Donald Carter Kathryn S. Carter v. Health Net of California, Inc.

Donald Carter (“Carter”) and his daughter Kathryn Carter (“Katie”) appeal the district court’s order vacating an arbitration award against Health Net of California (“Health Net”), an insurance company, on the ground that the arbitrator did not have jurisdiction over Health Net. The Carters argue that the district court lacked subject-matter jurisdiction over the opposing petitions to vacate and confirm the arbitration award because neither presented a federal question. We agree, and remand this case to the district court for remand to state court.

I.

On a Member Enrollment and Change Form provided by his employer, Grafil, Inc., Donald Carter selected the Preferred Provider Organization (PPO) insurance product as his employer-sponsored health insurance plan. The header of the form included the logo “Health Net: California’s Health Plan,” while the fine print on the form stated that Health Net Life Insurance (“HNL”) would be the underwriter for the Flex Net and PPO insurance plans, and Health Net would underwrite the other plans. The form also included a mandatory arbitration clause requiring each employee-signatory to submit to arbitration any dispute, except medical malpractice,…