BLUE CROSS & BLUE SHIELD v. UNITY OUTPATIENT SURGERY CENTER

Nos. 05-56261, 06-55316, 06-55565, 06-71645.

490 F.3d 718 (2007)

BLUE CROSS AND BLUE SHIELD OF ALABAMA; Blue Cross and Blue Shield of Massachusetts, Inc.; Blue Cross and Blue Shield of Michigan; Blue Cross and Blue Shield of Nebraska; Blue Cross and Blue Shield of North Carolina; Blue Cross and Blue Shield of Tennessee, Inc.; Carefirst Blue Cross and Blue Shield; Empire Healthchoice Assurance, Inc., d/b/a Empire Blue Cross Blue Shield; Excellus Health Plan, Inc., d/b/a Excellus Blue Cross Blue Shield; R.M.S.C.O., Inc.; Highmark, Inc., d/b/a Highmark Blue Cross Blue Shield and d/b/a Highmark Blue Shield; Premera Blue Cross; Regence Blue Shield; Regence Bluecross Blueshield of Utah; Regence Bluecross Blueshield of Oregon; Regence Blueshield of Idaho, Plaintiffs-Appellants, v. UNITY OUTPATIENT SURGERY CENTER, INC., Defendant, and Mitchell Rubin; Steven Rubin; Daniel Rose, M.D.; Mario Z. Rosenberg, M.D.; Paratha Govindarajan, M.D.; Rosalinda Landon; Leon Halac, M.D.; Byung Chun, M.D.; Robert J. McKenna, M.D.; Ardalan Babaknia, M.D.; Moustafa El Alamy, M.D.; Michael Chan, M.D.; Bharat Patel, M.D.; Edgar Lluncor, M.D.; Lan Thi Ngoc Nguyen; Huong Thien Ngo, Defendants-Appellees. Blue Cross and Blue Shield of Alabama; Blue Cross and Blue Shield of Massachusetts, Inc.; Blue Cross and Blue Shield of Michigan; Blue Cross and Blue Shield of Nebraska; Blue Cross and Blue Shield of North Carolina; Blue Cross and Blue Shield of Tennessee, Inc.; Carefirst Blue Cross and Blue Shield; Empire Healthchoice Assurance, Inc., d/b/a Empire Blue Cross Blue Shield; Excellus Health Plan, Inc., d/b/a Excellus Blue Cross Blue Shield; R.M.S.C.O., Inc.; Highmark, Inc., d/b/a Highmark Blue Cross Blue Shield and d/b/a Highmark Blue Shield; Premera Blue Cross; Regence Blue Shield; Regence Bluecross Blueshield of Utah; Regence Bluecross Blueshield of Oregon; Regence Blueshield of Idaho, Plaintiffs-Appellants, v. Unity Outpatient Surgery Center, Inc.; Unity Outpatient Surgery Center, LLC; Millennium Outpatient Surgery Center, a Medical corporation; St. Paul Outpatient Surgery Center, LLC; Tam Vu Pham, a/k/a Tom Vu; Rosalinda Landon; Andrew Harnen; Thu Ngoc Pham; a/k/a Perry Pham; Madhukar Jigjinni, MD; Chin Kim, MD; Martha Madrid, MD; Amer Rayyes, MD, Defendants-Appellees, and Anaheim West Outpatient Surgery Center, Inc.; Lincoln Management Group, LLC; St. Francis Outpatient Medical Center, Inc.; Inland Orange Medical Management, Inc.; Newport Superior Outpatient Medical Center, Inc.; Newport Superior Management Group, LLC; Harbor Multi-Specialty Surgical Center, Inc.; Pacific Outpatient Medical Center, a Medical corporation; Pacific Outpatient Medical Management Group, LLC; Premium Outpatient Surgery Center, a Medical corporation; Huong Thien Ngo; Lan Thi Ngoc Nguyen; Gordon Merrick; Dee Francis; Daniel Romanello; Ocher County Clinics, Inc.; Mitchell Rubin; Steven Rubin; Catherine Bach; Michael Schneider; Ardalan Babaknia, MD; Michael D. Chan, MD; Byung Chun, MD; Moustafa El Alamy, MD; Paratha Govindarajan, MD; Leon Halac, MD; Lars Hanson, MD; William Hampton, MD; Edgar Lluncor, MD; Robert J. McKenna, MD; Bharat Patel, MD; Daniel Rose, MD; Mario Z. Rosenberg, MD; Hamilton Sah, MD; Youn S. Toh, MD; Lloyd White, MD, Defendants. Blue Cross and Blue Shield of Alabama; Blue Cross and Blue Shield of Massachusetts, Inc.; Blue Cross and Blue Shield of Michigan; Blue Cross and Blue Shield of Nebraska; Blue Cross and Blue Shield of North Carolina; Blue Cross and Blue Shield of Tennessee, Inc.; Carefirst Blue Cross and Blue Shield; Empire Healthchoice Assurance, Inc., d/b/a Empire Blue Cross Blue Shield; Excellus Health Plan, Inc., d/b/a Excellus Blue Cross Blue Shield; R.M.S.C.O., Inc.; Highmark, Inc., d/b/a Highmark Blue Cross Blue Shield and d/b/a Highmark Blue Shield; Premera Blue Cross; Regence Blue Shield; Regence Bluecross Blueshield of Utah; Regence Bluecross Blueshield of Oregon; Regence Blueshield of Idaho, Plaintiffs-Appellants, v. Unity Outpatient Surgery Center, Inc.; Unity Outpatient Surgery Center, LLC; Millennium Outpatient Surgery Center, a Medical corporation; St. Paul Outpatient Surgery Center, LLC; Tam Vu Pham, a/k/a Tom Vu; Rosalinda Landon; Andrew Harnen; Thu Ngoc Pham, a/k/a Perry Pham; Madhukar Jigjinni, MD; Chin Kim, MD; Martha Madrid, MD; Amer Rayyes, MD; Lincoln Management Group, LLC; Inland Orange Medical Management, Inc.; Newport Superior Outpatient Medical Center, Inc.; Newport Superior Management Group, LLC; Pacific Outpatient Medical Center, a Medical corporation; Pacific Outpatient Medical Management Group, LLC; Premium Outpatient Surgery Center, a Medical corporation; Huong Thien Ngo; Lan Thi Ngoc Nguyen; Gordon Merrick; Dee Francis; Daniel Romanello; Mitchell Rubin; Steven Rubin; Catherine Bach; Michael Schneider; Ardalan Babaknia, MD; Michael D. Chan, MD; Byung Chun, MD; Moustafa El Alamy, MD; Paratha Govindarajan, MD; Leon Halac, MD; Lars Hanson, MD; William Hampton, MD; Edgar Lluncor, MD; Robert J. McKenna, MD; Bharat Patel, MD; Daniel Rose, MD; Mario Z. Rosenberg, MD; Hamilton Sah, MD; Youn S. Toh, MD; Lloyd White, MD, Defendants, and Anaheim West Outpatient Surgery Center, Inc.; St. Francis Outpatient Medical Center, Inc.; Harbor Multi-Specialty Surgical Center, Inc.; Ocher County Clinics, Inc., Defendants-Appellees. Blue Cross/Blue Shield of Alabama, Blue Cross and Blue Shield of Massachusetts, Inc; Blue Cross and Blue Shield of Michigan; Blue Cross and Blue Shield of Nebraska; Blue Cross and Blue Shield of North Carolina; Blue Cross Blue Shield of Tennessee, Inc.; Carefirst Blue Cross and Blue Shield; Empire Healthchoice Assurance, Inc., dba Empire Blue Cross Blue Shield; Excellus Health Plan, Inc. dba Excellus Blue Cross Blue Shield; R.M.S.C.O., Inc.; Highmark Inc., dba Highmark Blue Cross Blue Shield and dba Highmark Blue Shield; Premera Blue Cross; Regence Blue Cross Blueshield of Utah; Regence; Blue Cross Blueshield of Oregon and Regence Blueshield of Idaho, Petitioners, v. United States District Court for the Central District of California, Respondent, Unity Outpatient Surgery Center, Inc., Unity Outpatient Surgery Center, LLC; St. Paul Outpatient Surgery Center, LLC; Millennium Outpatient Surgery Center, A Medical corporation; Tam Vu Pham, aka Tom Vu; Huongthien Nto; Lan Thi Ngoc Nguyen; Andrew Harnen; Rosalinda Landon; Mitchell Rubin, Steven Rubin; Thu Ngoc Pham, aka Perry Pham; Ardalan Babaknia, M.D.; Michael Chan, M.D.; Byung Chun, M.D.; Moustafa El Alamy, M.D.; Paratha Govindarajan, M.D.; Leon Halac, M.D.; Madhukar Jigjinni, M.D.; Chin Kim, M.D.; Edgar Lluncor, M.D.; Martha Madrid, M.D.; Bharat Patel; Amer Rayyes, M.D.; Daniel Rose, M.D.; Mario Z. Rosenberg, M.D., Real Parties in Interest.

United States Court of Appeals, Ninth Circuit.

Filed May 25, 2007.


Attorney(s) appearing for the Case

Howard Veisz and Marvin Wexler, Kornstein Veisz Wexler & Pollard, LLP, New York, NY, for the plaintiff-appellant.

Peter Morris, Altman & Morris, Los Angeles, CA, for defendants-appellees Mario Z. Rosenberg, M.D. and Madhukar Jigjinni, M.D.

Mark Gregory Clinnin, Law Offices of Mark Gregory Clinnin, Los Angeles, CA, for defendant-appellee Thu Ngoc Pham.

Jennifer J. Miller, Beam Brobeck West Borges & Rosa, LLP, Santa Ana, CA, for defendant-appellee Amer Rayyes, M.D.

Alexander W. Kirkpatrick, Bondcurtis, LLP, Pasadena, CA, for defendant-appellee Edgar Lluncor, M.D.

Paul M. Gelb, Hooper Lundy & Bookman, Inc., Los Angeles, CA, for defendant-appellee Robert J. McKenna, M.D.

Andrea L. Jacobs, Law Office of David W. Wiechert, San Clemente, CA, for defendant-appellee Huong Thien Ngo.

Harold Sullivan, Law Offices of Harold Sullivan, Pasadena, CA, for defendant-appellee Millennium Outpatient Surgery Center.

Dennis E. Lee, Fenton & Nelson, Los Angeles, CA, for defendants-appellees Moustafa El Alamy, M.D., Michael Chan, M.D., and Unity Outpatient Surgery Medical Center, Inc.

Joel Bruce Douglas and Keith Mitchell Rozanski, Bonne Bridges Mueller O'Keefe & Nichols, Los Angeles, CA, for defendant-appellee Byung Chun, M.D.

Raymond J. McMahon and Marc B. Thompson, Bonne Bridges Mueller O'Keefe & Nichols, Santa Ana, CA, for defendant-appellee Chin Kim, M.D.

Margaret M. Holm, Bonne Bridges Mueller O'Keefe & Nichols, Santa Ana, CA, for defendant-appellee Ardalan Babaknia, M.D.

Tracy Green, Green & Associates, Los Angeles, CA, for defendants-appellees Mitchell Rubin, Steven Rubin and Daniel Rose.

Before: STEPHEN REINHARDT and JAY S. BYBEE, Circuit Judges, and LARRY A. BURNS, District Judge.


Opinion by Judge REINHARDT.

REINHARDT, Circuit Judge.

This case arises out of a scheme allegedly entered into by the defendants to fraudulently bill Blue Cross and Blue Shield Plans ("Blue Cross") for unnecessary medical services. Plaintiffs allege that defendants and their associates enticed individuals from around the country into undergoing unnecessary treatments at the defendant medical clinics by offering cash...

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