UFCW & Employers Benefit Trust v. Sutter HealthAnnotate this Case
UEBT is a healthcare employee benefits trust governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, and pays healthcare providers directly from its own funds for the services provided to enrollees in its health plans. UEBT contracted with a “network vendor,” Blue Shield, to obtain access to Blue Shield’s provider network at the rates Blue Shield had separately negotiated, and certain administrative services. One of Blue Shield’s preexisting provider contracts was with Sutter, a group of health care providers in Northern California. UEBT sued Sutter, on behalf of a putative class of all California self-funded payors, alleging that Sutter’s contracts with network vendors, such as Blue Shield, contain anticompetitive terms that insulate Sutter from competition and drive up the cost of healthcare. UEBT sought damages, restitution, and injunctive relief under the Cartwright Act (Bus. & Prof. Code 16720) and California’s unfair competition law (section 17200). Sutter moved to compel arbitration, relying on an arbitration clause in the provider contract signed by Sutter and Blue Shield. The trial court denied Sutter’s motion, concluding that UEBT was not bound to arbitrate its claims pursuant to an agreement it had not signed or even seen. The court of appeal affirmed.