Justia ERISA Opinion Summaries

The Eighth Circuit affirmed the district court's dismissal of plaintiff's complaint for failure to state a claim. Plaintiff alleged that his former employer, Wells Fargo, breached their fiduciary duty under the Employment Retirement Income Security Act (ERISA). The court held that the district court correctly determined that plaintiff's omission of any meaningful benchmark in his complaint meant that he failed to allege any facts showing the Wells Fargo Target Date Funds were an imprudent choice. In this case, plaintiff did not plead that the Funds were underperforming and his conclusory allegations of bad conduct did not save the complaint from its deficient pleading. Therefore, plaintiff failed to state a claim for relief under ERISA. View "Meiners v. Wells Fargo & Co." on Justia Law

NCMC filed suit alleging that Aetna underpaid out-of-network providers like NCMC in violation of the Employee Retirement Income Security Act of 1974 (ERISA) and Texas law. Aetna counterclaimed, alleging that NCMC fraudulently and negligently misrepresented its billing practices by routinely waiving patient responsibilities yet billing Aetna for the total out-of-network cost.The Fifth Circuit held that Aetna's reliance on any alleged misrepresentation by NCMC was not justifiable and Aetna failed to establish a conflict in substantial evidence on this element of its fraud and negligent representation claims; any error in excluding Aetna's damages expert was harmless, and the district court did not abuse its discretion in excluding evidence of physician compensation; the district court abused its discretion by denying Aetna leave to amend without providing reasons; but denial of leave to amend was warranted because Aetna's counterclaims were untimely and unduly prejudicial to NCMC. In regard to NCMC's cross-appeal, the court held that any error in denying NCMC's motion to compel was harmless; the district court therefore did not err in granting Aetna's Rule 52(c) motion for judgment as a matter of law; but the district court's order denying attorney fees must be vacated and remanded for an explanation. Accordingly, the court affirmed in part, reversed in part, and remanded. View "North Cypress Medical Center Operating Co. v. Aetna Life Insurance Co." on Justia Law

The Fourth Circuit affirmed the district court's grant of summary judgment to Hartford Life in an action brought under the Employee Retirement Income Security Act (ERISA). Plaintiff filed suit seeking a continuation of the long-term disability benefits that Hartford Life had terminated based on its conclusion that plaintiff was no longer "disabled," as that term was used in the plan. The court affirmed the district court's conclusion that Hartford Life, not Hartford Fire, determined that plaintiff was no longer eligible for long-term disability benefits, and Hartford Life's decision to terminate his long-term disability benefits was not an unreasonable exercise of discretion. In this case, the record demonstrated that plaintiff received a fair and thorough consideration of his claim and Hartford Life's conclusion was reasonably supported by the available evidence where, among other things, video surveillance evidence showed plaintiff walking at a quick pace and moving without observable bracing or support. View "Griffin v. Hartford Life & Accident Insurance Co." on Justia Law

Current and former employees of the University of Southern California may not be compelled to arbitrate their collective claims for breach of fiduciary responsibility against USC in an action under the Employee Retirement Income Security Act (ERISA). The Ninth Circuit affirmed the district court's denial of USC's motion to compel arbitration of claims for breach of fiduciary duty in the administration of two ERISA plans. The panel held that the district court properly denied USC's motion to compel arbitration where the claims asserted on behalf of the Plans in this case fell outside the scope of the arbitration clauses in individual employees' general employment contracts. View "Munro v. University of Southern California" on Justia Law

Cehovic’s employer offered its employees an insurance benefit plan through ReliaStar. Cehovic had two ReliaStar policies: a basic policy with a death benefit of $263,000, and a supplemental policy with a death benefit of $788,000. Both listed his sister, Cehovic‐Dixneuf, as the sole and primary beneficiary. After Cehovic died, his ex‐wife claimed that she and the child she had with Cehovic were entitled to the death benefits from the supplemental policy. The district court granted summary judgment for Cehovic‐Dixneuf. The Seventh Circuit affirmed. The Employee Retirement Income Security Act (ERISA) requires administrators of employee benefit plans to comply with the documents that control the plans, 29 U.S.C. 1104(a)(1)(D). For life insurance policies, that means death benefits are paid to the beneficiary designated in the policy, notwithstanding equitable arguments or claims that others might assert. The supplemental policy is governed by ERISA even though Cehovic paid all of its premiums without any direct subsidy from the employer. Cehovic’s employer performed all administrative functions associated with the maintenance of the policy. The plan description made clear that the supplemental life insurance policy would remain part of the employer’s group policy, but could be converted to an individual policy in certain situations. Nothing in the record shows that Cehovic executed a conversion. View "Cehovic-Dixneuf v. Wong" on Justia Law

The Second Circuit affirmed the district court's dismissal of plaintiff's Employee Retirement Income Security Act (ERISA) complaint for failure to state claims for which relief can be granted. Plaintiffs challenged the conduct of twelve banks and their affiliates in the FX market from January 2003 through 2014. On de novo review, the court held that plaintiffs failed to state plausible ERISA claims because the facts alleged do not show that defendants exercised the control over Plan assets necessary to establish ERISA functional fiduciary status. Furthermore, the court found no abuse of discretion in the district court's denial of adjournment or leave to file a fourth amended complaint. View "Allen v. Credit Suisse Securities (USA) LLC" on Justia Law

The Fifth Circuit affirmed the district court's dismissal of plaintiff's third amended complaint for failure to state a claim. Plaintiff, a former employee of Idearc, Inc., alleged that defendants breached their duties of loyalty and prudence as Employee Retirement Income Security Act (ERISA) fiduciaries. The court held that the district court properly dismissed plaintiff's substantive duty-of-prudence claim in light of Fifth Third Bancorp v. Dudenhoeffer; plaintiff's duty-of-prudence claim could not rest solely on defendants' procedural failings; and plaintiff's allegations did not give rise to a plausible inference that defendants' concern about the stock price was self-serving. View "Kopp v. Klein" on Justia Law

Apple acquired the Rogers, Arkansas Applebee’s Neighborhood Grill & Bar, and offered its employees a benefits package that included Guardian life insurance. Megan Moore alleged that employee James Moore enrolled for “basic life coverage” equal to 150% of his $62,000 annual salary, and “voluntary term life coverage” equal to five times his salary ($310,000). Megan, his designated primary beneficiary, alleged that Apple withheld premiums for the voluntary coverage from Moore’s salary until he died in 2013, but “failed to pay over those premiums” and to forward Moore’s application to Guardian. Mehan filed a proof of claim with Guardian, which indicated that premiums had not been received. Megan sued, asserting state law claims for breach of contract, negligence, breach of fiduciary duty, and promissory estoppel and seeks actual and punitive damages. The Eighth Circuit affirmed the dismissal of the complaint. The Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a), preempted all of Moore’s claims. “Allowing state law claims premised on the existence of an ERISA plan to proceed against the plan administrator would affect relations between primary ERISA entities and impact the administration of the plan.” The court noted that Moore's Second Amended Complaint alleging claims under ERISA, 29 U.S.C. 1132(a)(1)(B) and (a)(3) for wrongful denial of plan benefits, breach of fiduciary duty, and equitable estoppel, remains pending. View "Moore v. Apple Central, LLC" on Justia Law

In 2008, facing insolvency, Chrysler offered certain employees incentives to take early retirement, in addition to benefits they had earned under its Pension Plan. Pearce, then 60 years old, had worked for Chrysler for 33 years, and was eligible for the buyout plus the Plan’s 30-and-Out benefits--a monthly pension supplement “to help early retirees make ends meet until eligible for Social Security.” Chrysler provided Pearce with Pension Statements that repeatedly advised him to consult the Summary Plan Document (SPD). The SPD cautioned that “[i]f there is a conflict ... the Plan document and trust agreement will govern.” With respect to the 30-and-Out benefits, the SPD stated: “You do not need to be actively employed at retirement to be eligible ... you must retire and begin receiving pension benefits within five years of your last day of work for the Company.” Pearce believed that he could not lose his 30-and-Out benefits if he lost his job and declined the buyout offer. Chrysler terminated him that same day. Pearce was told that, because he had been terminated before retirement, he was ineligible for the 30-and-Out benefits; the SPD omitted a clause contained in the Plan, which said that an employee who was terminated was ineligible. Pearce sued under the Employee Retirement Income Security Act, 29 U.S.C. 1001. The Sixth Circuit reversed the district court’s grant of summary judgment to the Plan on Pearce’s request for reformation, affirmed summary judgment rejecting Pearce’s request for equitable estoppel, and remanded. Analyzing Pearce’s request for reformation under contract law principles, the court should consider information asymmetry--Chrysler had access to the Plan while Pearce did not but repeatedly referred Pearce to the SPD--and other factors. View "Pearce v. Chrysler Group LLC Pension Plan" on Justia Law

Linda worked for Children’s Hospital for 37 years, covered by its employer-funded Pension Plan. In 2015, Linda faced recurring cancer, and, at age 60, retired. The Plan describes a normal retirement pension, an early retirement pension, a deferred vested retirement pension, and a pre-retirement surviving-spouse death benefit. The surviving spouse benefit is available to a participant’s spouse when the participant dies “before the Participant’s annuity starting date.” No other benefit provides that it is available to beneficiaries if the participant dies before payments start. Early retirement pensions “commence with a payment due on the first day of the month next following” the date of termination and the election of benefits. A 10-year annuity is available and allows the participant to designate a beneficiary for the remainder of a 10-year period, but if the participant dies before distributions begin, the designated beneficiary will be a surviving spouse. Linda chose the early retirement pension, through a 10-year annuity. She designated her daughter, Kishunda, as her beneficiary. Linda retired on August 26. Her first pension payment was set to commence on September 1. She died on August 29. Kishunda was denied her mother’s pension and sued under the Employee Retirement Income Security Act, 29 U.S.C. 1132(a)(1)(B). The Seventh Circuit affirmed summary judgment, upholding the administrator’s interpretation of the Plan as not arbitrary; only spouses are entitled to benefits under the Plan when a participant dies before the start of her pension. View "Estate of Jones v. Children's Hospital and Health System, Inc. Pension Plan" on Justia Law