Michigan Supreme Court Finds Medical Providers Are Not in Privity With Claimants After Assignments Are Executed

In Mecosta, the Michigan Supreme Court eliminated the defense of res judicata and collateral estoppel when an assignment occurred before a judgment or order was entered because there was no privity between assignor and assignee.

However, defendants may still raise the first lawsuit’s same winning underlying defenses in the second lawsuit. In Mecosta, the insurance companies may still raise their MCL 500.3113(b) defense on which they prevailed in the Wayne Circuit Court, but the Kent Circuit Court is not required to follow the Wayne Circuit’s prior ruling.

Mecosta failed to address the issue of when dates of service occurred after a judgment or order was entered.

The claims in Mecosta arose before the No-Fault Tort Reform was enacted in 2019 and was solely decided on when an assignment of benefits was executed. Mecosta did not mention or reference medical providers’ new statutory standing under the 2019 No-Fault Reforms.

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