Bright Health Management, Inc. v. Texas Department of Insurance and Cantilo & Bennett, L.L.P., Special Deputy Receiver of Bright Healthcare Insurance Company of Texas

ACCEPTED 15-25-00092-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS 7/14/2025 2:54 PM NO. 15-25-00092-CV CHRISTOPHER A. PRINE CLERK IN THE COURT OF APPEALS FILED IN FOR THE FIFTEENTH JUDICIAL DISTRICT AUSTIN, TEXAS 15th COURT OF APPEALS AUSTIN, TEXAS 7/14/2025 2:54:55 PM CHRISTOPHER A. PRINE Clerk IN RE BRIGHT HEALTH MANAGEMENT, INC., Appellant, v. BRIGHT HEALTH INSURANCE COMPANY OF TEXAS, Appellee.

On Appeal from the 455th Judicial District Court, Travis County, Texas Cause No. D-1-GN-23-008361 The Honorable Catherine Mauzy, Presiding

BRIGHT HEALTH MANAGEMENT, INC.’S REPLY TO THE COURT’S ORDER REGARDING APPELLATE JURISDICTION

Carlos R. Soltero [email protected] State Bar No. 00791702 Brytne D. Kitchin [email protected] State Bar No. 24079973 Lisa Alcantar [email protected] State Bar No. 24069284 MAYNARD NEXSEN 2500 Bee Caves Road Bldg. 1, Suite 150 Austin, Texas 78746 Counsel for Appellant/Relator TO THE HONORABLE FIFTEENTH COURT OF APPEALS: Appellant Bright Health Management, Inc. (“BHM”) responds to this Court’s July 3, 2025 notice of potential dismissal for want of jurisdiction (“Notice”) as follows: 1. When faced with uncertainty regarding the appropriate vehicle for interim relief, a party may file both an appeal and a petition for writ of mandamus.

Parties whose rights are impacted by trial court decisions in contexts where it is unclear whether their appellate remedy is through an appeal or an original proceeding seeking a petition for writ of mandamus may seek both types of relief in the alternative. See, e.g., CMH Homes v. Perez, 340 S.W.3d 444, 446 (Tex. 2011). In Perez, CMH Homes filed an interlocutory appeal challenging the appointment of an arbitrator, “requesting in the alternative that its appeal be treated as a mandamus petition.” Id. The appellate court determined it was without jurisdiction, but the supreme court disagreed, concluding that the appeal could “properly be treated as a petition for writ of mandamus” and remanding the case for consideration of the merits. Id. When there is uncertainty and a party files only a petition for writ of mandamus, the party risks waiving all appellate rights if mandamus is not the appropriate remedy under the circumstances. See, e.g., In re State ex rel. De Leon, 89 S.W.3d 195, 196–97 (Tex. App.—Corpus Christi 2002, orig. proceeding) (denying petition for mandamus relief because the State had an adequate remedy at law in the form of a statutory appeal that it failed to timely exercise).

Here, given the uncertainty regarding the appropriate remedy under the unique circumstances of an order compelling a non-party to produce documents in an insurance party receivership, BHM filed both this appeal and a petition for writ of mandamus. See In re Bright Health Management, Inc., No. 15-25-00092-CV. Both proceedings challenge the District Court’s May 6, 2025 Order making rulings pertaining to the Special Deputy Receiver’s (“SDR”) June 28, 2024 Motion to Enforce Permanent Injunction Against BHM (the “Motion to Enforce”)1 and BHM’s corresponding Cross-Motion for Entry of Order Governing Electronically Stored Information (the “ESI Cross-Motion”). 2

2. This Court has jurisdiction over this appeal because the challenged Order functions as a temporary injunction and, additionally or in the alternative, as a modified order appointing receiver, and thus is an appealable interlocutory order.3 The Texas Civil Practice and Remedies Code expressly authorizes an appeal “from an interlocutory order of a district court” that “grants or refuses a temporary injunction.” TEX. CIV. PRAC. & REM. CODE § 51.014(a)(4). The Texas Supreme Court has interpreted this to include “jurisdiction over [an] interlocutory appeal from a prejudgment enforcement order that functions as a temporary injunction.” Harley Channelview Prop., LLC v. Harley Marine Gulf, LLC, 690 S.W.3d 32, 41– (Tex. 2024). Consistent with Harley Marine and Section 51.014(a)(4) of the Texas Civil Practices and Remedies Code, whether this Court has jurisdiction over this appeal “depends on whether the trial court’s order can properly be characterized as a temporary injunction.” Harley Marine, S.W.3d at 37.

In Harley Marine, the trial court ordered one of the parties “to immediately convey property to the other to enforce the court’s partial summary judgment ruling.” Id. at 35. The aggrieved party filed an interlocutory appeal, which the court of appeals dismissed for want of jurisdiction. Id. The supreme court disagreed that the appellate court lacked jurisdiction, holding that the trial court’s order directing that a party’s property be immediately conveyed “based on an interim ruling that a claim has merit is a temporary injunction, from which a party may appeal.” Id. In so holding, the supreme court noted that the order (1) required performance by the enjoined party; (2) was made effective and operated during the pendency of the suit; and (3) compelled a party’s performance based on the trial court’s “determination that the opposing party’s claim ha[d] merit.” Id. at 40.

Here, as in Harley Marine, the challenged order (1) requires BHM to perform by conveying its property (and property that belongs to other third parties)—e-mails that include privileged and confidential information not belonging to the insurer in receivership and to which the SDR has no legal or contractual entitlement—to the SDR; (2) is effective immediately and operates during the pendency of proceedings that may continue at the trial court level; and (3) compels BHM’s performance based on the District Court’s determination that the SDR’s claim of entitlement to those e-mails has merit. Accordingly, this Court has jurisdiction to consider the merits of BHM’s appeal under Section 51.014(a)(4) of the Texas Civil Practices and Remedies Code and Harley Marine. See Gruss v. Gallagher, 680 S.W.3d 642, 653–55 (Tex. App.— Houston [14th Dist.] 2023, no pet.) (holding that trial court’s ruling ordering “the current books and records of the Company” be made immediately available to a party constituted “a new temporary injunction” subject to interlocutory appeal under TEX. CIV. PRAC. & REM.

CODE § 51.014(a)(4)).

As further support for this Court’s jurisdiction, Section 51.014(a)(1) of the Texas Civil Practices and Remedies Code provides a statutory right for an appeal “from an interlocutory order of a district court” that “appoints a receiver or trustee.” While BHM is not directly appealing the District Court’s order appointing the SDR, the “character and function” of the District Court’s May 6, 2025 Order that is challenged in this appeal is a modified order appointing receiver as it expands the scope of the SDR’s receivership powers to include entitlement to the property of third parties irrespective of that property’s relevance to the receivership. See Harley Marine, 609 S.W.3d at 39 (“[I]t is the ‘character and function of an order’ that define its classification, not ‘matters of form.’”) (quoting Qwest Commc’ns Corp. v. AT&T Corp., 24 S.W.3d 334, 336 (Tex. 2000) (per curiam)). Thus, this Court also has jurisdiction over this appeal pursuant to Section 51.014(a)(1) of the Texas Civil Practices and Remedies Code. See Gruss, 680 S.W.3d at 653–55.

3. In the alternative, this Court has jurisdiction over this appeal because the challenged Order is a final judgment that disposes of all issues between BHM and the SDR concerning the “books and records” dispute.

Parties may appeal a final judgment in most civil disputes. See TEX. CIV. PRAC. & REM. CODE § 51.012. In determining whether a judgment is a “final judgment” over which an appellate court has jurisdiction, courts examine the substance of the claims before the trial court and the relief sought and granted rather than the form or words on the order. See McFadin v. Broadway Coffeehouse, LLC, 539 S.W.3d 278, 283 (Tex. 2018) (“[N]o particular title, form, or language is required to make a judgment final. Rather, whether it is final depends on both the language in it and the record.”). See also Sealy Emergency Room, LLC v. Free Standing Emergency Room Managers of Am., 685 S.W.3d 816, 824 (Tex. 2024)

(rejecting argument that trial court’s order was not final because the argument “prioritize[d] the technical recitation of unnecessary language over clarity” in appellate process). Thus, even if not “labeled a final judgment . . . an order constitutes a final judgment—and the time to appeal begins to run—when that order disposes of the last claim among the parties to the action.” Sealy Emergency Room, 685 S.W.3d 820. See also McFadin, 539 S.W.3d at 283–84 (“If a judgment disposes of every remaining issue in a case, it does not lack finality for purposes of appeal merely because it . . . refers to only some of the parties or claims.”).

Here, the only disputes between BHM and the SDR were: (1) which books and records in BHM’s possession BHM is required to provide to the SDR (addressed by the SDR’s Motion to Enforce) pursuant to the Insurer Receivership Act; and (2) whether it is appropriate to implement an ESI Protocol in connection with the production of the requested books and records (addressed by BHM’s ESI Cross-Motion). The challenged Order disposes of both issues, leaving no further disputes or controversies between BHM and the SDR pending before the trial court (e.g., award of attorney’s fees), and thus is a final, appealable order. See, e.g., Target Mud and Drilling Fluids, Inc. v. Herrera, No. 01-90-01150-CV, 1992 WL 8 76427, *1 (Tex. App.—Houston [1st Dist.] April 16, 1992, writ denied) (holding a trial court’s order requiring one party to deliver certain books and records to the other party was a final judgment because it disposed of all issues before the trial court—a petition to access books and records and related request for attorney’s fees—and “no future action by the trial court [was] necessary in order to settle and determine the entire controversy”).

Accordingly, if this Court concludes the challenged Order is not an appealable interlocutory order, BHM asserts that in the alternative, this Court has jurisdiction over this appeal because the challenged Order is a final judgment resolving all disputes between BHM and the SDR.

Conclusion “Appellate procedure should not be tricky. It should be simple, it should be certain, it should make sense, and it should facilitate consideration of the parties’ arguments on the merits.” Sealy Emergency Room, 685 S.W.3d at 824 (quoting Lane Bank Equip. Co. v. Smith S.

Equip., Inc., 10 S.W.3d 308, 314 (Tex. 2000) (Hecht, J., concurring)). For the reasons above, BHM respectfully submits that dismissal of this appeal for want of jurisdiction pursuant to TEX. R. APP. P. 42.3(a) would be inappropriate, as this Court has jurisdiction because the challenged Order is: (1) an interlocutory order that is appealable under TEX. CIV. PRAC. & REM. CODE §§ 51.014(a)(4) and/or 51.014(a)(1); or, in the alternative, (2) a final judgment. Accordingly, BHM respectfully requests that this Court consider the merits of BHM’s appeal and grant BHM all other just relief to which it may be entitled.

Respectfully submitted, By: /s/ Carlos R. Soltero Carlos R. Soltero [email protected] State Bar No. 00791702 Brytne D. Kitchin [email protected] State Bar No. 24079973 Lisa Alcantar [email protected] State Bar No. 24069284 MAYNARD NEXSEN 2500 Bee Caves Road Bldg. 1, Suite 150 Austin, Texas 78746 Counsel for Appellant/Relator

CERTIFICATE OF SERVICE I certify that a true and correct copy of this document was sent in accordance with TEX. INS. CODE § 443.007(d) and TEX. R. APP. P. 25.1(e) on July 14, 2025: Via Email: Via Email: [email protected] [email protected] Gregory A. Pierce Edwin Hartsfield P.O. Box 40 TEXAS DEPARTMENT OF INSURANCE Austin, TX 78767 RLO MC-FRD PO Box 12030 Via Email: [email protected] Austin, TX 78711-2030 Christopher Fuller FULLER LAW GROUP Via Email: 4612 Ridge Oak Drive [email protected] Austin, TX 78731 Vane Hugo Telephone: (512) 470-9544 TEXAS DEPARTMENT OF INSURANCE RLO MC-FRD Via Email: Jane Webre PO Box 12030 [email protected] Austin, TX 78711-2030 Scott Douglas & McConnico Colorado St., Suite 2400 Via e-Service: Austin, Texas 78701 [email protected] (512) 465-6300 Shawn Martin General Counsel Division Attorneys for CANTILO & Office of Financial Counsel BENNETT, L.L.P., Special TEXAS DEPARTMENT OF INSURANCE Deputy Receiver of PO Box 12030 Bright Healthcare Insurance Austin, TX 78711-2030 Company of Texas Via e-Service: Via Email: [email protected] [email protected] Jacqueline Rixen Tom Collins, Receivership Master RIXENLAW c/o Special Master’s Clerk RLO 8500 North Mopac Expy MC-FRD 1601 Congress Avenue Suite 605 Austin, TX 78701 Austin, TX 78759

Counsel for the Texas Life and Via Email: Health Insurance Guaranty [email protected] Association John Walker TEXAS DEPARTMENT OF INSURANCE Via First Class Mail RLO MC-FRD INTERNAL REVENUE SERVICE PO Box 12030 Special Procedures Branch Austin, TX 78711-2030 300 East 8th Street, Suite 352 Mail Stop 5026AUS Via Email: Austin, TX 78701 [email protected] Via Email: [email protected] Milan Shah Kelly Drury Centers for Medicare & Medicaid Services Center for Consumer Information and Insurance Oversight 7501 Wisconsin Ave Bethesda, MD 21814 Via Email: Via Email: [email protected] [email protected] Via Email: [email protected] Sandra Salazar Adrianne J. Simon General Counsel Division Blake Gould Office of Financial Counsel Fultz Maddox Dickens PLC TEXAS DEPARTMENT OF 101 South Fifth Street, 27th Floor INSURANCE Louisville, KY 40202 PO Box 12030 Counsel for THC Houston, LLC Austin, TX 78711-2030 d/b/a Kindred Hospital Houston Northwest Via e-Service: [email protected] Zachary L. Rhines Assistant Attorney General General Litigation Division OFFICE OF THE TEXAS ATTORNEY GENERAL

P.O. Box 12548, Mail Stop 01901 Austin, TX 78711-2548 Counsel for Texas Department of Insurance

/s/ Carlos Soltero Carlos R. Soltero

CERTIFICATE OF COMPLIANCE Microsoft Word reports that this document contains 1,761 words, excluding the portions of the document exempted by TEX. R. APP. P. 9.4(i)(1).

/s/ Carlos Soltero Carlos R. Soltero

Automated Certificate of eService This automated certificate of service was created by the efiling system.

The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Max Mendel on behalf of Carlos Ramon Soltero Bar No. 791702 [email protected] Envelope ID: 103102634 Filing Code Description: Response Filing Description: 2025-07-14 BHM Reply to Order re Jurisdiction Status as of 7/14/2025 3:20 PM CST Case Contacts Name BarNumber Email TimestampSubmitted Status Michaelle Peters [email protected] 7/14/2025 2:54:55 PM SENT Jane Webre [email protected] 7/14/2025 2:54:55 PM SENT Christopher Fuller 7515500 [email protected] 7/14/2025 2:54:55 PM SENT Gregory Pierce 15994250 [email protected] 7/14/2025 2:54:55 PM SENT Patricia Muniz [email protected] 7/14/2025 2:54:55 PM SENT Brian Falligant [email protected] 7/14/2025 2:54:55 PM SENT Abril Rivera [email protected] 7/14/2025 2:54:55 PM SENT Rachael Padgett [email protected] 7/14/2025 2:54:55 PM SENT Lisa Alcantar [email protected] 7/14/2025 2:54:55 PM SENT Kayla RosePfeiffer [email protected] 7/14/2025 2:54:55 PM SENT Carlos R.Soltero [email protected] 7/14/2025 2:54:55 PM SENT Max Mendel [email protected] 7/14/2025 2:54:55 PM SENT Brytne Kitchin [email protected] 7/14/2025 2:54:55 PM SENT