Order Denying Defendants' Motions to Compel Arbitration and Motions to Dismiss

This cause came on for hearing before the Court on January 8, 2003, on the following motions:

• Anthem Blue Cross and Blue Shield's Motion to Compel Arbitration, and to Dismiss or Stay Proceedings, including a Stay of Discovery (Oral Argument Requested);
• Defendant Aetna Health, Inc.'s Motion to Compel Arbitration and to Stay the Action Pending Arbitration and Motion to Stay Discovery (Oral Argument Requested);
• Human Health Plan of Ohio, Inc.'s Motion to Compel Arbitration, and to Stay Discovery Pending Resolution of the Arbitration Issue and Motion to Dismiss;
• United Healthcare of Ohio, Inc.'s Motion to Compel Arbitration and to Dismiss or Stay Proceedings, including Discovery (Oral Argument Requested); and
• Defendants' Joint Alternative Motion to Dismiss and to Stay Discovery (Oral Argument Requested).

Collectively, the foregoing motions are referred to herein as "Defendants' Motions."

Having fully considered the memoranda filed by counsel for the parties relating to Defendants' Motions, and the arguments of counsel, this Court FINDS that:

All of the Defendants' Motions are not well taken and are therefore OVERRULED.

A. Defendants' Motions to Compel Arbitration and Motions to Dismiss or Stay Proceedings, Inclding Discovery.

Plaintiffs Academy of Medicine of Cincinnati; A. Lee Greiner, MD; Raymond Will, MD; Victor Schmelzer, MD; Karl S. Ulicny, Jr., MD; E. Douglas Baldridge, MD; P. Scott Becker, MD; and the Northern Kentucky Medical Society (collectively "Plaintiffs") allege in their Amended Complaint that Defendants Aetna Health, Inc., Humana, Inc., Anthem Blue Cross and Blue Shield, and United HealthCare of Ohio (collectively "Defendants") engaged in a conspiracy of price fixing in violation of K.R.S. §367.175, Kentucky's antitrust statute. This dispute does not arise out of or relate to the contracts between Plaintiffs and Defendants. Rather the lawsuit arises out of Defendants' alleged conspiracy to fix the insurance reimbursement rates paid to physicians in Northern Kentucky. In addition, the parties never agreed to arbitrate claims that were independent of any branch of contract.

In this case, arbitration is a matter of contract. Since Plaintiffs are objecting to compelling this lawsuit to arbitration, the court shall not compel an arbitration for a dispute the parties did not agree, in advance, to arbitrate.

B. Defendants' Joint Alternative Motion to Dismiss and to Stay Discovery.

The association Plaintiffs, Academy of Medicine of Cincinnati and the Northern Kentucky Medical Society satisfy the requirements to have standing as party plaintifs in the case.

The Amended Complaint properly alleges a claim for violation of K.R.S. §367.175, Kentucky's antitrust statute.

This matter is properly brought and the claims alleged arise not from Defendants' performance of services related to the health insurance provider contracts, but rather from Defendants' alleged anticompetitive conduct, and further, the parties did not agree to arbitrate the claims alleged in the Amended Complaint as provided for by the K.R.S. §417.045-.240.

The Court further finds that Plaintiffs have properly pled a private right of action for injunctive relief and punitive damages, if proven at trial, and the court does have the authority to grant the injunctive relief requested by Plaintiffs, without having to engage in setting reimbursement rates.

The Court further finds that Defendants' Motion to Stay Discovery is denied.

IT IS THEREFORE ORDERED, ADJUDGED AND DECREED, THAT:
All of the Defendants' Motions are overruled.

Pursuant to Kentucky Civil Rule 12.01, Defendants are required to respond to the Amended Complaint within ten (10) days after the date of the entry of this Order.

IT IS SO ORDERED.
Joseph F. Bamberger, Judge
Boone Circuit Court