In re Electrical Welfare Trust Fund et al v. United States, 1:2019-cv-00353 (Fed. Cl.)
Kessler Topaz served as co-lead counsel in a class action asserting claims against the U.S. Government on behalf of self-insured, self-administered group health plans that were forced to contribute to the Affordable Care Act’s (“ACA”) newly created Transitional Reinsurance Program (“TRP”) in 2014. The TRP was created for the exclusive benefit of commercial health insurers, who were, for the first time, required to provide coverage to high-risk individuals. The Department of Health and Human Services (“HHS”) forced class members to contribute to the TRP despite the plain language of the statute– which Plaintiffs argued expressly exempted them from making payments. The legal claims, brought under the Fifth Amendment to the U.S. Constitution, are novel and rarely litigated. After researching, briefing and pursuing these novel arguments in the Court of Federal Claims, Plaintiffs ultimately secured a judgment in the amount of $185 million.
The Government appealed the Court’s judgment, and KTMC thereafter negotiated a highly favorable settlement. Pursuant to this agreement, which was fully approved by the Court in May 2024, the Government must pay 91.25% of all available damages, or approximately $169 million. The settlement is one of the largest ever for cases brought in the Court of Federal Claims.