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Vang v. State Farm Mutual Automobile Insurance Co.

United States District Court, D. Arizona

April 17, 2019

Chee Vang, et al., Plaintiffs,
v.
State Farm Mutual Automobile Insurance Company, et al., Defendants.

          ORDER

          DOMINIC W. LANZA UNITED SLATES DISTRICT JUDGE.

         INTRODUCTION

         The plaintiffs in this putative class action bought car insurance from State Farm Mutual Automobile Insurance Company (“State Farm”), sustained injuries in car accidents, and then visited the same chiropractor. This chiropractor, however, didn't receive timely payment from State Farm because he had been flagged by an internal State Farm anti-fraud program that sought to identify “which doctors cause State Farm to pay the most in automobile-accident bodily-injury claims.” (Doc. 20 ¶ 59 [amended complaint].) According to Plaintiffs, this program is actually “an elaborate scheme to avoid paying claims by racial and ethnic minorities and members of immigrant communities across the United States.” (Doc. 24 at 1.) Accordingly, Plaintiffs seek to assert anti-discrimination claims against State Farm under the Patient Protection and Affordable Care Act, 42 U.S.C. § 18116, and under 42 U.S.C. § 1981.[1]

         Notably, all of the plaintiffs reside in Minnesota. That's also where the car accidents occurred, where the chiropractor is based, and where the State Farm claims specialists were located at the time they made the challenged decisions to delay payment. The only connections between the conduct at issue in this case and the state of Arizona are that (1) State Farm used an Arizona “mail drop” during the time period in question and (2) State Farm reassigned some of the claims to an Arizona-based claims specialist in September 2018, which is after the key events occurred.

         State Farm has now filed a motion seeking dismissal or, alternatively, a transfer of venue under 28 U.S.C. § 1631. (Docs. 22, 24, 26.)[2] As explained below, the Court will grant the motion to dismiss because it lacks personal jurisdiction over State Farm. The company isn't subject to general personal jurisdiction in Arizona, even though it maintains a large facility in Arizona and has thousands of Arizona employees, because it can't be said to “be home” in Arizona, and it isn't subject to specific personal jurisdiction because Plaintiffs can't demonstrate a sufficient nexus between any of State Farm's conduct in Arizona and their alleged injuries. Given these conclusions, the Court need not reach State Farm's alternative dismissal arguments under Rule 12(b)(6).

         BACKGROUND

         Plaintiffs are State Farm policyholders residing in Minnesota. (Doc. 20 ¶¶ 16-19.) Each was injured in an automobile accident that occurred in Minnesota. (Id. ¶¶ 129, 142, 155.) Each received treatment from chiropractor Jer Lee, D.C. at the Chiro Health Clinic in Minnesota, as well as from other Minnesota-based providers. (Id. ¶¶ 130-31, 143-44, 157-59.) Each alleges State Farm delayed payment using a scheme targeting racial and ethnic minorities for sham fraud investigations. (Id. ¶¶ 1-9, 82-99, 129-73.)

         On November 6, 2018, Plaintiffs filed a complaint alleging that State Farm systematically targets healthcare providers serving minority populations and, in turn, knowingly discriminates against minority insureds like themselves. (See Doc. 1.) On

         December 18, 2018, State Farm moved to dismiss the complaint for lack of personal jurisdiction and failure to state a claim, or alternatively, to transfer under 28 U.S.C. § 1631. (Doc. 18.)

         On January 8, 2019, Plaintiffs filed an amended complaint. (Doc. 20.)

         On January 22, 2019, State Farm filed the motion now pending before the Court.

         (Doc. 22.)

         ANALYSIS

         a. Rule ...


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