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In a major victory for the health insurance industry, the U.S. Supreme Court on Monday unanimously ruled that patients may not sue under state tort law for insurers’ refusal to pay for doctor-recommended medicines and procedures. The ruling in two consolidated cases — Aetna Health Inc. v. Davila, No. 02-1845, and Cigna Health Care of Texas v. Calad, No. 03-83 — said that the 1974 Employee Retirement Income Security Act (ERISA) completely pre-empts such lawsuits, in part because its purpose was to “provide a uniform regulatory regime over employee benefit plans.” The Aetna ruling came at the beginning of the high court’s final push toward adjournment. Twelve argued cases remain to be decided — including key war-on-terror cases involving enemy combatants and Guantanamo detainees — and the Court is scheduled to issue rulings this Thursday and next Monday. The Court could add another sitting next week. In the health insurance cases, Justice Clarence Thomas, writing for the Court, said, “Any state-law cause of action that duplicates, supplements, or supplants the ERISA civil enforcement remedy conflicts with the clear congressional intent to make the ERISA remedy exclusive.” The cases were brought under the Texas Health Care Liability Act by Juan Davila, who challenged Aetna’s decision on which medication he should take for arthritis, and by Ruby Calad, who said Cigna’s decision to limit her hospital stay after a hysterectomy caused complications. The 5th U.S. Circuit Court of Appeals ruled their claims were not pre-empted by ERISA. The insurance industry, joined by the Bush administration, urged the Court to reverse the 5th Circuit to prevent insurers from having to face 50 different state liability regimes. Nine other states have laws like the one in Texas. In its brief to the Court, the Justice Department said allowing suits under state law would lead to “increasing costs through awards of or exposure to punitive damages and other state-law remedies in ways that cannot be readily predicted or budgeted.” The brief, signed by Paul Clement as acting solicitor general, noted that Solicitor General Theodore Olson recused in the case. Olson’s former law firm, Gibson, Dunn & Crutcher, represents Aetna in the case before the high court. “This type of stability in the important legal principles that govern the potential liability of employer-sponsored plans will make it easier for employers to provide (or perhaps expand) health coverage for working Americans,” said Gibson Dunn partner Miguel Estrada, who argued the case for Aetna. James Klein, president of the American Benefits Council, said, “Without this decision, employers would have, in effect, lost the ability to design uniform benefit plans covering all of their employees in any state where they may reside, because each state court would have been free to interpret differently a health plan’s terms of coverage.” Consumer groups were critical of the ruling, which they said leaves patients with little clout in combating HMO coverage decisions. “Consumers are foreclosed from any meaningful recovery,” said Sarah Lock, senior attorney at the AARP. “ERISA remedies are just not sufficient.” Under ERISA, she said, insured patients can recover the cost of the benefit that was denied and can get injunctive relief but no lost wages or pain-and-suffering damages that might be available under state tort law. Lock also pointed to a concurrence in the case written by Justice Ruth Bader Ginsburg and joined by Justice Stephen Breyer. While agreeing with the result, they noted approvingly the “rising judicial chorus” urging Congress to revise ERISA. They said a “regulatory vacuum” exists because the Court has interpreted ERISA to pre-empt state tort actions against HMOs, while also limiting the scope of relief consumers can obtain under ERISA. Sen. Edward Kennedy, D-Mass., responded to the ruling by renewing his call for congressional passage of a patients’ bill of rights. “When HMOs make medical decisions that injure or kill patients, they should be held accountable,” Kennedy said in a statement. In another closely watched business case Monday, the justices by a 7-1 vote ruled that federal courts can be enlisted to require U.S. companies to provide discovery materials in antitrust and other business litigation before foreign tribunals. The ruling Intel Corp. v. Advanced Micro Devices Inc., No. 02-572, is a defeat for Intel in its fight against a European antitrust probe triggered by complaints from Advanced Micro Devices, a competing computer chip manufacturer. The ruling, authored by Justice Ginsburg, interprets a 50-year-old statute that authorizes federal judges to order discovery in the United States for use in any “foreign or international tribunal.” Intel and other business organizations complained that a broad interpretation of the law would encourage competitors to go overseas to require broad and time-consuming discovery in business litigation. Justice Sandra Day O’Connor, who reported in her 2003 financial disclosure form that she owns between $15,001 and $50,000 in Intel stock, did not participate in the arguments and the ruling. Also on Monday, the Court upheld a Nevada law that requires people to identify themselves to police when stopped by police with reasonable suspicion of a crime. In a 5-4 decision in Hiibel v. Sixth Judicial District Court of Nevada, No. 03-5554, Justice Anthony Kennedy wrote for the majority that “a police officer is free to ask a person for identification without implicating the Fourth Amendment.” Kennedy also said the law did not violate the Fifth Amendment bar against forced self-incrimination. The case stemmed from the arrest of Larry Hiibel, who was stopped by police responding to a call about a possible assault in the truck Hiibel was standing near. Hiibel refused to give his name 11 times and was arrested under the law, similar to statutes in most other states. Justices John Paul Stevens, David Souter, Breyer, and Ginsburg dissented. Stevens said revealing a name can be self-incriminating because it provides “the key to a broad array of information about the person.” In another ruling Monday, the Court ruled 7-2 in Pliler v. Ford, No. 03-221, that federal judges are not obliged to give warnings to pro se litigants about their options in so-called mixed federal habeas cases, involving both exhausted and unexhausted claims. Justices Breyer and Souter dissented.

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