FREDERICK A. NITTA, M.D., INC., FREDERICK A. NITTA, individually, HAWAI‘I COUNTY MEDICAL SOCIETY, CHARLENE ORCINO, and ADRIAN “SCOTT” NORTON, Plaintiffs-Appellees, vs. HAWAI‘I MEDICAL SERVICE ASSOCIATION, Defendant-Appellant.  

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

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

The oral argument will also be livestreamed for public viewing via the Judiciary’s YouTube channel at YouTube.com/hawaiicourts and ‘Ōlelo TV 55 at olelo.org/tv-schedule/.

Attorneys for Defendant-Appellant HAWAI‘I MEDICAL SERVICE ASSOCIATION:   
     Joachim P. Cox, Randall C. Whattoff and Kamala S. Haake of Cox Fricke LLP 

Attorney for Plaintiffs-Appellees FREDERICK A. NITTA, M.D., INC., FREDERICK A. NITTA, individually, HAWAI‘I COUNTY MEDICAL SOCIETY, CHARLENE ORCINO, and ADRIAN “SCOTT” NORTON:    
     Ted H.S. Hong  

NOTE: Order granting Application for Transfer, filed 10/23/24. 

COURT: Recktenwald, C.J., McKenna, Eddins, Ginoza, and Devens, JJ. 

Brief Description:

In this case, Plaintiffs are Dr. Frederick A. Nitta, M.D., Inc.; Dr. Frederick Nitta; his patients Charlene Orcino and Adrian “Scott” Norton; and Hawai‘i County Medical Society. 

Plaintiffs sued Defendant Hawai‘i Medical Service Association (“HMSA”), alleging that its refusal to pay for patient medication and treatments tortiously interfered with the contracts between Dr. Nitta and his patients. 

HMSA moved to compel arbitration.  (HMSA also moved for summary judgment as to Orcino’s claims and to stay litigation pending arbitration.)  The circuit court requested supplemental briefing as to whether the contracts between HMSA and Dr. Nitta and his patients were contracts of adhesion and unenforceable.  The circuit court ultimately ruled that they were, in its “Findings of Fact, Conclusions of Law and Order Denying Defendant Hawai‘i Medical Service Association’s Motion: (1) to Compel Arbitration of Frederick A. Nitta, M.D., Inc.’s, Frederick A. Nitta’s, and Adrian ‘Scott’ Norton’s Claims; (2) for Summary Judgment as to Charlene Orcino’s Claims; and (3) to Stay Litigation Pending Arbitration, Filed on June 13, 2023” (“order”).   

HMSA appealed the order to the ICA as beyond the scope of its motion to compel.  The Plaintiffs, however, sought transfer because they considered this appeal as broadly implicating who gets to control healthcare decisions.  The points of error on appeal are summarized as follows: 

1.  The trial court erred when it based its analysis of unconscionability on the substantive terms of the overarching contract rather than the arbitration provisions.
2.  The trial court erred to the extent that it determined that the arbitration provisions in the HMSA-FNI Provider Agreements were not enforceable where the evidence established, among other things, that (a) the terms of the arbitration provisions were fair to all parties and were clearly disclosed to FNI; (b) FNI had the opportunity to provide input on the operative Commercial Provider Agreement but did not do so; (c) HMA provided significant input on behalf of providers like FNI; and (d) with respect to the provider agreements for government health insurance plans, the terms were largely set by the government.
3.  The trial court erred when it determined that the arbitration provision in Mr. Norton’s plan documents and the dispute resolution provision in Ms. Orcino’s plan documents were not enforceable where the evidence established, among other things, that (a) the terms of the dispute resolution provisions were fair to all parties and were clearly disclosed to Mr. Norton and Ms. Orcino; (b) the agreements were negotiated by parties of equal bargaining power – namely, the EUTF (on behalf of Mr. Norton) and the government (on Behalf of Ms. Orcino); (c) plan members by Mr. Norton and Ms. Orcino were given ample notice of the agreements and could review them at length before signing them; and (d) members were regularly reminded of their agreements and provided access to them.  In addition, the unconscionability framework does not apply to Ms. Orcino because her dispute resolution process is dictated by the Med-QUEST Division of DHS.
4.  The trial court erred when it made factual and legal findings that went to the merits of the parties’ dispute.