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PIP Litigators Bound to Suffer “Identity” Crisis After Recent 3rd DCA Ruling – JD Supra

Rumberger | Kirk
What started as a typical claim for personal injury protection benefits ended in the application of new precedent in Florida that will affect insurance litigators.  The culprit?  Collateral estoppel.
In United Auto. Ins. Co. v. Millennium Radiology, LLC, No. 3D21-0717, 2022 WL 468118, (Fla. 3d DCA Feb. 16, 2022), the Florida Third District Court of Appeal (DCA) ruled that when applying the doctrine of collateral estoppel, the parties must be the identical.  Collateral estoppel is the doctrine recognizing that the determination of facts litigated between two parties in a proceeding is binding on those parties in future proceeds.  In short, collateral estoppel prevents a party from re-litigating an issue that was resolved in a previous lawsuit or administrative proceeding, even if the issue relates to a different claim.
In Florida, PIP cases are usually brought by medical providers suing in their representative capacities, which is not the same as an individual capacity. According to the Third DCA, the doctrine of collateral estoppel does not apply because the parties are different.
At issue in United Auto was the reasonableness of the amount charged for an MRI. The provider attempted to preclude the insurance company from challenging the reasonableness of charges under the principles of offensive collateral estoppel because prior juries, from unrelated cases involving the same provider and same insurance company, found charges for the same procedures to be reasonable. At the trial court level, the insurance company unsuccessfully argued the application of collateral estoppel was improper because, although the provider was the same in prior cases, the parties were not identical because the provider received an assignment from a different patient in each case. 
On appeal, the Third DCA agreed with the insurance company finding that since there was no identity of the parties “the application of collateral estoppel was erroneous.” In reversing the trial court’s judgment, the Third DCA emphasized that the provider draws its identity from its assignors from case to case because the real party in interest is the provider as an assignee, not in its individual capacity as the provider for each insured.
Under the Third DCA’s holding, collateral estoppel will no longer be a bar to an insurer challenging the reasonableness of charges.  PIP providers will have to establish the reasonableness of their charges on a case-by-case basis.  This decision ensures that insurers have an opportunity to challenge the reasonableness of charges on a case-by-case basis without concern that previous, unrelated lawsuits will get in their way. 
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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