Justia ERISA Opinion Summaries

The Iron Workers negotiated a contract that required JD Steel to make contributions, on behalf of its employees, to the pension funds for local unions in which the employees performed work, amounting $10.00 for every hour that a JD employee worked in the local union's territory. Later, the Iron Workers negotiated a similar contract with Davis Rebar, except that, rather than require contributions to the local unions’ pension funds, the contract required Davis to make identical contributions to the local unions’ defined-contribution plans, such as a 401(k) plan. In 2013, JD worked on a parking garage at Cleveland’s Fairview Hospital while Davis worked on a garage at University Hospital. Both jobs were within the territory of the Local 17 Iron Workers Union. Davis apparently used equipment bearing JD’s name and logo. The companies shared a foreman and supervisors. The pension plan sued under 29 U.S.C. 1132(a)(3), alleging that JD and Davis are actually the same company, so that Davis is bound by JD’s contract and must make additional payments. Each company has made all payments required by its individual contract. The Sixth Circuit affirmed dismissal. Reasoning that the same association of unions negotiated and signed both agreements, the court declined to set aside the association’s judgment regarding its members’ best interests. View "Bd. Trs. Local 17 Iron Workers Pension Fund v. Harris Davis Rebar LLC" on Justia Law

A Challenge employee consulted Dr. Mirza about back pain, agreed to undergo an endoscopic discectomy, and executed an assignment of her benefits under Challenge’s plan. Mizra completed the procedure and submitted a claim for $34,500, which was denied. Mirza submitted additional documents. The claim was denied again. Mirza went through internal review and, on August 12, 2010, received a letter denying his final appeal, indicating that the procedure was not covered because it was medically investigational, and notifying Mirza of his right to bring a civil action under the Employee Retirement Income Security Act, 29 U.S.C. 1001. Neither the letter nor the earlier denials mentioned that, under the plan, Mirza had one year from the final denial to seek judicial review. While the parties debate the substance of an earlier phone call, the first time Mirza received written notice of the one-year deadline was April 11, 2011. On March 8, 2012, Mirza sued. The district court granted defendants summary judgment. The Third Circuit vacated. Plan administrators must inform claimants of plan-imposed deadlines for judicial review in their notifications denying benefits. The appropriate remedy is to set aside the plan’s time limit and apply the limitations period from New Jersey’s six-year deadline for breach of contract claims. View "Mirza v. Ins. Admin. of Am., Inc" on Justia Law

The NEI Board administers a self-funded, multi-employer health plan covered by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001. A Trust Agreement, executed by the participating companies and the Board, does not specify Plan details, but provides that “[t]he detailed basis on which payment of benefits is to be made … shall be set forth in the Plan of Welfare Benefits … subject to amendment by the Trustees.” The National Elevator Industry Health Benefit Plan Summary Plan Description, (SPD) provides the details and includes a subrogation provision: The Plan has the right to recover benefits advanced to a covered person for expenses or losses caused by another party. The Plan is only obligated to provide covered benefits resulting from that illness or injury that exceed amounts recovered from another party (regardless of whether designated to cover medical expenses). The Plan sought reimbursement for medical expenses paid on Moore’s behalf, following Moore’s settlement of a negligence action against entities responsible for injuries he suffered in an accident. Moore counterclaimed, alleging that the Board had violated its fiduciary duty by misrepresenting the Plan terms. The Sixth Circuit found that the SPD containing the subrogation provision set out the binding terms of the Plan and that the plain language of the provision required reimbursement. View "Bd. of Trustees v. Moore" on Justia Law

During his employment with a subsidiary of Santander Holdings, Stevens received treatment for ankylosing spondylitis, a chronic inflammatory disease, and participated in a short-term disability plan (STD) and a long-term disability plan (LTD). When Stevens’ condition worsened, Liberty Mutual, the administrator of Santander’s plans, initially awarded STD benefits to Stevens, then determined that Stevens no longer suffered from a qualifying disability and terminated his benefits. Stevens sued under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001. The district court found that Liberty Mutual’s decision to terminate Stevens’s STD benefits was arbitrary and capricious and remanded with instructions to reinstate Stevens’s STD benefit payments retroactively and to determine his eligibility for LTD benefit payments. The Third Circuit dismissed an appeal for lack of jurisdiction, finding that the remand order to the plan administrator was not a “final decision” appealable pursuant to 28 U.S.C. 1291 at that time. The district court retained jurisdiction over the case and the order is not yet appealable. View "Stevens v. Santander Holdings USA Inc." on Justia Law

Plaintiffs filed suit against United, claiming that United had violated its fiduciary duties under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(1)(B), (a)(3), and the terms of ERSIA-governed health insurance plans administered by United, and the Mental Health Parity and Addiction Equity Act of 2008 (the Parity Act), 29 U.S.C. 1185a(a)(3)(A). Plaintiffs also brought three additional counts under New York State law. The district court granted United's motion to dismiss. The court concluded that NYSPA has standing at this stage of the litigation and that Plaintiff Denbo’s claims, but not Plaintiff Dr. Menolascino’s claims, should be permitted to proceed. Therefore, the court affirmed in part and vacated in part, remanding for further proceedings. View "N.Y. State Psychiatric Ass’n v. UnitedHealth Grp." on Justia Law

Kevin and Lisa Nutt worked at Osceola Nursing Home. Funds were withheld from their paychecks as “pre-tax insurance.” After Kevin was injured, they learned that Osceola had not paid premiums. Their policy had lapsed; the Nutts owed $233,000 for medical services. The insurer told Lisa that it could reinstate the policy and pay the bills if Osceola made the delinquent premium payments. Osceola did not do so. Osceola then entered into a contract with Cooper, who specialized in turning around financially troubled nursing homes. Cooper’s company, Berryville, ultimately took title to the property. Before the closing, Cooper could assume management under a temporary lease. Cooper assigned this lease to OTLC, created for the project and owned by Hargis. Though OTLC was independent, Hargis regularly worked with Cooper in nursing-home ventures. OTLC operated the facility for Cooper and Berryville for three years. Nutt told Hargis about the outstanding bills. Days later, OTLC fired both Lisa and Kevin. They sued. The court entered default judgment against Osceola under the Employee Retirement Income Security Act, 29 U.S.C. 1001; found that they could not provide adequate relief; and, on a theory of successor liability, held OTLC liable. The Eighth Circuit reversed, stating that if successor liability required only subsequent operation, it would discourage the free transfer of assets to their most valuable uses. OTLC was not a party to the unlawful practices of Osceola and operated without significant connection to the culpable parties. View "Nutt v. Osceola Therapy & Living Cntr., Inc." on Justia Law

Central States, a multi-employer trust fund governed by ERISA, provides health and welfare benefits to participants in the teamster industry. Student Assurance processed claims for student accident policies. Central States claimed that it paid medical expenses of $137, 204 for 13 junior high, high school, and college student-athletes who were covered dependents under its plan and who sustained athletic injuries. Central States sought reimbursement from Student Assurance, which refused to pay. Central States alleged that according to the coordination of benefits provision of its plan, the student accident policies supply primary coverage for the students’ covered medical expenses. Student Assurance claimed that the student accident policies are excess policies, and that they are not obligated to pay until Central States has reached the maximum contribution under its plan. Central States sued, citing federal common law and section 502(a)(3) of ERISA, seeking declaratory relief, restitution, and the imposition of an equitable lien and constructive trust to secure reimbursement for the benefits paid on behalf of the common insureds. The district court dismissed, and the Eighth Circuit affirmed, holding that the claims, while ostensibly seeking equitable remedies, were actually for legal relief that is unavailable under section 502(a)(3). View "Cent. States, SE & SW Areas Health & Welfare Fund v. Student Assurance Servs., Inc." on Justia Law

Minor O.D. filed a petition for approval of a settlement her parents had negotiated with car insurance companies for injuries she had suffered in a car accident. On the day of the hearing, O.D.'s health insurance coverage provider Ashley Healthcare Plan, which had a subrogation lien against the proceeds of O.D.'s claim, removed the case to federal court, arguing that Mississippi Code Section 93-13-59 (which requires chancery court approval of settlement claims) was preempted by the federal Employment Retirement Income Security Act of 1974 ("ERISA"). The federal district court held that ERISA did not preempt the state law and remanded the case to the chancery court without awarding attorney's fees to O.D. On motion from O.D.'s parents, the Pontotoc County Chancery Court awarded O.D. attorney's fees, holding that Ashley Healthcare Plan's removal to federal court was contrary to clearly established law and that it was done for the purpose of delaying litigation. Ashley Healthcare Plan appealed the grant of attorney fees. The Mississippi Supreme Court affirmed. Although O.D. could have sought recovery of attorney's fees under Rule 54 of the Federal Rules of Civil Procedure, frivolous removals to federal court were also subject to the Mississippi Litigation Accountability Act. Furthermore, Ashley Healthcare Plan's removal to federal court was contrary to two decades of case law which uniformly held that Mississippi's law requiring chancery court approval of minors' settlements was not preempted by ERISA and that Ashley Healthcare Plan was seeking a remedy in federal court that was unavailable to it under the ERISA Civil Enforcement Clause. View "In the Matter of the Guardianship of O. D." on Justia Law

Joseph Martinez was a participant in the Plumbers and Pipefitters National Pension Plan, (governed by the Employee Retirement Income Security Act (ERISA)). Following some health problems, Martinez retired from plumbing in 2004 at age 56 and took advantage of the Plan’s early retirement pension. After a few years in retirement, he felt well enough to resume working, and his pension was suspended during that time according to rules that prohibit retirement benefits during disqualifying employment. When he retired again in 2009, he asked the National Pension Fund to allow him to convert the pension benefits he previously elected from an early retirement pension to a disability pension (a change that would have entitled him to higher monthly payments). The Fund denied the conversion and the district court upheld the denial. After review, the Tenth Circuit agreed with the district court that the Plan language was unambiguous and allowed Plan participants to apply for and receive only one type of pension benefit for life absent several clearly delineated exceptions, none of which applied to Martinez. Accordingly, the Court affirmed the Fund’s denial of Martinez’s claim for disability benefits. View "Martinez v. Plumbers & Pipefitters" on Justia Law

Plaintiffs, former employees of PwC, filed suit under the Employee Retirement Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., alleging that PwC's retirement plan deprived them of so-called "whipsaw payments," which guarantee that plan participants who take distributions in the form of a lump sum when they terminate employment will receive the actuarial equivalent of the value of their accounts at retirement. The PwC plan defines “normal retirement age” as five years of service, so that it coincides with the time at which employees vest in the plan. The court held that the plan’s definition of “normal retirement age” as five years of service violates the statute not because five years of service is not an “age,” but because it bears no plausible relation to “normal retirement,” and is therefore inconsistent with the plain meaning of the statute. Accordingly, the court affirmed the judgment of the district court, but for different reasons than those cited by the district court. The court did not reach the district court's alternative reasons for denying defendants' motion to dismiss. View "Laurent v. PricewaterhouseCoopers LLP" on Justia Law