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Anthem v. Insurance Companies6/8/2000
Court of Appeals No. 10A01-9807-CV-243
ON PETITION TO TRANSFER
An Indiana insurance company sued the parent corporation of a chain of psychiatric hospitals alleging fraud in submitting insurance claims. The Indiana trial court found that the parent corporation did not have sufficient contacts with Indiana to be able to be sued here consistent with due process. Reviewing the question of law presented de novo, we find the requirements for personal jurisdiction over the parent corporation, mandated by both Trial Rule 4.4(A) and the Due Process Clause, satisfied and reverse the judgment of the trial court.
Background
On December 19, 1995, Anthem Insurance Companies, Inc., filed suit against forty-four related entities, including Tenet Healthcare Corporation ("Tenet"), three wholly-owned subsidiaries of Tenet, and 40 other entities affiliated with Tenet ("providers") alleging fraud in connection with claims submitted for psychiatric services rendered. Anthem contends that these companies engaged in a fraudulent scheme to obtain payments for psychiatric patients who did not need hospitalization or continued treatment. Specifically, Anthem claims that these health care providers obtained insurance payments of over $30 million by misrepresenting patient information to extend hospital stays longer than medically necessary.
On February 16, 1996, 40 of the Defendants moved to dismiss the claims for lack of personal jurisdiction. Included among these Defendants was Tenet (the parent corporation), National Medical Enterprises Hospitals, Inc., and National Medical Enterprises Psychiatric Properties, Inc., which are two wholly-owned subsidiaries of Tenet, and 37 providers. After discovery and a hearing on the motion to dismiss, the trial court granted the motion with respect to Tenet, NME Hospitals, and NME Psychiatric Properties. Anthem appealed the dismissal of Tenet and NME Hospitals. The Court of Appeals affirmed the dismissal of Tenet, but reversed the dismissal of NME Hospitals. See Anthem Insurance Cos. v. Tenet Healthcare Corp., 709 N.E.2d 1060, 1069 (Ind. Ct. App. 1999). Judge Robb dissented, believing that there were sufficient contacts to establish general personal jurisdiction over Tenet. Id. at 1069-70. This Court granted transfer to clarify the criteria for evaluating personal jurisdiction questions and the standard for reviewing trial court personal jurisdiction decisions.
Discussion
I.
Personal Jurisdiction Under Indiana Law. Personal jurisdiction is "a court's power to bring a person into its adjudicative process" and render a valid judgment over a person. Black's Law Dictionary 857 (7th ed. 1999); accord Mishler v. County of Elkhart, 544 N.E.2d 149, 151 (Ind. 1989) ("To render a valid judgment, a court must possess two forms of jurisdiction: jurisdiction over the subject matter and jurisdiction over the parties."). Traditionally, courts relied on consent, service of process within a jurisdiction, and domicile as bases for asserting jurisdiction over a person, but the United States Supreme Court, in International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945), formulated a new standard for personal jurisdiction based on the defendant's contacts with a forum state and notions of fairness and reasonableness.
Because Indiana state trial courts are courts of general jurisdiction, jurisdiction is presumed. See Mid-States Aircraft Engines, Inc. v. Mize Co., 467 N.E.2d 1242, 1247 (Ind. Ct. App. 1984); Weenig v. Wood, 169 Ind. App. 413, 419-20, 349 N.E.2d 235, 240 (1976), transfer denied. Therefore, the plaintiff need not allege jurisdiction in its complaint. Weenig, 169 Ind. App. at 420, 349 N.E.2
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