Contractual Prerequisites and Assignment Requirements for Healthcare Providers’ ERISA Claims: Insights from Abira Medical Laboratories v. Cigna

Introduction

In Abira Medical Laboratories, LLC v. Cigna Health & Life Insurance Company, the United States Court of Appeals for the Second Circuit addressed whether a medical provider—Genesis Diagnostics (doing business as Abira Medical Laboratories)—could maintain a variety of contract and statutory claims against an insurer that refused to pay for services rendered to its insureds. Genesis alleged breaches of contract, violations of the Connecticut Unfair Trade Practices Act (CUTPA) and Unfair Insurance Practices Act (CUIPA), promissory and equitable estoppel, unjust enrichment, and statutory claims under federal pandemic relief statutes and ERISA. On May 20, 2025, a three-judge panel affirmed the District Court’s Rule 12(b)(6) dismissal of all claims, holding that Genesis failed to allege the existence of any contract or valid assignment of benefits and had not properly sought leave to amend. This commentary analyzes the decision’s factual and procedural background, the court’s reasoning, the precedents applied, and the decision’s implications for future healthcare-provider litigation.

Summary of the Judgment

The Second Circuit affirmed the District Court’s dismissal of Genesis’s amended complaint with prejudice. Key holdings include:

No express or implied contract: Genesis did not plead the formation of any agreement—written, oral, or inferred by conduct—between it and Cigna.
Dependent state‐law claims: CUTPA, CUIPA and the covenant of good faith and fair dealing require a contractual relationship; without one, those counts fail.
Promissory estoppel and equitable estoppel fail for lack of a “clear and definite promise.” Genesis’s allegations of nonpayment and repudiation are inconsistent with any promise to pay.
Unjust enrichment fails because Connecticut law does not permit a provider to recover from an insurer for services rendered directly to an insured absent contractual privity.
ERISA § 502(a)(1)(B) claim fails for lack of a valid assignment from any plan beneficiary; Genesis did not challenge the District Court’s finding on this point at the appellate stage.
Leave to amend was properly denied: Genesis never filed a Rule 15 motion or offered facts to cure the pleading defects.

Analysis

Precedents Cited

The panel relied on a range of controlling Connecticut and Second Circuit authorities to define the elements of each claim:

Claim construction and Rule 12(b)(6) review: Orchard Hill Master Fund Ltd. v. SBA Commc’ns Corp., 830 F.3d 152 (2d Cir. 2016) (de novo standard).
Contract formation (Connecticut law): AGW Sono Partners, LLC v. Downtown Soho, LLC, 343 Conn. 309, 322 (2022); Conn. Light & Power Co. v. Proctor, 324 Conn. 245, 259 (2016).
Dependent state‐law claims: Capstone Bldg. Corp. v. Am. Motorists Ins. Co., 308 Conn. 760, 795 (2013) (CUTPA); Zulick v. Patrons Mut. Ins. Co., 287 Conn. 367, 378 (2008) (CUIPA); Stewart v. Cendant Mobility Servs. Corp., 267 Conn. 96, 104 (2003) (promissory estoppel); Horner v. Bagnell, 324 Conn. 695, 708 (2017) (unjust enrichment).
Assignment exception for ERISA claims: Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 329 (2d Cir. 2011).
Prior pandemic‐relief determination: Murphy Medical Associates, LLC v. Yale Univ., 120 F.4th 1107 (2d Cir. 2024) (FFCRA and CARES Act claims precluded).
Failure to raise issues in district court: Green v. Dep’t of Educ. of City of N.Y., 16 F.4th 1070, 1078 (2d Cir. 2021).
Leave to amend: WC Cap. Mgmt., LLC v. UBS Sec., LLC, 711 F.3d 322, 334 (2d Cir. 2013); Metz v. U.S. Life Ins. Co., 662 F.3d 600, 603 (2d Cir. 2011); Empire Merchants, LLC v. Reliable Churchill LLLP, 902 F.3d 132, 139 (2d Cir. 2018).

Legal Reasoning

The court applied traditional principles of contract law and ERISA standing, rejecting Genesis’s broad theory of “course of dealing” as inconsistent with its own allegations of repudiation. Because Genesis admitted Cigna repeatedly ignored or denied claims, there was no conduct from which to infer an agreement to pay. The court further held that state statutes aimed at unfair insurance conduct cannot supplant basic privity requirements, and that unjust enrichment claims fail when the insurer did not receive a direct benefit from the provider’s services. On ERISA, the panel reaffirmed that only participants, beneficiaries, or their assignees have standing—and Genesis had neither pled nor preserved any assignment theory.

Finally, the court found no abuse of discretion in refusing to grant leave to amend. Genesis never filed a formal Rule 15 motion, never described new factual allegations, and never sought to correct deficiencies in its ERISA assignment count.

Impact

Although issued as a non-precedential summary order, Abira v. Cigna sends clear guidance to healthcare providers and their counsel in the Second Circuit:

Providers must plead express agreements or assignments of benefits with specificity. Broad allegations of “course of dealing” are insufficient if they contradict allegations of nonpayment or repudiation.
State‐law claims under CUTPA, CUIPA, the covenant of good faith and fair dealing, and theories of promissory estoppel or unjust enrichment will be dismissed absent privity or a clear promise to pay.
ERISA § 502(a)(1)(B) suits require either participant/beneficiary status or an adequately pleaded assignment. Failure to muster either dooms the claim.
Where facts can be cured, litigants must move promptly under Rule 15(a) and articulate proposed amendments. “Judicial economy” boilerplate is insufficient to preserve an amendment request.

Future disputes in Connecticut and the Second Circuit will look to Abira for its firm re-endorsement of classic contract prerequisites and the narrowness of the ERISA assignment exception.

Complex Concepts Simplified

Rule 12(b)(6) review: A court takes a plaintiff’s allegations as true and construes them in the plaintiff’s favor, but will dismiss if those facts do not “plausibly” show a right to relief.
Express vs. implied contract: An express contract arises from clear offers, acceptances, and terms. An implied contract may be inferred from conduct—but only when that conduct is consistent with an agreement to perform.
Promissory estoppel: Requires a clear promise, reasonable reliance, and injustice if the promise is not enforced.
Unjust enrichment: A quasi-contract claim requiring that the defendant directly received a benefit and that retaining it without payment would be unjust.
ERISA § 502(a)(1)(B): Allows only plan participants, beneficiaries, or their valid assignees to sue a plan administrator or fiduciary to recover benefits due under the plan.
Assignment Exception: A “narrow” carve-out permits providers to sue under ERISA if they obtain a valid assignment of the beneficiary’s right to sue the plan.
Leave to Amend (Rule 15): Parties must formally move for permission to amend and show how they will remedy any pleading defects.

Conclusion

Abira Medical Laboratories v. Cigna reaffirms fundamental contract and ERISA principles in the context of healthcare‐provider disputes. The decision underscores that without a clear contractual relationship or a valid assignment of benefits, neither state law nor federal ERISA provisions will provide a remedy. Healthcare providers must therefore secure express assignments or contractual commitments before rendering services on the assumption of payment. Equally important, litigants must diligently follow procedural rules—especially when seeking to cure pleading defects through amendment. In emphasizing these bedrock requirements, the Second Circuit has sent a cautionary message that broad, indirect allegations of insurer misconduct will not suffice to withstand a Rule 12(b)(6) challenge.