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Allstate Insurance Co. v. Tacoma Therapy, Inc.

United States District Court, W.D. Washington, Tacoma

April 16, 2014

ALLSTATE INSURANCE COMPANY, et al., Plaintiffs,
v.
TACOMA THERAPY, INC., et al., Defendants.

ORDER DENYING PLAINTIFFS' MOTION TO STRIKE OR DISMISS COUNTERCLAIMS [DKT # 64]

RONALD B. LEIGHTON, District Judge.

I. Introduction

THIS MATTER is before the Court on Plaintiff[1] Allstate's motion to strike or dismiss Defendant McLaughlin's Counterclaims. Defendants are Tacoma Therapy, Inc., Tacoma Rehabilitation, Inc., and the Law Office of McLaughlin & Associates, Inc. The individual owners of these entities and their spouses are also named in the suit. Plaintiffs are four related insurance companies. The Defendants have provided medical and legal services to Allstate's insureds. Allstate claims that the Defendants conspired to obtain insurance payments for medical services that were either not medically necessary or not actually performed. Wesley McLaughlin and his law firm counterclaimed, asserting claims for conspiracy, defamation, Washington Consumer Protection Act violations and tortious interference. McLaughlin alleges that Allstate committed all of these violations by filing this lawsuit. Allstate now seeks to strike or dismiss the counterclaims under Washington's Anti-SLAPP law or Fed.R.Civ.P. 12b(6). For the reasons stated below, Allstate's motion to strike is DENIED. Allstate's motion to dismiss the conspiracy, defamation or tortious interference counterclaims is GRANTED. Allstate's motion to dismiss the CPA claim is DENIED.

II. Background

Allstate alleges that the Defendants used a referral scheme to commit insurance fraud. It claims that the provider Defendants overbilled Allstate's insureds and third-party claimants. Then, McLaughlin and his law firm submitted claims to Allstate and recovered payment for treatment that was not necessary or, in some cases, not provided at all.

McLaughlin not only denies all of Allstate's allegations, he has counterclaimed alleging that by filing this lawsuit, Allstate has defamed him, conspired to defraud and extort him, violated the Washington Consumer Protection Act, and tortiously interfered with his business expectations. To be clear, all of McLaughlin's counterclaims are based solely on the fact that Allstate's filed this lawsuit.

McLaughlin alleges that the multiple Allstate entities conspired to defraud and extort him and others who accept liens on insurance claims as payment. According to McLaughlin, Allstate filed this lawsuit and similar lawsuits around the country in an attempt to drive these providers out of business. He further alleges that Allstate's allegedly fraudulent litigation violates the Washington Consumer Protection Act.

Allstate moves to dismiss or strike the counter claims, arguing that they are asserted in retaliation for its original complaint. Allstate first claims that the suit is a SLAPP suit and subject to a motion to strike under the Washington Anti- SLAPP law. In the alternative, Allstate argues dismissal is warranted under Rule 12b(6) for failure to state a claim.

III. Discussion

A. Washington Anti-SLAPP Law

Allstate claims that McLaughlin's counterclaims are barred by Washington's Anti-SLAPP law. Specifically, Allstate claims that McLaughlin's counterclaims are retaliatory and an attempt to silence Allstate's public participation. McLaughlin contends that the Anti-SLAPP law does not apply because this is a private dispute, not an issue of public concern.

Strategic lawsuits against public participation (SLAPP suits) are suits filed in retaliation for speaking out on an issue of public concern and are designed to silence the speaker. Aronson v. Dog Eat Dog Films, Inc., 738 F.Supp.2d 1104, 1109 (2010).

[S]trategic lawsuits against public participation (or SLAPP suits) are "filed against individuals or organizations on a substantive issue of some public interest or social significance, " and "are designed to intimidate the exercise of First Amendment rights."

Id. The party subject to the SLAPP suit can move to strike the SLAPP claim. R.C.W. 4.24.525(4).

(4)(a) A party may bring a special motion to strike any claim that is based on an action involving public participation and petition, as ...

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