This week's notable decision, Hamid v. Metropolitan Life Ins. Co., No. 20-CV-01601-VC, 2021 WL 405225 (N.D. Cal. Feb. 5, 2021), was heard by the Honorable Vince Chhabria. In ruling for the plaintiff, the court reaffirmed that objective evidence was not required to prove disability. The court also determined that certain evidence in the record contained objective indications of disability that MetLife had ignored. Additionally, the court found that MetLife’s failure to engage with Hamid’s favorable Social Security disability determination in a meaningful way further undermined its finding of no disability.
Mr. Hamid worked in the mortgage brokerage industry for several years. In his last position as an Enterprise Retail Sales Manager at Bank of America, Hamid managed the mortgage department for eight Bank of America branches and managed ten to fifteen employees who reported directly to him.
Hamid’s medical records document a history of recurrent sinus infections and headache-related issues dating back as early as 2000. He sought treatment from over a dozen different doctors and specialists over many years and underwent both conservative and invasive treatments. Hamid consistently reported chronic head and face pain which was documented in medical records and corroborated by statements from his family members and co-workers. Hamid stopped working in October 2018 and filed claims for STD and LTD benefits based on a combination of frequent migraines, persistent pain and pressure in his face and head, and side effects of medications that included fatigue and mental fogginess.
MetLife denied Hamid’s claims on grounds that there was not enough “clinical” or “objective” evidence to substantiate his subjective complaints. The court rejected MetLife’s arguments and found that, within the context of prolonged and consistently documented chronic pain and headache systems, it was wrong for MetLife to insist upon “objective” and “clinical” evidence as a prerequisite for disability. The court, citing Holmgren v. Sun Life & Health Ins. Co., 354 F. Supp. 3d 1018, 1028 (N.D. Cal. 2018), noted that chronic headache and migraine pain is precisely the type of medical condition that is difficult to quantify through lab reports and imaging scans. The fact that Mr. Hamid’s test and imaging results were mostly normal or showed only mild abnormalities was not a sufficient basis to assume that Hamid was exaggerating his symptoms. The court pointed out that, although Hamid’s treating doctor found his symptoms to be “out of proportion” to exam and objective findings, the same doctor continued to recommend treatments, including additional surgeries, which supported the veracity of Hamid’s reported symptoms. The court considered that there was substantial corroborating evidence for Mr. Hamid’s symptoms in the form of treatment records, supporting letters from his treating doctors, and supporting statements from family members and coworkers, and there was no contrary evidence to suggest his symptoms were not credible.
In addition, the court pointed to several objective indications of disability that MetLife had ignored. The court found objective indications of disability beyond self-reported symptoms including Hamid seeking and receiving extensive pain management treatments from multiple medical specialists, such as botox injections, allergy injections, and multiple surgeries. Prescriptions for numerous powerful drugs including opioids and ketamine also constituted objective evidence of impairment.
The court found it notable that the SSA had approved disability benefits on essentially the same records. The court also found it notable that MetLife did not address or engage with the SSA decision in any meaningful way, pointing out that Metlife had not substantively discussed the SSA determination or articulated why the SSA might have reached a different conclusion. The court stated that MetLife’s “cursory” treatment of the SSA decision further undermined its determination of no disability.
Considering the totality of the evidence, the court granted Hamid’s motion for judgment and ordered MetLife to pay STD benefits and 24 months of LTD benefits for the “own occupation” period of disability.
Summaries of this past week’s notable ERISA decisions.
Dimopoulou v. First Unum Life Ins. Co., et al., No. 1:13-CV-07159-ALC, 2021 WL 406741 (S.D.N.Y. Feb. 5, 2021) (Judge Andrew L. Carter, Jr.). In this case, the court awarded Plaintiff’s attorneys’ fees in the amount of $259,076.40, costs in the amount of $2,694.95, and prejudgment interest in the amount of $143,166.98. The dispute in this case with regard to fees was limited to an increase in the previously approved reasonable hourly rate. Defendant disputed Plaintiff's request of a 4% increase in the fee amount. The court agreed, finding that although Plaintiff’s counsel pointed to its own practice as justification for the rate, it failed to show that $750 was commensurate with the market. The cases where counsel had been awarded this rate were all Social Security matters. The court found that an hourly rate awarded in a Social Security matter was inapposite and not helpful in determining a reasonable market rate in an ERISA case. The court also reduced the fee requested based on the reasonableness of hours expended, finding that the request was too high. Defendant did not object to the requested costs and thus they were awarded. With regard to pre-judgement interest, the court, noting the “sound discretion” it has in determining whether to award interest, discussed the factors to be considered and determined an award of interest was appropriate in this case. Defendant argued that interest should not be awarded because Plaintiff never won a judgment; instead, Defendant decided on its own to pay Plaintiff benefits. Alternatively, Defendant argued that Plaintiff was not entitled to benefits until November 2019, when she submitted the evidence upon which Defendant purported to have ultimately approved her benefits. Defendant also argued that the delay between its receipt of the evidence in November 2019 and its determination in February 2020 was justified, so no interest was payable prior to February 2020. If the court awarded interest, Defendant argued that the prime rate, 3.25%, was equitable. The court found most of Defendant’s arguments unpersuasive. The court had allowed interest in other cases when benefits were awarded after an administrative review rather than litigation and the court was not persuaded by Defendant’s argument that Plaintiff should be deemed to have been eligible as of the time sufficient evidence was submitted. Defendant had agreed to pay benefits retroactive to November 30, 2010. Consequently, awarding interest from that time would fully compensate Plaintiff for the benefit to which she was entitled, be fair and equitable, and encourage the remedial purpose of ERISA. However, the court did agree with Defendant that an award of 9% interest would not be equitable and represented a windfall for Plaintiff. Accordingly, the court ordered interest at the prime rate, 3.25%.
Wise v. Monterey Cty. Hosp. Ass'n Health & Welfare Plan, No. 18-CV-07454-LHK, 2021 WL 308521 (N.D. Cal. Jan. 28, 2021)(Judge Lucy H. Koh) After a bench trial, the court determined Plaintiff’s claim for health insurance benefits was wrongfully denied by United Healthcare (“UHC”), but that neither UHC nor Maximus, who provided an independent medical review of UHC’s denial and upheld UHC’s incorrect decision, had breached fiduciary duties to Plaintiff. Plaintiff then brought this motion for attorney’s fees. The court determined an award of costs and fees should be granted, and UHC agreed but challenged which fees and costs should be awarded. The court excluded from the award attorney's fees incurred pursuing claims against other defendants. The court also reduced the total amount of fees by 15% because Plaintiff prevailed on her claim for benefits due, but lost on her breach of fiduciary duty claim, and was therefore ultimately only partially successful.
Breach of Fiduciary Duty
Varga v. General Elec. Co., No. 20-1144-CV, __ F. Appx. __, 2021 WL 391602 (2d Cir. Feb. 4, 2021) (Before Kearse, Pooler, and Lynch, Circuit Judges). This appeal involved the dismissal of a putative class action claim for breach of fiduciary duty for continuing to offer the GE Stock Fund as an investment option for the 401(k) plan. The district court dismissed the complaint on the basis that Appellant failed to plausibly plead an alternative action that the fiduciaries could have taken that would have protected the plan the plan participants. Appellant argued on appeal that she adequately alleged alternative actions that would have protected the plan and plan participants including earlier disclosure that the Fund was overvalued since GE knew it had been improperly under-reserving for insurance liabilities by five to ten billion dollars. Appellant also argued that GE could have closed the Fund to new investments. Appellant argued that the failure to disclose would only increase reputational damage once the issue was inevitably disclosed but the Court agreed with the district court that the Complaint failed to allege any triggering event that would make disclosure inevitable. The Court also found that the allegations that the Fund could have been closed was conclusory and did not state facts sufficient to suggest that the fiduciaries could not have concluded that such action would do more harm than good.
In re MedStar ERISA Litig., No. CV RDB-20-1984, 2021 WL 391701 (D. Md. Feb. 4, 2021) (Judge Richard D. Bennett). Plaintiffs alleged breach of fiduciary duty related to the management of the MedStar Health, Inc. Retirement Savings Plan, claiming that the Plan failed to appropriately monitor expense ratios compared to those charged by similarly sized plans, resulting in overly expensive Plan options. MedStar moved to dismiss, arguing that the passively managed investment options could not be compared to actively managed options. The court did not agree that such a distinction could be properly determined at this early stage of litigation, and allowed the litigation to proceed.
Stewart v. Kamphuis, No. 3:20-CV-10384-RHC-APP, 2021 WL 311228 (E.D. Mich. Jan. 29, 2021) (Judge Robert H. Cleland). The Department of Labor filed a complaint against Defendants alleging breaches of fiduciary responsibilities under ERISA §§ 403, 404, and 406 with respect to the Deliver Dental Solutions, Inc. 401(K) Plan and Trust. The Bankruptcy Court had held defendants had nondischargeable debt to the Plan of $53,590.41. Upon consideration of this finding, the court entered a consent order and judgment assigning various financial obligations to the Defendants for unremitted employee salary deferral contributions and loan repayments, and associated lost opportunity costs. It also assessed a penalty on Defendants in the amount of $8,497.52 pursuant to § 502(1).
Central Valley Ag Coop. v. Leonard, No. 19-3044, 2021 WL 317215, __ F.3d __ (8th Cir. Feb. 1, 2021) (Before Benton, Erickson, and Grasz, Circuit Judges). Plaintiff Central Valley Agricultural Cooperative (“Central Valley”) adopted a self-funded health care plan after a merger. It obtained the plan through a broker. The plan it chose included medical bill reviewers employed by a third party administrator. That administrator then sub-contracted another reviewing company for the work. Central Valley believed the payment structure between the third party administrator and its subcontractor constituted an illegal kickback. In 2016 Central Valley moved to a different reviewing system, but continued to believe that the structure of payments for review was illegal and improper and filed suit, alleging breach of fiduciary duty under ERISA. The district court held that the ERISA claims were not valid as the third party administrator was not a fiduciary under ERISA. The administrator did not exercise discretionary control over the plan, its assets, or its administration. Under the payment plans, the third party administrator made recommendations about whether to reduce payments, but Central Valley made the final decision. The court determined that only one entity in the structure was a fiduciary, a claims delegate that had discretion to adjust payment upwards by 30% of the permitted payment level. However, none of the allegations relating to breach of fiduciary duty included the claims delegate role. The Eighth Circuit affirmed the district court’s ruling in favor of Defendants and its award of attorney fees.
Disability Benefit Claims
Hewitt v. Lincoln Fin. Corp., No. 18 C 8235, 2021 WL 353884 (N.D. Ill. Feb. 2, 2021) (Judge Joan H. Lefkow). Hewitt sued Defendants under ERISA to recover long-term disability benefits, medical care benefits, and payments allegedly due under the terms of the plan. Plaintiff applied for benefits in July of 2013, and Defendants denied his claim and appeal at the end of the year. The denial letter informed Hewitt that he had “the right to bring civil action under section 502(a) of ERISA following an adverse benefit determination on review,” but the letter did not set out the applicable time limit to do so. The Policy provided that “[a] claimant… cannot start any legal action … more than three years after the time Proof of claim is required.” Plaintiff did not file suit until December 2018. Liberty moved to dismiss Hewitt's second amended complaint, arguing that the claims were time-barred. Hewitt argued that his claims were not time-barred because Liberty failed to notify him of the time limitation in its appeal denial letter as required by ERISA. The court held that it was the denial of benefits letter, as opposed to the Policy, that most clearly and readily provides the Plaintiff with the information he needs to know to pursue his claim. The regulation itself contemplates that failure to include this information in the denial of benefits letter is per se prejudicial to the Plaintiff. In addition, the court held that it was well established in the Seventh Circuit that where “a participant sues...seeking to recover benefits purportedly due to him under the terms of his ERISA plan...the most analogous Illinois statute of limitations is the 10-year period for suits pertaining to written contracts.”
White v. Anthem Life Ins. Co., No. 20-CV-03591-HSG, 2021 WL 352098 (N.D. Cal. Feb. 2, 2021) (Judge Haywood S. Gilliam, Jr.). On September 4, 2019, the court found that Plaintiff failed to exhaust her administrative remedies before seeking judicial review and granted Defendant’s motion for summary judgment on this basis. White appealed the court’s summary judgment order to the Ninth Circuit. Before the Ninth Circuit issued a decision, White sent a letter to Anthem on February 20, 2020 requesting that Anthem review its termination of her benefits. Anthem replied to this letter on March 18, 2020, stating that White was not eligible for an appeal, her request for continued disability benefits beyond April 2, 2014 was denied, and her file remained closed. White then filed this action on May 29, 2020. On October 21, 2020, the Ninth Circuit affirmed the court's grant of summary judgment in favor of Anthem. White v. Anthem Life Ins. Co., No. 19-16954 (9th Cir. Oct. 19, 2020). Before the court now was Anthem’s motion to dismiss, contending that the facts as alleged established that White failed to timely exhaust her administrative remedies. White argued that the Court should deny the motion to dismiss because her February 2020 letter served to effectively appeal Anthem’s denial of benefits and thus exhausted her administrative remedies. The Court held that White failed to file a timely appeal with Anthem, notwithstanding her February 2020 request. The court found that this threshold issue was dispositive and did not address the other arguments included in Anthem’s motion to dismiss.
Wright vs. Reliance Standard Life Ins. Co., No. 19-14643, 2021 WL 303428, __ Fed. Appx. __ (11th Cir. Jan. 29, 2021) (Before Martin, Newsom, and Branch, Circuit Judges). In this dispute over disability and waiver of premium benefits, the district court’s grant of summary judgment in favor of Reliance was affirmed. Plaintiff claimed to be disabled due to pain and fatigue and was diagnosed with a constellation of health problems, including fibromyalgia and dysautonomia. Reliance denied Plaintiff’s disability and waiver of premium claims stating that her medical evidence was inconsistent and did not support disability. According to Reliance, Plaintiff’s medical examinations were normal and she was exercising twice a week. As part of the appeal, Plaintiff was seen by her own preferred independent doctor and Reliance’s preferred independent doctor. Plaintiff’s independent doctor diagnosed her with a dozen ailments and opined that she was totally disabled. Reliance’s independent doctor acknowledged Plaintiff’s conditions, but opined that her symptoms did not correlate with the physical examination. Reliance upheld its denial after appeal. Plaintiff filed suit, and cross-motions for summary judgment followed. The district court applied the abuse of discretion standard of review in entering judgment for Reliance. The district court explained that Plaintiff’s medical records were inconsistent in that one doctor claimed that Plaintiff was bedridden from pain while at the same time recommending a vigorous exercise program. The circuit court affirmed the district court. The circuit court noted that some doctors said she could work, such as Reliance’s independent doctor, while others said she could not. Although plaintiff’s preferred doctors said she could not work, her examinations were normal and she was exercising, with more vigorous exercises recommended. Further, the circuit court found that plaintiff had not established that Reliance’s “run of the mill” conflict rendered its denials arbitrary and capricious.
Knowlton v. Pilkington Holdings, Inc., No. 3:20-CV-2292, 2021 WL 397393 (N.D. Ohio Feb. 4, 2021) (Judge James R. Knepp II). Defendants allegedly breached a promise to cover Plaintiff's full dental expenses for life and the dispute was over where the merits of that claim should be litigated. The court granted Plaintiff’s motion to remand the case to state court, finding that Defendants failed to meet their burden that ERISA preemption applied. The court could not find that Defendants proved the dispute involved an ERISA plan for purposes of complete preemption and thus removal. The court looked at rights sought to be enforced by Plaintiff and whether they originated with a benefit plan. The court noted that the Sixth Circuit has rejected the “but-for” test for preemption, explaining that this test would capture too many claims that were based on independent duties. Instead, the court ruled that its analysis was case-specific, and in this case, mindful that removal statutes are strictly construed, the court found that it was not clear from the complaint whether Plaintiff's claims were completely preempted.
Life Insurance & AD&D Benefit Claims
Byerly v. Standard Ins. Co., No. 20-40302, __Fed. App’x __, 2021 WL 364243 (5th Cir. Feb. 2, 2021) (Before Jolly, Southwick, and Costa, Circuit Judges). Plaintiff Byerly stubbed his toe in a household accident. Due to several preexisting medical conditions—diabetes, peripheral neuropathy, and peripheral arterial disease—the injury eventually required a below-the-knee amputation of his leg. He filed a claim under his employer-sponsored accidental death and dismemberment plan. The plan administrator rejected the claim on the ground it was not just the stubbing of his toe, but also his preexisting conditions, that resulted in the need for an amputation. Byerly’s wife then brought this ERISA suit on behalf of his estate (Byerly passed away for reasons unrelated to the amputation). The court affirmed, holding that there was no qualifying “loss” even under de novo review of the claim. AD&D benefits are not payable “if the accident or loss is caused or contributed to by...[s]ickness...existing at the time of the accident” and sickness is defined as “your sickness, illness, or disease.” Plaintiff did not dispute that Byerly’s comorbidities substantially contributed to his amputation. Indeed, three separate doctors, including Byerly’s own treating provider, stated that the gangrene and osteomyelitis that led to the amputation would not have happened but for his diabetes, peripheral neuropathy, and peripheral arterial disease. Thus, Byerly’s “loss” was not caused “solely and directly by an accident” nor did it “occur independently of all other causes.”
Medical Benefit Claims
Saginaw Chippewa Indian Tribe of Michigan, et al., v. Blue Cross Blue Shield of Michigan, No. 16-CV-10317, 2021 WL 323761 (E.D. Mich. Feb. 1, 2021) (Judge Thomas L. Ludington). Plaintiffs brought suit against Blue Cross Blue Shield of Michigan (“BCBSM”) based on its administration of two self-funded health plans: one for employees of the Tribe (“Employee Plan”) and one for members of the Tribe (the “Member Plan”). The Plans are funded primarily by the Indian Health Service (“IHS”) and supplemented with tribal dollars. Most aspects of the Plans are administered by BCBSM. Plaintiffs alleged BCBSM charged hidden fees, overstated the cost of medical services, and violated ERISA fiduciary duties by failing to demand Medicare Like Rates (“MLR”). (In an earlier decision, the Sixth Circuit affirmed that the Employee Plan was governed by ERISA, but not the Member Plan.) Ultimately, the court granted BCBSM’s motion for summary judgment and dismissed Plaintiffs’ amended complaint. This case addressed Plaintiffs' motion to alter or amend the judgment contending that the court committed factual and legal error. Plaintiffs' arguments centered around the Purchased/Referred Care (“PRC”) Program which provided health services at the expense of IHS for necessary care at public and private medical and hospital facilities that are unavailable through an IHS facility. Plaintiffs, rather than BCBSM, administer the PRC Program to ensure that the Plans pay first before PRC funds are used to stretch those funds as far as possible. First, Plaintiffs asserted that the court incorrectly assumed that the Member Plan and Employee Plan were funded in the same manner. The court noted that it was not confused, but this point is irrelevant as BCBSM had no involvement in the handling of PRC Program and owed no duty fiduciary or otherwise to the PRC Program. Plaintiffs also asserted that the court was mistaken when it concluded that in order for tribes to access MLR, PRC funds were required. Plaintiffs argued that the court reached this conclusion because it relied on the PRC FAQs and not solely on the text of the regulation. The court disagreed and noted that many other courts have relied on the FAQs as well as the text of the regulation. Plaintiffs also argued the court created a new condition for MLR eligibility which is inconsistent with Congress’ intent to expand tribal access to federal resources, programs and benefits. The court disagreed and noted that Plaintiffs could create a different reimbursement model if it wanted to utilize PRC funds through a BCBSM administered plan. Plaintiffs’ motion was denied. This case provides a good discussion of how medical services are provided to Native Americans and the evolution of those services.
Brianna S. v. UnitedHealthcare, No. 2:18-CV-00672-DBB, 2021 WL 308231 (D. Utah Jan. 29, 2021) (Judge David Barlow). Plaintiff sought mental health benefits for residential treatment under an ERISA plan insured and administered by United. The parties filed cross-motions for summary judgment. The court applied the arbitrary and capricious standard of review. The court found that United’s decision to deny authorization for residential treatment was supported by substantial evidence and UBH guidelines used to make coverage determinations. The UBH guidelines required residential treatment to be provided under the direction of a “physician.” United determined that mental health services must be a provided by a “behavioral health provider” and only a psychiatrist would meet the UBH guidelines. United claimed the provider’s nurse practitioner and pediatrician did not suffice under the UBH guidelines. Based on the UBH guidelines, the court found United’s decision to deny residential treatment benefits was not arbitrary and capricious. The court found the breach of fiduciary duty claim to be duplicative as it focused on benefit determinations made under the plan and application of the UBH guidelines.
Margaret G.T. & N.Q. v. Oxford Health Plans (NJ), No. 2:20-CV-00211-DBB, 2021 WL 391432 (D. Utah Feb. 4, 2021) (Judge David Barlow). Plaintiffs claimed Defendants improperly denied mental health benefits and sought recovery under ERISA and the Parity Act. Defendants moved to dismiss Plaintiff’s Parity Act claim. The court found Plaintiffs had not alleged a plausible Parity Act claim because Plaintiffs made only conclusory allegations which merely contended different treatment of medical or surgical benefits versus mental health treatment. The court found the allegations did not provide facts about the alleged disparate treatment. The court granted Plaintiffs' request to receive and review benefit plan documents and granted leave to amend their complaint.
Pension Benefit Claims
BorgWarner Inc. v. Mariano, No. CV-20-00321-PHX-SMB, 2021 WL 321891 (D. Ariz. Feb. 1, 2021) (Judge Susan M. Brnovich). Decedent’s surviving spouse, his children, and a living trust created to receive his residual estate all contended they were the proper beneficiaries of the decedent’s retirement account. The surviving spouse entered a premarital agreement with the decedent which stated in part that she would waive rights to any of her husband’s Qualified Joint and Joint Survivor Annuities or Qualified Preretirement Survivor Annuities. The court determined that the retirement plan at issue was not the specific kind of qualified annuity referenced in the premarital agreement, and therefore decedent’s surviving spouse had no duty to disclaim interest in the retirement plan.
Sargent v. Southern Cal. Edison 401(k) Savings Plan, No. 20-CV-1296-MMA (RBB), 2021 WL 347689 (S.D. Cal. Feb. 2, 2021) (Judge Michael M. Anello). Plaintiff sought 401(k) benefits under her ex-husband’s employee benefit plan pursuant to a marital settlement agreement, and filed an action contending breach of fiduciary duty. Defendant moved for judgment on the pleadings pursuant to FRCP 12(c). The court found Plaintiff failed to plead facts showing how Defendants took affirmative steps to hide their breach of fiduciary duty. The court found Plaintiff’s allegations merely showed that Defendants failed to disclose material information, which fell short of affirmative concealment. The court found that Plaintiff’s allegations did not show how the denials misled her, misrepresented plan terms, or involved a failure to convey information. The court found Plaintiff had not alleged an injury entitling her to equitable relief. The court granted Defendant’s motion and dismissed with leave to amend.
Pleading Issues & Procedure
Employer Trs. of W. Pa. Teamsters & Emp’rs Welfare Fund v. Union Trs. of W. Pa. Teamsters & Emp’rs Welfare Fund, No. 19-388, 2021 WL 345841 (W.D. Pa., Feb 2, 2021) (Judge Joy Flowers Conti). Union Trustees filed a complaint seeking partial vacation of an arbitration award issued against it and on behalf of Employer Trustees with respect to an alleged breach of fiduciary duty. On cross-motions for summary judgment, the Court found for Union Trustees, holding (1) the arbitrator had authority to issue the arbitration award, (2) there was no justification to overturn the arbitrator’s award, (3) the arbitrator did not commit a breach of fiduciary duty, (4) the Union Trustees did not commit a breach of fiduciary duty, and (5) the arbitrator’s award should be enforced.
Young v. Reliance Standard Life Ins. Co., No. 1:20-CV-739, 2021 WL 327701 (W.D. Tex., Feb. 1, 2021) (Judge Lee Yeakel). Plaintiff received long term disability benefits from Defendant. After Plaintiff received a settlement related to the car accident which caused his disability, Defendant reduced Plaintiff’s benefits because it considered the settlement to be “Other Income Benefits” under the terms of the policy. Plaintiff appealed and filed suit. Subsequently, Defendant reversed its determination and refunded Plaintiff the money it had previously offset. Defendant then filed a motion to dismiss the complaint as moot, or in the alternative based on Plaintiff’s failure to name the proper Defendant. Plaintiff opposed the motion, claiming his rights to future benefits were at risk because without a ruling clarifying the meaning of the offset language in the policy, there remained a controversy regarding whether defendant was entitled to an offset. Plaintiff also claimed entitlement to attorney’s fees. The Court agreed to dismiss the improper party from the suit and denied the motion for attorney’s fees because it was premature. The court refused to dismiss the suit based on grounds of mootness, as Plaintiff sought remedies other than the benefits previously withheld (and subsequently paid).
Operating Engineers’ Local 324 Fringe Benefit Funds v. Rieth-Riley Constr. Co., Inc., No. 20-10323, 2021 WL 391338 (E.D. Mich. Feb. 4, 2021) (Judge David M. Lawson). This dispute involved the determination of the appropriate forum in which to resolve a dispute about fringe benefit contributions after the expiration of a collective bargaining agreement. Under ERISA and the LMRA, suits involving contributions can be brought in federal court. However, where no contract exists, or as here the contract has expired, the appropriate forum is the National Labor Relations Board which has “exclusive jurisdiction.” The defendant moved to dismiss the claims under Fed. R. Civ. P. 12(b)(1) for lack of subject-matter jurisdiction. The Court ruled that under either ERISA or NLRA the Court lacked subject-matter jurisdiction to enforce contractual obligations while negotiations for a new contract were being conducted.
O’Dell v. Sun Life Assurance Co. of Canada, No. 2:20-CV-2098, 2021 WL 364261 (S.D. Ohio Feb. 3, 2021) (Chief Judge Algenon L. Marbley). Before the Court was Defendant Huntington BancShares Inc.’s and Sun Life’s separate Motions for Judgment on the Pleadings (MJOP). Under the Plan governing Plaintiff O’Dell’s long-term disability benefits, Huntington was designated as the Plan Administrator and Sun Life administered the plan. After receiving a denial of her claim for long-term disability benefits, O’Dell, through counsel, made three separate requests to Sun Life for her administrative claim file but she never received a response from either Sun Life or Huntington. O’Dell then filed this lawsuit containing three counts, including Count III for statutory penalties for a refusal to supply her claim file. Huntington filed a MJOP as to Count III arguing that it is was only obligated to provide O’Dell with a limited set of plan documents, which did not include claim documents or any documents “used in the ministerial day-to-day processing of individual claims.” Huntington argued that O’Dell’s request for her “complete administrative claim file” was not a request for any of the specified plan documents and so it was under no duty to provide any documents to her. Huntington also claimed that O’Dell’s letter did not provide “clear notice” that she was seeking plan documents and that the plan document cannot be considered a “key document” at the center of the claim denial decision. Sun Life also filed a MJOP pertaining to Count III arguing that only plan administrators are liable for penalties, and because it is an insurance company, there is no statutory authority to impose these penalties against it. The Court granted both MJOPs and dismissed Count III, holding that it was not plausible that Huntington had received clear notice that the text of the long-term disability plan was the “key document” underlying O’Dell’s claims, and that O’Dell was making a request for plan documents. O’Dell’s request for the “complete administrative claim file” did not constitute “clear notice” under Sixth Circuit law.
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