King

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UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF LOUISIANA

ALEXANDRIA DIVISION

LAUREN KING ET AL, CIVIL DOCKET NO. 1:25-CV-01312

Plaintiff

VERSUS JUDGE EDWARDS

CRYSTAL A THOMAS ET AL, MAGISTRATE JUDGE PEREZ-MONTES

Defendants

REPORT AND RECOMMENDATION

Plaintiffs Lauren King, Delta Med Clinic LLC, Delta Skin Care LLC, and JDB

Enterprises move to remand this action to the Seventh Judicial District Court in

Catahoula Parish, Louisiana, arguing that their Petition asserts only Louisiana-law

causes of action and that the references to federal statutes, regulations, and programs

do not create federal-question jurisdiction. ECF No. 22 at 1–2.. Defendants oppose

remand and contend that Plaintiffs’ claims—including their civil conspiracy and

fraud theories—depend on federal law because the Petition repeatedly invokes

federal criminal statutes, HIPAA and its Privacy Rule, Medicare and Medicaid, and

other federal programs and agencies. ECF No. 30 at 1–4.

The balance of jurisprudence is clear on the controlling point here: the presence

of a federal statute or regulation as an element of a state law tort claim—particularly

where an enforcement mechanism is absent—is not itself sufficient to preclude

remand. Therefore, IT IS RECOMMENDED that Plaintiffs’ Motion to Remand (ECF

No. 22) be GRANTED and that this matter be REMANDED to the Ninth Judicial

District Court, Rapides Parish, Louisiana. IT IS FURTHER RECOMMENDED that

Defendants’ Motions for More Definite Statement (ECF Nos. 7, 8, 9, 17) be DENIED

AS MOOT.

I. Background

Plaintiffs filed this lawsuit in the Seventh Judicial District Court for the Parish

of Catahoula, Louisiana, on July 31, 2025. ECF No. 1 at 2. Plaintiffs—a medical clinic

and its owners— seek various forms of relief against their former billing contractor

and former employees for allegedly conspiring to misappropriate patient data and

trade secrets, hijack the clinic's electronic billing portal, and fraudulently divert

insurance claims to a secretly-formed competing entity. Plaintiffs served Defendant

Crystal Thomas on August 6, 2025. ECF No. 1 at 1. Defendant Thomas filed a notice

of removal to this Court on September 5, 2025, asserting federal question jurisdiction

under 28 U.S.C. § 1331. ECF No. 1 at 2. The case was assigned to Judge Jerry

Edwards, Jr. and referred to this Court. ECF No. 2.

On September 9, 2025, this Court issued an electronic jurisdictional review

finding that subject matter jurisdiction appeared to exist under 28 U.S.C. § 1331.

ECF No. 4. Defendant Thomas filed an answer on September 12, 2025. ECF No. 5.

On September 15, 2025, defendant Mallorie Parham filed a motion to dismiss for

failure to state a claim and a motion for more definite statement. ECF Nos. 6, 7. That

same day, defendants CT Advising, L.L.C., and Louisiana Mind Body & Health,

L.L.C. each filed motions for more definite statement. ECF Nos. 8, 9. Defendant

Megan Lurry was granted leave to file a motion for more definite statement on

September 19, 2025. ECF Nos. 15, 16, 17.

Plaintiffs filed a motion to remand on September 24, 2025. ECF No. 22.

Defendants filed a joint opposition on October 13, 2025. ECF No. 30. Plaintiffs filed a

reply on October 20, 2025. ECF No. 34. On April 16, 2026, Judge Edwards denied

without prejudice defendant Parham's motion to dismiss. ECF No. 35.

Plaintiff King is an Advanced Practice Registered Nurse – Certified Nurse

Practitioner licensed by the Louisiana State Board of Nursing. ECF No. 1-1 at 8. King

is the sole member of Delta Med Clinic, which she formed on August 4, 2020. ECF

No. 1-1 at 8. Delta Med Clinic owns and operates from 1305 4th Street, Suite A,

Jonesville, Louisiana. ECF No. 1-1 at 8. Delta Med Clinic provides primary health

services and became a certified Rural Health Clinic on October 1, 2024. ECF No. 1-1

at 8–9.

Delta Med Spa, formed on October 31, 2023, provides medical aesthetic

services from 1305 4th Street, Suite B, Jonesville. ECF No. 1-1 at 9. King formed JDB

Enterprises, L.L.C. d/b/a Delta Derm on November 12, 2024, as a medical clinic

focused on wound care. ECF No. 1-1 at 10.

Delta Med Clinic hired Lurry as a receptionist in August 2023 and promoted

her to office manager in January 2025. ECF No. 1-1 at 10–11. Lurry's responsibilities

included overseeing employees, paying bills, and credentialing providers. ECF No. 1-

1 at 11. On August 1, 2024, Lurry signed a non-disclosure agreement prohibiting

disclosure of confidential information, including protected health information. ECF

No. 1-1 at 11.

Parham was hired as a physician assistant in April 2024. ECF No. 1-1 at 11–

12. Parham's duties included patient care and compliance with billing procedures for

Medicare, Medicaid, and other payers. ECF No. 1-1 at 12. Parham also signed a non-

disclosure agreement on August 1, 2024. ECF No. 1-1 at 12.

On July 23, 2024, Delta Med Clinic and CT Advising entered into a billing and

collection services agreement. ECF No. 1-1 at 12–13. Crystal Thomas is the sole

owner of CT Advising. ECF No. 1-1 at 12. Under the billing agreement, CT Advising

was to submit claims, follow up on denials, deposit collections into Delta Med Clinic's

account, and maintain records confidentially. ECF No. 1-1 at 12–13. The billing

agreement also included a HIPAA business associate addendum. ECF No. 1-1 at 13.

Plaintiffs allege that Thomas formed Louisiana Mind Body & Health, L.L.C.

on November 14, 2024, using Delta Med Clinic's property address—1305 4th Street,

Jonesville, Louisiana 71343—as LMBH's domicile address, without authorization.

ECF No. 1-1 at 14. Plaintiffs allege that Thomas, CT Advising, and LMBH submitted

applications to credential King, Parham, and Dr. Patel through LMBH with

Louisiana Medicaid and other payers without authorization. ECF No. 1-1 at 15–16.

Plaintiffs allege that on or about May 1, 2025, Blue Cross Blue Shield Federal

Employee Program sent correspondence to LMBH in response to a claim LMBH

submitted for services rendered to a Delta Med Clinic patient. ECF No. 30 at 4.

Plaintiffs allege that Lurry accessed and downloaded all of Delta Med Clinic's

patient demographics on April 2, 2025, then resigned at lunch that day. ECF No. 1-1

at 27. Parham resigned on April 23, 2025. ECF No. 1-1 at 27. But on April 29, 2025,

LMBH allegedly posted on Facebook that it was accepting new patients and identified

Parham as a provider. ECF No. 1-1 at 27–28.

On May 9, 2025, Thomas filed a petition for protection from stalking or sexual

assault against King in the Ninth Judicial District Court for the Parish of Rapides.

ECF No. 1-1 at 28. Plaintiffs allege the petition made salacious statements about

King and was malicious and frivolous. ECF No. 1-1 at 28–29.

The state court petition asserts ten counts: (I) trade secret misappropriation,

(II) fraud, (III) breach of contract, (IV) breach of fiduciary duty, (V) breach of duty of

fidelity and loyalty, (VI) civil conversion and theft, (VII) Louisiana Unfair Trade

Practices Act violations, (VIII) tortious interference with business relations, (IX)

malicious prosecution, and (X) civil conspiracy under Louisiana Civil Code article

2324. ECF No. 1-1 at 6. Throughout the petition, plaintiffs reference the Health

Insurance Portability and Accountability Act (“HIPAA”), Medicare, Medicaid, and

federal criminal statutes 18 U.S.C. §§ 666, 1341, and 1343. ECF No. 30 at 4–5. But

not causse of action directly relies upon federal law as its basis.

II. Law and Analysis

A. Legal Standard

Federal courts are courts of limited jurisdiction. Under 28 U.S.C. § 1441(a), a

defendant may remove only a civil action of which the district courts have original

jurisdiction. The removing party bears the burden of showing that federal jurisdiction

exists and that removal was proper. Any doubt as to the propriety of removal must

be resolved against federal jurisdiction. "If there is “any doubt about the propriety of

removal,” it “must be resolved in favor of remand.”

, No. 2:25-CV-00867, 2025 WL 2816749, at *1 (W.D. La. Aug. 19, 2025),

No. 2:25-CV-00867, 2025 WL 2884829 (W.D. La. Oct. 9,

2025) ( , 491 F.3d 278, 281-82 (5th Cir. 2007)).

Federal district courts have original jurisdiction over civil actions arising

under the Constitution, laws, or treaties of the United States. 28 U.S.C. § 1331. A

federal question exists only when a well-pleaded complaint establishes either that

federal law creates the cause of action or that the plaintiff’s right to relief necessarily

depends on resolution of a substantial question of federal law.

, 538 F.3d 334, 337–38 (5th Cir. 2008);

, 850 F.3d 714, 721 (5th Cir. 2017). The

mere presence of a federal issue in a state-law cause of action does not automatically

confer federal-question jurisdiction. , 538 F.3d at 338.

Where state law creates the cause of action, federal-question jurisdiction exists

only in a limited category of cases:

The fact that a substantial federal question is necessary to the

resolution of a state-law claim is not sufficient to permit federal

jurisdiction: “ ... did not purport to disturb the long-

settled understanding that the mere presence of a federal issue in a state

cause of action does not automatically confer federal-question

jurisdiction.” 478 U.S. 804, 813,

106 S.Ct. 3229, 92 L.Ed.2d 650 (1986). Likewise, “the presence of a

disputed federal issue ... [is] never necessarily dispositive.”

545 U.S. 308, 314, 125

S.Ct. 2363, 162 L.Ed.2d 257 (2005). Instead, “[f]ar from creating some

kind of automatic test, thus candidly recognized

the need for careful judgments about the exercise of federal judicial

power in an area of uncertain jurisdiction.” 478 U.S. at

814, 106 S.Ct. 3229.

If, however, the standard for federal question jurisdiction is no

“automatic test,” what sort of test is it? Although the Court's answer has

at times been less than pellucid,3 it recently summed up the requisite

inquiry: “[T]he question is, does a state-law claim necessarily raise a

stated federal issue, actually disputed and substantial, which a federal

forum may entertain without disturbing any congressionally approved

balance of federal and state judicial responsibilities.” 545 U.S.

at 314, 125 S.Ct. 2363. In other words, federal question jurisdiction

exists where (1) resolving a federal issue is necessary to resolution of the

state-law claim; (2) the federal issue is actually disputed; (3) the federal

issue is substantial; and (4) federal jurisdiction will not disturb the

balance of federal and state judicial responsibilities."

538 F.3d at 338. In fact, when Congress has not created a private federal cause

of action for the federal statute at issue, that circumstance counsels against finding

jurisdiction based on an embedded federal issue. at 338–39; 1

B. Application

This matter was removed because it allegedly presents a federal question

under 28 U.S.C. § 1331. ECF No. 1. Defendants relied on the Petition’s references to

18 U.S.C. §§ 666, 1341, and 1343, and asserted that Plaintiffs’ right to relief

necessarily depends on resolution of a substantial question of federal law. ECF No. 1

at 2. Plaintiffs then moved to remand. ECF No. 22; ECF No. 14 at 6.

1 These principles apply with particular force in removed cases. If subject-matter jurisdiction

is lacking, the case must be remanded. 28 U.S.C. § 1447(c);

, 79 F.4th 444, 446–48 (5th Cir. 2023); , 79 F.4th at 448.

In deciding that motion, the Court looks to the face of the state-court Petition

attached to the Notice of Removal. See ECF No. 1-1; , 538 F.3d at 337. On its

face, the Petition does not plead any cause of action created by, or arising directly

from, federal law. Rather, Plaintiffs seek relief under Louisiana law for trade-secret

misappropriation, fraud, breach of contract, breach of the duty of fidelity and loyalty,

conversion and theft, tortious interference with business relations, LUTPA

violations, malicious prosecution, and civil conspiracy. ECF No. 1-1 at 6; ECF No. 1-

2 at 23–39. Every cause of action is a Louisiana tort claim.

The factual allegations do repeatedly reference HIPAA, Medicare, Medicaid,

and federal payer or credentialing systems. Plaintiffs allege, for example, that Delta

Med Clinic is a covered entity under the HIPAA Privacy Rule, that Delta Med Clinic

and its employees and business associates were subject to HIPAA, and that CT

Advising was a business associate under HIPAA. ECF No. 1-1 at 8–13. Plaintiffs also

allege unauthorized credentialing activity, misuse of clearinghouse and electronic

health-record systems, and submission or diversion of claims involving Medicare,

Medicaid, and private payers. ECF No. 1-1 at 15–23. But those allegations do not, on

their own, create a federal cause of action.

The Petition’s LUTPA allegations are central to defendants’ removal theory.

In that count, Plaintiffs allege that defendants’ conduct violated, among other

provisions, 18 U.S.C. §§ 666, 1341, and 1343, HIPAA, and Louisiana criminal

statutes, and that the conduct therefore constitutes unfair or deceptive acts or

practices under Louisiana law. ECF No. 1-2 at 34–37. Even so, the pleaded cause of

action is a LUTPA claim, and the relief sought is under Louisiana law. ECF No. 1-2

at 34, 37. The same is true of the Petition as a whole. It invokes federal laws and

regulations as part of the factual narrative and as alleged benchmarks of wrongful

conduct.

That, however, is not enough. A state-law claim does not arise under federal

law simply because it references federal law, or because federal standards may inform

whether the conduct was wrongful. , 538 F.3d at 337–39;

, No. 6:21-CV-00982, 2022 WL 331228, at *2 (W.D. La. Feb. 3, 2022)

(“[P]laintiff must show that‘Congress intended to create, either expressly or by

implication, a private cause of action. . . . Notably, criminal statutes do not create

private causes of action that would establish federal question jurisdiction.”) (internal

citation and quotation omitted). The question is whether federal law creates the claim

or, in the broadest iteration, whether the plaintiff’s right to relief necessarily depends

on resolving a substantial federal issue. , 538 F.3d at 337–38. On the face of

this Petition, neither condition is met.

Here, neither condition is met. No federal statute creates any of Plaintiffs’

claims. For example, HIPAA does not create a private cause of action. ,

470 F.3d 569, 571–72 (5th Cir. 2006). This Court has previously applied that principle

in the removal context. In the court remanded a

removed case after concluding that an alleged HIPAA violation embedded in state-

law breach-of-contract and tort claims did not create federal-question jurisdiction.

See No. 09-0277, 2009 WL 2835778, at The Court

explained that treating such references as sufficient would improperly federalize

state-law disputes that only incidentally allege violation of a federal statute. at

*3;

The same reasoning applies here. Plaintiffs allege that Delta Med Clinic is a

HIPAA-covered entity, that its employees and business associates were subject to

HIPAA, and that defendants misused patient information and related systems in

ways Plaintiffs characterize as wrongful. ECF No. 1-1 at 8–13; ECF No. 1-2 at 35, 37.

But because HIPAA provides no private cause of action, its alleged violation does not

itself supply federal-question jurisdiction. , 470 F.3d at 571–72; , 2009

WL 2835778, at *2–3. Even if proof of conduct inconsistent with HIPAA is one

component of Plaintiffs’ state-law theories, that does not convert those theories into

federal claims. , No. 23-30350, 2024 WL

3094598 (5th Cir. May 13, 2024) (affirming remand of Louisiana hospital privacy suit

where HIPAA-related allegations did not satisfy federal-officer removal requirements

and belonged in state court; , No. CV 24-303-JWD-EWD,

2024 WL 3094598, at 2 (M.D. La. June 21, 2024))(remanding where defendants failed

to show a substantial, actually disputed federal issue embedded in plaintiff’s state-

law claims); , No. 20-192-SDD-SDJ, 2021 WL

4143932 (M.D. La. Sept. 13, 2021) (remanding and holding that references to HIPAA

and other federal provisions in support of state-law claims did not transform those

claims into federal ones or create federal-question jurisdiction).

Nor do the Petition’s references to federal criminal statutes change the

analysis. The Notice of Removal relied heavily on the Petition’s allegations that

Defendants conspired to violate 18 U.S.C. §§ 666, 1341, and 1343. ECF No. 1 at 2.

But those statutes are not pleaded as causes of action. They appear in the LUTPA

count as part of Plaintiffs’ theory that defendants’ conduct offended established public

policy and was immoral, unethical, oppressive, or unscrupulous. ECF No. 1-2 at 34–

37. That use of federal criminal statutes as alleged standards or illustrations of

wrongful conduct under state law does not create federal-question jurisdiction.

. No. 09-0277, 2009 WL 2835778 at .

Defendants also argue that federal jurisdiction exists because Plaintiffs’ civil-

conspiracy allegations depend on proving unlawful conduct defined by federal law.

But that argument also falls short of supporting federal jurisdiction. The actionable

element is the underlying intentional or willful act that the conspirators agreed to

commit and actually committed. , 71 F.4th 278, 293 (5th Cir. 2023);

, 38 So. 3d 987, 991 (La. App. 4 Cir. 2010). So the

jurisdictional question remains the same: whether Plaintiffs’ right to relief on their

Louisiana claims necessarily depends on the resolution of a substantial federal issue.

Here it does not. The Petition can be read as alleging that defendants agreed to

commit state-law wrongs—fraud, conversion, unfair trade practices, breach of

contractual and fiduciary obligations, and related intentional acts—even though the

facts include alleged misuse of HIPAA-regulated information and federal healthcare

billing mechanisms. But that does not place the case in the narrow category described

above.

The Court also is not persuaded by defendants’ references to Medicare and Medicaid.

The Petition does allege misuse of Medicaid credentialing forms, Medicare billing

pathways, private-payer enrollments, and claim-routing information. ECF No. 1-1 at

15–23. But the core dispute remains one between private parties over alleged misuse

of confidential information, unauthorized credentialing, diversion of receivables,

interference with business operations, and unfair competition. The Petition does not

seek judicial review of agency action, does not name a federal agency or officer, and

does not assert a federal reimbursement claim. As pled, the federal healthcare

components are part of the factual mechanism of the alleged wrongdoing, not

independent claims arising under federal law.

That distinction matters. In , the Fifth Circuit reiterated

that only a “small and special category” of state-law cases arises under federal law.

850 F.3d at 721. And in , the Supreme Court emphasized that even a necessarily

raised federal issue is not enough unless it is substantial in the relevant jurisdictional

sense and capable of federal resolution without upsetting the federal-state balance.

568 U.S. at 258. Here, recognizing federal jurisdiction would significantly expand §

1331 by sweeping into federal court state-law business-tort, contract, and LUTPA

suits whenever the alleged wrongdoing involved HIPAA-governed information,

federal healthcare reimbursements, or references to federal criminal statutes. That

is precisely the sort of disruption of the federal-state balance that , ,

, and caution against.

In short, the face of the Petition shows only Louisiana causes of action. The

embedded references to HIPAA, Medicare, Medicaid, and federal criminal statutes do

not create federal causes of action, and defendants have not shown that Plaintiffs’

right to relief necessarily depends on the resolution of a substantial federal issue

within the narrow meaning of and . Given the absence of a private HIPAA

cause of action, the persuasive reasoning of , and the consistent post-

authority declining to find jurisdiction merely because federal standards appear

within state-law theories, the removing defendants have not carried their burden.

The motion to remand should be granted.

III. Conclusion

For the foregoing reasons;

IT IS RECOMMENDED that Plaintiffs’ Motion to Remand (ECF No. 22) be

GRANTED and that this matter be REMANDED to the Ninth Judicial District Court,

Rapides Parish, Louisiana.

IT IS FURTHER RECOMMENDED that Defendants’ Motions for More

Definite Statement (ECF Nos. 7, 8, 9, 17) be DENIED AS MOOT.

Under 28 U.S.C. § 636(b)(1)(c) and Fed. R. Civ. P. 72(b), a party may file

written objections to this Report and Recommendation within 14 days of service,

unless the Court grants an extension of time to file objections under Fed. R. Civ. P.

6(b). A party may also respond to another party’s objections to this Report and

Recommendation within 14 days of service of those objections, again unless the Court

grants an extension of time to file a response to objections.

No other briefs may be filed without leave of court, which will only be granted

for good cause. A party’s failure to timely file written objections to this Report and

Recommendation will bar a party from later challenging factual or legal conclusions

adopted by the District Judge, except if the challenge asserts “plain error.”

SIGNED on Wednesday, May 138, 2026.

He

JOSEPH H.L. PEREZ-MONTES

UNITED STATES MAGISTRATE JUDGE

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