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Multiplan, Inc. v. Holland

United States District Court, S.D. Mississippi, Southern Division

June 14, 2018

MULTIPLAN, INC. and PRIVATE HEALTHCARE SYSTEMS, INC. PLAINTIFFS/COUNTER-DEFENDANTS
v.
STEVEN W. HOLLAND, doing business as Physical Therapy Clinic of Gulfport DEFENDANT/COUNTERCLAIMANT

          MEMORANDUM OPINION AND ORDER CONCERNING HOLLAND'S REQUEST FOR INTEREST AND PENALTIES

          LOUIS GUIROLA, JR.UNITED STATES DISTRICT JUDGE

         BEFORE THE COURT are the post-trial briefs [299, 301, 310] submitted by the parties concerning the amount of interest and penalties, if any, to which Steven W. Holland is entitled as a result of the jury verdict in this case. For the following reasons, the Court finds that Holland is entitled to recover prejudgment interest in the amount of eight percent per annum, calculated according to the actuarial method, from September 29, 2014. Holland is also entitled to post-judgment interest at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding March 30, 2018.

         BACKGROUND

         This lawsuit arose out of a dispute between Holland, a physical therapist, and two preferred provider organizations (PPOs), PHCS and Multiplan. Holland has argued throughout this litigation that PHCS and Multiplan wrongfully applied Holland's discount rate to workers' compensation claims. Holland claims that these discounts constituted a breach of contract, because his contract with PHCS required insurers to provide direction or steerage of patients but Mississippi workers' compensation statutes and regulations effectively eliminate direction or steerage. Following a five-day trial, a jury found in favor of Holland as to his breach of contract claim. Pursuant to the parties' stipulation as to the amount of contractual damages, this Court entered a [291] Judgment awarding Holland $14, 329.25. The parties now ask the Court to determine whether Holland is entitled to recover additional damages, including interest and penalties pursuant to the Mississippi Workers' Compensation Fee Schedule.

         Prior to trial, the parties entered into the following stipulation concerning post-trial damages calculations to be decided by the Court:

1. The issues of whether, and if so, how the regulations of the Mississippi Workers Compensation Commission (“MWCC”) are to be employed in the calculation of damages to be awarded on Holland's breach of contract claim with respect to the forty-six (46) claims at issue in the case with discounts totaling $14, 329.25 (identified in the attached spreadsheets by claim number), should Holland prevail at trial on such claim, are ones exclusively of law and therefore to be decided by the Court, and not by the jury. In the event that the jury renders a verdict in Holland's favor on his breach of contract claim, the parties will provide legal authority and argument on these legal issues through such briefing as the Court then directs. The parties expressly reserve all of their respective rights and arguments with respect to such issues, including the right to appeal any ruling of the Court on the same.
2. If, following the parties' submissions (and such argument as the Court entertains), the Court determines that application of the MWCC regulations is appropriate in this case, the parties have agreed upon various alternative calculations that reflect the following:
a. Whether interest of 1.5% per month per the MWCC regulations is to be applied to the unpaid claim balances reflecting the discounts found to have improperly taken;
b. Whether such interest is to be simple or compounded;
c. Whether a 10% penalty is to be applied once (at the end of the relevant period) on the total (unpaid balance plus interest, whether simple or compounded); or
d. Whether such penalty is to be applied every month to the unpaid claim balances reflecting the discounts found to have improperly taken.
3. The spreadsheets provided to the Court set forth the arithmetic results of the various combinations of the items set forth in paragraph 2 above if the Court finds the MWCC regulations to be applicable. Based on its determinations, the Court will select one of the resulting totals.
4. The spreadsheets provided to the Court reflect the following:
1. 1.5% interest compounded monthly with 10% penalty applied, monthly ...

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