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Stand Up Multipositional Advantage MRI, P.A. v. American Family Insurance Company, et al.

January 24, 2017 by Matthew Bass

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After being injured in a motor vehicle accident, American Family policyholders sought treatment from Plaintiff Stand Up MRI. Prior to being provided treatment, however, Stand Up MRI required those policyholders to sign an “irrevocable assignment of insurance benefits.” The assignment included the right to receive benefits, the right for Stand Up MRI to pursue claims in its own name, and the right to settle claims without the consent of the policyholder. It also included language that the policyholder could not require Stand Up MRI to reduce its bill if he or she hired an attorney to pursue a claim. American Family’s policy of insurance included an anti-assignment clause, which stated that a policyholder’s interest could not be assigned without American Family’s consent. The policyholders pursued no-fault claims, and American Family made payment to its policyholders and their attorneys, as opposed to Stand Up MRI. Stand Up MRI commenced suit against the policyholders, their attorneys, and American Family for failing to make payment directly to Stand Up under the assignments. The Minnesota Supreme Court concluded that Stand Up MRI’s assignments were unenforceable in light of the anti-assignment clause in American Family’s insurance policy. The Court relied upon a common law rule upholding anti-assignment clauses, in general, and upon reviewing case law from other jurisdictions, the Court determined that the anti-assignment clause would be upheld because it was executed pre-loss, as “loss” is defined under Minnesota’s No-Fault Act, as opposed to post-loss. Therefore, summary judgment was appropriately granted to American Family.

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