

CIGNA HEALTH AND LIFE :

INSURANCE COMPANY, et al. :

MEMORANDUM

Judge Juan R. Sánchez February 25, 2025

This is a contract dispute arising out of an insurance company’s decision to stop providing

reimbursement for services it previously covered. Defendant MultiPlan, Inc. (“MultiPlan”) is a

“middleman” that creates and operates healthcare networks—connecting providers with insurers

by contracting with each independently. Plaintiff Anatomic and Clinical Laboratory Associates,

P.C. (“ACLA”) is a healthcare provider in the MultiPlan Network. Defendant Cigna1 is an insurer

in the Network. ACLA alleges it provided certain healthcare services to Cigna members and was

denied reimbursement. ACLA then sued MultiPlan and Cigna to recover payments to which

ACLA claims it is entitled under the agreements among the parties. Both Defendants have moved

to dismiss the case for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6).

MultiPlan’s motion will be denied as to ACLA’s breach of contract claim against MultiPlan and

granted as to all other claims against MultiPlan. Cigna’s motion will be denied as to third-party

beneficiary breach of contract and unjust enrichment claims and granted as to all other claims

against Cigna.

1 There are five Cigna entities named as defendants and referred to collectively as “Cigna”:

Cigna Health and Life Insurance Company; Cigna Health Management, Inc.; Cigna Healthcare,

Inc.; Connecticut General Life Insurance Co.; and Cigna Corporation.

BACKGROUND

This case involves a third-party healthcare provider network.2 Defendant MultiPlan, the

third party, is a company that “operates and markets healthcare networks” by entering into written

agreements with healthcare providers and “payors (e.g., insurance companies, self-funded

insurance plans, health maintenance organizations, and/or third-party administrators).” MultiPlan

Mem. Supp. Mot. Dismiss 2, ECF No. 112. Plaintiff ACLA is a Tennessee-based provider group

that provides pathology services to patients. Am. Compl. ¶ 4, ECF No. 94. ACLA is a provider in

the MultiPlan Network pursuant to an agreement between it and MultiPlan. Id. ¶¶ 47-48. Cigna is

an insurance company that is a payor in the MultiPlan Network pursuant to an agreement between

Cigna and MultiPlan. Id. ¶¶ 47, 53-55. This case concerns Cigna’s decision to stop paying ACLA

for certain services covered under the MultiPlan Network.

2 Third-party provider network arrangements operate differently from traditional in-network

and out-of-network arrangements. In simple terms, a provider is in-network with an insurer if there

is a direct contract between the parties. In-network agreements require providers to provide

healthcare services to the insurer’s members in exchange for payment at a negotiated rate. In

contrast, an out-of-network provider has no agreement with the insurer—so it is not limited to a

pre-negotiated rate when billing the insurer and is not contractually guaranteed payment for

services provided to the insurer’s members. See generally Thomas E. Birsic & Mary Beth F.

Johnston, Health Care Institutions, in Business and Commercial Litigation in Federal Courts, at

§ 104:28 (American Bar Association, 5th ed. 2024) (describing the difference between in-network

and out-of-network providers). Third-party provider network arrangements involve a third party,

neither an insurer nor a provider, who contract with providers and insurers separately. Generally,

this arrangement requires providers to provide certain services at pre-negotiated rates to the third

party’s clients (i.e., the insurers) in exchange for reimbursement from the clients. Unlike in-

network arrangements, there is no direct contract between the provider and the insurer in the

provider network. And unlike out-of-network arrangements, there is an agreement or group of

agreements that indirectly manage the provider-insurer relationship. See generally Temple Univ.

Hosp., Inc. v. Grp. Health, Inc., Civ. No. 05-102, 2006 WL 1997424, at *1-2 (E.D. Pa. July 13,

2006) (describing a type of provider network).

ACLA joined the MultiPlan Network by entering into the MPI Participating Professional

Group Agreement (“MPI Agreement”).3 Id. ¶ 48. Pursuant to the MPI Agreement, ACLA agreed

to provide “Covered Services”4 to enrollees of MultiPlan’s Clients (e.g., Cigna) in exchange for

reimbursement by the Clients at the negotiated rates specified in the MPI Agreement (“MPI Rate”).

Id. ¶¶ 50-51. MultiPlan agreed to require its Clients to pay ACLA the MPI Rate. Id. Under the

MPI Agreement, ACLA’s obligations are, in relevant part, as follows:

3.2 Provision of Health Care Services. Group and each Participating Professional

will render medical and health care services in a manner which assures availability,

adequacy, and continuity of care to Participants.

…

3.4 Access. Group and each Participating Professional will use reasonable efforts

to accept all Participants for treatment in accordance with all terms and conditions

of this Agreement. Group will ensure that medical and health care services are

available to Participants 24 hours a day, 7 days a week. Group will provide at least

ninety (90) days prior written notice to MPI [MultiPlan] whenever Group or any

Participating Professional (i) closes or limits their respective practice; and (ii) re-

opens or removes any limitation on a closed or limited practice.

…

3.9 Network Participation and Requirements. MPI may, in its sole discretion,

include Group and each Participating Professional as a Network Provider in any or

all Network(s). Group and each Participating Professional acknowledge that certain

Programs offered by Clients accessing the Network (i) may not include a network

option; or (ii) may cover Covered Services under Participant’s Program at an in-

Network or out-of-Network benefit level. Group and each Participating

3 ACLA failed to attach the MPI Agreement to the Amended Complaint, but MultiPlan

attached it to its motion to dismiss. The Court may properly consider the agreement at the motion

to dismiss stage because it is “integral” to the Amended Complaint. Schmidt v. Skolas, 770 F.3d

241, 249 (3d Cir. 2014) (citation and internal quotation marks omitted). The MPI Agreement is

attached as “Exhibit 1-A” and appears on pages 20 to 36 of ECF No. 112 (ECF pagination).

4 “Covered Services” means “health care treatment and supplies rendered by a Network

Provider [i.e., ACLA] and provided to a Participant for which a User [i.e., Cigna] is responsible

for payment pursuant to the terms of a program.” MPI Agreement 1, ECF No. 112.

Professional will comply with any Network specific requirements contained in

Exhibit B and/or the administrative handbook(s).

…

3.11 Administrative Handbooks. Group and each Participating Professional will

comply with the terms of the administrative handbook(s), including, without

limitation, observing the protocols of the quality management and

credentialing/recredentialing program(s). MPI may, in its sole discretion, modify

the administrative handbook(s) from time to time and post such modifications to

the MPI website. Group and each Participating Professional will periodically

review the administrative handbook(s) on the MPI website for updates.

MPI Agreement 3-4, ECF No. 112. The administrative handbook5 states “MultiPlan Clients and

Users may elect not to access your Participating Professional Agreement, and in those situations,

the terms of your agreement will not apply.” Administrative Handbook 8, ECF No. 112.

MultiPlan’s obligations under the MPI Agreement are, in relevant part, as follows:

4.3 Client Agreements. MPI agrees that it has entered into agreements with Clients

[i.e., Cigna] that specify that the right to access the Network, including access to

the Contract rates, shall be subject to the terms of this Agreement.

…

4.5 Identification. MPI will require Clients to furnish Participants with a means of

identifying themselves to Group as covered under a Program with access to the

Network, such as (i) an MPI authorized name and/or logo on an identification card;

(ii) an MPI phone number identifier; (iii) written notification by Client of MPI

affiliation at time of benefits verification; (iv) an MPI authorized name and/or logo

on the Explanation of Benefits; or (v) other means acceptable to MPI and Group.

…

4.7 Use of Contract Rates. MPI will require Clients and its Users to use the Contract

Rates agreed to in this Agreement solely for Covered Services rendered to

Participants covered under a Program which utilizes the Network.

5 The administrative handbook is attached to MultiPlan’s motion to dismiss as “Exhibit 1-

B,” and appears on pages 37 to 73 of ECF No. 112 (ECF pagination). The Court may consider the

administrative handbook because it is explicitly referenced in the MPI Agreement and discusses

the “access” issue that is integral to the Amended Complaint. See Schmidt, 770 F.3d at 249.

MPI Agreement 5, ECF No. 112.

Cigna is part of the MultiPlan Network pursuant to its contract with MultiPlan, which

consists of a Master Services Agreement (“MSA”) and a Statement of Work (“SOW”)

(collectively, the “Client Agreement”).6 Am. Compl. ¶ 54, ECF No. 94. The Client Agreement

allows Cigna the right to access the provider’s services under the MultiPlan Network and

reimburse the provider directly at the rates negotiated in the provider’s MPI Agreement. Id. ¶¶ 54-

57. The relevant portion of the SOW is as follows:

1.1 Services

Supplier [MultiPlan] shall provide the following Services in accordance with the terms

and conditions of the Agreement to Company [Cigna]: The delivery of Complementary

and Extender Network Services for claims are from providers that do not participate in

a Company or an Affiliated Company participating provider network. It is understood

Supplier's providers described herein whose claims receive Claim Prices under the is

Agreement shall not be considered part of the Company's contracted provider network

for purposes of those claims.

…

B. Company’s Role

…

4. It is understood by Company for the Complementary and Extender Network

services, a provider may not honor the Claim Price if Company does not comply

with the applicable terms and conditions of the agreements between Supplier and

providers. Upon request, Supplier will provide to Company the provider contract

templates and make available the terms and conditions of provider agreements that

enable Company to adjudicate claims. In such cases, Company agrees that Supplier

has no liability under this SOW for the claims expense or the Claim Price that must

be reversed to the extent caused by Company's failure to comply with such

applicable terms and conditions.

…

6 ACLA failed to attach the Client Agreement to the Amended Complaint, but Cigna

attached it to its motion to transfer or dismiss the original Complaint, as Exhibits 2 (MSA) and 3

(SOW). ECF No. 43. The Court may properly consider the agreement at this stage because it is

“integral” to the complaint. Schmidt, 770 F.3d at 249 (3d Cir. 2014).

6. In order to qualify for the Claim Price under the Complementary and Extender

Network Services, Company will pay or arrange to pay provider in accordance with

the terms of the contract between Supplier and provider or the Network Service

Vendor, as applicable, subject to any applicable state and federal law regarding

timely payment of claims.

7. Notwithstanding any other provision of this Agreement and SOW, Company

shall have the right to pay claims from providers in accordance with the applicable

benefit plans in lieu of accessing the Claim Price made available by Supplier.

Statement of Work 1-2, ECF No. 43-2. The Client Agreement also states that “[e]xcept as expressly

stated, this Agreement will not confer any rights or benefits upon any third party.” Master Services

Agreement ¶ 13.4, ECF No. 43-1.

Under the MultiPlan Network, ACLA performed the professional component of clinical

pathology services (“PCCP services”). Am. Compl. ¶¶ 55-60, ECF No. 94. PCCP services are

clinical laboratory oversight services that allow the laboratories to operate and perform clinical

tests.7 Id. at 2. These services are a “Covered Service” under the MPI Agreement. Id. ¶¶ 50, 71.

For “years,” Cigna reimbursed ACLA for PCCP services at the MPI Rate. Id. ¶ 60. To obtain

reimbursement for PCCP services performed for the benefit of Cigna enrollees, ACLA would

submit reimbursement claims using the corresponding Current Procedural Terminology (“CPT”)8

7 According to ACLA, these services include: “ensuring that tests, examinations, and

procedures are properly performed, recorded, and reported; interacting with members of the

medical staff regarding issues of laboratory operations, quality, and test availability; designating

protocols and establishing parameters for performances of clinical testing; recommending

appropriate follow-up diagnostic tests, when appropriate; supervising laboratory technicians and

advising technicians regarding aberrant results; selecting, evaluating, and validating test

methodologies; [and] directing, performing, and evaluating quality assurance and control

procedures …” Am. Compl. 2 n.2, ECF No. 94.

8 CPT codes are a “listing of descriptive terms and identifying codes for reporting medical

services and procedures performed by physicians” that was developed by the American Medical

Association (“AMA”). Current Procedural Terminology (CPT), Center for Medicare & Medicaid

Services (Apr. 2023), https://mmshub.cms.gov/measure-lifecycle/measure-specification/specify-

code/CPT [https://perma.cc/YYJ2-V75A].The purpose of the CPT coding system is to “provide a

uniform language that accurately describes medical, surgical, and diagnostic services, and thereby

code with “Modifier 26” appended to indicate it was billing for only the professional component

of the service, and Cigna would reimburse ACLA directly for the PCCP services.9 See id. ¶¶ 22-

25, 55-60. In the fall of 2021, however, Cigna informed providers that, effective November 2021,

it would deny reimbursement claims for PCCP services submitted with Modifier 26 “when the

facility [i.e., the hospital] is contractually responsible for laboratory management and oversight

services” (the “Denial Notice”). Id. ¶ 64. Cigna advised providers that it would pay hospitals a

“global fee” for the clinical pathology services provided—i.e., a fee that includes both the

professional and the technical component for the underlying services provided. Id. ¶ 66. But

according to ACLA, payment of a global fee is appropriate only when the hospital is entitled to

bill and receive payment for both the professional and technical component of the underlying

service.10 Id. ACLA alleges that is not the case here because its pathologists are not employees of

the hospitals. Id.

After receiving notice of Cigna’s change in policy, ACLA objected and attempted to

negotiate with Cigna to no avail. Id. at 4. In October or November 2021, Cigna began denying

payment to ACLA for PCCP reimbursement claims, while continuing to pay ACLA’s other

reimbursement claims at the MPI Rate. Id. ¶¶ 61, 68. Cigna claims it has reimbursed the hospitals

for PCCP services and will not separately reimburse certain pathology groups like ACLA. Id. ¶

provides an effective means for reliable nationwide communication among physicians, patients,

and third parties.” Id.

9 Oral Arg. Audio at 1:01:00-1:02:20, ECF No. 137.

10 For example, ACLA alleges payment of a global fee would be permitted “[w]hen a

facility/institution/physician owns the equipment, purchases the supplies and employs a technician

to perform the procedure as well as a physician to interpret the results.” Am. Compl. ¶ 66, ECF

No. 94.

70. But ACLA denies that any of the hospitals it staffs have been separately reimbursed by Cigna

for PCCP services provided by ACLA. Id. In the spring of 2022, Cigna announced another policy

change, stating PCCP services would be reimbursed at a flat rate of $5 per test, which Cigna

considers to be the market value of the PCCP services. Id. ¶¶ 85, 87. After the announcement,

however, Cigna continued to deny ACLA payment for PCCP services and has not paid ACLA $5

per test—nor would ACLA accept payment in this amount.11 Id. ¶ 91.

ACLA alleges MultiPlan conspired with Cigna to breach its obligations to ACLA. Id. ¶¶

100-02. According to ACLA, under the MPI Agreement, MultiPlan has an obligation to require

Clients (like Cigna) to use the MPI Rate specified in the agreement, but instead MultiPlan

acquiesced to Cigna’s position that the Client Agreement gives Cigna the freedom not to pay the

contract rates. Id.

Based on the foregoing, ACLA filed this action against MultiPlan and Cigna.12 The case

was originally filed in the Middle District of Tennessee but was transferred to this Court in October

2023 based on a forum selection clause in the Client Agreement. ECF No. 89. ACLA filed an

Amended Complaint in December 2023, ACLA brings claims against Cigna for breach of contract

as a third-party beneficiary of the Client Agreement (Count III), breach of implied-in-fact contract

(Count V), breach of covenant of good faith and fair dealing (Count VI), unjust enrichment (Count

VIII), declaratory judgment (Count IX), and injunctive relief (Count X). Am. Compl. 28-30, 32-

37, 39-41, ECF No. 94. ACLA also brings claims against MultiPlan for breach of contract (Count

11 In its motion to dismiss, Cigna notes it had not yet implemented the new policy when

ACLA filed this lawsuit. Cigna Mem. Supp. Mot. Dismiss 4, ECF No. 113-1.

12 This action was filed by ACLA and a second plaintiff, Cumberland Pathology Associates,

PLLC, a Tennessee-based pathology group. Cumberland’s claims have been stayed pending

arbitration. ECF No. 39.

IV), breach of implied-in-fact contract (Count V), breach of covenant of good faith and fair dealing

(Count VII), and declaratory judgment (Count XI). Id. at 30-35, 37-39, 41-42. Both Defendants

moved to dismiss the Amended Complaint in February 2024. ECF Nos. 112, 113. The Court heard

oral argument on the motions on October 31, 2024. ECF No. 136.

STANDARD OF REVIEW

To withstand a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), “a

complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is

plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible when the facts pled “allow[] the

court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.

“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements,

do not suffice.” Id.

In evaluating a Rule 12(b)(6) motion, a district court must separate the legal and factual

elements of the plaintiff’s claims. Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009).

The court must assume the truth of all well-pleaded factual allegations, construe the facts and the

reasonable inferences therefrom “in a light most favorable to the [plaintiff,]” and “determine

whether they ‘plausibly give rise to an entitlement to relief.’” Oakwood Labs., LLC v. Thanoo, 999

F.3d 892, 904 (3d Cir. 2021) (quoting Iqbal, 556 U.S. at 679). The court may also consider

“exhibits attached to the complaint,” “matters of public record,” and documents “integral to or

explicitly relied upon in the complaint” at the motion to dismiss stage, without converting the

motion into one for summary judgment. Schmidt, 770 F.3d at 249 (emphasis, citation, and internal

quotation marks omitted).

DISCUSSION

A. MultiPlan’s Motion to Dismiss

MultiPlan moves to dismiss ACLA’s claims for breach of contract (Count IV), breach of

implied-in-fact contract (Count V), breach of covenant of good faith and fair dealing (Count VII),

and declaratory judgment (Count XI) against it for failure to state a claim. The motion will be

denied as to the breach of contract claim and granted as to all other claims.

At the outset, the motion will be granted as to the claim for breach of the covenant of good

faith and fair dealing (Count VII) because this is not an independent cause of action under

Tennessee law.13 Shah v. Racetrac Petroleum Co., 338 F.3d 557, 572 (6th Cir. 2003) (holding

“[b]reach of the implied covenant of good faith and fair dealing is not an independent basis for

relief” under Tennessee law); Brown v. Bd. of Educ. of Shelby Cnty. Schs., 47 F. Supp. 3d 665,

687 (W.D. Tenn. 2014) (same). The motion will also be granted as to the declaratory judgment

claim (Count XI) because it is duplicative of the breach of contract claim.14 Siegel v. Goldstein,

657 F. Supp. 3d 646, 662 (E.D. Pa. 2023) (finding that dismissal of declaratory judgment claim is

warranted when it “duplicate[s] other claims”).

As to the breach of contract claim, ACLA asserts MultiPlan breached the MPI Agreement

by failing to require Cigna to compensate ACLA for PCCP services pursuant to the terms of the

MPI Agreement. MultiPlan argues its duty to require Cigna to compensate ACLA at the MPI Rate

is only triggered if Cigna “accesses” the MultiPlan Network. MultiPlan Mem. Supp. Mot. Dismiss

8-11, ECF No. 112. MultiPlan asserts Cigna stopped accessing the MultiPlan Network when

13 The parties agree Tennessee law applies to ACLA’s contract-based claims against

MultiPlan because the MPI Agreement is governed by Tennessee law.

14 Federal law governs the declaratory judgment claim because it a remedy set forth by the

Declaratory Judgment Act, 28 U.S.C. § 2201. Aaron Enters., Inc. v. Fed. Ins. Co., 415 F. Supp. 3d

595, 599-600 (E.D. Pa. 2019).

Cigna’s Denial Notice became effective in November 2021.15 See id. Thus, MultiPlan owed no

such duty to ACLA under the MPI Agreement.

The interpretation of the contract is a question of law for the Court to decide. Bridgestone

Am.’s, Inc. v. Int’l Bus. Machines Corp., 172 F. Supp. 3d 1007, 1019 (M.D. Tenn. 2016). To allege

a breach of contract, a plaintiff must plead (1) the existence of an enforceable contract, (2)

nonperformance amounting to a breach of the contract, and (3) damages caused by the breach. Doe

v. Belmont Univ., 334 F. Supp. 3d 877, 890 (M.D. Tenn. 2018). Under Tennessee law, the “central

tenet of contract construction is that the intent of the contracting parties at the time of executing

the agreement should govern.” Planters Gin Co. v. Fed. Compress & Warehouse Co., 78 S.W.3d

885, 890 (Tenn. 2002).

The first step in interpreting a contract is to determine whether the whether the language

of the contract is ambiguous. Am. Reliable Ins. Co. v. Addington, 644 F. Supp. 3d 453, 457 (M.D.

Tenn. 2022). A contract is ambiguous if more than one reasonable interpretation exists. Int’l Paper

Co. v. Beazley Ins. Co., 731 F. Supp. 3d 1013, 1044 (W.D. Tenn. 2024) (citing Fisher v. Revell,

343 S.W.3d 776, 780 (Tenn. Ct. App. 2009)). If the language is ambiguous, a court may examine

extrinsic evidence to determine the intent of the parties, and the ambiguity is construed against the

drafter. Waste Servs. of Decatur, LLC v. Decatur Cnty., Tenn., 367 F. Supp. 3d 792, 807 (W.D.

Tenn. 2019); Crye-Leike, Inc. v. Carver, 415 S.W.3d 808, 816 (Tenn. Ct. App. 2011) (“Tennessee

courts adhere to the general rule that ambiguities in a contract are construed against the drafter.”).

However, if the contract is clear and unambiguous, the plain meaning of the terms controls. Action

Chiropractic Clinic, LLC v. Hyler, 467 S.W.3d 409, 412 (Tenn. 2015).

15 Oral Arg. Audio at 2:00:00-2:04:55, ECF No. 137.

At this stage, the Court finds the MPI Agreement is ambiguous because it contains

language supporting both parties’ interpretations of MultiPlan’s obligations. For example, section

4.7 of the MPI Agreement supports ACLA’s interpretation because it provides that MultiPlan “will

require” Cigna to reimburse ACLA at the “Contracted Rate” for “Covered Services” under the

MultiPlan Network. MPI Agreement 5, ECF No. 112. ACLA’s interpretation that MultiPlan’s

obligation is triggered when ACLA provides Covered Services through the MultiPlan Network is

reasonable based on this language. ACLA has sufficiently alleged that it provided PCCP services

to Cigna patients through the MultiPlan Network, and MultiPlan failed to “require” Cigna to pay

the MPI Rate for the PCCP services. In contrast, the permissive language of section 3.9 of the

MPI Agreement supports MultiPlan’s interpretation that its obligation depends on Cigna

“accessing” the Network. Section 3.9 provides, in relevant part, that ACLA “acknowledge[s] that

certain Programs offered by Clients accessing the Network … may cover Covered Services under

Participant’s Program at an in-Network or out-of-Network benefit level. Group [ACLA] and each

Participating Professional will comply with any Network specific requirements contained in

Exhibit B and/or the administrative handbook(s).” Id. at 4. The administrative handbook, in turn,

states that Cigna “may elect not to access” the MPI Agreement and, in such case, the MPI

Agreement “will not apply.” Administrative Handbook 8, ECF No. 112-2. However, neither the

MPI Agreement nor the handbook defines what it means for Cigna to “access” the MultiPlan

Network.16 ACLA has sufficiently alleged that Cigna “accessed” the Network based on the parties’

course of dealing. Further, at this stage, the ambiguity is properly resolved during fact discovery

16 Based on oral argument, the Court understands MultiPlan to be interpreting “access” to

depend on whether Cigna chooses to pay the MPI Rate after ACLA has already performed the

service, but neither the MPI Agreement nor administrative handbook clearly supports that

interpretation.

and is construed against MultiPlan, which drafted the MPI Agreement. See ChampionX, LLC v.

Resonance Sys., Inc., 726 F. Supp. 3d 786, 821 (E.D. Tenn. 2024) (stating “when a contract is

ambiguous, a court should not interpret the contract at the motion to dismiss stage” (internal

quotation marks and citation omitted)). Accordingly, the motion to dismiss will be denied as to the

breach of contract claim (Count IV).

However, the motion will be granted as to the breach of implied-in-fact contract claim

(Count V) because the MPI Agreement is a valid and enforceable contract between MultiPlan and

ACLA on the same subject matter. Ingram Barge Co., LLC v. Bunge N. Am., Inc., 455 F. Supp. 3d

558, 577 (M.D. Tenn. 2020) (“A contract cannot be implied, however, where a valid contract exists

on the same subject matter”) (quoting Jaffe v. Bolton, 817 S.W.2d 19, 26 (Tenn. Ct. App. 1991));

Nissan N. Am., Inc. v. Cont’l Auto. Sys., Inc., 503 F. Supp. 3d 555 (M.D. Tenn. 2020) (same).

B. Cigna’s Motion to Dismiss

Cigna also moves to dismiss all claims against it: ACLA’s claims for breach of contract as

a third-party beneficiary of the Client Agreement (Count III), breach of implied-in-fact contract

(Count V), breach of covenant of good faith and fair dealing (Count VI), unjust enrichment (Count

VIII), declaratory judgment (Count IX), and injunctive relief (Count X). The motion will be

granted as to all claims except the third-party beneficiary breach of contract and unjust enrichment

claims.

At the outset, the motion will be granted as unopposed as to the breach of covenant of good

faith and fair dealing and injunctive relief claims (Counts VI and X).17 The motion will also be

granted as to the declaratory judgment claim (Count IX) because it is duplicative of the breach of

contract claim. Siegel, 657 F. Supp. 3d at 662.

17 See ACLA Opp’n Cigna Mot. Dismiss 4 n.6, ECF No. 120.

As to the remaining claims, Cigna initially raises two global issues. First, Cigna argues the

Amended Complaint should be dismissed for failure to comply with Federal Rule of Civil

Procedure 8 because it contains no information about the individual reimbursement claims on

which ACLA seeks recovery. Alternatively, Cigna seeks a more definite statement under Rule

12(e). Second, Cigna argues ACLA’s claims are preempted by the Employee Retirement Income

Security Act of 1974 (ERISA) to the extent they involve Cigna’s failure to pay claims under health

plans subject to ERISA. Both arguments fail.

A pleading is sufficient under Rule 8 if it contains “a short and plain statement of the claim

showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The pleading “need only give

the defendant fair notice of what the ... claim is and the grounds upon which it rests.” Erickson v.

Pardus, 551 U.S. 89, 94 (2007) (internal quotation marks and citation omitted). The Amended

Complaint contains sufficient information to give Cigna notice of the reimbursement claims at

issue. ACLA asserts the breach of contract claim is based on Cigna’s denial of reimbursement

claims for PCCP services submitted with Modifier 26 that were denied starting “[i]n or about

October or November 2021” on the basis of Cigna’s Denial Notice. Am. Compl. ¶¶ 63-68, ECF

No. 94. These are claims ACLA submitted to Cigna, which Cigna denied for a specific, identifiable

reason. This information is adequate to put Cigna on notice about the claims at issue. Accordingly,

the Rule 8 argument lacks merit.

The Court also rejects Cigna’s ERISA preemption argument. Section 514(a) of ERISA

preempts state law claims that “relate to” an ERISA plan. 29 U.S.C. § 1144(a); Ingersoll-Rand Co.

v. McClendon, 498 U.S. 133, 142 (1990). A state law claim “relates to an ERISA plan if it has a

connection with or reference to such a plan.” Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141,

147 (2001) (internal quotation marks and citation omitted). To determine whether ERISA preempts

the claims, the Court must find: (1) ACLA could have brought the claims under ERISA, and (2)

no other independent duty supports the claims. Pascack Valley Hosp. v. Loc. 464A UFCW Welfare

Reimbursement Plan, 388 F.3d 393, 400 (3d Cir. 2004).

ACLA asserts its claims against Cigna are not preempted because they are based on an

independent contractual relationship with Cigna as a result of the Multiplan Network agreements.

ACLA’s pleading makes clear that the breach of contract claims against Cigna are for

reimbursement claims for PCCP services provided pursuant to the MultiPlan Network that (1)

Cigna denied reimbursement starting in October or November 2021, (2) Cigna stated the basis for

the denial was the Denial Notice and/or Modifier 26, and (3) ACLA expressly pleads it does not

seek benefits under ERISA. See Plastic Surgery Ctr., P.A. v. Aetna Life Ins. Co., 967 F.3d 218,

230-35 (3d Cir. 2020) (finding that provider plausibly stated breach of contract claims that were

not preempted by ERISA because of alleged contractual relationship for payor to pay provider for

alleged services). As pleaded, Cigna reimbursed ACLA for these same services, pursuant to the

MPI Rate, in the years leading up to implementation of the Denial Notice. Viewing the allegations

in light most favorable to ACLA, the claims do not require the interpretation of ERISA plans

because the plans are not “critical factor[s] in establishing liability.”18 See Ingersoll-Rand Co. v.

McClendon, 498 U.S. 133, 139 (1990).

Turning to the breach of contract claims, because there is no direct contract between ACLA

and Cigna, ACLA relies on two alternative theories: (1) ACLA is a third-party beneficiary of the

18 To the extent some of ACLA’s reimbursement claims may be covered by ERISA, that is a

fact-intensive issue to be resolved during discovery. See Plastic Surgery Ctr., P.A., 967 F.3d at

234 (holding “reference to an ERISA plan in the calculation of damages” does not trigger

preemption if all that is required is a cursory examination of the plan).

of the Client Agreement between Cigna and Multiplan, and (2) ACLA, MultiPlan, and Cigna have

an implied-in-fact contract.

To attain third-party beneficiary status under Pennsylvania law, either (1) both parties to

the contract must have affirmatively expressed an intention in the contract itself that the third party

be a beneficiary, or (2) the circumstances must be so compelling that recognition of the

beneficiary’s right is appropriate to effectuate the intention of the parties and the performance must

satisfy an obligation of the promisee to the beneficiary.19 Bunis v. Masha Mobile Moving &

Storage, LCC, 674 F. Supp. 3d 186, 194 (E.D. Pa. 2023); M.S. ex rel. Michelle M.S. v. Cedar

Bridge Mil. Acad., 904 F. Supp. 2d 399, 412 (M.D. Pa. 2012). However, “a contract that expressly

disclaims intent to create third-party beneficiaries” is generally effective in excluding third parties

from invoking rights in the agreement. Medevac MidAtlantic, LLC v. Keystone Mercy Health Plan,

817 F. Supp. 2d 515, 527-28 (E.D. Pa. 2011); see also In re NCB Mgmt. Servs., Inc. Data Breach

Litig., Civ. No. 23-1236, 2024 WL 4160349, at *7 (E.D. Pa. Sept. 11, 2024) (finding “parties to a

contract are permitted to expressly disclaim the existence of intended third-party beneficiaries”

under Pennsylvania law).

ACLA argues it is an intended third-party beneficiary of the Client Agreement because the

Client Agreement requires Cigna to directly pay providers for services at the MPI Rate and Cigna

cannot perform its duties under the agreement without providing direct benefits to MultiPlan

Network providers, such as ACLA. ACLA Opp’n Cigna Mot. Dismiss 9-10, ECF No. 120. Cigna

disputes this, noting the Client Agreement expressly disclaims conferring any third-party

beneficiary rights, and that Cigna only has obligations to MultiPlan Network providers if it

19 The parties agree that Pennsylvania law applies to ACLA third-party beneficiary claim

because it requires construction of the Client Agreement, which has a choice-of-law provision

specifying that Pennsylvania law governs. See Master Services Agreement ¶ 13.7, ECF No. 43-1.

accesses the MultiPlan Network. Cigna Mem. Supp. Mot. Dismiss 9-10, ECF No. 113-1; Cigna

Reply 4-5, ECF No. 120. The Court agrees that Cigna has obligations to MultiPlan Network

providers if it accesses the network. At this stage, however, ACLA has plausibly alleged that Cigna

accessed the Network based on the parties’ course of dealing. According to ACLA, it provided

PCCP services to Cigna patients under the MultiPlan Network, as it had done for years prior to

October or November 2021. The only difference is that Cigna stopped paying for the services

starting in October or November 2021. While Cigna offers a different interpretation, the Client

Agreement does not clarify what “access” means.20 See Client Agreement, ECF Nos. 43-1 and 43-

2. The Client Agreement is therefore ambiguous because while it disclaims third-party beneficiary

rights in the MSA (“[e]xcept as expressly stated, this Agreement will not confer any rights or

benefits upon any third party”), it confers such rights in the SOW (“[Cigna] will pay or arrange to

pay provider in accordance with the terms of the contract between [MultiPlan] and provider or the

Network Service Vendor”). See Bohler-Uddeholm Am., Inc. v. Ellwood Grp., Inc., 247 F.3d 79,

93 (3d Cir. 2001) (holding a contract is ambiguous if “it is reasonably or fairly susceptible of

different constructions”); see also Chambers v. Chesapeake Appalachia, L.L.C., 359 F. Supp. 3d

268, 281 (M.D. Pa. 2019) (“Courts are better positioned to tease out ambiguities on summary

judgment.”). Viewing the allegations in light most favorable to ACLA, the Amended Complaint

plausibly suggests Cigna accessed the MultiPlan Network, triggering its obligation to pay ACLA

for PCCP services at the MPI Rate. Because Cigna failed to pay ACLA, Cigna’s motion will be

denied as to this claim.

20 Based on the briefing and oral argument, the Court understands that Cigna, like MultiPlan,

interprets “access” as depending on whether Cigna chooses to pay the MPI rate after ACLA has

already performed the service. This definition, however, does not appear in the Client Agreement,

nor is it the only reasonable interpretation of the agreement.

ACLA next argues Cigna breached a valid, implied-in-fact contract between the parties.21

Under Tennessee law, an implied-in-fact contract can “arise under circumstances which, according

to the ordinary course of dealing and common understanding ... show a mutual intention to

contract.” Nissan N. Am., Inc. v. Cont’l Auto. Sys., Inc., 503 F. Supp. 3d 555, 566 (M.D. Tenn.

2020) (quoting Metro. Gov’t of Nashville & Davidson Cnty. v. Cigna Healthcare of Tenn., Inc.,

195 S.W.3d 28, 32 (Tenn. Ct. App. 2005)). For an implied-in-fact contract to be enforceable, it

“must be sufficiently definite” and supported by mutual assent and consideration. PB&J Towing

Serv., I&II, LLC v. Hines, 487 F. Supp. 3d 695, 704 (W.D. Tenn. 2020) (internal quotation marks

and citation omitted); see also AMISUB (SFH), Inc. v. Cigna Health & Life Ins. Co., 681 F. Supp.

3d 842, 853 (W.D. Tenn. 2023). There must be a “benefit conferred upon the defendant by the

plaintiff, appreciation by the defendant of such benefit, and acceptance of such benefit under such

circumstances that it would be inequitable for him to retain the benefit without payment of the

value thereof.” Layne Christensen Co. v. City of Franklin, Tenn., 449 F. Supp. 3d 748, 757 (M.D.

Tenn. 2020). However, an implied-in-fact contract is terminable at will by either party with

reasonable notice. First Flight Assocs., Inc. v. Pro. Golf Co., 527 F.2d 931, 935 (6th Cir. 1975)

(“Contracts silent on time of termination are generally terminable at will by either party with

reasonable notice”); McReynolds v. Cherokee Ins. Co., 896 S.W.2d 777, 779 (Tenn. Ct. App.

1994).

This claim will be dismissed because the facts alleged show Cigna properly terminated any

implied-in-fact contract that may have existed between the parties. For years, ACLA provided

PCCP services to Cigna patients under the MultiPlan Network and received reimbursement from

21 The parties agree that Tennessee law applies to this claim because it is based on the parties’

alleged conduct. The alleged services were performed in Tennessee.

Cigna at the MPI Rate. The circumstances of this relationship demonstrate a common

understanding between the parties based on a defined exchange of services and payments. ACLA’s

services were limited to the services outlined in the MPI Agreement and Cigna’s reimbursement

reflected the rates set forth in that Agreement. Because any implied-in-fact contract between the

parties did not have a termination date, however, Cigna could terminate it, which it did by issuing

its Denial Notice. According to the Amended Complaint, ACLA received notice of the Denial

Notice in the “fall of 2021,” before it became effective. Am. Compl. ¶ 64, ECF No. 94. In fact,

before the policy was implemented, ACLA tried to negotiate with Cigna regarding the Denial

Notice and failed. ACLA notes that after the Denial Notice was issued, Cigna continued to pay for

Covered Services other than PCCP services at the MPI Rate, but this, at best, shows the parties

potentially assented to a new implied contract that did not include the PCCP services. See Bristol

Anesthesia Servs., P.C. v. Carilion Clinic Medicare Res., LLC, Civ. No. 2:15-17, 2018 WL

1512932, at *6-7 (E.D. Tenn. Mar. 26, 2018) (finding that an insurer’s unilateral change in

reimbursement rate terminated an implied-in-fact contract at the original rate and potentially

“manifested mutual assent enough to find that a second implied-in-fact contract was created

between the parties,” before ultimately ruling that no such second contract was created). The

Amended Complaint makes clear that the implied-in-fact contract for the PCCP services was

terminated by Cigna. Accordingly, Cigna’s motion will be granted as to this claim.

Finally, in the alternative, ACLA brings a claim for unjust enrichment against Cigna for its

failure to pay ACLA for PCCP services.22 To recover for unjust enrichment under Tennessee law,

22 The parties agree that Tennessee law applies to this claim because it is based on the parties’

alleged conduct. The alleged PCCP services were performed in Tennessee. Further, at this stage,

ACLA can pursue the unjust enrichment claim as an alternative to the third-party beneficiary

claim. Iron Horse Energy Servs., Inc. v. S. Concrete Prods., Inc., 443 F. Supp. 3d 952, 958 (W.D.

a plaintiff must establish “(1) a benefit conferred upon a defendant by a plaintiff, (2) appreciation

by the defendant of such benefit, and (3) acceptance of such benefit under such circumstances that

it would be inequitable for him to retain benefit without payment of the value thereof.” Freeman

Indus., LLC v. Eastman Chem. Co., 172 S.W.3d 512, 525 (Tenn. 2005) (internal quotation marks

and citation omitted). “The Tennessee Supreme Court has noted that the most significant

requirement in a claim for unjust enrichment is that the enrichment to the defendant be unjust.”

Doe v. Belmont Univ., 334 F. Supp. 3d 877, 905 (M.D. Tenn. 2018) (internal quotation marks and

citation omitted). ACLA alleges it provided PCCP services for the benefit of Cigna’s enrollees as

required by the MultiPlan Network agreements, Cigna received reimbursement claims from ACLA

for the PCCP services, and Cigna refused to pay for the PCCP services. Am. Compl. ¶¶ 211-218,

ECF No. 94. Further, ACLA alleges the MPI Agreement prohibits it from seeking payments

directly from Cigna enrollees. MPI Agreement 6, ECF No. 112 ([N]either Group [ACLA] nor any

Participating Professional will bill or require any Participant [Cigna enrollee] to tender any

payment with respect to Covered Services.”). Accordingly, ACLA has sufficiently alleged an

unjust enrichment claim against Cigna. Compare River Park Hosp., Inc. v. BlueCross BlueShield

of Tenn., Inc., 173 S.W.3d 43, 58-60 (Tenn. Ct. App. 2002) (affirming trial court’s finding that

insurer was unjustly enriched by provider’s provision of services to insurer’s enrollees), with HCA

Health Servs. of Tenn., Inc. v. Bluecross Blueshield of Tenn., Inc., Civ. No 2014-01869, 2016 WL

3357180, at *10 (Tenn. Ct. App. June 9, 2016) (affirming summary judgment dismissal of an

unjust enrichment claim, in part, because the provider “can seek payment directly from the

[insurer’s enrollees] it has treated.”).

Tenn. 2020) (finding the plaintiff is allowed to plead an unjust enrichment claim in the alternative

where there is a dispute as to the existence and terms of any contract between the parties)

CONCLUSION

In sum, MultiPlan’s motion will be denied as to the breach of contract claim and granted

as to all other claims. Cigna’s motion will be denied as to the third-party beneficiary breach of

contract and unjust enrichment claims and granted as to all other claims.

An appropriate Order follows.

BY THE COURT:

/s/ Juan R. Sánchez

Juan R. Sánchez, J.