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Clark v. K-Mart Corp.

argued: April 6, 1992.

SUSAN CLARK
v.
K-MART CORPORATION, APPELLANT



On Appeal from the United States District Court for the Western District of Pennsylvania. (D.C. Civil No. 91-1431). September 10, 1992, Reargued

Before: Greenberg and Scirica, Circuit Judges, and Debevoise, District Judge*fn* Reargued Before: Sloviter, Chief Judge, and Stapleton, Mansmann, Greenberg, Hutchinson, Scirica, Cowen, Nygaard, Alito, and Roth, Circuit Judges

Author: Nygaard

Opinion OF THE COURT

NYGAARD, Circuit Judge.

In this appeal, K-Mart challenges first, the propriety of a preliminary injunction which enjoined it from denying coverage for plaintiff's high-dose chemotherapy with autologous bone marrow transplant procedure, and second, the amount of the injunction bond. Because both issues are moot, we will dismiss the appeal.

I.

Susan Clark was diagnosed as having metastatic breast cancer. Her oncologist, Dr. Jeffrey E. Shogan, recommended that she receive high dose chemotherapy with autologous bone marrow transplant ("HDCT-ABMT"). Compared to conventional therapies, this procedure offered Mrs. Clark a relatively good probability of remission and even a reasonable possibility of long-term survival. But it had to begin almost immediately and was estimated to cost in the neighborhood of $150,000.

Mrs. Clark is an employee of K-Mart and sought coverage for this procedure under K-Mart's self-insured Comprehensive Health Care Plan.*fn1 K-Mart has the final authority to determine whether a claim is covered under this ERISA plan, but has contracted with Blue Cross and Blue Shield of Michigan to manage the daily operations of the Plan. Blue Cross concluded that the treatment was experimental and investigational, not covered by the Plan, and K-Mart denied coverage.

Mrs. Clark filed this ERISA action seeking a preliminary injunction to compel K-Mart to fund her HDCT-ABMT treatment. After a hearing, the district court granted her motion and enjoined K-Mart from denying coverage for the procedure, conditioned, however, upon payment of a $1,000 bond. The injunction issued on September 13, 1991. K-Mart did not seek a stay of the preliminary injunction. Rather, it appealed both the propriety of the injunction and the amount of the bond.

II.

At both the panel and in banc arguments, it came to the court's attention that K-Mart had complied with the preliminary injunction. K-Mart never disputed this at either argument. Following argument before the court in banc, we asked the parties to address whether this appeal was moot in light of University of Texas v. Camenisch, 451 U.S. 390, 101 S. Ct. 1830, 68 L. Ed. 2d 175 (1981). We specifically requested the parties to state in writing whether the record disclosed if all the costs of the medical procedures to date had been paid and whether there could be further costs associated with those procedures. We also asked specifically whether there was "any relevant information" with regard to mootness which was not a part of the record and which could be made a part of the record by stipulation or remand. In response, Mrs. Clark asserted both that she received the HDCT-ABMT treatment and that K-Mart paid for it. In K-Mart's response, counsel asserted that the record below did not reveal whether the treatment took place but did not address whether it had information about treatment or payment which could be used to supplement the record on the mootness issue. In fact, counsel's supplemental brief can be read as studiously failing to shed light on Mrs. Clark's post-hearing treatment.

If counsel wished to argue that we should consider only facts in the district court record, he should have forthrightly responded to our request and then argued that, notwithstanding the additional facts, the new facts were not properly before us and should not be considered. Counsel knew or could have found out whether Mrs. Clark received the treatment, and whether K-Mart paid for it. Hence, we will deem admitted Mrs. Clark's unrebutted statement that she received the treatment and that K-Mart paid for it.

Finally, there is nothing in the record to indicate that Mrs. Clark could ever receive the HDCT-ABMT treatment again. Indeed, it was unrebutted at oral argument before the panel that once the ...


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