Justia ERISA Opinion Summaries

29 U.S.C. 1132(a)(3) does not authorize an award of attorney's fees incurred during the administrative phase of the Employee Retirement Income Security Act (ERISA) claims process. The Ninth Circuit affirmed the district court's dismissal of an ERISA action brought by plaintiff against MetLife. The district court granted MetLife's motion to dismiss the complaint, agreeing with MetLife that attorney's fees awards are not other appropriate equitable relief under section 1132(a)(3).In Cann v. Carpenters' Pension Trust Fund for Northern California, 989 F.3d 313 (9th Cir. 1993), the panel held that attorney's fees incurred in administrative proceedings are not recoverable under section 1132(g), ERISA's express fee-shifting provision. The panel was obligated to read section 1132(a)(3) in conjunction with section 1132(g). Under the expressio unius canon, section 1132(g)'s silence as to fees incurred in an administrative proceeding gives rise to the inference that section 1132(a)(3) does not authorize such fees. View "Castillo v. Metropolitan Life Insurance Co." on Justia Law

Plaintiffs, participants in the Gannett Co. 401(k) Savings Plan, filed suit alleging that defendants breached their fiduciary duties of prudence and diversification under the Employee Retirement Income Security Act (ERISA). Plaintiffs contend that defendants ignored an imprudent single-stock fund in the Plan for several years, resulting in millions of dollars in losses.The Fourth Circuit vacated the district court's dismissal of plaintiff's complaint for failure to state a claim, holding that plaintiffs plausibly alleged that a fiduciary breached a duty, causing a loss to the employee benefit plan. In this case, plaintiffs alleged that defendants breached their duty of prudence by allegedly failing to monitor the continuing prudence of holding a single-stock fund; because defendants did not monitor the merits of the fund, they did not uncover that it was an imprudent fund; defendants' failure to discover the imprudence led to the failure to divest the fund; and, when the price of the stock in the fund went down, the Plan suffered a loss. The court remanded for further proceedings. View "Quatrone v. Gannett Company, Inc." on Justia Law

PCMA filed suit claiming that the Employee Retirement Income Security Act of 1974 (ERISA) and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Medicare Part D), preempt two sections of the North Dakota Century Code regulating the relationship between pharmacies, pharmacy benefits managers (PBMs), and other third parties that finance personal health services. The district court determined that only one provision in the legislation was preempted by Medicare Part D and entered judgment in favor of North Dakota on the remainder of PCMA's claims.The Eighth Circuit held that it need not address the "connection with" element of the analysis because the legislation is preempted due to its impermissible "reference to" ERISA plans. In this case, the legislation is preempted because its references to "third-party payers" and "plan sponsors" impermissibly relate to ERISA benefit plans. Therefore, the court held that the North Dakota legislation is preempted because it "relates to" ERISA plans "by regulating the conduct of PBMs administering or managing pharmacy benefits." Finally, the court held that North Dakota waived its savings clause argument. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Pharmaceutical Care Management Ass'n v. Tufte" on Justia Law

Plaintiffs, participants in Target's employee stock ownership plan (ESOP), filed suit against Target and its senior executives, alleging violations of the Employee Retirement Income Security Act (ERISA).The Eighth Circuit affirmed the district court's dismissal of the claims, holding that plaintiffs failed to show that the fiduciaries breached their duty of prudence. In regard to plaintiffs' proposed alternative actions, the court held that Target could not have implemented a purchase freeze without inevitable disclosure and a reasonably prudent fiduciary could still believe disclosure was the more dangerous route than the route taken. The court also held that plaintiffs failed to show that the fiduciaries violated the duty of loyalty in administering the plan because of their potential conflicts where plaintiffs point to nothing more than the tension inherent in the fiduciaries' dual roles as ERISA fiduciaries and Target officers. Plaintiffs also failed to show that the fiduciaries breached the duty of loyalty by making misleading statements to Plan participants because they failed to allege that the fiduciaries knew they were making untruthful statements in their disclosures and to specify which statements were untrue. Finally, plaintiffs' claim that Target's CEOs breached their duty to monitor the other ERISA fiduciaries cannot survive without an underlying breach. View "Dormani v. Target Corp." on Justia Law

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