Justia ERISA Opinion Summaries

The Eighth Circuit affirmed the district court's order dismissing plaintiffs' second amended complaint brought under sections 409 and 502 of the Employee Retirement Income Security Act (ERISA), against Wells Fargo and fiduciaries of Wells Fargo's 401(k) plan. This appeal arose out of the unauthorized-accounts scandal at Wells Fargo where Wells Fargo pressured and induced thousands of its employees to engage in widespread unlawful and unethical sales practices.The court held that the district court did not err in finding that plaintiffs have failed to plausibly plead that a prudent fiduciary in defendants' position could not have concluded that earlier disclosure of negative information would do more harm than good to the fund. The court also held that the district court did not err in holding that plaintiffs have failed to sufficiently plead a claim of breach of the duty of loyalty. In this case, neither of plaintiffs' claims for failure to disclose material information to plan participants about Wells Fargo's sale practices and conflicts of interests and actions of self-interest sufficiently alleged a plausible inference that defendants breached their duty. View "Allen v. Wells Fargo & Co." on Justia Law

The parents of a teenage girl (L.M.) sued Premera Blue Cross under the Employee Retirement Income Security Act (ERISA), claiming improper denial of medical benefits. L.M. experienced mental illness since she was a young girl. L.M. was eventually placed in Eva Carlston Academy, where she obtained long-term psychiatric residential treatment. For this treatment, the parents submitted a claim to Premera under the ERISA plan’s coverage for psychiatric residential treatment. Premera denied the claim ten days into L.M.’s stay. But Premera agreed to cover the first eleven days of L.M.’s treatment, explaining the temporary coverage as a "courtesy." The parents appealed the denial of subsequent coverage, and Premera affirmed the denial based on a physician's medical opinion. The parents filed a claim for reimbursement of over $80,000 in out-of-pocket expenses for L.M.’s residential treatment at the Academy. Both parties moved for summary judgment, and the district court granted summary judgment to Premera based on two conclusions: (1) Premera’s decision was subject to the arbitrary-and- capricious standard of review; and (2) Premera had not acted arbitrarily or capriciously in determining that L.M.’s residential treatment was medically unnecessary. The district court granted summary judgment to Premera, and the parents appealed. After review, the Tenth Circuit concluded the district court erred by applying the arbitrary-and-capricious standard and in concluding Premera had properly applied its criteria for medical necessity. Given these conclusions, the Court reversed and remanded the matter back to the district court for de novo reevaluation of the parents’ claim. View "M. v. Premera Blue Cross" on Justia Law

Doctors removed Haynes’s gallbladder. She was injured in the process and required additional surgery that led to more than $300,000 in medical expenses. Her father’s medical-benefits plan (the Fund) paid these because Haynes was a “covered dependent.” The plan includes subrogation and repayment clauses: on recovering anything from third parties, a covered person must reimburse the Fund. Haynes settled a tort suit against the hospital and others for $1.5 million. She and her lawyers refused to repay the Fund, which sued to enforce the plan’s terms under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(3). Haynes argued that she did not agree to follow the plan’s rules and was not a participant, only a beneficiary. The district judge granted the Fund summary judgment and enjoined Haynes and her lawyer from dissipating the settlement proceeds. The Fund had named each of them as a defendant.The Seventh Circuit affirmed. ERISA allows fiduciaries to bring actions to obtain “equitable relief … to enforce ... the terms of the plan.” The nature of the remedy sought—enforcement of a right to identifiable assets—is equitable. Having accepted the plan’s benefits, Haynes must accept the obligations The absence of a beneficiary’s signed writing, regardless of the beneficiary's age, does not invalidate any of the plan’s terms. View "Central States, Southeast & Southwest Areas Health & Welfare Fund v. Haynes" on Justia Law

J.L. and D.W. were covered by employer-sponsored Aetna insurance plans that provided out-of-network benefits only in cases of “Urgent Care or a Medical Emergency” (J.L.) or not at all (D.W.). J.L. needed bilateral breast reconstruction surgery and there were no in-network physicians available to perform the procedure. D.W. required facial reanimation surgery—a niche procedure performed by only a few U.S. surgeons. Both were referred for treatment to the Plastic Surgery Center, an out-of-network New Jersey medical practice. The Center negotiated with Aetna, which agreed to pay a “reasonable amount.” The Center billed $292,742 for J.L.’s services, Aetna paid only $95,534.04. Of the $420,750 the Center billed for D.W.’s services, Aetna paid only $40,230.32.The district court dismissed common law breach of contract, promissory estoppel, and unjust enrichment claims, holding that section 514(a) of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1000, expressly preempted all claims. The Third Circuit reversed as the breach of contract and promissory estoppel claims, which do not require impermissible “reference to” ERISA plans. The claims, as pleaded, plausibly seek to enforce obligations independent of the plan and do not require interpretation or construction of ERISA plans. The claims plausibly arise out of a relationship that ERISA did not intend to govern. View "Plastic Surgery Center, P.A. v. Aetna Life Insurance Co" on Justia Law

Plaintiffs filed a putative class action, asserting breach of contract claims under Iowa law and breach of fiduciary duty claims under the Employee Retirement Income Security Act (ERISA), based on allegations that Wellmark violated the Patient Protection and Affordable Care Act's (ACA) mandate's cost-sharing and "information and disclosure" requirements. The district court dismissed the information and disclosure claims for failure to state a claim and granted Wellmark summary judgment on the cost-sharing claims.The Eighth Circuit affirmed and held that the district court accurately noted that neither the ACA's statutory mandate nor its implementing regulations requires the disclosure of information -- including a list of providers -- or prohibits "administrative barriers" or "inconsistent guidance." Rather, the mandate provides that group health plans and health insurance issuers "shall, at a minimum provide coverage for and shall not impose any cost sharing requirements for" preventive health services. The court also held that the summary judgment record established that defendant provided plaintiffs qualified, available in-network providers of comprehensive lactation support and consulting services and did not violate the ACA's cost-sharing mandate. View "York v. Wellmark, Inc." on Justia Law

Plaintiff filed suit under the Employee Retirement Income Security Act (ERISA) alleging that the Committee wrongfully denied his disability claim under its Employees' Retirement Plan and breached its fiduciary duty by failing to conduct a full and fair review of his medical records when reconsidering his claim.The Eighth Circuit affirmed the district court's judgment in favor of the Plan, holding that the district court properly found that the Committee did not breach its fiduciary duty by failing to review the medical records. The court rejected defendant's claim that the Committee offered different rationales for denying his claim and held that the Committee's denial letters consistently state that the application was denied as untimely because it was not made before or in connection with plaintiff's separation. View "DaPron v. Spire Inc. Retirement Plans Committee" on Justia Law

The Fifth Circuit denied plaintiff's motion for attorneys' fees under the Employee Retirement Income Security Act. The court held that 29 U.S.C. 1132(g)(1) does not provide unfettered discretion to courts to award fees. The court explained that a fees claimant whose only victory was an interlocutory ruling by the Court of Appeals that his complaint should not have been dismissed for failure to state a claim has not received any relief on the merits. In this case, plaintiff persuaded the court to reverse the district court's summary judgment ruling in favor of Humana. If plaintiff achieves some success on the merits on remand, she may then ask for fees. View "Katherine P. v. Humana Health Plan, Inc." on Justia Law

After Marvin Crowder died, Fidelity disbursed his plan benefits to his sister as his designated beneficiary. Plaintiff, Marvin's ex-wife, filed suit under the Employee Retirement Income Security Act (ERISA), alleging claims of wrongful denial of benefits and breach of fiduciary duty.The Eleventh Circuit affirmed the district court's dismissal of plaintiff's ERISA claims, holding that the Plan Administrator correctly interpreted the Plan and that, after her divorce, plaintiff had no entitlement to her ex-husband's benefits under the Plan's terms. Because plaintiff was not a "beneficiary" under Section 14.03 of the Plan, she failed to state a plausible claim for wrongly denied benefits. Likewise, plaintiff's claims for breach of fiduciary duty failed because she was not a "beneficiary" under the Plan and defendants owed no ERISA-imposed duties to her. Furthermore, plaintiff also lacked statutory authorization to bring a claim for equitable relief based on defendants' alleged breach of their fiduciary duties. View "Crowder v. The Delta Air Line, Inc. Family-Care Savings Plan" on Justia Law

The judgment the Second Circuit entered in its initial opinion in this appeal was vacated by the Supreme Court and remanded for reconsideration. The court reinstated the judgment.Plaintiffs, participants in IBM's employee stock option plain filed suit alleging that the plan's fiduciaries breached their duty of prudence under the Employee Retirement Income Security Act (ERISA). The district court granted defendants' motion to dismiss; this court reversed and remanded; and then the Supreme Court granted defendants' petition for certiorari, which presented the question whether a plaintiff can state a duty-of-prudence claim based on generalized allegations that the harm of an inevitable disclosure of an alleged fraud generally increases over time. The Supreme Court also granted the government's motion to participate in oral argument as an amicus curiae in support of neither party, so that it could present the views of the Department of Labor and the Securities and Exchange Commission. After oral argument, the Supreme Court vacated the judgment and remanded, explaining that defendants' and the government's post-certiorari arguments primarily addressed matters that fell beyond the question presented to the Supreme Court, and that had not been raised before this court.The court held that the arguments raised in the supplemental briefs either were previously considered by this court or were not properly raised. To the extent that the arguments were previously considered, the court will not revisit them. To the extent that they were not properly raised, they have been forfeited, and the court declined to entertain them. Accordingly, the court reversed the district court's judgment and remanded for further proceedings. View "Jander v. International Business Machines Corp." on Justia Law

Plaintiff filed suit individually and as the beneficiary of the life insurance policy of her mother, Kathleen Sullivan, under the Employee Retirement Income Security Act of 1974 (ERISA), after the denial of Sullivan's life insurance benefits by Verizon and Prudential.The Second Circuit held that the district court did not err in dismissing plaintiff's ERISA section 502(a)(1)(B) claim against both defendants and her section 502(a)(3) claim against Prudential. In this case, the terms limiting Sullivan's death benefits to a percentage of her annual income were accurately stated in the plan and its description, and thus the generous benefits plaintiff seeks never vested under the terms of the plan. However, the court held that the district court erred in dismissing the section 502(a)(3) claim against Verizon, because plaintiff pleaded estoppel as "appropriate equitable relief;" the fiduciary breach is sufficient to support the equitable remedy of surcharge; and reforming the plan to accord with Sullivan's reasonable expectations is an appropriate equitable remedy. Finally, the court rejected Verizon's arguments supporting its denial that it committed a fiduciary breach. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Sullivan-Mestecky v. Verizon Communications, Inc." on Justia Law