Justia ERISA Opinion Summaries
Avenoso v. Reliance Standard Life Insurance Co
Avenoso, a maintenance supervisor, had long-term disability insurance under a Reliance policy, governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(1)(B). The policy provided two years of benefits if the claimant showed that he was unable to perform the material duties of his current occupation and provided continued benefits if the claimant showed that he was unable to perform the material duties of any occupation. Avenoso left his job due to lower-back pain and underwent back surgery. Reliance approved two years of benefits. At the end of the two years, Reliance informed Avenoso that it would discontinue benefits because Avenoso had not shown that he was unable to perform the material duties of any occupation.Avenoso had an MRI; the results appeared relatively mild. Avenoso sent Reliance a note from his physician, recommending that Avenoso “avoid lifting, bending and prolonged sitting” due to his lower back condition. He was receiving Social Security disability benefits. Following a “functional-capacity evaluation,” a physical therapist concluded Avenoso did not demonstrate an ability to tolerate an 8-hour workday. An independent medical evaluation concluded that Avenoso retained sedentary-work capacity and was “able to work 8 hours a day but was engaging in “symptom magnification.” A vocational-rehabilitation specialist identified five “viable sedentary occupational alternatives” consistent with Avenoso’s physical capacities. The Eighth Circuit affirmed summary judgment in favor of Avenoso. The district court’s finding that Avenoso lacks sedentary-work capacity was not clearly erroneous. View "Avenoso v. Reliance Standard Life Insurance Co" on Justia Law
Massaro v. Palladino
In this Employee Retirement Security Act (ERISA) dispute, the Employer Trustees filed suit alleging that the Union Trustees breached their fiduciary duties under ERISA when they passed, by simple majority, two amendments to the trust agreements governing the Funds (the Trust Agreements). The district court granted summary judgment in favor of the Employer Trustees and concluded that the Union Trustees had breached their fiduciary duties under Section 404(a)(1)(D), because – under the terms of the Trust Agreements – the amendments were required to be passed by a unanimous vote of the Trustees.Although the Second Circuit agreed with the district court that, under the terms of the trust agreements, the Union Trustees' amendments were required to be passed by a unanimous vote, the court nevertheless concluded that the district court erred in granting summary judgment to the Employer Trustees because the Union Trustees were not acting in a fiduciary capacity when they passed those amendments. Accordingly, the court vacated the district court's grant of summary judgment; dismissed the Employer Trustees' cross-appeal and appeals as moot; and remanded for further proceedings. View "Massaro v. Palladino" on Justia Law
Noga v. Fulton Financial Corp Employee Benefit Plan
A plan participant sued under the Employee Retirement Income Security Act, 29 U.S.C. 1132(a)(1)(B), claiming that an insurance-company fiduciary wrongfully terminated his benefits. The participant enrolled in his former employer’s welfare benefit plan, which provided long-term disability and life insurance benefits through group insurance policies. When his health deteriorated and he could no longer do his job, the participant claimed benefits. The insurance company, which funded and administered those policies, authorized benefits. Its in-house medical professionals reaffirmed that conclusion for two years. Then, with no recent change to the participant’s medical condition, the company used a third-party vendor to retain an outside physician to evaluate the participant. After an in-person examination, that physician concluded that the participant was not totally disabled. The company terminated benefits. The participant administratively appealed, and the cycle repeated. The company’s multiple requests for additional outside medical reviews were irregular in their timing and prompting.The Third Circuit affirmed summary judgment in favor of the participant. The insurance company performed two functions that are in financial tension: it determined eligibility for benefits and funded benefits. That creates a structural conflict of interest, which, combined with significant deviation from normal eligibility-review processes, influenced its fiduciary decision-making. The company abused its discretion in terminating the participant’s benefits. The court properly ordered their retroactive reinstatement. View "Noga v. Fulton Financial Corp Employee Benefit Plan" on Justia Law
Pharmaceutical Care Management Ass’n v. Wehbi
PCMA filed suit to enjoin the enforcement of several North Dakota statutory provisions, claiming that they were preempted by the Employee Retirement Income Security Act of 1974 (ERISA), and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Medicare Part D). The district court concluded that ERISA preempted none of the challenged provisions and that Medicare Part D preempted only one; the Eighth Circuit reversed on the issue of ERISA preemption; and the Supreme Court vacated the judgment and remanded in light of Rutledge v. Pharmaceutical Care Management Association, 592 U.S. ---, 141 S. Ct. 474 (2020).On remand from the Supreme Court, the Eighth Circuit concluded that Sections 16.1(11) and 16.2(4), as well as Sections 16.1(10) and 16.2(2), do not meet the connection-with standard. The court explained that none of the challenged provisions has an impermissible connection with ERISA plans and are therefore not preempted. The court also concluded that state laws are preempted as applied to Medicare Part D plans if and only if they either (1) regulate the same subject matter as a federal Medicare Part D standard (in which case they are expressly preempted), or (2) otherwise frustrate the purpose of a federal Medicare Part D standard (in which case they are impliedly preempted). In this case, a provision requiring plans to disclose certain information to patients or prohibiting plans from prohibiting pharmacies from disclosing certain information are preempted, as well as provisions regarding collection of retroactive fees from pharmacies. Accordingly, the court affirmed in part and reversed in part. View "Pharmaceutical Care Management Ass'n v. Wehbi" on Justia Law
Jette v. United of Omaha Life Insurance Co.
The First Circuit vacated the entry of summary judgment in this case brought by Plaintiff seeking relief from the termination of her benefits under the civil enforcement provision of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(1), holding that Defendant did not provide Plaintiff a full and fair review of her claim, and Plaintiff was prejudiced by Defendant's procedural violation.Plaintiff participated in a long-term disability plan sponsored by her employer and funded and administrated by Defendant. The Plan was subject to ERISA. When Defendant terminated Plaintiff's disability benefits, Plaintiff filed an internal appeal review. Defendant upheld the termination of benefits, relying in part on a report written by a doctor hired by Defendant to examine Plaintiff. Plaintiff was not given a copy of the doctor's report. Plaintiff sought relief under ERISA's civil enforcement provision, arguing that, in failing to provide her with an opportunity to respond to the doctor's report, Defendant failed to provide her with a full and fair review, as required by ERISA and its implementing regulation. The district court granted summary judgment for Defendant. The First Circuit vacated the summary judgment, holding that Defendant committed a procedural violation, and Plaintiff was prejudiced thereby. View "Jette v. United of Omaha Life Insurance Co." on Justia Law
Card v. Principal Life Insurance Co.
Card was diagnosed with “chronic lymphocytic leukemia,” which can cause fatigue. Card alleges her worsening fatigue left her unable to perform her job as a night-shift nurse. She applied for disability benefits under an Employee Retirement Income Security Act (ERISA) plan administered by Principal, which denied her requests for short-term, long-term, and total disability benefits. Card sued. The district court granted Principal summary judgment. The Sixth Circuit reversed and remanded the case to Principal for further proceedings. Principal granted Card short-term disability benefits but requested additional information for her other claims. Card then filed motions in the district court, seeking attorney’s fees and asking the court to reopen the case because Principal had not reached a benefits decision for her other claims within the 45 days allegedly required by ERISA . The district court issued a “virtual order” on its docket, denying the motions for lack of jurisdiction.The Sixth Circuit first held that it had jurisdiction to review that order then vacated and remanded to the district court. A district court retains jurisdiction over a beneficiary’s ERISA suit during the remand. "As in every other ERISA case in this procedural posture," the prior decision remanded to the district for it to retain jurisdiction while Principal engaged in the new benefits determination. View "Card v. Principal Life Insurance Co." on Justia Law
Browe v. CTC Corp.
Plaintiffs filed suit under the Employee Retirement Income Security Act (ERISA) against a defunct photo‐finishing company and its former CEO, alleging various violations and breaches of fiduciary duties with respect to a deferred compensation plan.The Second Circuit held that the district court correctly denied defendants' invocation of ERISA's three-year statute of limitations for fiduciary claims because defendants failed to prove that all plaintiffs had knowledge of the breaches more than three years prior to the commencement of this suit; defendants waived any reliance on ERISA's six‐year statute of repose by failing to assert it any time prior to their reply brief before the court; the Plan is not exempt from ERISA's funding, fiduciary, and vesting requirements because it was not offered to a qualitatively select group of employees; the district court's decision to limit damages on plaintiffs' fiduciary claims to the Plan's projected balance as of 2004 was error, and damages must be recalculated; the district court erred in failing to assess the scope of CTC's liability, if any, for the claims asserted against it; the CEO is liable for the entire amount of the restoration award, because liability under ERISA is joint and several; although the district court's conclusion that Plaintiff Launderville is liable in contribution is supported by sufficient evidence, that liability is to the CEO, not to the Plan; there is no basis to impose liability on Launderville for her failure to comply with ERISA's reporting requirements; the district court's entry of judgment for defendants on plaintiffs' wrongful denial of benefits claims was error; the district court's order that the restoration award be distributed on a per capita basis to Plan participants risks violating those participants' vested rights and is, in any case, inconsistent with ERISA; and defendants' evidentiary challenge is meritless. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Browe v. CTC Corp." on Justia Law
Sofco Erectors, Inc. v. Trustees of the Ohio Operating Engineers Pension Fund
Sofco terminated its collective bargaining agreement (CBA) with a local union. The Ohio Operating Engineers Pension Fund then assessed almost a million dollars in withdrawal liability against Sofco under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1002(41. Sofco challenged the assessment in ERISA-mandated arbitration. The arbitrator upheld the assessment. The district court affirmed in part and reversed in part.The Sixth Circuit affirmed in part. The Fund’s actuary used a 7.25% growth rate on assets for minimum funding purposes but for withdrawal-liability purposes, used the “Segal Blend,” which violated ERISA’s mandate that the interest rate for withdrawal liability calculations be based on the “anticipated experience under the plan.” The court vacated the district court’s decision upholding the Fund’s assessment of partial-withdrawal liability for 2011-2013 and remanded. A construction-industry employer is liable for a partial withdrawal when its contributions decline to an “insubstantial portion of its work in the craft and area jurisdiction of the collective bargaining agreement of the type for which contributions are required.” The CBA clearly establishes the union’s jurisdiction over forklift work and Sofco’s obligations to contribute to the fund for that work. The district court did not err by concluding that the Fund properly included forklift work in the withdrawal liability calculation. View "Sofco Erectors, Inc. v. Trustees of the Ohio Operating Engineers Pension Fund" on Justia Law
Ovist v. Unum Life Insurance Company of America
The First Circuit affirmed the judgment of the district court granting summary judgment to Defendant and dismissing Plaintiff's action brought under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq, holding that summary judgment was properly granted.Plaintiff was a participant in her employer's long-term disability plan, which was insured and administered by Defendant, Unum Life Insurance Company of America, and governed by ERISA. In 2011, Plaintiff was granted benefits under the plan. In 2015, Defendant terminated Plaintiff's benefits. Plaintiff brought this action seeking recovery and reinstatement of her benefits. The district court granted summary judgment for Defendant. The First Circuit affirmed, holding (1) Defendant's requirement that Plaintiff provide objective evidence of her functional limitations in order to avoid a limitation in the plan was reasonable; and (2) substantial evidence supported Defendant's determination that Plaintiff lacked objective proof in her functional limitations. View "Ovist v. Unum Life Insurance Company of America" on Justia Law
Warmenhoven v. NetApp, Inc.
Plaintiff and six other retired executives sued NetApp and the Plan, alleging that terminating the Plan violated the Employee Retirement Income Security Act (ERISA) because they had been promised lifetime benefits. The complaint alleged two distinct ERISA claims: (1) a direct claim for benefits under 29 U.S.C. 1132(a)(1)(B); and (2) an alternate claim for equitable relief under section 1132(a)(3) to redress NetApp's alleged misrepresentations that the Plan would provide lifetime benefits. After the district court granted summary judgment in favor of NetApp, only plaintiff appealed.The Ninth Circuit affirmed the district court's judgment as to plaintiff's section 1132(a)(1)(B) claim, rejecting plaintiff's contention that NetApp's promises in the PowerPoints created an ERISA plan with lifetime benefits. Furthermore, by deliberately choosing to stand on his flawed argument that the PowerPoints created a vested ERISA plan without there being any written instrument, and by declining to argue in the alternative that he could prevail even if section 1102(b) applied, plaintiff has affirmatively waived any argument under the proper legal standard that the PowerPoints were written instruments. The panel explained that that waiver conclusively defeats his section 1132(a)(1)(B) claim because, under Cinelli v. Sec. Pac. Corp., 61 F.3d 1437, 1441 (9th Cir. 1995), he bears the burden to prove that a specific written instrument vested lifetime benefits.The panel vacated the judgment as to plaintiff's section 1132(a)(3) claim, disagreeing with the district court's conclusion that no reasonable factfinder could find that NetApp committed a remediable wrong. Rather, the panel concluded that plaintiff's fiduciary duty claim survives summary judgment on the remediable wrong issue, because there is a genuine dispute of material fact as to whether NetApp incorrectly represented to Plan participants that the Plan provided lifetime health insurance benefits. Accordingly, the panel remanded the issue for further proceedings. View "Warmenhoven v. NetApp, Inc." on Justia Law