Medical Benefits Admin. v. Nivano Physicians CA3

FACTS AND PROCEEDINGS

MBA provided professional billing and management services for physicians and physician groups. Nivano, an independent practice association, contracted with MBA to provide administrative and management services.1 Under this agreement, Smith, who was the founder and president of MBA, served as Nivano’s chief executive officer (CEO), a role she held until October 2016. LuminX Agreement In 2004, MBA purchased the right to use a piece of healthcare software known as LuminX from Acclamation Systems, Inc., which in turn was purchased by Ebix, Inc. (Ebix) in or around 2010. MBA used LuminX to perform a number of essential functions for Nivano’s operations. MBA paid Ebix $237,415 for the right to use LuminX, and further agreed to pay Ebix a monthly “maintenance fee” in connection with MBA’s continued use of the software. The agreement to purchase the right to use LuminX (LuminX agreement) authorized MBA to use LuminX for “its internal business purposes but not for the internal purposes of third parties or on any timesharing, renting, or service bureau basis.” The LuminX agreement specifically prohibited and made “void” any efforts by MBA to sublicense or otherwise…