N.C. Business Court Opinions, April 12, 2023 – April 25, 2023
Blue Cross & Blue Shield of N.C. v. MH Master Holdings, LLLP, 2023 NCBC 31 (N.C. Super. Ct. April 4, 2023) (Bledsoe, C.J.)
Key Terms: motion to dismiss; health insurance reimbursements; statute of limitations; contractually abridged limitations period
In October 2022, Plaintiff Blue Cross & Blue Shield of North Carolina brought suit to recover certain overpayments it had made in 2018 and 2019 for claims submitted by Defendant McDowell, a hospital system in Marion, North Carolina. However, the parties had entered into an agreement which provided that neither party could recover an overpayment from the other any later than two years after the payment in question was made. Defendants moved to dismiss, arguing that this provision barred Plaintiff’s claims.
The Court began by noting that parties to a contract are allowed to shorten the applicable statute of limitations under North Carolina law. The Court then turned to the language of the provision at issue and concluded it unambiguously provided that, absent fraud, neither party could recover an overpayment any later than two years after the payment. Since the overpayments were made in 2018 and 2019, but the suit was not brought until 2022, the plain language of the agreement barred Plaintiff’s suit.
The Court was unpersuaded by Plaintiff’s arguments that the terms of the agreement were ambiguous as applied and that the Court’s previous decision in Frye Reg’l Med. Ctr., Inc. v. Blue Cross Blue Shield of N.C., Inc., which addressed a materially identical agreement, required contract clauses shortening statute of limitations periods to explicitly refer to the filing of lawsuits in order to be enforceable. Accordingly, the Court granted the motion and dismissed the action with prejudice.
North Carolina ex rel. Stein v. MV Realty PBC, LLC, 2023 NCBC Order 25 (N.C. Super. Ct. April 12, 2023) (Bledsoe, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(1); N.C.G.S. § 7A-45.4(a)(3); N.C.G.S. § 7A-45.4(b)(2)); unfair debt collection practices; unfair or deceptive lending practices; unfair and deceptive trade practices; telephone solicitations; antitrust law; amount in controversy
After Plaintiff filed suit asserting claims for unfair debt collection practices, unfair or deceptive lending practices, unfair and deceptive trade practices, and violations of the prohibitions regarding telephone solicitations, the corporate defendants filed a notice of designation pursuant to N.C.G.S. §§ 7A-45.4(a)(1), (a)(3), and (b)(2).
(a)(1) – Defendants argued that designation was proper under § 7A-45.4(a)(1) (disputes involving the law governing LLCs) because Plaintiff sought to pierce the limited liability veil. The Court rejected this contention, however, because a claim for piercing the corporate veil, standing alone, is insufficient to support mandatory complex business case designation and the claims did not otherwise implicate the law governing LLCs.
(a)(3) – Defendants also argued that designation was proper under § 7A-45.4(a)(3) (disputes involving antitrust law including disputes arising under Chapter 75) because the case involved a material dispute arising under the North Carolina Telephone Solicitations Act, which is a dispute arising under Chapter 75. The Court again disagreed, because while Chapter 75 encompasses both antitrust and consumer protection law, section (a)(3) makes clear that only those actions involving antitrust law qualify for designation. Since Plaintiff’s claim involved consumer protection law, not antitrust law, designation under (a)(3) was not proper.
(b)(2) – Lastly, Defendants argued that designation was proper under § 7A-45.4(b)(2) (actions described in sections (a)(1)-(5) or (8) in which the amount in controversy is at least $5 million based on the pleadings) because Plaintiff’s claims had the potential to exceed $5 million. However, the Court determined that designation was improper under this section as well because 1) the Court had already concluded that no basis for designation existed under sections (a)(1) or (a)(3) and 2) the Complaint did not seek relief in an amount equal to or in excess of $5 million.
Campbell Sales Grp., Inc. v. Niroflex by Jiufeng Furniture, LLC, 2023 NCBC Order 26 (N.C. Super. Ct. April 20, 2023) (Davis, J.)
Key Terms: motion to stay; enforcement of judgment; partial summary judgment; certification; final judgment; Rule 54(b); Rule 62; interlocutory orders; substantial right doctrine; discretion; inherent authority
In a previous order, discussed here, the Court denied summary judgment on Plaintiff’s claims, but granted partial summary judgment in favor of Defendant Genfine on its counterclaims, and thereafter, entered a judgment in Genfine’s favor in an amount in excess of $500,000. After Genfine began taking steps to enforce the judgment, Plaintiff moved to stay its enforcement, arguing that 1) immediate enforcement proceedings were not legally proper because the Court did not certify the judgment as a “final judgment” pursuant to Rule 54(b), and 2) alternatively, the Court should enter a discretionary stay pending resolution of Plaintiff’s remaining claims at trial and entry of a final judgment.
Upon review of Rule 54, which governs judgments upon multiple claims or involving multiple parties; Rule 62 which governs the issuance of a stay of proceedings to enforce a judgment; and the rules governing the appeal of interlocutory orders, the Court concluded that the judgment was immediately appealable as an interlocutory order affecting a substantial right because it granted a specific monetary sum to one party from another party. However, no case law from North Carolina’s appellate courts squarely resolved the issue of whether immediate appealability rendered the judgment immediately enforceable where the order has not been certified as a final judgment under Rule 54(b).
Without clear appellate guidance and without deciding if the judgment was immediately enforceable, the Court concluded that any enforcement proceedings should be subject to a discretionary stay pursuant to Rule 62(g) or, in the alternative, pursuant to the Court’s inherent authority to enter orders necessary for the proper administration of justice. The Court further determined that no bond would be required of Plaintiff related to the stay order.
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The information in this article is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation.