Neuroaxis Neurosurgical Assocs. v. Costco Wholesale

U.S. DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Contracts

New York Law Journal

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Judge Denise Cote

Neurosurgeons associated with Neuroaxis Neurosurgical Associates sought payment from welfare benefit plans for surgeries performed on plan members. Defendants, Sprint Nextel, Costco Wholesale and Aetna Health Insurance, moved to dismiss plaintiffs' claims. The litigation began when Neuroaxis sued Aetna to recover for health services it provided. The parties entered a tolling pact by which they agreed to engage in settlement negotiations, and dismissed the action. The agreement provided that should negotiations fail, "the [p]arties shall have the right to file and pursue any and all [c]laims in Federal Court." It also provided that the statute of limitations would be tolled for the claims. The tolling period ran from Dec. 20, 2010, to Sept. 16, 2011. Defendants argue plaintiffs could not take advantage of the tolling agreement because they breached its terms by re-initiating their law suits in state court rather than federal court. The court disagreed, finding no such prohibition. It reasoned that the language in the agreement referring to federal court was permissive, not mandatory. Thus, it ruled the parties had to take into account the tolling agreement when calculating whether any of plaintiffs' claims were time barred.

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