(CN) – A federal judge prematurely remanded a $150 million lawsuit accusing health insurers and HMOs of engaging in “questionable and sometimes fraudulent practices” in their dealings with a dental college in Puerto Rico, the 1st Circuit ruled.
The College of Dental Surgeons of Puerto Rico sued 25 entities in a Puerto Rico court, claiming the college and its dentist members were defrauded by insurers, HMOs and others.
Two insurers sought to remove the case to federal court under the Class Action Fairness Act, while the college insisted the case should stay in the local court.
U.S. District Judge Jose Fuste sided with the college, saying the complaint lacked a sufficiently defined class.
But the Boston-based appeals court said it was too early to rule out a class action, as the college could seek injunctive and declaratory relief on behalf of a class of dentists.
“The complaint plausibly alleges claims for class-wide relief; it consistently alleges harm to the dentists as a professional group; it describes the College as representing the ‘dentistry class’ in Puerto Rico; it states that its allegations are similar to those made in a class action pending in … Florida; and it seeks class-wide relief,” Judge Selya wrote.
The district court “downplayed these allegations – it simply did not mention them – and relied instead on the absence of any sufficient class definition,” Selya added.
“That reliance was misplaced.”
The 1st Circuit vacated Judge Fuste’s order and remanded to the district court.