Spinedex v United Healthcare of Arizona, Inc.

Frequently Asked Questions

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Questions

Answers

1. WHY DID I RECEIVE THE NOTICE?

Answer:

The United States District Court for the District of Arizona authorized the Notice because you have a right to know about a proposed Settlement of this class action, including the right to claim money, and about all of your options, before the Court decides to give “final approval” to the Settlement. If the Court approves the proposed Settlement, payment will be made to Settlement Class Members who qualify and submit a valid and timely Claim Form. The Notice explains the lawsuit, the Settlement, your legal rights, what benefits are available, who may be eligible for them, and how to get them.  Your right to pursue certain types of claims against Defendants may be affected by the Settlement, so please read the Notice carefully. 

The proposed Settlement was reached in the class action lawsuit under the case caption Spinedex Physical Therapy USA, Inc. et al. v. United Healthcare of Arizona, Inc. et al, pending in the United States District Court for the District of Arizona, Case No. CV 08-0457-PHX-ROS (the “Litigation”).  Plaintiffs Spinedex Physical Therapy USA, Inc. (“Spinedex”) and Claude Aragon (together, the “Settling Plaintiffs” or “Class Representatives”) have agreed to settle all claims against Defendants in the Litigation and certain related entities and individuals in exchange for the United Defendants’ modification of certain business practices and the establishment of a One Million, Four Hundred Seventy-Five Thousand Dollar ($1,475,000) cash Settlement Fund, against which members of the Settlement Class can make claims for a settlement payment.  The Honorable Roslyn O. Silver of the United States District Court for the District of Arizona (the “Court”) has scheduled a hearing to consider the fairness, reasonableness, and adequacy of the Settlement, to be held on August 1, 2019 at 10:00 a.m. at the Sandra Day O’Connor United States Courthouse, United States District Court for the District of Arizona, 401 W. Washington Street, Phoenix, Arizona 85003 (the “Final Fairness Hearing”).

You may elect to opt out of the Settlement Class and the Settlement, as explained in FAQ 10.  You also have a right to object to the proposed Settlement or to the application for attorneys’ fees, costs, and expenses, or the application for service awards to the Class Representatives that Settlement Class Counsel intends to make to the Court, but only if you comply with the procedures described in the Notice.  If you and your Affiliates do not opt out of the Settlement, and the Court finally approves the proposed Settlement, you will be entitled to receive the benefits (if you submit a valid Claim Form) of the Settlement and will be bound by the Settlement’s provisions, including the release of claims against all Released Parties.


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2. WHAT IS THIS LITIGATION ABOUT?

Answer:

The Litigation has been brought against Defendants by the Settling Plaintiffs as a proposed class action.  The Settling Plaintiffs allege that Defendants failed to comply with the Employee Retirement Income Security Act (“ERISA”) and the terms of various private sector employer-sponsored group health plans when processing claims for physical therapy benefits and nonsurgical spinal decompression therapy, regardless of whether the decompression therapy was performed by a physical therapist. 

More specifically, the Settling Plaintiffs allege that Defendants improperly denied coverage for nonsurgical spinal decompression therapy treatments—including, but not limited to, treatments using a Vertebral-Axial Decompression table (“VAX-D”)—on the basis that such treatments are experimental and unproven.  The Settling Plaintiffs also allege that the Defendants’ processing of other physical therapy claims did not meet ERISA’s procedural requirements, and that Defendants’ methodologies for determining reimbursement amounts for Out-of-Network services resulted in underpayment of their physical therapy claims.  While this class action settlement covers alleged improper denials for nonsurgical decompression therapy, it does not cover, on a class-wide basis, claims that the Settling Plaintiffs (i.e., Spinedex and Mr. Aragon) asserted in connection with other types of physical therapy treatments.  However, the settlement does cover the Settling Plaintiffs’ individual claims relating to matters beyond nonsurgical spinal decompression therapy.   

Defendants deny all of the Settling Plaintiffs’ allegations.  To obtain further information about the claims in the Litigation, you may review a copy of the complaints filed in the Litigation from this website.

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3. WHAT IS A CLASS ACTION, AND WHY IS THIS CASE A CLASS ACTION?

Answer:

In a class action, one or more people, called class representatives, sue on behalf of others with purportedly similar legal claims.  All of these people together are called a “class” or “class members.”  If the Court determines that the claims of all members of the proposed class are similar, then that Court will resolve the issues for all class members, except for those who specifically ask to be excluded from the class, because the claims alleged by the class representatives purportedly apply similarly to all class members.  This case was filed as a proposed class action because the Class Representatives believed that Defendants’ policies and practices for processing physical therapy and nonsurgical spinal decompression therapy claims violated ERISA and caused class members to be denied health plan payments to which they were entitled.  The Court did not rule during the Litigation that the case would be certified as a class action, but the Court has preliminarily certified a “Settlement Class” relating to claims for Out-of-Network nonsurgical spinal decompression therapy in connection with settlement of the Litigation.  A “settlement class” is a class solely for purposes of concluding a settlement of the case.  The Court has not certified a settlement class for any other claims that the Settling Plaintiffs asserted.  The Settling Plaintiffs are, however, dismissing all of their claims in connection with the Settlement. 

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4. WHY IS THERE A SETTLEMENT?

Answer:

The Court did not decide in favor of either side on the merits of Plaintiffs’ claims, and Defendants had numerous defenses, including defenses relating to the statute of limitations and the potential failure of claimants to exhaust the process for appealing claims decisions offered by health plans.  Both sides have agreed to settle on a class-wide basis all claims relating to the administration or determination of nonsurgical spinal decompression therapy that were or could have been at any point asserted against Defendants in the Litigation in exchange for a payment of money, along with other non-monetary relief.  The Settling Plaintiffs have also agreed to settle all claims that were or could have been at any point asserted against Defendants in the Litigation.  This way, the Parties avoid the uncertainties and cost of a trial and possible appeal, the affected members of the Settlement Class who qualify will receive a cash payment, and the United Defendants will modify certain internal procedures to which the Settling Plaintiffs, on behalf of the settlement class, object.

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5. WHAT ARE THE TERMS OF THE PROPOSED SETTLEMENT FOR THE CLASS MEMBERS?

Answer:

In the Settlement Agreement, the Settling Plaintiffs, on behalf of the Settlement Class Members, agreed to settle all claims relating to the administration or determination of Out-of-Network nonsurgical spinal decompression therapy that were or could have been at any point asserted against Defendants in the Litigation in exchange for a payment of money, along with other non-monetary relief.  The proposed settlement class covers only private sector employer-sponsored health plans insured or administered by the United Defendants.

The terms of the Settlement Agreement are summarized in the Notice, and a copy of the entire Settlement Agreement, dated December 20, 2018, may be reviewed on this website.

A.  Settlement Payment

If the Court grants final approval of the Settlement, the Settlement Agreement provides for monetary benefits to be provided by Defendants to members of the Settlement Class who have not opted out of the Settlement and who meet the requirements set forth in the Plan of Allocation described in FAQ 6.

The Settlement establishes a cash Settlement Fund in the amount of One Million, Four Hundred Seventy-Five Thousand Dollars ($1,475,000), plus accrued interest, less Settlement Class Counsel’s attorneys’ fees, costs, and expenses and the Settling Plaintiffs’ service awards as finally approved by the Court, and the costs and expenses of administering the Settlement and Settlement Fund.  If the Settlement is finally approved by the Court, members of the Settlement Class will be entitled to payments from the cash Settlement Fund, as set forth in the Plan of Allocation described in FAQ 6, and subject to the provisions of the Settlement Agreement.

B.  Non-Monetary Relief

If the Court grants final approval of the Settlement, the United Defendants will also undertake certain non-monetary relief.  As described in the Settlement Agreement, the United Defendants will:

  • Modify certain internal policies and practices pertaining to appeals of denied claims and ERISA document requests, as described in the Settlement Agreement.  Settling Plaintiffs believe that these modifications will i) increase the likelihood that all important documents needed to review claims are available to the United Defendants, ii) allow authorized representatives to more easily submit claims, and iii) provide participants and beneficiaries with better access to documents that they may need to effectively appeal denied claims.
  • Have their Medical Technology Assessment Committee review and consider additional post-2010 medical literature submitted by the Settling Plaintiffs concerning the medical efficacy of Decompression Therapy.
  • Arrange for one or more representatives from the Medical Technology Assessment Committee to meet with stakeholders (to be chosen by the Settling Plaintiffs) to discuss the medical efficacy of Decompression Therapy.

C.  The Release and Dismissal with Prejudice

If the Settlement Agreement is finally approved, the Litigation will be dismissed with prejudice as to all Defendants.  However, if enough Settlement Class Members opt out or if the value of opt outs exceeds a certain dollar value, the United Defendants may cancel the settlement. In addition, the Defendants and Released Parties will be released and discharged of any and all claims, up through April 24, 2019, as stated in Article XIII of the Settlement Agreement, that the Settling Plaintiffs or Settlement Class Members did assert or could have asserted against any of the Released Parties based on or arising from their administration and/or determination of Out-of-Network Benefits for Decompression Therapy Services.  These claims include claims that the Settlement Class Members may not know or suspect to exist in their favor through April 24, 2019. 

In substance, the Settlement Class Members are releasing all Released Parties (which include all of the Defendants’ heirs, executors, predecessors, administrators, successors, assigns, past, present and future and direct and indirect parents, Subsidiaries and Affiliates, and each of their agents, representatives, officers, directors, executives, members, partners, participants, shareholders, investors, principals, employees, trustees, assigns and attorneys) from claims based on, by reason of, arising from, in connection with, or relating to the Released Parties’ administration and/or determination of Out-of-Network Benefits for Decompression Therapy Services.  These claims are released regardless of whether they arise due to joint or coconspirator liability for acts or omissions by any of the Released Parties or any Person other than the Released Parties.  The release and “covenant not to sue” provisions of the Settlement Agreement affect your legal rights, and you should review them carefully. A complete copy of the Settlement Agreement may be reviewed on this website.

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6. HOW WILL THE SETTLEMENT FUND BE ALLOCATED?

Answer:

The Settlement Fund is $1,475,000 plus accrued interest.  The Net Settlement Fund is the Settlement Fund less Settlement Class Counsel’s attorneys’ fees, costs, and expenses, and the Settling Plaintiffs’ service awards as finally approved by the Court, and the costs and expenses of administering the Settlement and Settlement Fund.

The Net Settlement Fund will be allocated to members of the Settlement Class based on the Recognized Loss of each member of the Settlement Class as determined below.  Should the amount of all submitted claims be less than or equal to the Net Settlement Fund, all claimants shall receive their full Recognized Loss less 20% as explained below.  Should the amount of all submitted claims be greater than the Net Settlement Fund, claimants shall receive a percentage of their Recognized Loss less 20% based on a pro rata allocation.

Terms that appear frequently in this section are the following:

  •  “Claim Form” means the form attached to the Notice.
  • “Complete Claim Denial(s)” means a denial of the entirety of a claim or claims for reimbursement submitted by a Settlement Class Member for the service provided to a Plan Member on a date of service, resulting in no reimbursement to the Settlement Class Member by any of the Released Parties for such service.  Where more than one claim is submitted on a single date of service, each claim that is denied in its entirety constitutes a Complete Claim Denial.
  •  “Decompression Therapy Services” means any type of nonsurgical spinal decompression therapy, including, but not limited to, such therapy administered using the VAX-D Table and encompassed by HCPCS code S9090.  Decompression Therapy Services does not include traction.
  •  “Out-of-Network” means healthcare services provided to a Plan Member outside the plan’s participating provider network as it is defined under the terms and conditions of his or her plan, but to which the Plan Member is still entitled to coverage under the terms and conditions of such plan.
  • “Plan Member” means a Person enrolled in or covered by a plan for benefits offered or administered by the United Defendants and governed by ERISA.
  • “The VAX-D Table” means the VAX-D Therapeutic Table, or the Vertebral Axial Decompression Table, invented by Allan Dyer, M.D., Ph.D., and manufactured by VAX-D Medical Technologies USA, as well as all other forms of nonsurgical spinal decompression therapy.  Nonsurgical spinal decompression therapy does not include traction.

All members of the Settlement Class must submit a Claim Form to be eligible to receive payment from the Net Settlement Fund.  You may submit a Claim Form for any Complete Claim Denial of Out-of-Network Decompression Therapy Services received through April 24, 2019.  If you file a Claim Form prior to that date, but you have additional claims, you may submit an update to your previously filed claim no later than May 24, 2019. 

There are two types of Settlement Class Members—Plan Members (participants or beneficiaries in private sector plans) and medical providers.  The eligibility requirements for Plan Members to submit a Claim Form and receive payment are different from those of medical providers.  You have been mailed either a Plan Member or medical provider Claim Form based on the United Defendants’ records.  Additional information is provided below.  

Important Information 

If you are a Plan Member and paid out-of-pocket (other than solely for a copayment, coinsurance, or deductible) for any Complete Claim Denial of Out-of-Network Decompression Therapy Services, payments from the Net Settlement Fund will be made directly to you if you qualify. 

Eligibility Requirements for Plan Members

You are eligible to participate as a claimant in Group 1 only if you are a Plan Member who paid to your medical provider any portion of the amount billed by your medical provider above your copayment, coinsurance, or deductible for a Complete Claim Denial of Out-of-Network Decompression Therapy Services received from March 7, 2002 through April 24, 2019.  You must also have had difficulty understanding or completing the procedures for appealing the Complete Claim Denial under the terms of your health plan.   

The Recognized Loss for Group 1 claimants is 100% of the amount that you paid.  However, 20% of the Recognized Loss will be subtracted to arrive at your eligible payment amount from the Settlement Fund to take into account copayments, coinsurance, or deductibles that you would ordinarily pay under your health plan.   

Eligibility Requirements for Medical Providers

You are eligible to participate as a claimant in Group 2 only if you meet all of the following requirements:

  • You are a medical provider who provided Out-of-Network Decompression Therapy Services to a Plan Member for which a Complete Claim Denial was received from March 7, 2002 through April 24, 2019. 
  • You received an assignment that allows you to collect Out-of-Network Benefits from a Plan Member and can produce such assignment.  You may be required to produce the assignment when (or after) you submit your claim under the Settlement Fund. 
  • You also must have had difficulty understanding or completing the procedures for appealing the Complete Claim Denial under the terms of the relevant health plan.
  • The Plan Member must not have paid you for the Out-of-Network Decompression Therapy Services for which you submitted a claim.  You are eligible if the Plan Member paid only a copay, coinsurance, or deductible, or if the Plan Member paid less than the full amount of the claim after accounting for copayments, coinsurance, and deductibles.  You are not required to have balance billed the Plan Member to be eligible.      

The Recognized Loss for Group 2 claimants is 100% of the amount of the claim that you submitted for Out-of-Network Decompression Therapy Services provided to a Plan Member.  However, 20% of the Recognized Loss will be subtracted to arrive at your eligible payment amount from the Settlement Fund to take into account copayments, coinsurance, or deductibles that the Plan Member would ordinarily be responsible for under his or her health plan.   

When you receive payment from the Net Settlement Fund, you will be deemed to have released the Plan Member from further liability relating to the specific claim that you make.  

Additional Provisions for All Settlement Class Members (Plan Members and Medical Providers)

  • If you do not submit a Claim Form, you will not receive any money from the Net Settlement Fund.  However, you will nonetheless be bound by the judgment of the Court and any claim you have against Defendants will be released, unless you opted out.
  • If the total amount of valid claims submitted by claimants (Plan Members and medical providers) is greater than the Net Settlement Fund, your Recognized Loss will be paid on a pro rata basis.
  • All Recognized Losses are rounded to the nearest dollar.

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7. WHAT WILL HAPPEN AT THE FINAL FAIRNESS HEARING?

Answer:

The Final Fairness Hearing will be held before Judge Roslyn O. Silver on August 1, 2019, at 10:00 a.m., at the Sandra Day O’Connor United States Courthouse, United States District Court for the District of Arizona, 401 W. Washington Street, Phoenix, Arizona 85003. The hearing, however, may be adjourned by the Court without additional notice to the Settlement Class, other than an announcement in open court.

Members of the Settlement Class who support the Settlement do not need to be present at the hearing or take any action to indicate their approval, as Settlement Class Counsel will be present to address any questions or concerns raised by the Court.  At the Final Fairness Hearing, the Court will consider:

  • Whether the Settlement of the Litigation that is reflected in the Settlement Agreement is fair, reasonable, and adequate to the members of the Settlement Class;
  • Whether the Court should unconditionally certify the Settlement Class for settlement purposes only in accordance with Rule 23 of the Federal Rules of Civil Procedure; and
  • What attorneys’ fees, costs, and expenses should be paid to Settlement Class Counsel from the Settlement Fund.

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8. MAY I PARTICIPATE IN THE FINAL SETTLEMENT HEARING?

Answer:

Any Settlement Class Member who objects to the Settlement, the Settlement Agreement, the application for attorneys’ fees, costs, and expenses, or the other matters to be considered at the Final Fairness Hearing may submit such objections to Settlement Class Counsel.  Settlement Class Members are not required to appear at the Final Fairness Hearing to present any objections; all objections will be consolidated and filed with the Court prior to the Final Fairness Hearing by Settlement Class Counsel.  You may appear at the Final Fairness Hearing by counsel at your own expense, if you wish.

To object to the Settlement, you must, on or before May 24, 2019:

  • Serve, either by hand delivery or by first-class mail, postage prepaid, a statement setting forth your objections, if any, to the matters to be considered and the basis for those objections, along with any documentation in support of those objections, upon the following counsel:

Settlement Class Counsel
Joseph A. Garofolo
Garofolo & Ramsdell, LLP
3443 Golden Gate Way, Suite H
Lafayette, CA 94549

To be permitted to appear at the Final Fairness Hearing, you must, on or before May 24, 2019:

• File with the Court a notice of your intention to appear; and
• On the same or following day, serve a copy of the notice of your intention to appear, either by hand delivery or by first-class mail, postage prepaid, upon the following counsel:

Settlement Class Counsel
Joseph A. Garofolo
Garofolo & Ramsdell, LLP
3443 Golden Gate Way, Suite H
Lafayette, CA 94549

Defense Counsel
Jared R. Friedmann, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153

John C. West
Lewis Roca Rothgerber Christie LLP
201 East Washington Street, Ste 1200
Phoenix, AZ 85004

If you do not comply with the foregoing procedures and deadlines for submitting written objections and/or appearing at the Final Fairness Hearing, you may lose substantial legal rights, including, but not limited to: i) the right to appear and be heard at the Final Fairness Hearing; ii) the right to contest approval of the proposed Settlement or the application for an award of attorneys’ fees, costs, and expenses or service awards for Class Representatives; and iii) the right to contest any other orders or judgments entered in connection with the Settlement.

You cannot request exclusion from the Settlement and also object to the Settlement.  Only members of the Settlement Class may object to the Settlement.  You should consult the Court’s Preliminary Approval Order for additional information on the requirements for objecting to the Settlement or participating in the Final Fairness Hearing.  A copy of the Order may be reviewed on this website.

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9. HOW DO I FILE A CLAIM FOR PAYMENT?

Answer:

The Settlement provides for payments from the Net Settlement Fund to members of the Settlement Class who do not opt out and who qualify and timely submit Claim Forms to the Settlement Administrator.  In order to qualify for a settlement payment, you must complete Group 1 (Plan Members) Paper Claim Form or Group 2 (Medical Providers) Paper Claim Form, sign it, and mail it to:

Spinedex Class Action Litigation
c/o Settlement Administrator
PO Box 58430
Philadelphia, PA 19102-8430

YOUR CLAIM FORM MUST BE POSTMARKED NO LATER THAN MAY 24, 2019.
Whether or not you mail in a Claim Form, if you are a member of the Settlement Class who has not opted out, you will be bound by all orders and judgments entered in connection with the Settlement and Settlement Agreement, including the release and discharge of claims against the Defendants and Released Parties, the covenant not to sue, and the dismissal with prejudice described above, unless you exclude yourself from the Settlement Class.



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10. WHAT IF I DO NOT WANT TO BE PART OF THE SETTLEMENT?

Answer:

If you do not want to be a Settlement Class Member and participate in the Settlement (including being eligible to receive monetary payments), then you must complete and sign the Opt-Out Request Form and mail by first-class mail the completed Opt-Out Request form to:

Spinedex Class Action Litigation – EXCLUSIONS
c/o Settlement Administrator
PO Box 58430
Philadelphia, PA 19102-8430

YOUR REQUEST FOR EXCLUSION MUST BE POSTMARKED NO LATER THAN MAY 24, 2019.
By opting out from the Settlement Class, you will not share in the Settlement, and you may seek to file any claim you believe you have against the Defendants by filing your own lawsuit at your own expense.  Out-Of-Network provider groups, as distinct legal entities, and their individual Out-Of-Network provider members, partners, shareholders, owners, or employees, must separately request exclusion from the Settlement Class in order to opt out.     


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11. DO I HAVE A LAWYER IN THIS CASE?

Answer:

The Court has appointed Garofolo & Ramsdell, LLP as lead Settlement Class Counsel for settlement purposes to represent you and the Settlement Class.  You do not have to separately pay Settlement Class Counsel.  Settlement Class Counsel will seek compensation from the Settlement Fund.  You may have your own lawyer appear in court for you in this case, but you must hire one at your own expense.

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12. HOW WILL THE LAWYERS BE PAID?

Answer:

If the Court approves the proposed Settlement, Settlement Class Counsel will apply to the Court for an award of attorneys’ fees in an amount not to exceed thirty-three and one-third percent (33-1/3%) of the Settlement Fund, and reimbursement of costs and expenses not to exceed $126,000 (not including reimbursement of mediation fees by the United Defendants). Any attorneys’ fees and expenses awarded by the Court will be paid from the Settlement Fund.

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13. WHAT IF I DO NOTHING AT ALL?

Answer:

If you do nothing, you will get no money from the Settlement.  But, unless you exclude yourself from the Settlement Class, you will be bound by the release and covenant not to sue provisions of the Settlement.

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14. HOW DO I GET MORE INFORMATION?

Answer:

This website is a summary and does not describe all details of the Settlement.

Complete copies of the Settlement Agreement, the complaints filed in the Litigation, the Preliminary Approval Order, and certain other Court orders in this case, except for those filed under seal, may be examined and copied during regular office hours, and subject to customary copying fees, at the Clerk of the Court’s Office, United States District Court, District of Arizona, Phoenix, Arizona. Certain documents—including the Settlement Agreement—may also be obtained on this website.
You also may obtain copies of the above-described documents, copies of the Notice, and the Group 1 (Plan Members) Paper Claim Form or Group 2 (Medical Providers) Paper Claim Form on this website, or by contacting the Settlement Administrator at:

Spinedex Class Action Litigation
c/o Settlement Administrator
PO Box 58430
Philadelphia, PA 19102-8430
Settlement Administrator Telephone: 1-844-702-2787

DO NOT CALL OR WRITE THE COURT, THE CLERK OF THE COURT, DEFENDANTS, OR DEFENSE COUNSEL FOR INFORMATION OR LEGAL ADVICE.




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This website is authorized by the Court, supervised by counsel and controlled by the Settlement Administrator approved by the Court. This is the only authorized website for this case.

For more information please call 844-702-2787

Documents

Please read for a full explanation of the settlement and your options and all applicable timelines.

Contact

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Submit Claim

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Important Dates

  • Exclusion Deadline.

    Friday, May 24, 2019 You must complete and mail your request for exclusion form so that it is postmarked no later than Friday, May 24, 2019.
  • Objection Deadline.

    Friday, May 24, 2019 You must mail your objection(s) and/or notice of intent to appear at the Final Approval Hearing so that it/they are postmarked no later than Friday, May 24, 2019.
  • Claim Form Deadline.

    Friday, May 24, 2019

    You must submit your Claim Form on line no later than Friday, May 24, 2019, or mail your completed paper Claim Form so that it is postmarked no later than Friday, May 24, 2019.

  • Final Fairness Hearing Date.

    Thursday, August 1, 2019

    The Final Fairness Hearing is scheduled for Thursday, August 1, 2019 at 10:00 am. Please check this website for updates.

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