Justia ERISA Opinion Summaries

In 2002, Nolan’s employer, DTE, created a cash balance pension plan and invited its existing employees to transfer from their traditional defined benefit plan to the new plan. Nolan accepted. When she retired in 2017, DTE told Nolan that her monthly pension benefit would be what she had accrued as of 2002 under the old plan, despite her participation in the new cash balance plan. Nolan brought a class action under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001(a)–(b), alleging that DTE made misleading promises and failed to explain the new plan’s risks. The district court dismissed. The Sixth Circuit affirmed in part, finding Nolan’s procedural claim untimely. Even accepting Nolan’s allegations as true, Nolan failed to state a claim under ERISA section 204(h); DTE satisfied the requirement to make a good faith effort to comply even though the notice provided to employees was ultimately inadequate under ERISA section 102. Reversing in part, the court found that Nolan stated a plausible claim that DTE’s notice was defective under section 102 because it failed to describe the plan in a manner understandable to the average participant that employees transferring to the new plan would not actually receive any new benefits if the benefit accrued under the new plan did not catch up to their frozen traditional plan benefit or the effect that interest rates could have on depreciating the already-earned benefits during conversion. View "Nolan v. Detroit Edison Co." on Justia Law

Plaintiffs, five former employees of CB&I who worked as laborers on a construction project in Louisiana, quit before the project ended and thus made them ineligible to receive the Project Completion Incentive under the term of that plan. Plaintiffs filed suit in state court seeking the bonus for the period they did work, arguing that making such employees ineligible for bonuses amounts to an illegal wage forfeiture agreement under the Louisiana Wage Payment Act. LA. STAT.ANN. 23:631, 23:632, 23:634. After removal to federal court, the district court concluded that the incentive program was an Employee Retirement Income Security Act (ERISA) plan because it required ongoing discretion and administration in determining whether a qualifying termination took place.The Fifth Circuit concluded that the employee benefit at issue—a bonus for completing the project—is not an employee benefit plan under ERISA. The court explained that the plan involves a single and simple payment; determining eligibility might require the exercise of some discretion, but not much; and the plan lacks the complexity and longevity that result in the type of "ongoing administrative scheme" ERISA covers. Therefore, there is no federal jurisdiction over this action. The court vacated and remanded for the case to be returned to state court. View "Atkins v. CB&I, LLC" on Justia Law

The First Circuit affirmed the judgment of the district court dismissing this putative class action complaint brought under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., holding that the district court did not err or abuse its discretion.Plaintiffs claimed that FMR LLC and several related Fidelity entities and affiliates (collectively, Fidelity) violated fiduciary duties it owed to its customer plans and their participants by exacting and retaining certain fees. The fees were exacted from mutual funds for the privilege of being placed on the menu of investment options Fidelity made available to 401(k) plans that contract with it to receive certain investment opportunities and services. The district court granted Fidelity's motion to dismiss for failure to state a claim. The First Circuit affirmed, holding that the district court properly dismissed the complaint. View "Wong v. FMR LLC" on Justia Law

Plaintiff, a dermatologist in Atlanta, Georgia, has filed many appeals in the Eleventh Circuit in recent years, all of which have involved her attempts to receive in-network payments despite being an out-of-network provider. These consolidated appeals arise from plaintiff's treatment of two patients who were insured under two separate employee welfare benefit plans which are administered by United. The Employee Retirement Income Security Act of 1974 (ERISA) covers both plans.The Eleventh Circuit affirmed the district court's dismissal of plaintiff's cases against Coca-Cola and Delta (defendants). The court concluded that, even assuming that waiver is available in the ERISA context, defendants did not waive their ability to assert the anti-assignment provisions as a defense. Furthermore, regardless of waiver, plaintiff's lawsuit still fails to state a claim: United paid her in full, both under the terms of the patients' assignments and the provisions of the healthcare plans. View "Griffin v. Coca-Cola Refreshments USA, Inc." on Justia Law

Plaintiffs filed suit against several laboratory testing companies, alleging that the companies violated federal and Connecticut law by submitting fraudulent or overstated claims for medical services purportedly provided to plaintiffs' plan members. The district court dismissed the complaint with prejudice after concluding that plaintiffs' claims are time-barred by Connecticut’s three-year statute of limitations applicable to tort claims.The Second Circuit found, under Connecticut law, that plaintiffs' equitable claims, which include their federal claims, are subject to no statute of limitations and are instead governed only by the doctrine of laches. Therefore, the court vacated the district court's decision in part. However, the court nonetheless affirmed the district court's dismissal of the state law claims, and specifically reject plaintiffs' argument that the limitations period applicable to those claims was tolled during the pendency of a prior action between the parties. The court explained that, although plaintiffs note that several sister circuits have tolled limitations periods applicable to compulsory counterclaims as a matter of federal law, the legal claims at issue here are all brought under state law, subject only to state law tolling rules, and provide no relief for plaintiffs. View "Connecticut General Life Insurance Co. v. BioHealth Laboratories, Inc." on Justia Law

Participants in Georgetown University retirement plans sued the University and individual plan fiduciaries, seeking to bring individual and representative class action claims for breach of fiduciary duty under the Employee Retirement Income Security Act (ERISA) 29 U.S.C. 1001–1461. They alleged that the plans paid excessive fees for record-keeping services and included investment options that consistently underperformed their benchmarks. In January 2019, the district court dismissed the complaint without prejudice, citing Article III standing as to some aspects of plan management, such as the inclusion of investment options neither plaintiff had selected. Regarding the duty of prudence, the court found that the excessive recordkeeping fees allegations provided no factual support for the assertion that the plans should pay only $35/year per participant. In May, the court denied as untimely their motion for leave to file an amended complaint.The D.C. Circuit vacated. Dismissal of a complaint without prejudice is generally not a final appealable order. Exceptions that apply where the record clearly indicates that the district court has separated itself from the case do not apply to this case. The January Order did not enter a final, appealable judgment; the district court erred when considering the motion to amend the complaint in refusing to apply the Rule 15(a)(2) standard, rather than the more restrictive standards under Rules 59(e) and 60(b). View "Wilcox v. Georgetown University" on Justia Law

Central Valley filed suit against various defendants who either marketed or administered self-funded health care plans, alleging that defendants breached various fiduciary duties and engaged in various prohibited transactions in violation of the Employee Retirement Income Security Act of 1974 (ERISA).The Eighth Circuit affirmed the district court's grant of summary judgment for defendants. In regard to the 2015 health care plan, the court held that because Central Valley made the final payment decisions, AMPS and TBG did not have discretion over their compensation and were not fiduciaries. In regard to the 2016 health care plan, the court held that because none of Central Valley's allegations pertain to CDS's fiduciary duty of making benefit determinations on hospital and facility claims, Central Valley’s fiduciary duty claim against CDS fails. Furthermore, TBG, AMPS, and CDS did not act with discretion with respect to compensation, and thus no defendant became a fiduciary. Finally, the court rejected Central Valley's prohibited transactions claim. The court also affirmed the district court's award of attorney fees, holding that the district court properly balanced the Westerhaus factors and did not abuse its discretion in awarding defendants attorney's fees. View "Central Valley Ag Cooperative v. Leonard" on Justia Law

The Ninth Circuit reversed the district court's dismissal of Beverly Oaks' claim for benefits under the Employee Retirement Income Security Act of 1974 (ERISA). Beverly Oaks contends that Blue Cross waived or is equitably estopped from raising an anti-assignment provision as a reason for denying a benefits claim for the first time in litigation.The panel held, under Spinedex Physical Therapy USA Inc. v. United Healthcare of Ariz., Inc., 770 F.3d 1282, 1296 (9th Cir. 2014), that Beverly Oaks plausibly alleged that Blue Cross waived the anti-assignment provisions in the Teamsters, Williams Lea, and Woodward Plans. Therefore, Blue Cross cannot raise the anti-assignment provision for the first time in litigation when Blue Cross held that provision in reserve as a reason to deny benefits. In this case, Blue Cross confirmed that plan benefits were available during pre-surgery conversations, Beverly Oaks submitted the claim form to Blue Cross indicating that it sought to recover benefits via a patient assignment, and Blue Cross either denied in full or underpaid the claims during the administrative claim process without asserting the anti-assignment provision as a ground for denying full reimbursement. The panel also held that Beverly Oaks alleged facts that showed plausibly that Blue Cross made an actionable misrepresentation and was thus equitably estopped from raising the antiassignment provisions as a litigation defense contrary to its prior conduct. View "Beverly Oaks Physicians Surgical Center, LLC v. Blue Cross and Blue Shield of Illinois" on Justia Law

Pharmacy benefit managers (PBMs) reimburse pharmacies for the cost of drugs covered by prescription-drug plans by administering maximum allowable cost (MAC) lists. In 2015, Arkansas passed Act 900, which requires PBMs to reimburse Arkansas pharmacies at a price at least equal to the pharmacy’s wholesale cost, to update their MAC lists when drug wholesale prices increase, and to provide pharmacies an appeal procedure to challenge MAC reimbursement rates, Ark. Code 17–92–507(c). Arkansas pharmacies may refuse to sell a drug if the reimbursement rate is lower than its acquisition cost. PCMA, representing PBMs, sued, alleging that Act 900 is preempted by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1144(a).Reversing the Eighth Circuit, the Supreme Court held that Act 900 is not preempted by ERISA. ERISA preempts state laws that “relate to” a covered employee benefit plan. A state law relates to an ERISA plan if it has a connection with or reference to such a plan. State rate regulations that merely increase costs or alter incentives for ERISA plans without forcing plans to adopt any particular scheme of substantive coverage are not preempted. Act 900 is a form of cost regulation that does not dictate plan choices. Act 900 does not “refer to” ERISA; it regulates PBMs whether or not the plans they service fall within ERISA’s coverage. Allowing pharmacies to decline to dispense a prescription if the PBM’s reimbursement will be less than the pharmacy’s cost of acquisition does not interfere with central matters of plan administration. The responsibility for offering the pharmacy a below-acquisition reimbursement lies first with the PBM. Any “operational inefficiencies” caused by Act 900 are insufficient to trigger ERISA preemption, even if they cause plans to limit benefits or charge higher rates. View "Rutledge v. Pharmaceutical Care Management Association" on Justia Law

Plaintiffs, individuals living with HIV/AIDS who have employer-sponsored health plans, and who rely on those plans to obtain prescription drugs, filed suit alleging that CVS's program violates the anti-discrimination provisions of the Affordable Care Act (ACA), the Americans with Disabilities Act (ADA), and the California Unruh Civil Rights Act (Unruh Act); denies them benefits to which they are entitled under the Employee Retirement Security Act (ERISA); and violates California's Unfair Competition Law (UCL). The district court granted defendants' motion to dismiss.The Ninth Circuit held that Section 1557 of the ACA does not create a healthcare-specific anti-discrimination standard that allowed plaintiffs to choose standards from a menu provided by other anti-discrimination statutes. Because plaintiffs claim discrimination on the basis of their disability, to state a claim for a Section 1557 violation, they must allege facts adequate to state a claim under Section 504 of the Rehabilitation Act. Applying the section 504 framework, the panel concluded that plaintiffs adequately alleged that they were denied meaningful access to their prescription drug benefit under their employer-sponsored health plans because the program prevents them from receiving effective treatment for HIV/AIDS. Therefore, plaintiffs have stated a claim for disability discrimination under the ACA.However, plaintiffs have failed to establish a claim of disability discrimination under the ADA, because they have not plausibly alleged that their benefit plan is a place of public accommodation. Finally, the panel upheld the district court's denial of plaintiffs' claims under ERISA and their cause of action under California's Unfair Competition Law. The panel affirmed in part, vacated in part, and remanded. View "Doe v. CVS Pharmacy, Inc." on Justia Law