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Mitchell v. I Can Schools

United States District Court, S.D. Indiana, Indianapolis Division

September 20, 2019

Tyler Mitchell, Plaintiff,
I CAN Schools, n.k.a. Accel Schools Ohio, LLC, Dynamic Public Schools, n.k.a. Cincinnati North Preparatory School, Inc., d.b.a. Southwest Ohio Preparatory School, Pansophic Learning LLC, Indiana College Preparatory School, Inc., and Aetna Health, Inc., Defendants.


          Hon. Jane Magnus-Stinson, Chief Judge United States District Court.

         Plaintiff Tyler Mitchell brings this action under the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq., the Family Medical Leave Act (“FMLA”), 29 U.S.C. § 2601 et seq., the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), 29 U.S.C. § 1161 et seq., and Indiana law. She alleges that her employer-provided health insurance was cancelled without her knowledge, leaving her liable for medical costs incurred when she gave birth to her child. Defendants Accel Schools Ohio, LLC, (“Accel”) and Pansophic Learning, LLC, (“Pansophic”) (collectively, “Accel/Pansophic”) have filed a Motion to Dismiss, or in the Alternative, Motion for a More Definite Statement, [Filing No. 23], which is now ripe for review.


         Standard of Review

         The Federal Rules of Civil Procedure require only a “short and plain statement of the claim showing that the pleader is entitled to relief.” Erickson v. Pardus, 551 U.S. 89, 93 (2007)(quoting Fed.R.Civ.P. 8(a)(2)). The complaint need only provide the defendant with “fair notice of what the . . . claim is and the grounds upon which it rests.” Erickson, 551 U.S. at 93(quoting Bell Atlantic v. Twombly, 550 U.S. 544, 555 (2007)) (internal quotation marks omitted). In reviewing the sufficiency of a complaint, the Court must accept all well-pled facts as true and draw all permissible inferences in favor of the plaintiff. Alarm Detection Sys., Inc. v. Vill. of Schaumburg, 930 F.3d 812, 821 (7th Cir. 2019).

         In order to survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the complaint must contain allegations that collectively “state a claim to relief that is plausible on its face.” Id. (internal quotations omitted) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556).



         Consistent with the standard of review described above, the following allegations from the Complaint are accepted as true for purposes of deciding the Motion to Dismiss. In 2015, Ms. Mitchell was hired by I CAN Schools, Inc. (“I CAN”) to teach at Indiana College Preparatory School (“ICPS”). [Filing No. 1 at 3-4.] As a part of her employment, Ms. Mitchell had medical, dental, and vision insurance coverage, and a deduction was taken from each of her paychecks to pay for her contribution towards the cost of this coverage. [Filing No. 1 at 4.] Her medical insurance was under a group policy written by Aetna. [Filing No. 1 at 4.]

         When Ms. Mitchell began her employment, I CAN was a nonprofit charter school management organization that managed approximately seven schools in Ohio as well as ICPS in Indiana. [Filing No. 1 at 3-4.] ¶ 2016, one of the founders of I CAN created Dynamic Public Schools (“DPS”). [Filing No. 1 at 4.] In March of 2017, the board of I CAN voted to have “the Accel Charter School Network take over its seven (7) Ohio schools.” [Filing No. 1 at 4.] “ICPS was not part of the transfer, ” and “remained part of the DPS Network.” [Filing No. 1 at 5.]

         Meanwhile, in November 2016, Ms. Mitchell had notified the “School Defendants” that she was pregnant and would need to take medical leave in or around June 2017 for the birth of her child. [Filing No. 1 at 4.] On December 1, 2016, she renewed her medical insurance coverage with Aetna and enrolled in an Open Access Managed Choice Plan, which was sponsored by Pansophic, the parent company to Accel and I CAN. [Filing No. 1 at 4; Filing No. 1 at 2.] On April 30, 2017, unbeknownst to Ms. Mitchell, her medical coverage was cancelled. [Filing No. 1 at 5.] Ms. Mitchell took FMLA leave from May 22 to July 10, 2017. [Filing No. 1 at 5.] On August 1, 2017, again unbeknownst to Ms. Mitchell, her health coverage was reinstated, and DPS was listed as the Plan Sponsor. [Filing No. 1 at 5.] She resigned from her job at ICPS on October 30, 2017, still unaware that she had not had medical insurance coverage from April 30 to July 31, 2017. [Filing No. 1 at 6.] Contributions for her medical insurance were continuously deducted from each of Ms. Mitchell’s paychecks for the duration of her employment. [Filing No. 1 at 6.]

         On January 19, 2018, Ms. Mitchell was contacted by a debt collector who informed her that she owed money for inpatient medical services rendered in May 2017. [Filing No. 1 at 6.] Ms. Mitchell then contacted the hospital, who informed her that Aetna had initially paid for her medical services, but had requested a refund several months later, claiming that Ms. Mitchell did not have coverage when the services were rendered. [Filing No. 1 at 6.] She then contacted Aetna, and an Aetna representative informed her that Defendants had cancelled her medical coverage on April 30, 2017. [Filing No. 1 at 6.] Ms. Mitchell then obtained a document from Aetna, which showed that she had medical insurance coverage that became effective on December 1, 2016 and was terminated on April 30, 2017. [Filing No. 1 at 7.] The plan sponsor listed on this documentation was Pansophic. [Filing No. 1 at 7.] Ms. Mitchell also obtained another document showing that her medical coverage became effective on August 1, 2017, and was terminated on October 31, 2017, with DPS listed as the plan sponsor. [Filing No. 1 at 8.]

         In the Complaint, Ms. Mitchell asserts the following causes of action related to Defendants’ unilateral cancellation of her medical insurance: (1) “Interference and/or Retaliation” under the FMLA, [Filing No. 1 at 8-9]; (2) a violation of COBRA, [Filing No. 1 at 9]; (3) interference with benefits under ERISA, [Filing No. 1 at 9-10]; (4) denial of benefits under ERISA, [Filing No. 1 at 10]; (5) breach of fiduciary duty under ERISA, [Filing No. 1 at 10-11]; and (6) theft and conversion under Indiana law, [Filing No. 1 at 11-12]. Accel and ...

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