Michigan Court of Appeals; Docket #360887; Unpublished
Judges Cavanagh, Markey, and Borrello; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion, Link to Concurrence
STATUTORY INDEXING:
Statutory Right of Service Providers to Assert Direct Causes of Action Against Insurers [§3112]
TOPICAL INDEXING:
Assignments of Benefits – Validity and Enforceability
Medical Provider Standing (Post-Covenant)
SUMMARY:
In this unanimous, unpublished, per curiam decision (Markey, concurring), the Court of Appeals reversed the trial court’s summary disposition order dismissing Plaintiff C-Spine Orthopedics, PLLC’s (“C-Spine”) action for No-Fault PIP benefits against Defendant Allstate Insurance Company (“Allstate”). Relying on C-Spine Orthopedics, PLLC v Progressive Marathon Ins Co, ___ Mich App ___ (2022) (“C-Spine I”), the Court of Appeals held that C-Spine could sue Allstate for PIP benefits it assigned to various factoring companies, and despite the fact that C-Spine did not obtain counter-assignments from the factoring companies—reinvesting C-Spine with the right to pursue the benefits in litigation against Allstate—until after filing suit. Under MCR 2.201(B)(1), ‘a person authorized by statute may sue in his or her own name without joining the party for whose benefit the action is brought,’ and under MCL 500.3112, providers can assert direct causes of action against insurers. Thus, even though C-Spine filed suit before obtaining counter-assignments from the factoring companies, it could still sue Progressive for the assigned benefits in its own name, and without joining the factoring companies.
The facts and procedural history of this case mirrored the facts in C-Spine I, and were summarized by the Court of Appeals as follows:
“The facts in this case largely parallel the facts in C-Spine Orthopedics—(1) auto accident victims obtained medical treatment and services from C-Spine for injuries incurred in the accidents; (2) the victims assigned their rights to obtain no-fault PIP benefits from responsible insurers to C-Spine; (3) C-Spine transferred all of its rights and interests in certain accounts receivable to third-party factoring companies, including those associated with the underlying auto-accident victims; (4) C-Spine then commenced civil suits against the no-fault insurers for payment of services rendered to the victims; (5) the insurers moved for summary disposition on the basis that C-Spine was not the real party in interest and lacked standing in light of the transfers; (6) C-Spine produced backdated counter-assignments from the factoring companies, conveying the accounts receivable back to C-Spine; and (7) the trial court eventually granted summary disposition in favor of the insurers.”
The Court of Appeals reversed the trial court’s summary disposition order in favor of Allstate, applying its analysis in C-Spine I. In C-Spine I, the Court held that C-Spine could sue a no-fault insurer in its own name—and without joining the factoring companies—regardless of when it obtained the counter-assignments. The Court observed that under MCR 2.201(B)(1), ‘a person authorized by statute may sue in his or her own name without joining the party for whose benefit the action is brought.’ C-Spine was such a ‘person,’ because under MCL 500.3112, a medical provider is authorized to ‘assert a direct cause of action against an insurer . . . to recover overdue benefits payable for charges for products, services, or accommodations provided to an injured person.’ Thus, the issues of when the counter-assignments were obtained and whether C-Spine backdated the counter-assignments were immaterial.
“Applying C-Spine Orthopedics, we must conclude that C-Spine, having statutory standing under MCL 500.3112, has standing in this case and is the real party in interest. Accordingly, we reverse the trial court’s ruling granting summary disposition in favor of Allstate. We do note that because the trial court did not take into consideration the counter-assignments given that they were not produced until after discovery, which ruling is not challenged on appeal, C-Spine Orthopedics would appear to dictate that the factoring companies be added to the suit on remand as necessary parties, MCR 2.205(A), to eliminate the risk of a second lawsuit by the factoring companies. C-Spine Orthopedics, ___ Mich App at ___; slip op at 4.”
