No. SCAP-12-0000361, Thursday, May 16, 2013, 10 a.m.

MICHAEL SIOPES and LACEY SIOPES, Petitioners/Plaintiffs-Appellants, vs. KAISER FOUNDATION HEALTH PLAN, INC.; HAWAI`I PERMANENTE MEDICAL GROUP, INC; KAISER FOUNDATION HOSPITALS, INC., Respondents/Defendants-Appellees.

The above-captioned case has been set for argument on the merits at:

Supreme Court Courtroom
Ali`iolani Hale, 2nd Floor
417 South King Street
Honolulu, HI 96813

Attorneys for Petitioners:

Mark S. Davis, Michael K. Livingston, Matthew C. Winter, and Clare E. Connors of Davis Levin Livingston

Attorneys for Respondents:

William S. Hunt, Dianne Winter Brookins, Jan M. Vernon, and David A. Abadir of Alston Hunt Floyd & Ing

NOTE: Order granting Application for Transfer, filed 08/29/12.

NOTE: Order granting motion for postponement of oral argument from 04/04/13 to 05/16/13 at 10:00 a.m., filed 03/05/13.

COURT: MER, CJ; PAN, SRA, SSM, & RWP, JJ.

[ Listen to the entire audio recording in mp3 format ]

Brief Description:

Petitioners Michael Siopes and Lacey Siopes appeal from the Circuit Court of the First Circuit’s (circuit court) March 5, 2012 orders granting Respondents Kaiser Foundation Health Plan, Inc., Hawai`i Permanente Medical Group, Inc., and Kaiser Foundation Hospitals, Inc.’s (collectively, “Kaiser”) Motion to Compel Arbitration (Motion to Compel Arbitration) and Motion to Stay Discovery and Other Pretrial Proceedings Pending a Ruling on the Motion to Compel Arbitration (Motion to Stay Discovery).

Michael Siopes is enrolled in a Kaiser group health plan through his employer, the Hawai`i Employer-Union Health Benefits Trust Fund (EUTF). Lacey Siopes, Michael Siopes’ spouse, is not enrolled in a Kaiser plan. Petitioners filed suit against Kaiser, asserting claims including breach of contract and medical negligence and seeking a declaration that the mandatory arbitration provision contained in the group service agreement between the EUTF and Kaiser is void and unenforceable.

The circuit court granted Kaiser’s Motion to Compel Arbitration and Motion to Stay Discovery, compelling Petitioners to arbitrate all of their claims. Petitioners timely appealed both orders and filed an application for transfer of the appeal from the Intermediate Court of Appeals to this court. This court issued an order granting transfer on August 29, 2012.

Petitioners argue that the circuit court erred by: 1) failing to find the arbitration provision unenforceable due to the lack of mutual assent and bilateral consideration; 2) compelling Lacey Siopes to arbitrate her claims even though she is not a Kaiser member; and 3) failing to review the terms of the arbitration provision for unconscionability. Respondents maintain that: 1) as a Kaiser member, Michael Siopes is bound by the arbitration provision contained in the service agreement negotiated by Kaiser and the EUTF; 2) the broad language of the arbitration provision encompasses Lacey Siopes’ claims; and 3) the terms of the arbitration agreement are not unconscionable.